Cities and Local Government Devolution Bill [HL]

Lord Tyler Excerpts

Monday 13th July 2015 Lords Chamber

[Baroness Williams of Trafford]

My Lords, in moving Amendment 26, I shall speak to all the other amendments in the group. They are about streamlining, fast-tracking and giving greater flexibility in the setting up of combined authorities or the making of changes to an existing combined authority. Certain of the amendments also give greater flexibility in establishing or changing economic prosperity boards, which can also be established under the Local Democracy, Economic Development and Construction Act 2009. Specifically, Amendments 26, 27, 62 and 77 modify the processes for establishing a combined authority in order to provide, if circumstances warrant it, a fast-track process that, while quicker, will maintain all the necessary essential safeguards.

The current process for creating a combined authority under the 2009 Act is lengthy. Past experience shows that it can take well over a year even to reach the point of the order being made, and that is before the real implementation begins. The process involves duplication, particularly where the setting up of a combined authority is agreed as part of the conversations and discussions surrounding a devolution deal. These amendments provide a streamlined process for creating combined authorities where the risks of duplication are minimised—a streamlined process that in particular can be used where local areas have agreed to have combined authorities as part of the devolution deals which they have agreed with the Government. This streamlined process will allow them to implement the deal as quickly as possible without getting tied up in further administrative processes that do no more than duplicate the conversations and discussions that have led to the deal.

For example, a number of councils agree as part of a deal to the establishment of a combined authority. They have provided the Secretary of State with sufficient information and evidence for the Secretary of State to undertake the statutory tests: that is, to conclude that creating the combined authority is likely to improve the exercise of statutory functions in the combined authority’s area, to have regard to the need to reflect the identities and interests of local communities, and to secure effective and convenient local government. Finally, all the councils in the area of the proposed combined authority consent to the combined authority. In such circumstances, the fast-track process will enable the Secretary of State to proceed to seek Parliament’s approval of the necessary draft order once he has fulfilled a statutory duty to consult such persons as he considers appropriate. His decision as to who is appropriate will of course have to be taken in accordance with the well-established principles of administrative law—to act reasonably having regard to all relevant considerations.

With this streamlined process, councils no longer have to undertake the lengthy process of developing a governance review and preparing a scheme. This is not because the substance of these steps is unimportant but because that substance will have been undertaken in a different way, and the guarantee that this is so is provided by the statutory requirements of the Secretary of State to apply in accordance with administrative law the statutory tests and the statutory consultation.

These amendments also provide that where the fast-track process is not being followed and councils are developing a governance review and scheme, the process can still be more streamlined than is currently the case. The current requirement that the Secretary of State undertakes a consultation, including the clear duplication of being required to consult the very authorities that have prepared the scheme, is replaced by simple requirements that the Secretary of State must have regard to the scheme and the councils must consent to the combined authority. The Secretary of State still has the option of consulting if he considers it necessary. These amendments therefore facilitate the timely implementation of devolution deals, which will be of critical importance to areas being able to respond to the economic challenges and opportunities the country faces today. It is not an option that we have bureaucratic and time-consuming processes slowing the actions needed to grow our economy, improve productivity and increase our competitiveness.

Amendments 63, 64, 65, 76 and 78 provide certain greater flexibility and streamlining aspects of combined authorities and greater flexibility for economic prosperity boards, for which the 2009 Act also provides. Amendment 79 makes a small change to references in Sections 111 and 112 of the 2009 Act. The origin of these amendments is the draft legislative reform order that was laid in Parliament in March this year. In its report of 19 June, the Delegated Powers and Regulatory Reform Committee noted that the Bill and the LRO were operating in the same policy space, and commented that making changes through two separate legislative vehicles progressing at different speeds would present challenges. We have responded to the committee’s comments and by these amendments are now incorporating into this Bill provisions that give effect to those in the draft LRO, and are withdrawing the LRO.

The amendments do three things. First, they enable local authorities that do not have contiguous boundaries to form combined authorities and economic prosperity boards if the statutory tests are met. They also allow the creation, if the statutory tests are met, of combined authorities and economic prosperity boards that have a “doughnut-shaped” area. Secondly, they enable a county council in a two-tier area to be within a combined authority for only part of its area where that area coincides with one or more districts. Thirdly, they provide that minor changes to the funding, constitution or functions of an economic prosperity board can be prompted by the councils asking for such a change.

All these amendments streamline and facilitate putting in place the governance needed to support the devolution of powers to areas, helping areas grow their local economies and improving the efficiency of local public services. I commend them to the House and beg to move Amendment 26.

[Lord Tyler (LD)]

My Lords, I shall speak to Amendments 62 and 77 in this group. First, I very much appreciate the Minister’s explanation of the reason for this group and I particularly welcome the fact that the Government have moved so quickly to amalgamate the previous draft LRO with the Bill. In my view, that is extremely important.

I think the Minister knows that I serve on the Delegated Powers and Regulatory Reform Committee. As an individual, I very much welcome that she has been able to respond so quickly. However, I think she will also know that this afternoon the committee met especially to look at the latest set of amendments. Amendments 62 and 77, to which I want to draw attention, were in one set of amendments that we looked at today.

I am obviously in some difficulty; I cannot refer to the precise recommendations of the committee because they will be reported to your Lordships’ House tomorrow, which is really my point. It would be quite wrong for us to move on those amendments without having seen the recommendations of your Lordships’ committee. However, I can refer briefly to the importance of these amendments. Amendment 62 would introduce a new clause which would make substantial amendments to the Local Democracy, Economic Development and Construction Act 2009. It would do so in a way that quite deliberately dilutes the provisions for consultation.

I think all Members of your Lordships’ House who have been following this Bill are well aware that wide consultation, which was a requirement of that previous Act, is central to the acceptance of this Bill in its current form. The dilution of those very important provisions in the 2009 Act seems to me to raise important issues. The Minister has been talking at some length about streamlining and fast-track. I am always a little apprehensive about fast-track streamlining because it usually means a sleight of hand. I fear that in this case that is precisely what is in place. If we are not to have the effective consultation provided for by the previous Act, at the very least we need a full explanation. We have not yet had that and I do not think we can expect to have it until the Minister has had an opportunity of seeing the report from the committee, which will be published tomorrow.

I understand only too well that in the speed with which the department has had to composite—I think that that is the appropriate word—the LRO from the provisions in the Bill, it may well simply have been a mistake that this consultation process has been, in the words of the Minister, streamlined. That raises very important issues that Members who have been following the consideration of this Bill throughout will wish to look at again in the light of the report from the Delegated Powers and Regulatory Reform Committee. Since that will not be available until tomorrow, I hope the Minister will at least agree that there should be, as there can be under the rules of the House, a further debate on these clauses on Wednesday. I certainly would reserve the right to speak. as an individual of course but with the information that will then be available from the committee, when these come before us again on Wednesday. I hope that the Minister will recognise that that is a perfectly appropriate way for the House to proceed.