Elected Mayors and Local Government

Mike Kane Excerpts

Thursday 9th July 2015 Westminster Hall

[Mike Kane (Wythenshawe and Sale East) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Brady, and not just because you are a neighbouring MP of mine. I congratulate my hon. Friend the Member for Coventry South (Mr Cunningham), who has such experience in these matters, on securing the debate.

Disraeli said—if I can pay tribute to at least one Tory Prime Minister—that

“what Manchester does today, the rest of the world does tomorrow”.

He said that on the steps of the Free Trade Hall 200 years ago. I cautiously welcome the Cities and Local Government Devolution Bill, but it is almost as though the present Government are being brought kicking and screaming behind the innovative approach of Manchester and Greater Manchester. We are leading the way—there is no doubt about that—in the debate. The new plans for the Greater Manchester combined authority will involve it taking the reins on transport—integrating our buses and public transport system—and housing. We need to start building 10,000 houses a year across our conurbation. It will also take the reins on planning, policing and public health to drive up prosperity within our region. As I mentioned policing, I would like to place on record my tribute to Sir Peter Fahy, who has announced his retirement as chief constable today. He has served our conurbation with honour over many years and has made a real difference.

We are leading the way in bringing together health and social care budgets. That is a combined total of £6 billion. That will put in the hands of local people the power to decide what sort of health services they need and will suit their needs. This will not be an easy process, as we know from Healthier Together, but it is necessary. The task ahead is to bridge the gap. Between 2004 and 2013, the number of businesses in cities in the south grew by 27%—almost twice the 14% growth seen in cities elsewhere in the UK.

The Manchester Independent Economic Review found that, outside London, Manchester is the city region that, given its scale and potential for improving productivity, is best placed to take advantage of the benefits of agglomeration and increase growth. To criticise the Government, though, how do we get agglomeration and increased growth when we start pulling schemes such as the Leeds-Manchester electrification, or even the midland main line electrification, which would drive traffic to places such as Manchester airport in my constituency? Greater Manchester has the potential to be a net contributor to the national economy. When a mayor is elected by the people of the region, he or she needs to maximise investment in our growth priorities by supporting the private sector to drive growth and by helping businesses to do better.

In Greater Manchester, we spend about £22 billion on public services, yet we raise only about £17 billion in taxes. The key is bridging that gap. There is no doubt about it: if we want to be a powerhouse in the north, we have to close that gap. That will be the key priority for the interim mayor—and, when we go forward after the election in 2017, the full-time mayor. We need to become a fiscally self-reliant city. Austerity has not worked for us. We spent £22 billion in 2010 and we are still spending more than £22 billion today. The current Government have blown welfare budgets and other budgets through the roof. We can deal with this better locally than nationally.

Independent forecasts have shown that, with devolution powers, cities alone could deliver £222 billion and add 1.16 million jobs to the economy by 2030 if we get this right. We must reform the way we do public services. We must reduce barriers to productivity and reduce the need for spending on reactive public services.

In Greater Manchester, there is a significant opportunity for the Government and the region jointly to develop and deliver an approach that will have a long-term and permanent positive impact on the UK as a whole, as well as Greater Manchester. For the plan to work for the people of Greater Manchester and other combined authorities, local authorities must work together. That has been the key to this. If anybody thinks that it has been easy in Manchester, they are wrong. Our two great cities of Salford and Manchester and the other eight boroughs have had to work together and across political divides. That has been not been easy, so I pay tribute to the leaders who are putting this together. I hope that the Minister will reflect that in his comments.

Greater Manchester will be empowered, through larger devolved budgets, to promote better skills, infrastructure and economic development in return for growth plans. Through the retention of our business rates growth, we can develop our constituencies within our cities even better. We have an enterprise zone that has not quite got off the ground yet; the zone, announced in 2011, is at Manchester airport. We need to push to ensure that in our spatial planning, we are getting the industrial strategy right so that we can increase our tax base. Manchester airport has just announced £1 billion of investment for the duration of a 10-year transformation plan. As you know, Mr Brady, we are moving from 23 million passengers to 55 million passengers a year over the next 10 to 20 years, so the potential is huge.

We have announced an interim mayor, Tony Lloyd. I wish him every success and pay tribute to him and the 10 leaders for their co-operation in bringing this agenda to the Government’s attention, and for securing the package that they did in the Queen’s Speech this time round.

[Owen Thompson (Midlothian) (SNP)]

I, too, commend the hon. Member for Coventry South (Mr Cunningham) for securing the debate. Obviously, my colleagues and I in the Scottish National party pass no comment on the structures of local government in England. That is ultimately a matter for the people of England, local government being devolved to Scotland, so although the structures are of interest to us, we will reflect on our experiences in Scotland, rather than making suggestions. However, I hope that some of my comments will prove useful in a consideration of the further development of devolution relating to local government for England.

In Scotland, there have been a number of approaches over recent years. The Scottish Government pursued the “Our Islands, Our Future” campaign. We are seeing far greater discussion and agreement on devolving direct decision making to the island communities around Scotland. Local communities will be able to have a say over the incomes from the Crown Estate and 100% of the net income from the seabeds will be passed to island communities. There will also be island-proofing when legislation goes through the Scottish Parliament. As a former council leader, I have always felt that the best decisions are those taken closest to the people who are impacted by them. The Community Empowerment (Scotland) Bill, which has progressed through the Scottish Parliament, is also designed to pass greater decision-making powers to our local communities.

We have heard a lot of talk about the northern powerhouse—and, today, the midlands powerhouse and the Greater Manchester area. I have to confess that every time the northern powerhouse is mentioned, I think of the Aberdeen and Aberdeenshire city deal proposals that are moving forward; I suppose my geography is slightly different. However, Aberdeen City and Aberdeenshire are not the only two councils in Scotland looking to progress with city deals. The Glasgow one has been in place since August 2014. Beyond Aberdeen, Dundee is also making progress, and my former authority, Midlothian, is working with the other authorities in the Lothian region on an Edinburgh city deal.

My perspective is that I come from the second smallest local authority in Scotland, where I was initially very resistant to any approaches involving what felt at times like being swallowed up into the massive great beast of Greater Edinburgh, because that was always a threat. It was a big advantage that, since reorganisation, Midlothian was a council in its own right. Having worked through the process and worked closely with the leaders of Edinburgh City Council, East Lothian, West Lothian, Fife and the Scottish Borders, I could see the benefits. Other speakers have touched on how important infrastructure is in the development of any proposals to benefit from a city deal arrangement. Certainly I was able to see the huge benefits that Midlothian would have been able to achieve through a city deal arrangement, so I very much hope that that work, which is continuing positively, will go on for the benefit of our communities, because ultimately it is our communities that we are all here to represent. Often on these issues, the geography becomes the battle line, rather than any political allegiance. People are looking to get the best results for the town that they are from and that they represent. They are looking to ensure that local people’s say and outcomes are as strong as possible.

We saw yesterday another Budget of cuts and continued austerity. Over a number of years, I have compared the impacts on parts of local government in Scotland as I waited annually to see what settlement my former council got. We have been very fortunate in Scotland, because the cuts to local government have not been as severe as in England. The Scottish Government have done everything possible to protect local government’s share of the Scottish budget, in line with the levels from 2012-13. Over three years, cuts in Scotland have equated to 6.3%, whereas in England it has been 18.6%. I can only imagine how difficult some of the decisions have been that had to be taken in local authorities in England. Thankfully, the Scottish Government have done what is possible to protect and help local government, because local government is a key part of driving forward any agenda. It is the frontline for most of our communities; it is the first contact that most people have with elected representatives. As a former councillor, I think that we should encourage more and more people to get involved in it.

The cuts made so far are hitting the most deprived areas hardest, and the cuts that are to come will do the same. The Joseph Rowntree Foundation identified that the scale of cuts in England is greatest in deprived areas and least in the most affluent. According to the foundation, the largest cuts have been to spending on the most deprived areas, at around £220 per head of population. That is a worrying illustration of the wrong priorities being followed by the Government. I hope that over time, we can persuade, cajole and push to get that changed. Investment in the frontline must continue to ensure that the priorities of any Government can be delivered. Thankfully, the Scottish Government’s action has ensured that local government budgets have been protected, and they are doing everything possible to tackle inequality.

In Scotland, the SNP and the Scottish Government have not taken a position on elected mayors, and we do not feel that the case has been made yet. Ultimately, to come back to the theme of many contributions, such a proposal has to come from communities; it cannot be top-down. Any decisions about the future of elected mayors or devolution to other areas, whatever their shape or size, must come from communities. That has to be the first priority.

I have mentioned “Our Islands, Our Future”. In Scotland, there has also been the Commission on Strengthening Local Democracy, which the Convention of Scottish Local Authorities developed with civic society, local government and the Scottish Government. The commission looked at what measures could be taken and what avenues could be explored for further devolution of powers to local government and then on to local communities. I commend the commission’s report to any Member who is interested. It is fascinating reading, and it is a great example of how to take forward ideas for devolution to local authorities from a community level.

[Mike Kane]

The SNP, from what we have seen, has had a massive centralising effect in Holyrood. Take the Police Service of Scotland, which it has effectively nationalised. If we talk to colleagues in Glasgow and other cities, we find that they have felt excluded by the SNP Government at Holyrood from the decision-making process in Scotland.

[Owen Thompson]

I am delighted that someone has given me the opportunity to bring this up, because it is a common misconception. The SNP Scottish Government have done more to pass decision making, accountability and authority to local authorities, rather than taking it in to a central point.

The hon. Gentleman gave the example of the police and fire services. I was a member of Midlothian Council for almost 10 years, and from 2007 to 2012—before the single police and fire forces—Midlothian Council got two representatives on the Lothian and Borders police board and fire board. There was no scope for anyone in opposition to have any say whatsoever. Now that we have a single force, each local authority has its own police and fire scrutiny set-up, which includes six members of our authority and other partners who can scrutinise and challenge the police and fire service. There is far more local accountability of police and fire services than ever. Sadly, in Midlothian, two of our Labour colleagues do not take up the current opportunities. To me, this is a far better means of local decision making.