English Devolution and Community Empowerment Bill

Lord Shipley Excerpts

Committee stage
Thursday 29th January 2026 Grand Committee

[Lord Fuller (Con)]

I am sorry if the noble Baroness regrets those, but the facts stand. A mayor who has done a rather good job in one part of the country is now going to be prevented from standing as a result of applying Labour’s rules for all the other parties. That is a statement of fact. I do not deny that Labour has the right to have its internal rules, but those rules should not be forced on all the other parties. I am sorry that the noble Baroness feels that way, but that is how we in the other political parties feel when another party’s internal rules are applied to everyone else. It is anti-democratic. As I say, I am sorry that she feels that way, but the feeling is equal on this side of the Committee. That should be placed on the record, too.

[Lord Shipley (LD)]

My Lords, these have been an interesting set of interventions. I agree with the noble Baroness, Lady Royall, that it is important that party-political contributions are kept to an absolute minimum when we are debating a Bill.

There is a basic issue in this group. The public have a right to expect that elected individuals do not end up with two jobs: being a mayor and being an MP. In some circumstances, it might be possible for the electorate to knowingly vote for that. However, that would be most unlikely to be the case. There is a question as to where, geographically speaking, the mayor might be the MP; it might be within the mayoral authority and it might be elsewhere. Either way, there is a clear conflict of interest, because Parliament judges the allocation of funding, for example, to the mayoral authority.

I do not think that you can have one person doing two jobs. Amendments 76 and others in the name of the noble Lord, Lord Gascoigne, would allow that, for whatever period, there could be an overlap of both mayor and MP retaining both offices. To be absolutely clear, we think that that is wrong. I say to the Minister that these matters are important and should not be for political parties to judge alone. It should instead be clearly understood that, when people have been elected to one of the posts, they should carry out the responsibilities that they have been given by the general public.

On Tuesday, I said that if, in a mayoral authority, there had been a large number of commissioners appointed by the mayor but then that mayor decided to become a Member of Parliament, he or she would leave the mayoralty and, as the Bill is currently drafted, all the commissioners would lose their jobs as a consequence. When politicians are elected to a job, they must see the job through and do it to the best of their ability, given that the public have expressed confidence in them doing so. They have an obligation to fulfil their contract with the electorate.

[Baroness Thornhill (LD)]

My Lords, I will add something to the wise words of my colleagues. To us, this is about the concentration of power in the hands of one person. The powers being given to new mayors are considerable and I understand them; to some extent, I agree with them—as a directly elected mayor for 16 years, of course, I would say that, wouldn’t I? I see the two roles as completely different: a role in national government is completely different from a local, regional role. There could be massive conflicts of interest, but the key thing is that this concentrates too much power. Conservative colleagues have talked about that, but then they are quite happy to let somebody do both jobs. To our mind, that is just not rational.

The key thing is that this creates more political opportunities for more people. It also encourages mayors. The key thing about a mayoralty is that the mayors can develop their own local, independent mandate, rather than being overshadowed by national party politics. They are very different and distinct and they could be in direct conflict with each other. That is why we absolutely believe in that separation of powers.

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[Lord Shipley (LD)]

My Lords, I agree with the noble Baroness, Lady Scott of Bybrook, that Amendment 93 is sensible and proportionate. If you are going to have an annual report, the modest additional reporting proposed in this amendment would, as she said, help us understand better the success of devolution.

I will speak to Amendments 94 and 197 in the name of my noble friend Lady Pinnock. It needs to be demonstrated clearly in the annual reporting whether the Secretary of State has been exercising powers under this Act without the consent of or contrary to decisions made by locally elected officials. It would be entirely reasonable and helpful, when we are asked to pass a Bill about devolution from Westminster, to know what the Secretary of State has actually done in the previous year.

On Amendment 197, we will touch on parish and town councils later, but there is a fundamental issue here. If we have a Bill called the English Devolution and Community Empowerment Bill, the Government should be reviewing and promoting parish and town councils, maximising their geographical coverage and making an annual report to Parliament as to what has been done. The danger with this Bill is that so much power is being concentrated. I tried last week to get greater devolution from the strategic authorities to existing local government and then through to existing town and parish councils, but the Government were not amenable. I hope that further progress will have been made on that by Report.

There are two other amendments in my name. Amendment 252 would require the Secretary of State to undertake a review of local and community banking powers. I am grateful for the briefing I received from the Royal Holloway positive money group and its advice on this amendment. This is about the terribly important issue of how devolution drives growth in practice. One of the Government’s objectives is to drive growth, but how do you do that if the resources are not there? This amendment would be central to the success of the Bill, because it addresses a core structural barrier that currently undermines devolution: the centralised control of credit creation.

The Bill seeks to devolve political authority and fiscal responsibility, and it talks about community power, but I do not think that that will be fully realised without devolving financial capacity—that is, the creation of local, community and publicly owned banks. This amendment would ensure that devolved authorities are not responsible for growth outcomes when they lack the financial tools to influence those outcomes. Devolution means that powers have to accompany those devolved responsibilities. There are three aspects to devolution: devolution of powers, devolution of responsibilities and devolution of resources. But there is a problem for the devolved authorities in their ability to deliver local growth, resilient public finances and genuine community empowerment.

I am asking the Minister to do some further work and give more consideration to this. I will bring this back on Report, but I am not asking for the solution to be identified immediately. A range of issues need to be addressed and some are complex. I fear that, when this Bill is an Act, it will get into difficulty with its delivery—in generating growth and jobs. I hope that the Minister does not seek to rule out this amendment offhand.

My other amendment in this group is Amendment 253. I was tempted to degroup, but I decided that it is probably better to bring together all the amendments where I am asking for reviews, to raise these issues and ask the Government to think about them, because I will also bring back this amendment on Report.

There needs to be a review of regional and national public spending. Different parts of the United Kingdom have significantly different amounts of public expenditure. I quote from Table 9.1b of total UK identifiable expenditure on services, per head, from 2023 to 2024, which is the last year in which information is available. The information is from the Government’s Public Expenditure Statistical Analyses 2025. That shows that, if the average for nations and regions in the UK is 100, some are well above that and others are well below. London is at 115, when the average is 100. Scotland, Wales and Northern Ireland are all well in excess of 100.

There are some reasons for these differences that are unique to those places, which means that work has to be done to understand why that is. However, the Barnett formula is at the heart of it. That formula, designed by the late Lord Barnett and introduced in the late 1970s, is a very useful instrument for the Treasury to disburse money to the nations, but it hides the significant differences in public spending across the UK.

To that extent, I have tried before to get the Government adequately to explain why, when the average public expenditure is 100, the east Midlands is only 90—in other words, 10 percentage points below the average. The great danger of the Bill is that, when it becomes an Act, it will promote a blame culture. The mayors will blame the Government for not having enough resource, and the public will blame the mayors. The whole democratic system will be in some difficulty if it is not understood why some places get much higher levels of public spending than other areas.

All I am asking the Government is that they are aware of this matter and review it. It implies reviewing the Barnett formula, and I have previously moved Questions for Short Debate and proposals for that to happen in your Lordships’ House. I have not been alone in doing that. A number of years ago, there was a Select Committee of your Lordships’ House that urged reform of the Barnett formula to one that has a needs assessment across the UK. I ask the Minister whether the Government might think about that.

I am going to bring this back on Report. I understand that it is primarily a matter for the Treasury, but somebody does have to explain all this, because otherwise the public are simply going to say, “As mayors compete with each other for the favours of the Treasury, whose fault is it that they are getting more money than us?”

I want devolution to succeed, but the Government have to understand this issue a bit better. How can we empower community banking? How can we invest for growth outside the existing structures? How can the Government make sure that, when they are spending public money, they are allocating it fairly across the United Kingdom? I hope that the Minister will give me some indication that the Government are prepared to look at this.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I am sorry if I am speaking out of order; we are missing quite a few signatories. I will speak to Amendment 197 in the name of the noble Baroness, Lady Pinnock, and Amendment 252—about local and community banking powers—which the noble Lord, Lord Shipley, just addressed. The timing of this debate is interesting, because just this morning Santander announced that it is closing a further 44 branches after an earlier announcement that it would be closing 95 branches around the country. Lloyds is closing more than 100 branches by March. A total of 432 bank branches closed in 2025; this puts the figure of bank branches lost at some 7,000.

Large banks, whether based in London or globally, will say that everyone is going digital. What I find, however, when I travel to communities up and down the land, is that quite often the fact that they no longer have a bank or that their last bank is about to close is a major issue. If you speak to a small or even medium-sized enterprise and ask if they are getting financing from the banks, they just laugh at you. The kind of application you have to make includes filling in an enormous number of forms. You do not speak to a person, and the application churns through the computer; computer says no and that is the end of it. Historically, you would have a local bank manager who knew the local community and its businesspeople, and was able to support people whom they knew were worth the punt. The large banks are physically evacuating out of communities and are just not interested in anything except large, multinational companies and their like.

This is why, with regard to local and community banking powers, getting local banks set up is in the interests of local communities and absolutely something to be looked at as an option by Government. I note that, although I am not entirely praising it—I should declare that I am a customer—Nationwide, with its co-operative model, is staying in communities far more, but it still cannot do everything that communities need by any means. Amendment 252 is therefore terribly important.

I turn to Amendment 197’s duty to review parish and town councils. I declare my position as a vice-president of the National Association of Local Councils. Despite the rhetoric around it, this Bill is taking local democracy far further from the people. In many places—as has been happening through more than a decade of austerity—parish and town councils have been picking up the slack where larger bodies have stepped away and not had the money to engage.

More than a dozen years ago I was in Leominster, and the list of services that the local town council had picked up there ran from keeping the public toilet open—I am sorry; I seem to have a theme today, but it was not my intention—to keeping the tourist information centre open to cutting the grass and looking after the green spaces. These tasks had been abandoned by the unitary authority and were therefore picked up by the town council. The problem is that Leominster is an historic town—there is a wonderful, medieval town hall to meet in—but it is often the more disadvantaged communities around the country that do not have parish and town councils. One example is the large new council estates. Those who need it most do not have that local representation. A review, therefore, would be welcome in examining the Government’s heading to take democracy away from the people and enabling us to see how we can restore it at grass-roots level. To me that is essential.

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[Lord Shipley (LD)]

My Lords, I thank the noble Lord, Lord Bassam, for leading this group; I entirely agree with what he says. I hope that we may be able to achieve a further step forward on this when we get to Report. He said many things, but I shall just draw out one of them. In all these changes, we have to avoid decision-making becoming more remote from people. He has a solution, and my noble friend Lady Pinnock had one in a previous group, so I hope that the Government will be willing to explore this further. As I say, we will look at this issue again on Report.

In this group, I have Amendment 241C, which is a probing amendment. I would like the Government to comment on the general power of competence that is being given to English national parks authorities in Clause 73. My amendment would require those authorities to consult communities surrounded by or bordered by a national park on matters that might impact those communities. The need for this review is because the national parks have separate planning powers. Areas bordering or surrounded by a national park need to be given the reassurance that, where there may be an impact on them as a result of a national park’s decision, they have a right to be formally consulted on it. In the context of a new general power of competence, will the consultation actually happen? I think that it must happen, for the reason that the noble Lord, Lord Bassam, raised about decision-making becoming remote.

Strategic authorities are going to be very large. Many existing local authorities are also very large. The more we have unitary councils, the more that trend will be increased. The right to be consulted matters more than it may have mattered hitherto. As a consequence of that, where a general power of competence is being given to a national park authority in Clause 73, that should be accompanied by a requirement to consult those communities surrounded or bordered by a national park on matters that might impact on those communities. I hope that the Minister can confirm that the Government are prepared to look at this issue further.

[Baroness McIntosh of Pickering (Con)]

My Lords, I would like to give an alternative view from that of the noble Lord, Lord Shipley, on Amendment 241C. First, though, I say this to the noble Lord, Lord Bassam: I spent 10 and a half years representing Great Bentley in the European Parliament—not all of its residents, but the greater group in the area—and it was a great privilege to represent that part of Essex.

I pay tribute to the work of the North York Moors National Park Authority. Let me say a word about how dramatic its work has been, with the wildfires last summer and the potential prosect of further wildfires ahead. It has done a sterling job. Obviously, at one stage, it looked as though livelihoods and livestock might be imperilled and lost with the wildfire at Fylingdales, which was in my constituency for the last five years of my time in the other place; it came perilously close to many farms. I pay tribute to the work that the authority did.

I apologise that I did not realise that I should have spoken before the noble Lord, Lord Shipley, in order to understand more about the background to what he is seeking to do. I would like just to place on the record that, to my certain knowledge, the powers that the North York Moors National Park Authority already has—as well as the powers under the Bill—are received very warmly. It is already working quite hard, I think, and devoting a large amount of time to consulting as widely as it possibly can. I am slightly concerned that Amendment 241C could introduce an extra burden that it would be very hard pressed to meet.

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[Baroness Royall of Blaisdon (Lab)]

My Lords, I am pleased to follow the noble Lord, Lord Bichard. I agree with so much that he said—but I shall speak to Amendment 196, which would introduce a duty on local public service partners such as NHS bodies, the police and fire authorities to co-operate with strategic authorities and principal councils. I am particularly concerned about inequalities. I was very proud to co-found and co-chair the Oxfordshire Inclusive Economy Partnership, which works closely with businesses, charities, higher education establishments and local councils, including in relation to inequality and health. Oxfordshire is now a Marmot place—and I know that the Greater Manchester Combined Authority is considered to be a Marmot city region. I hope that new strategic authorities will follow.

As noble Lords are aware, health inequalities are pronounced within as well as between regions, with huge life expectancy gaps between and within local authorities, including those operating within the same strategic authority. For example, within the East Midlands Combined County Authority, the gap is 5.2 years. The gap is enormous within cities; we all know that in London the gap is between 17 and 19 years. But, shockingly, in counties such as Oxfordshire there is a life expectancy gap of at least 10 years. Addressing these health inequalities requires action at regional level, where leaders have the power to shape economic growth, create healthy places and, consequently, reduce the inequalities.

The Bill already contains several important levers to do this, which is welcome, with the duty to improve health and reduce health inequalities in Clause 44; the requirement for strategic authorities to produce local growth plans in Clause 39 and Schedule 20; and the inclusion of health, well-being and public service reform in the areas of competence for commissioners. However, I believe that this amendment is necessary, because we know, and evidence demonstrates, that health improvement and a reduction in health inequalities requires joined-up policies and actions across public services.

My amendment would ensure reciprocal engagement in local decision-making, service planning and policy implementation, strengthening whole-area collaboration across public services. It would also be the catalyst for places to use the powers that they already have to build local partnerships. The duty would also embed in statute best practice around co-operation, which already exists at neighbourhood, local and regional level. It would set out clearer expectations on different parts of the system, such as integrated care boards and local authorities, to collaborate on improving health.

The amendment is light touch, practical and evidence-based, with the support of many organisations that work on health and reducing health inequalities. It would not add unnecessary bureaucracy or require new spending commitments, but it would make a profound difference to policy-making and action in areas of our country and in the new bodies that are about to be created. I beg to move.

[Lord Shipley (LD)]

My Lords, the issues raised in this group are fundamental, and I support everything that has been said so far, broadly speaking. Our efforts to identify how the new structure will relate to all the other organisations delivering public services, and how they will all work together, demonstrates the importance of Committee. I hope that when the Minister replies there will be some positive movement on that.

I hope the Minister will not think me flippant when I have said what I am about to say. Amendments 98 and 99 are important in probing the necessity of forcing local partners to respond to meeting requests. Many of the Bill’s pages—pages 23 to 34—are about mayoral powers to require local partners to attend meetings and other mayors to collaborate, and so on. I have a simple question for the Minister about local partners; as I say, I hope she will not think I am being flippant. The Bill says:

“The mayor for the area … may convene meetings with local partners to consider relevant local matters”.


I understand that, but can local partners convene a meeting with the mayor to consider relevant local matters?

I ask that question because, on previous days in Committee, the answers that we have had about devolution away from mayors to, say, constituent councils, have been that there is to be no power of scrutiny for a constituent council within a strategic authority. That is a very serious matter—I do not think it will work. My question is simple: can local partners convene a meeting with the mayor, or is this a one-way power whereby only the mayor can convene meetings with local partners? If it is, I hope that the noble Lord, Lord Bichard, and the noble Baroness, Lady Royall, will be willing to pursue the matter when we get to Report.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Baronesses, Lady Scott and Lady Royall, and the noble Lord, Lord Bichard, for their amendments on local partners’ co-operation with mayors. This is an important group of amendments. Without this type of local co-operation, devolution will not work, so I take it very seriously.

Amendment 98 would provide for the Mayor of London, instead of the Secretary of State, to define “local partners” for the purposes of Clause 21. Elsewhere in England, it would remain for the Secretary of State to define the meaning of “local partners” in regulations. Were this amendment to be made, it would create an immediate inconsistency between the powers of the Mayor of London and the approach taken elsewhere in England. Allowing the Mayor of London to specify local partners where other mayors could not would lead to a piecemeal and unclear definition of local partners, risking confusion at all levels. Defining “local partners” in regulations will allow for appropriate parliamentary scrutiny—I think that is important—will provide a single, coherent definition across England and will ensure that mayors’ power to convene can be clearly understood by both mayors and local partners.

Examples of the types of organisations the regulations may include are those that deliver public services on behalf of, or receive funding from, a mayoral strategic authority; are identifiable as key enablers in statutory strategies; or play a material role in helping a mayoral strategic authority perform its functions within its local area. We are not seeking to define “local partners” in isolation. We are interested in understanding from strategic authorities and their mayors the type of organisations and institutions that should fall under a definition of a “local partner”. We are doing some more work on that with our strategic authorities.

I turn to Amendment 99, which seeks to understand the requirement for local partners to respond to a notification from a mayor of a strategic authority to convene a meeting. Clause 21 provides mayors with a new power to notify local partners of their intention to convene a meeting on a local matter that relates to their areas of competence. It also places a corresponding requirement on any local partner to respond to such a notification. This power is designed to enable mayors to bring the right people around the table, so that partners can work together to tackle shared challenges, seize opportunities for their communities and deliver the best outcomes for local people. The point from the noble Lord, Lord Bichard, about data sharing was very relevant to this. It is often the lack of ability to share data across organisations that slows down these kinds of collaborative projects.

The requirement on local partners is proportionate and not unduly burdensome. It does not oblige partners to engage beyond acknowledging the notification, nor does it prescribe what steps a local partner must take following any meeting or how they must act. Rather, the requirement is simply to respond to a mayor’s notification. The intention is to promote constructive dialogue even where there may be a difference of view on the relevant local matter. Taken together with the other mayoral powers of competence in this Bill, Clause 21 will strengthen the role of strategic authority mayors, giving them the means to drive growth, foster collaboration and deliver improvements for their communities.

On the point that the noble Lord, Lord Shipley, made about whether public bodies can require the mayor to attend, the mayor’s role in convening will probably answer that point, but I will reflect on it. If the mayor had a duty to convene people to collaborate on issues, and another body requested a meeting to discuss something like that, it would not seem in the spirit of what is in this Bill for the mayor to decline that invitation. I will take that back and think about it a little more.

Finally, I turn to Amendments 196 and 237 from my noble friend Lady Royall and the noble Lord, Lord Bichard. I assure noble Lords that the Government —and I—strongly support the spirit of the amendments: local public service partners and strategic authorities should collaborate to ensure quality, joined-up services for local people. Placing a new, wide-ranging statutory duty on local public service partners to attend meetings; provide information and assistance; and engage with strategic and local authorities in their local area may place an additional and unwarranted burden on these bodies. I, too, remember the Total Place initiative. One thing that got in the way of that was the dialogue between bodies, when they said, “We just do not have the capacity to provide that at the moment”. It caused some friction between some bodies.

As set out in the English devolution White Paper, it is the intention that mayors act as conveners on public service reform. The Bill provides them with the power to do this by granting them a power to convene local partners on their areas of competence, which include health, well-being and public service reform. The Bill places a corresponding duty on local partners to respond to a request by a mayor to meet. It is important to note that this does not place a duty on local partners to agree to particular policies of the mayor or to meet if they do not think that it is appropriate. We believe that this strikes the right balance between giving mayors the tools to drive collaboration, protecting the independence of local partners to act as they think fit and avoiding burdensome duties to which they must adhere.

English Devolution and Community Empowerment Bill

Lord Shipley Excerpts

Committee stage
Tuesday 27th January 2026 Grand Committee

[Lord Lansley (Con)]

My Lords, it is a pleasure to follow my noble friend and speak to these amendments to Clause 6. The clause relates to decision-making in combined county authorities and combined authorities and its purpose is to provide for a default structure of voting in both kinds of strategic authorities. In particular, that default structure would provide that in mayoral authorities the majority in favour of a decision must include the mayor, thus in effect giving the mayor a veto over decisions, since the majority excluding the mayor would not be decisive.

Before I turn to my amendments, and apropos of the question of whether the clause stands part, I will ask a question. I refer noble Lords and the Minister to Section 13(2)(a) of the Levelling-up and Regeneration Act. The section enables regulations to be made about members, and Section 13(2)(a) states that those regulations can include provision about

“cases in which a decision of a CCA requires a majority, or a particular kind of majority, of the votes of members of a particular kind”.

It seems to me that that paragraph of the levelling-up Act enables exactly what the Minister is setting out to do by statutory instrument rather than by primary legislation. Could she tell us why primary legislation is required to achieve this purpose? That might inform our deliberations on the stand part debate.

Amendments 42 and 44 are in my name. I do not share my noble friend’s desire, set out in her Amendments 41 and 43, to take out the mayoral veto from the clause. I have been a resident in the Cambridgeshire and Peterborough combined authority for however many years. When we had a mayor, the mayor found it very difficult to secure, for example, a non-statutory spatial strategy, not least because the mayor was often frustrated in getting a policy through due to the votes of one of the strategic authority’s constituent councils. In my view, if you elect a mayor and you want a mayor to exercise leadership in a strategic authority, it does not follow that the mayor will necessarily be able to get everything that the mayor wants, and the mayor will have to secure a majority to do so. It is very difficult for the mayor to carry on and provide that leadership if there is a majority that can carry proposals against his or her own policy.

This therefore forces the mayor to act in a certain way. I have seen that in Cambridgeshire, where the current mayor, Paul Bristow, is doing a very good job; he will be known to some of my noble friends. Partly because of this legislation, he is securing a majority in the combined authority, not least because there is an expectation that the strategic authority, when it gets these powers, will be able to make progress with the majority that includes him, and so he will not be able to be blocked by one constituent council.

I turn my focus to my Amendments 42 and 44. The former relates to combined county authorities. In this Committee, I am afraid that we are getting used to the fact that we have to do everything twice, because we have to legislate both for combined county authorities and for combined authorities; it will get a lot simpler when we have just one kind of strategic authority and when legislation for all strategic authorities is pretty much the same. Nevertheless, combined county authorities are governed by Section 10 of the Levelling-up and Regeneration Act 2023, which enables the Secretary of State to set out their constitutional arrangements. Section 10(2)(b) includes

“the voting powers of members of the CCA (including provision for different weight to be given to the vote of different descriptions of member)”.

That is the existing legislation: it provides for different weights to be allocated to different members. The current situation is that the constitution of a combined county authority is not a “one member, one vote” arrangement—it can vary.

Clause 6 will insert new Section 13A into the Levelling-up and Regeneration Act 2023. It says that

“each voting member has one vote”.

So, what I am really asking by way of these two amendments—in this instance, for combined county authorities—is: does the primary legislation we are discussing now override, in effect, the existing potential for regulations to determine a different weight for different members for different decisions; or, because of this primary legislation, does it have to be “one member, one vote”?

There is a problem there. That problem was illustrated to me when we had a meeting just a few weeks back—my noble friend Lady Scott of Bybrook will recall it—about Suffolk. It was about unitaries, as it happened, but it also encompassed a discussion about the prospective Norfolk and Suffolk strategic authority, which is in the devolution priority programme. The leader of Suffolk County Council was asked, “Suffolk is a single unitary and Norfolk is three, maybe even four, unitaries. What happens if they come together into one strategic authority?”

The problem is easily illustrated: one constituent council and one vote equals perhaps three votes for Norfolk and one vote for Suffolk. The leader of Suffolk County Council said, “That’s not a problem because we’ll weight the votes”. This is exactly what one would do using existing legislation, but I am worried that the structure of the Bill’s drafting will take that discretion away. That is the purpose of my Amendment 42.

My Amendment 44 relates to combined authorities, not combined county authorities, but it runs to the exact same issue. Of course, combined authorities are governed not by the Levelling-up and Regeneration Act but by the Local Democracy, Economic Development and Construction Act 2009, Section 104 of which provides that the constitutional arrangements for combined authorities may, by order, be made according to the provisions of the Local Transport Act 2008. Section 84 of that latter Act relates to constitutional arrangements; subsection (2)(b) refers to

“the voting powers of members of the ITA”—

the integrated transport authority—

“(including provision for different weight to be given to the vote of different descriptions of member)”.

The Committee will recognise those exact same words, so we are dealing with exactly the same issue: is it different weights for different members, or is it to be overridden by “one member, one vote”?

I want, as the outcome of this debate, for us to be sure that this legislation continues to permit a constitution for a strategic authority that both allocates different weights to different members and enables voting power to reflect the wide range of circumstances of constituent councils and other voting members of strategic authorities.

[Lord Shipley (LD)]

My Lords, I shall be very brief because it would be better if the Minister responded to the important points that have been made.

I will not take up too much of the Committee’s time, but I want to say two things that will, I think, help in this situation. First, we must get clarity about which powers are only for the mayor and which are to be shared with the combined authority; it is important that that be made clear. Secondly, on voting in the combined authority, there is at times a requirement for a two-thirds majority and, at other times, a requirement for a simple majority. We need to be absolutely clear why those differences apply.

With that, I would like to hear what the Minister has to say.

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[Lord Cameron of Dillington (CB)]

My Lords, I, too, support Amendment 46, particularly the reference to the land use framework. The point about the land use framework is that it is not a dictatorial thing; it is not saying, “Thou must do this or that” or “Thou must grow that”, or whatever it might be. It is definitely a framework, but on the other hand there is no point in having a framework unless it is part of the thinking from the top to the bottom of government—central government to regional government to local authority and everything in between.

I should also say that a land use framework is not necessarily a fixed event. It is not going to be cast in stone for ever and it should be open to review from time to time. I would have thought that three years would be the right sort of time. However, it needs to change according to events, including world events. Do we need more homegrown food production as a result of current world politics? Does the latest research tell us that our biodiversity is still receding, running away from us? Does the international situation indicate that we need more homegrown green power or more homegrown timber? That is important. The noble Baroness, Lady Young, and I have just come from a meeting where it was indicated that the Government’s long-term housebuilding programme could very much depend on our ability to produce the relevant timber products needed. What would be the point of a land use framework if regional and local government just continue to do their own thing regardless? Therefore, the amendment tabled by the noble Lord, Lord Lansley, is crucial to the efficient management of that very scarce UK commodity—namely, our land.

[Lord Shipley (LD)]

The noble Lord, Lord Cameron, said that it would be unhelpful if regional and local government continued doing their own thing. I think that this is an important debate and I look forward to the Minister’s reply, but the Government might look at the powers that existed with regional development agencies until 2012, in terms of spatial development strategies and the land use framework, when a lot was done. They might revisit that to make sure that everyone going off to do their own thing—the point raised by the noble Lord, Lord Cameron—is avoided.

[Lord Jamieson (Con)]

My Lords, I thank my noble friend Lord Lansley for his amendments. I think that there has been consensus among noble Lords contributing on this group that this is something that should be explored and looked at further. Amendment 45 rightly links local growth plans to spatial development strategies, ensuring that they are not formed in isolation and do not contradict each other. When a local growth plan is drafted, it should take account of the implications for spatial development. We welcome this amendment and support a more integrated and coherent approach.

However, we also believe that these plans must be informed by neighbourhood plans as well as neighbourhood priority statements, which have yet to be commenced under the Levelling-up and Regeneration Act. Amendment 46 seeks to ensure that spatial development strategies take into account national environmental improvement plans and the land use framework. This will help local government at least to have regard to the national Government’s environmental targets and to be aware of the environmental solutions proposed. As for the land use framework, we are still waiting for it to be published. Can the Minister confirm the timeline? As others have asked, will it be imminent?

Amendments 138, 139, 144 and 145 address the need for spatial development strategies to be aligned with infrastructure projects to identify any that are needed for growth. Again, these should be important considerations to ensure that new developments are supported with the necessary infrastructure rather than treating the two in isolation. As we said in the Planning and Infrastructure Bill debates, the consequences for development of the failure to deliver infrastructure should also be clear.

We agree with the principle behind all these amendments. It is important that combined authorities’ and councils’ various strategies are joined up, co-ordinated and coherent to ensure not only good governance and efficiency across local government but, more importantly, high-quality development. I thank my noble friend for his efforts and I look forward to hearing the Minister’s response.

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Secondly, during this period of major reforms, mayors need the flexibility and trust given to them from the Government to put the right arrangements in place for their own region. If direction of travel is towards mergers to fewer forces, the Government should surely be willing to give mayors flexibility and to appoint a single deputy mayor for more than one of their current police force areas.

[Lord Shipley (LD)]

My Lords, we have had a very interesting set of amendments so far, but what strikes me about them is that they all seem to run counter to the principle of election—be that either direct or indirect election—and we need to be very careful about that.

I have given notice to oppose that Clause 9 stands part of the Bill for two reasons. First, elections are important for public posts that require the expenditure of large sums of public money. I believe that most of those positions should be elected. Secondly, there is a huge absence of detail in the proposal within new paragraph 9 in Schedule 3 for the appointment and scrutiny of commissioners.

The Explanatory Notes at paragraph 74 states that commissioners will be,

“independent appointees, made by and accountable to the mayor”.

I have difficulty understanding quite how they will be independent if they are made by and accountable to the mayor and function, as the Explanatory Notes explain in the same paragraph, as “extensions of the mayor”. Can the Minister say in what way they are independent and why “independent” does not appear in this paragraph? The Explanatory Notes then state:

“Commissioners would not replace elected members”—


and there has already been a debate about that as part of this group, but they then say that areas—whatever an area is defined as—will,

“have the freedom to use a combination of commissioners and elected members to lead on different areas depending on what works best for them”.

Will the Minister say who makes the decision about whether elected members have the capacity to lead an area of competence, whether that decision made by the mayor alone and will the appointment of commissioners be public appointments, subject to the Nolan principles of selflessness, integrity, objectivity, accountability, openness, honesty and leadership? Perhaps the Minister can tell us whether the posts will be advertised and subject to equal opportunities legislation. Will there be an agreed job description and a person specification? Will there be competitive interviews or is it all a matter, in practice, for mayoral patronage? Will councillors of constituent councils be able to scrutinise the full-time commissioners—for they are full-time appointments—that the mayor may decide to appoint?

Schedule 3 states that:

“The mayor must determine the terms and conditions of a person’s appointment as a commissioner”.


Can the Minister tell us what scrutiny is planned about what those terms and conditions actually are?

We should just note that the appointment of a commissioner will end when the mayor’s term of office comes to an end. That means that a mayor who decides to resign will cause all the commissioners they have appointed to lose their jobs, which are, as it says in the Explanatory Notes, full-time jobs. It seems that the clear implication of the wording of the Bill is that if a mayor was to quit the post, all those appointed by the mayor would have to leave. I seek the Minister’s clarification of that point, for that is my reading of Clause 9 and Schedule 3.

I have noted that commissioners cannot approve local growth plans, local transport plans or spatial development strategy, but they are writing them, planning them and will be advising the mayor on them. I understand the formality of a decision to approve a plan, but what the plan is and how it has got there will clearly be heavily dependent upon the commissioner.

I understand that:

“The mayor must obtain the consent of the CCA to any arrangement for a commissioner to exercise a function”,


but does that extend to the appointments process itself? I wonder why there is no discussion by the Government of using the professional expertise of local government officers. So, not only are the Government dispensing with the ballot box in terms of any form of direct election to strategic authorities, but they are simply leaving an election of a mayor, following which we simply have a world of appointments. I am very concerned about what that means. I ask myself, “Whatever happened to the primacy of the ballot box?” because commissioners will not be elected, so voters will have no say in their appointment because the electorate will elect a only mayor and will have no role after that. Indeed, unlike with a Member of Parliament, the electorate will have no power of recall of a mayor.

We then have Amendment 196A in this group on special advisers. I listened carefully to what the noble Lord, Lord Bassam, said about them, but I have not understood the difference between a full-time commissioner and a special adviser. The noble Lord talked about a special adviser having professional expertise. I understand that professional advice is needed—of course it is—but I have not understood what is wrong with professional local government officers, with their expertise in the areas that might, at the moment, be proposed for a commissioner.

There are a lot of very important questions for the Minister to answer. The level of expenditure has been mentioned twice so far this afternoon, and the consequent level of the precept, which might then be high. We must be really careful about this and not duplicate. I remember, because I was around when metropolitan counties were abolished and we moved to joint boards, that the expertise in each of the areas of concern we have proposed was held by an individual local authority that had a lot of officers dealing with that specific policy area on behalf of everybody else. The joint boards had councillors; I was privileged to serve as a councillor on a number of those joint boards at different times.

I just do not think that the Government have gone far enough in examining how to deliver some of their proposals on, say, local transport, which used to function in Tyne and Wear with a joint board. What exactly is the problem with that? As I said last week, I fear that we have upwards mission drift in this Bill, taking powers away from established local government. I believe that to be true, but I also think that we are in danger of reinventing processes that have previously worked pretty well. I do not think that Clause 9 and Schedule 3 can stand here without us challenging what the Government intend to do because there is already a demand in this group for us to have yet more commissioners.

I am, by the way, in favour of culture’s status being raised—it is absolutely correct to do that—but I am uncomfortable with the suggestion that every area of concern should have a commissioner. Indeed, that is not the Minister’s proposal. The Government are not proposing that that should happen because there will be a mixture of commissioners, with the elected leaders of the councils of the combined authority and the strategic authority.

I shall stop there, but I hope that the Minister can allay some of my concerns around the failure of the Bill to have anything worth reading in it and with nearly everything that is going to happen next coming in the form of guidance. As I said last week, I would be happier if I knew a little more about what the Government are thinking in terms of guidance.

With that, I shall respond at some point when we come to the right moment, but I very much hope that the Minister will take on board some of my comments.

[Viscount Trenchard (Con)]

My Lords, I agree very much with most of what the noble Lord, Lord Shipley, just said. I have been unhappy with much of Clause 9 since I first read it, and I look forward to hearing what my noble friends have to say about it, because they have also added their names to the intention from the noble Lord, Lord Shipley, to oppose the Question that the clause stands part.

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[Baroness Taylor of Stevenage (Lab)]

For the overview and scrutiny committee, I believe it is a simple majority vote, but I will clarify that in writing for the noble Lord.

We expect that commissioners will have detailed knowledge and expertise in their assigned area of competence and will be appointed on this basis. Constituent members will not necessarily be experienced in their portfolio subject area. There are also circumstances where it would not be appropriate for a portfolio lead to represent both the borough and the region; there may be perceived conflicts of interest. As I said earlier, the local authority leaders who sit on the combined authority will also be running their councils on a day-to-day basis.

Commissioners will be able to represent the mayor’s authority and policy positions in a given area, including by speaking to the media. They could help make day-to-day decisions that are delegated by a mayor and provide strategic insight and advice for their area of expertise. We also expect commissioners to play a leading role in stakeholder engagement and partnership working, across geographies and organisations, as appropriate. This would include working closely with local councillors, business leaders and public sector institutions, using their advocacy and influence to deliver the mayor’s agenda.

I hope that that has helped clarify some of the points raised by noble Lords and that, with the assurances I have given, they will not press their amendments.

[Lord Shipley (LD)]

If there are any matters raised by me or other noble Lords that the Minister did not cover, could she send a letter to cover them? I do not think I heard confirmation about the Nolan principles, for example. If there is anything else, I hope that officials might draft something for her to send.

[Baroness Taylor of Stevenage (Lab)]

I did confirm that the commissioners will be subject to the Nolan principles. I will go back over Hansard—I always do after these debates—and if I have missed anything, I will certainly write to the noble Lord.

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Moved by

[Lord Shipley]

53: After Clause 9, insert the following new Clause—
“Scrutiny of mayoral commissioners(1) The mayor of a combined county authority must establish, for each commissioner appointed by the mayor, a scrutiny committee composed of elected members of the constituent local authorities.(2) The purpose of each scrutiny committee is to review, assess and report on the exercise of the policy responsibilities of the commissioner to whom it relates.(3) Each scrutiny committee must have the following powers—(a) to require the mayor, the relevant commissioner, or any member of their staff to attend before the committee to give evidence;(b) to require the production of any documents relevant to the exercise of the commissioner’s functions;(c) to publish reports on the committee’s findings and recommendations.(4) The mayor and the relevant commissioner must have regard to any report or recommendation made by the corresponding scrutiny committee under this section.”Member's explanatory statement
This amendment requires a Mayor of a Combined County Authority to establish a scrutiny committee of elected members with powers of summons to examine and report on the Mayor’s exercise of functions.

[Lord Shipley (LD)]

My Lords, I rise to move Amendment 53 on behalf of my noble friend Lady Pinnock. This amendment is about how you scrutinise mayoral commissioners. I noted what the Minister said in responding to the previous group about the mayor or combined authority members being responsible for scrutinising commissioners, yet that removes any responsibility on the constituent authorities to undertake scrutiny. It is doubly important that elected members of the constituent local authorities have some powers in scrutinising the work of a commissioner. They will need powers to do that—to require the mayor and relevant commissioner or indeed any member of their staff to attend and give evidence—so it can be a requirement to attend rather than a request to attend, and there should be an ability to require the production of any documents relevant to the exercise of a commissioner’s function.

There should then be a right to publish reports on the committee’s findings and recommendations, with an absolute power to do so; it would not be for the combined authority or the mayor to say that this matter cannot be published. It is really a fundamental matter about who is in a position to scrutinise what mayors do.

Can I make just two points about scrutiny, which will come up later in our deliberations? The best form of scrutiny is one that happens before the decision is made, not one that comments on a decision after it has been made. The best way in which to deliver that objective is through a committee system, because a committee system actually authorises decisions to be made and has the major advantage that the scrutiny is happening at the same time as a decision is made.

I have found it very disappointing in the Bill that quite so much is being said about the committee system and its perceived failures, most of which I do not recognise. It may be that when we get to further discussions in Committee and then on Report, further consideration can be given to those matters. I hope the Minister will be able to say that the Government do not downplay the importance of scrutiny, particularly when so many issues and so much public money is involved in the proposals to devolve power to mayors and commissioners. I beg to move.

[Lord Bichard (CB)]

My Lords, I rise to speak to my Amendment 191, and, in doing so, declare an interest as an honorary vice-president of the Local Government Association.

The amendment would provide for the establishment in every local area of a local public accounts committee to ensure the effective scrutiny and accountability across the whole range of public service spending and activity in that area, not just the actions of the strategic authority or the mayor. So why is an amendment like this necessary?

During the past 40 years we have seen in this country a radical fragmentation of our public services with the establishment of a myriad disconnected, sometimes single-purpose agencies. Sadly, these have too often worked in isolation, seeking to achieve their own specific targets energetically, but on occasions their efforts have conflicted or overlapped with their partners. They have too often worked in silos and, sadly, regulators have been very slow to recognise and challenge that. As a result, the public often struggle to access or even make sense of the disjointed services which this system has produced. In addition, resources are wasted because of the overlap and duplication, bureaucracy thrives, and there is inevitably a culture of competition rather than collaboration. This needs to change, but I do not believe that, as drafted, the Bill alone will achieve that level of change. If we are adequately to integrate public services in a locality, all public service providers and partners have to build co-operation into everything they do.

A later amendment in my name seeks to impose a duty on all local public partners to do just that. But alongside that kind of duty we also need to put in place local accountability—and not always accountability to the centre, which has been the model we have followed for so long. We need more local accountability to ensure that genuine co-operation does take place, so that services are delivered which are actually recognisable to ordinary local people and which meet their needs effectively.

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[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank my noble friend Lord Bassam and the noble Lord, Lord Bichard, for their amendments relating to accountability and scrutiny, and I hope that the noble Baroness, Lady Pinnock, is recovering.

Starting with Amendment 191, tabled by the noble Lord, Lord Bichard, there is already an existing system of scrutiny that provides accountability to the public and local checks and balances and accountability to government, including a requirement for combined authorities and combined county authorities to establish an overview and scrutiny committee and an audit committee. In addition, the English devolution accountability framework and the scrutiny protocol set out the processes and principles that mayoral strategic authorities are expected to follow. Both documents are being reviewed to reflect the changes introduced through the integrated settlement and through this Bill. Where the most established mayoral strategic authorities benefit from integrated settlement, assurance is provided via an outcomes framework which interacts with the wider government system of accountability.

However, we recognise that there is scope to strengthen further the system of accountability and scrutiny for mayoral strategic authorities. That is why the Government committed in the English devolution White Paper to exploring a local public accounts committee model. Listening to the noble Lord made me reflect on some work that I did in 2015 with Sir Richard Leese, who was then the leader of Manchester City Council, and Jules Pipe, who was then mayor of Hackney. That work was focused on devolution and turning the dial from acute responses to prevention.

We recommended that if there was more widespread devolution, there was a need to think about local public accounts committees. Although that feels like six months ago, it was 10 years ago. Maybe every idea has its time. Therefore, I accept the principle behind this amendment and assure the noble Lord that we intend to hold mayoral strategic authorities to a very high standard.

The noble Baroness, Lady Thornhill, was reflecting on the scrutiny of integrated settlements, for example, and allowing those who have the local knowledge of how things are working is crucial. When we were thinking about the possibility of a local public accounts committee, we saw it as being as powerful as the Public Accounts Committee here, being able to call witnesses from various bodies that are impacted on by the services and projects that are being delivered so that it can gain a much fuller picture of what is going on. This is a very different type of scrutiny—fundamentally different, as the noble Baroness said, to audit, which is a financial function. It is really important that we consider this fully. However, I ask that the Government are given time to complete the engagement that we need to do with the sector to design such a new approach, because it is important that we talk to the sector about this.

I hear the point that the noble Lord, Lord Fuller, made about the scrutiny of all levels of local government. He is of course right that both budgets and precept levels in town and parish councils are not insignificant in many areas, so we have to think about that. It is essential that any new accountability and scrutiny regime complements the existing system and the reformed audit framework in the future. Above all, it must be proportionate and supported by clear guidance and support for the sector, to make sure that we get these reforms right. With that assurance, I hope the noble Lord will feel able not to move his amendment.

Amendment 196B relates to local accounting officers. I thank my noble friend Lord Bassam for this proposed new clause that would require established mayoral strategic authorities to create local accounting officers. His amendment would designate the head of paid service as the accountable officer responsible for local spending, value for money and scrutiny. Although I agree with the importance of strong accountability and value for money, all mayoral strategic authorities already operate within an existing system of accountability, and that accountability is split between the “golden triangle” of statutory officers: the chief executive, chief finance officer and monitoring officer. These officers are accountable to their board and required to comply with the best value duty.

Strengthened systems are already in place for areas that have integrated settlements. This includes the mayoral strategic authority chief executive being responsible for core accountability processes within their authority, including responsibility for local outcome delivery and value for money. However, we are continuing to explore the local accounting officer model. We recognise that accountability to Parliament for the use of taxpayer money, which the accounting officer system provides, is a fundamental principle and not something to be altered lightly.

As part of our work on testing a strengthened accounting officer model, the Government are engaging with mayoral strategic authorities and other government departments. It would not be appropriate to pre-empt the outcome of that work with a primary legislative change to introduce local accounting officers at this point. For these reasons, I hope my noble friend will feel able not to move his amendment.

On Amendment 53, tabled by the noble Baroness, Lady Pinnock, this proposed new clause would place a duty on the mayor of a combined county authority to establish a separate scrutiny committee for each commissioner they have appointed. As I have set out, mayoral strategic authorities are expected to follow the existing principles and processes described in the English devolution framework. This includes requirements that all combined authorities, and combined county authorities, must establish an overview and scrutiny committee, which provides local checks and balances. The noble Lord, Lord Shipley, raised a very important issue about being able to undertake pre-scrutiny. Overview and scrutiny committees are very capable of putting in place pre-decision scrutiny if they wish to do so. Some local authorities have that already, so it is not prohibited.

Further, the Bill ensures that the overview and scrutiny committee will have the power to recommend termination of a commissioner’s appointment. I can respond properly now to the question from the noble Lord, Lord Jamieson, about the voting majority. To correct what I said earlier, a two-thirds majority of non-mayoral members of the combined authority or the combined county authority is required to accept the recommendation. Commissioners are also accountable to the mayor, who can terminate their appointment.

As Clause 9 allows for the appointment of up to seven commissioners, this amendment would risk institutions having to establish as many as seven scrutiny committees in addition to the existing overview and scrutiny committee that is already accountable. This would create significant additional labour and cost pressures for combined county authorities. There is a technical difficulty in that it would also apply a lopsided accountability system, as the amendment makes no reference to these seven committees applying to combined, as opposed to combined county, authorities. While we recognise that there is scope further to strengthen the system of accountability and scrutiny for mayoral strategic authorities, we believe that this amendment would create unnecessary pressures on the existing system, and I therefore ask that it is not moved.

[Lord Shipley (LD)]

I am grateful to the Minister for a comprehensive reply to a comprehensive set of issues. It gives us pause for thought. I am glad that the Minister recognises the importance of pre-scrutiny. That is a fundamental issue, so if it can be better built into the Bill before it becomes an Act, that will be very helpful. I beg leave to withdraw the amendment.

Amendment 53 withdrawn.

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Amendment 62 would require the publication of the commissioners’ allowances online. I would be grateful if the Minister could explain why the Government consider it unnecessary to include a clear requirement in the Bill for these allowances to be published. Is that not the bare minimum for transparency? Surely the Government are not going to suggest that there are material costs associated with this since senior council officers’ salary bands are already published, as are councillors’ allowances. Proactive publication in this area strikes me as a sensible and proportionate safeguard —one that would strengthen, rather than undermine, the credibility of the commissioner’s role. I beg to move.

[Lord Shipley (LD)]

My Lords, I have just one thing to add to what the noble Baroness, Lady Scott of Bybrook, said. Last week, I mentioned the importance of guidance being published in advance of Report; it is absolutely fundamental to our understanding of the Bill, given that so much is missing from it. I therefore repeat my support for the point made by the noble Baroness, Lady Scott, that it would help us to have a better understanding of some of the detail that the Government are going to put into guidance before we get to the point of debating and voting on it on Report.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Baroness, Lady Scott, for her amendments relating to providing allowances for combined county authority members with special responsibilities.

Amendments 62 and 236 would make it mandatory for the Secretary of State to issue guidance before Clause 10 comes into effect, and would require a combined county authority to publish an annual report on its webpage outlining the allowances that have been paid to members with special responsibilities. I welcome the commitment from the noble Baroness to ensuring transparency in local government—a matter of paramount importance to this Government.

As a former council leader, the noble Baroness, Lady Scott, will know, as I do, that allowances probably attract more debate and discussion, from both Members and the public, than much of the other policy that we debate. That is why we will issue statutory guidance on complying with the duty under Clause 10 to produce and publish reports. The guidance will allow the Secretary of State to set clear expectations—for example, regarding the frequency of such reports and where they are published—to support combined authorities and combined county authorities in this area. In the event that further clarification is needed, the power to issue guidance provides flexibility for the Government to update their position.

I would also add that, because this amendment applies to combined county authorities only, it would create a divergence in law between the requirements imposed on them versus combined authorities. That would be inconsistent; it would not be right to treat the two types of authority differently on that basis. My understanding is that this statutory guidance will be published on Royal Assent. I ask the noble Baroness to withdraw her amendment.

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[Lord Jamieson (Con)]

My Lords, the Clause 12 stand part notice, in my name and that of my noble friend Lady Scott of Bybrook, is intended to probe. We recognise that mayors and mayoral combined authorities will, in practice, need the ability to borrow to deliver infrastructure, regeneration and long-term investment. Borrowing can be a sensible and necessary tool. Our purpose today is not to deny that reality but to seek clarity from the Government about how this power will operate in practice and what safeguards will accompany it.

We would welcome further detail from the Minister on a number of points. First, what caps or controls do the Government envisage on mayoral borrowing? Will these mirror existing prudential borrowing frameworks for local authorities, or will a different regime apply? Secondly, what is the Government’s expectation of the purposes for which this borrowing will be undertaken? Are there limits envisaged on the types of projects or expenditure that may be funded through borrowing? Thirdly, who ultimately underwrites this borrowing? In the event of financial difficulty, where does the liability sit? Does it sit with the combined authority itself, with constituent councils or perhaps with central government?

Finally, what checks will be in place to ensure that borrowing decisions are subject to appropriate scrutiny and transparency, locally and nationally? Devolution must go hand-in-hand with accountability. Granting borrowing powers without clear safeguards risks storing up problems for the future—for local taxpayers and potentially for the Exchequer. I look forward to the Minister’s response and reassurance on these important points. I beg to move.

[Lord Shipley (LD)]

I am grateful to the noble Lord, Lord Jamieson, for raising some very crucial issues on the levels of borrowing powers. I add to that my concern—made even more so by the fact that constituent councils will not be able to scrutinise the work of the mayor or commissioners.

In that situation, I hope the Government will not be anticipating that local councils will then be responsible for any overspending by mayors and the combined authorities because, otherwise, there will be a demand on the council tax payer. So can the Minister confirm that overspends caused by poor-quality work by mayoral authorities will not end up with the council tax payer having to bail them out?

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Baroness, Lady Scott, for her Clause 12 stand part notice, ably spoken to by the noble Lord, Lord Jamieson.

All existing mayoral combined and combined county authorities have the power to borrow for all their functions. Unlike local authorities, the current process requires making a bespoke statutory instrument after an institution has been established. This process is highly inefficient. The Bill streamlines the process by giving the power to borrow to mayoral combined authorities and mayoral combined county authorities for purposes relevant to their functions. The power to borrow is still subject to safeguards. Clause 12 requires authorities to obtain the Secretary of State’s consent before they exercise the power for the first time in respect of functions other than transport, policing, and fire and rescue.

I will cover some of the points that the noble Lord, Lord Jamieson, asked me about. First, in relation to agreeing a debt cap, in general the exercise of power will remain subject to consent from the Secretary of State for the Ministry of Housing, Communities and Local Government, before it can be used for the first time, as I said. That would follow any internal processes, such as a debt cap agreement. The only exception will be where the new mayoral combined authorities and combined county authorities inherit fire, police or transport functions. In this instance, the power to borrow can be exercised immediately for these functions to ensure that ongoing financial arrangements are not disrupted.

In terms of how borrowing is agreed, any borrowing by a mayoral strategic authority is agreed through the annual budget-setting process and is subject to approval by the combined and combined county authority, operating within existing legislative, financial and prudential controls. While the mayor proposes the budget, borrowing cannot be undertaken unilaterally. Under the Bill, most budgets will be approved by a simple majority, which must include the mayor.

In response to the noble Lord, Lord Shipley, the budget, like all other matters, will be subject to the overview and scrutiny process, so there can be scrutiny of the budget in the same way that you would expect in a local authority.

The noble Lord, Lord Jamieson, asked about underwriting. Like the rest of local government, strategic authorities must also operate within the prudential framework. This framework comprises statutory duties and codes intended to ensure that all borrowing and investment is prudent, affordable and sustainable. It provides robust mechanisms for oversight and accountability. For those reasons, I ask that the noble Lord does not press his clause stand part notice.

Local Government (Exclusion of Non-commercial Considerations) (England) Order 2026

Lord Shipley Excerpts

Wednesday 21st January 2026 Grand Committee

[Lord Kirkhope of Harrogate (Con)]

My Lords, I will intervene briefly. First, I declare a long-gone interest: I was a county councillor many years ago. I always believed, as did my local authority, that, whatever one did in terms of procurement, the overall aim and need was to obtain best value for money in any contracts of any size, so I have slightly mixed views about this order. On the one hand, as the Minister said, it is very important that we support our native suppliers and contractors as far as is possible when it comes to work, particularly below the threshold. I would like the Minister to clarify that low threshold when she responds.

However, it seems that there are one or two questions here. First, this order would give a local authority the ability to determine a defined local area. Is that within the particular boundaries of the local authority? I see that there is provision here for that to include bordering authorities. Bearing in mind the nature of unitary local government nowadays, that would be an enormously large area. Does this mean either that you can choose to have a very small defined area, such as a particular town or village that contains certain traders who may be able to be part of the procurement, or, more generally, that it would be a wide area? Does the advertisement that will be placed, which is required, have to give reasons why a defined area has been chosen?

My only worry there, in looking back at the history of local government, is that a selection procedure that aims at a defined area within a local authority surely could—I am not saying that it would, but it could—be used politically in certain circumstances: for example, in a political operation where a number of procurements were made available in certain parts of a local authority area that happened to have a particular political complexion. There does not appear to be much of a safeguard against that here, so I would like some reassurance from the Minister on this point.

I mentioned the advertisement. I would like to know a little more from the Minister about the nature of that advertisement, as well as the reasoning that there has to be in it for doing what the local authority has chosen to do. The Minister is right when she talks about boycotts regarding countries; that is a very difficult area indeed. Again, we must be very careful that there is no indication here of a boycott, in the hands of politicians, against a particular country—or, indeed, to come back to the low-threshold procurements, of a boycott against particular individuals, firms or people who are being ruled against, either because they have different political views or because they have some other discriminatory situation with which they might not comply.

I am sorry to raise these few doubts in my mind. Although I see the intention here as very positive, I want to be absolutely sure that, in its delivery, it will not only maintain support for local contractors and local services but continue on the basis with which I started: providing council tax payers with the best value for money.

[Lord Shipley (LD)]

My Lords, I am grateful for this statutory instrument, which I support and which will be hugely helpful for local taxpayers in the generation of local jobs. I note the comments of the noble Lord, Lord Kirkhope of Harrogate; I look forward to the Minister’s response to all the points made by the noble Lord. I would say just two things. First, we are talking here about procurement contracts below the threshold. Secondly, I believe that best value can include the generation of local jobs as a consequence of that procurement process; there has to be an allowance for that.

I want to ask one specific question of the Minister, which I hope can be replied to now. It touches on a point made by the noble Lord, Lord Kirkhope of Harrogate: the definition of local area. I have not understood it; nor have I understood why there is reference in the Explanatory Notes to the consultation that took place in relation to combined authorities. My immediate reaction when I read this statutory instrument was that I did not understand how combined authorities fitted into this structure. It is quite difficult to see how that would work.

In particular, in Article 3(5)(a), the local area is defined very clearly. It is stated that,

“where there is one relevant authority”—

let us say one council—

“which intends to enter into a relevant contract … the area of that authority”

is the whole of the area of that authority. My understanding of this is that a council cannot subdivide its area; it has to be within its whole area. However, it can also be “the area specified” as

“the area of that authority, or … any of the areas of the counties or London boroughs that border that area”.

I have not understood why the counties and London boroughs are pulled out in this order as being a special case when the metropolitan districts are not in the old metropolitan counties—from my perspective, in the north-east of England, West Yorkshire or South Yorkshire. If one council decides to enter a procurement process, is it forbidden to define its local area as a neighbouring authority or part of one?

For the sake of choosing a random example, if Bradford Council decided that it wished to procure as a single authority, would it be able to run the process including a neighbourhood area such as Calderdale, Kirklees or Leeds? I have not understood this; nor have I understood why this issue is not addressed in the context of the Bill on English devolution that is going through, where this issue is not mentioned at all. Procurement does not appear in that Bill. It seems to me that there is a need for clarity on why the combined authorities are excluded and why the London boroughs have become a special case. All metropolitan areas should be a special case.

Beyond that, I am happy for the Minister to write in reply, if this is seen as at all complicated, but we need absolute clarity here now; otherwise, when people start to implement the order, there is going to be confusion about what they are allowed to do. Otherwise, I am in favour of this order.

[Lord Jamieson (Con)]

My Lords, I declare my interest as a councillor in central Bedfordshire.

We are generally coming to a fairly positive view across the parties on this instrument. It makes a notable change to the long-standing restrictions in Section 17 of the Local Government Act 1988, which were originally designed to prevent local authorities taking account of non-commercial considerations, including location of supplier, when awarding contracts. As the Minister clearly outlined, this order proposes to disapply that restriction in a narrow set of circumstances, allowing local authorities, best-value authorities and parish councils to reserve below-threshold contracts either to suppliers based anywhere in the United Kingdom or within a defined local area.

The intention is clear: to give local authorities greater flexibility regarding their local economies, their local supply chains and, where appropriate, the use of local SMEs and VCSEs. Many of us recognise that that is a positive move for local government on small-scale contracts. However, it would be helpful to get further clarity on some issues. The noble Lords, Lord Kirkhope of Harrogate and Lord Shipley, raised the issue of the definition of boundaries. Is it sub-local? Does it include metropolitan boroughs and so on? I would like assurance and clarity on that, as well as on what level of flexibility there is.

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[Baroness Taylor of Stevenage (Lab)]

My Lords, I am grateful to all noble Lords who have spoken in this debate seeking—quite rightly—some clarification.

I will refer first to the below-threshold limits, because I think that that would put this in a context that might be helpful. The below threshold for local authorities is £207,720 for goods and services and £5.193 million for works; that is the threshold that applies here. I should add that central government has had similar powers to these since December 2020, so we are doing something for local government that central government has had for some time.

The noble Lord, Lord Kirkhope, spoke about best value in procurement. I agree entirely with what the noble Lord, Lord Shipley, said: it is my belief that best value should definitely include the social value of local procurement, which is why the Government were keen to take this step as soon as we could. It brings jobs locally and helps local businesses. That can be very much added into the best value equation for local people.

On the definition of local authorities, there is a flexible definition of what a local authority is. To refer to the questions that have been asked, it is for the local authority to determine what that local area will be. The order has been drafted to take account of changes that will be made by the English Devolution and Community Empowerment Bill regarding local government reorganisation and authorities’ geographic areas of responsibility. Strategic authorities are already covered by the order, and combined authorities and county combined authorities are already listed as best value authorities under Section 1 of the Local Government Act 1999. This order applies to all best value authorities.

Importantly, for strategic authorities, a designation applies to particular combined authorities and combined county authorities; the underlying corporate entities remain the county authority or the county combined authority. When they receive a strategic authority designation, they continue to be best value authorities and, therefore, to be covered by this order—so no amendment to the order will be needed. It is intended that this measure is future-proofed, which will include new local authorities formed as part of the reorganisation process.

On the advertisement issue raised by the noble Lord, Lord Kirkhope, I understand his point about this having the potential to be a political matter, but these are economic decisions taken in terms of the contract. It is hard to see a situation where a local authority would take a decision about where it was going to have its boundary in relation to politics, because that will change; you might very well cause yourself a future problem if you were to do that. These decisions should be taken as economic and financial decisions for the council concerned. Of course, the advertisement must state the area to which the contract applies, so it has to go out in public with that.

I hope that I have covered the question from the noble Lord, Lord Shipley, about definition in my response to the question from the noble Lord, Lord Kirkhope. Local authorities will be able to determine in a flexible way what their local area is; they can set it as their own area, or the entire county or borough in which they are located, or they can extend it to bordering English counties or other areas local to them as they see fit, or to London boroughs. If you are in the south of my county, you will have London boroughs on your southern border, so you may wish to extend it to them as well.

[Lord Shipley (LD)]

I would like to be clear about this, because I have not understood what the Minister said. The order does not say that a metropolitan district council, as a single authority, can join another authority to theirs. In other words, if a metropolitan district council, such as Calderdale, as a single authority wishes to procure a contract, can it invite bids from a neighbouring council which is not a London borough or a county? That is what the Minister just said that they can do, and I think it is not specified in the order. I think we need to be very clear about this, because it is not just about strategic authorities; in my case, the strategic authority is 120 miles long, and that is not a local area.

[Baroness Taylor of Stevenage (Lab)]

Councils can procure either singly in an area that they have determined or jointly with an area that is next to them. I am not sure that I can be any clearer in setting the proposal and I am not sure where the confusion is arising.

[Lord Shipley (LD)]

The confusion lies in Article 3(5)(a)(ii). The point is that it refers to one relevant authority— not more than one—that seeks to procure a contract. The sub-paragraph says that

“where there is one relevant authority which intends to enter into a relevant contract”,

it can do so only in

“the area of that authority”,

which means its own area, or

“any of the areas of the counties or London boroughs that border that area”.

There is no mention at that point of a neighbouring metropolitan council.

If it would help the Minister, I would be very happy to have a response in writing, as long as it is posted in the Library. I am in favour of this happening, so do not want to hold things up, but would like to be clear about whether the councils—I live in Tyne and Wear—can work together in procurement. Can one relevant authority procure, but advertise the contract in a neighbouring authority, even if that neighbouring authority is not a part of the procurement process? You can do it in London and when you are next to a county but, at the moment, according to this order, you cannot do it in an urban metropolitan area.

[Baroness Taylor of Stevenage (Lab)]

I will take away the issue that the noble Lord has raised, review it and write to him on it, but it looks clear to me that the order says

“where there are two or more relevant authorities which intend to enter into a relevant contract … the areas of those authorities, or … the areas specified in (i) and any of the areas of the counties or London boroughs that border those areas”.

I think that it is clear, but I will take it back, review it and come back to the noble Lord.

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[Baroness Taylor of Stevenage (Lab)]

I think the answer is yes but I will come back to the noble Lord in writing. The threshold might step in there because, as I have set out, there are limits on the threshold for this process.

[Lord Shipley (LD)]

My Lords, I want just to clarify one small point. The noble Lord, Lord Jamieson, raised the issue of council areas that border each other but, where there is a river between them, there is a question of whether the border is the middle of the river. I just want to say that because, when I read this, I realised that there are lots of rivers where councils work across the river together and they ought to be in a position where they can procure jointly.

[Baroness Taylor of Stevenage (Lab)]

I think administrative boundaries take account of rivers generally, so I hope that there being a river in between you would not get in the way of you procuring jointly with your neighbouring area. At some point in the past the Boundary Commission would have taken account of that river and said which area it lies in; as we know, rivers tend to go in and out of different counties.

English Devolution and Community Empowerment Bill

Lord Shipley Excerpts

Committee stage
Tuesday 20th January 2026 Grand Committee

[Baroness Scott of Bybrook (Con)]

My Lords, first, before I start, I wish a belated happy birthday for yesterday to the Minister. I hear it was a big one, and I hope she enjoyed it. Secondly, I declare my interests as a vice-president of the Local Government Association and a vice-president of the National Association of Local Councils.

I am pleased to open the debate today on the first amendment on the first day in Committee on a set of important principles that should guide the remainder of our debate on the Bill. I must also say, with respect, that the Title of the Bill still promises rather more than its text delivers. It speaks of devolution and community empowerment, yet too often it reads as central direction dressed up as local choice. We can and we should do better than that.

Amendment 1 in my name and that of my noble friend Lord Jamieson goes back to first principles: the purpose of this Act. It asks the Government to be clear in the Bill that we will champion consent over compulsion, secure sustainable council finances without unfunded mandates, protect social care with stronger local accountability, support local growth through devolved powers, and enable flexible, locally driven housebuilding and planning. These are not abstract aspirations. They are the everyday tests by which our residents judge whether devolution is real and beneficial to their lives.

Proper devolution is built, not imposed. It is negotiated, not mandated. It respects identity, geography and local choice. That has been a consistent theme in the debate on this Bill: concern that the centre would gain broad powers to redraw local structures, create strategic authorities, consolidate councils and impose mayors without clear and explicit local consent. That is not empowerment; it is compulsion. At Second Reading, many noble Lords raised precisely this point, and we did so again when the Government proposed to commit this Bill, a constitutional Bill, to Grand Committee without the agreement of the usual channels. Process matters because it reveals intent.

Our amendment therefore states plainly that the Bill’s first purpose should be to strengthen community empowerment by championing consent over compulsion. Noble Lords might think that that should be a given in a Bill called the English Devolution and Community Empowerment Bill, but the detail of the Bill does not follow. It risks a power grab, enabling Ministers to force reorganisations and mayoralties on areas that have previously said no and even to postpone local elections to fit a central timetable. That is not how you build trust.

Local government cannot be rebuilt on financial quicksand. We all know how many councils have come to the brink. We have heard repeated warnings about local government reorganisations that promise continual savings but deliver costly transitions and do not make any of those savings into the future, and about new duties placed on councils, such as social care or regulation, but without the resources to meet them.

The second purpose listed in the amendment calls for a simple commitment: no unfunded mandates. If the Government wish to assign functions downwards, they should assign the means to discharge them as well; otherwise, we will set up local leaders to fail and then blame them for that failure. That is not partnership; it is abdication. Commons colleagues pressed this exact point at Second Reading and on Report: stop hoarding power in Whitehall while offloading pressures on to town halls. Put the principle of fiscal sustainability into law and plan reforms accordingly. If we do not do so, we risk even more tax rises through the back door.

Nowhere is the risk of failed devolution clearer than in adult and children’s social care. Every noble Lord who has served in local government, of whom there are many, understands the arithmetic, the demography, the demand and the duty. This does not change where local government is organised or reorganised. If we devolve responsibility with capacity, we will simply move waiting lists from one council to another and call it reform.

The amendment’s third principle seeks to

“protect vital social care services and enhance local accountability”

for outcomes, with transparent reporting to the people who depend on them. Reorganisation cannot become a distraction from stabilising the front line. We need to understand how this is going to work. Social care is perhaps the biggest responsibility of local government, yet the Bill does not even mention those words.

Growth is not ordained by Ministers; it is enabled by place and by leaders who know their patch and who can unlock a stalled site or knit together skills, transport and planning to make things happen. The Government’s own narrative for the Bill claims that it is the biggest transfer of power from Whitehall in a generation. If that is truly the case, the test is simple: will local leaders get the levers they need, or are we just creating authorities that must still ask for permission for every pilot, every power and every penny? Our amendment’s fourth principle states a purpose to

“support local growth through devolved powers and locally led decision-making”.

Finally, on housing, communities will support more houses when homes make sense: the right homes, in the right place, with the right infrastructure. That is achieved through locally driven planning that takes communities with it—not rigid national targets that ignore character, capacity or constraint. The Government speak about flexibility, but our amendment would require it. It would clarify that the Act’s intent is to

“enable flexible and locally driven housebuilding and planning to meet community needs”.

This is perfectly compatible with ambition, but it rejects the idea that Whitehall always knows best.

This purpose clause would not blow the Bill off course but set its course. It states exactly what Ministers say they want to achieve: empowerment, sustainability, accountability, growth and locally led planning. If the Government mean what they say about handing power back to local people, they should welcome having this in the Bill. I beg to move.

[Lord Shipley (LD)]

My Lords, I declare at the outset that I have been a vice-president of the Local Government Association for a number of years. The noble Baroness, Lady Scott of Bybrook, said many things with which I agree. We are in a position where we are seeing the cumulative impact of many years of underfunding—serious underfunding of both local government and problems such as adult social care, to which the noble Baroness referred—for which a proper policy has never ever been devised.

I want to be clear that we are in favour of strategic authorities that can drive growth. I am, however, bothered about the potential for upwards mission creep, on which the electorate have no direct say other than via the election of a mayor every few years. So I see this Bill not as a destination but as a staging post towards something that genuinely devolves power.

I went first to the overview of the Bill, given that this amendment seeks to define the Bill’s purpose. In the Explanatory Notes, the Government have indeed done that. I shall read it out, if I may. It is very short:

“The purpose of the English Devolution and Community Empowerment Bill is to transfer power out of Whitehall, by giving local leaders the tools to deliver growth, fixing the foundations of local government, and empowering communities”.


There is great potential in the Bill for delivering growth. However, I do not think that it fixes the foundations of local government or that it empowers communities. As we go through the Committee stage, I hope that this will become clearer.

In Amendment 1, the purpose of the Bill has been redefined by the noble Baroness, Lady Scott of Bybrook. It has some things in it and other things are not in it. I hope that the Minister will try to explain in greater detail how the Bill does deliver devolution. There are two amendments in the name of my noble friend Lady Pinnock. I should tell the Committee that I am standing here because my noble friend is not able to do so. We hope that she will, in the next two or three weeks, be walking much better than she has been able to and will return to your Lordships’ House. I send our very best wishes to her and I hope on behalf of the whole Committee, as I am sure that that is shared by everybody.

In Amendment 95, my noble friend has explained what she thinks the Secretary of State’s statutory duty should be in terms of strategic authorities. Amendment 95 is very important, because it specifies that the role of local government is to be

“the primary democratic institution responsible for the leadership, coordination and long-term stewardship of local areas”.

We have to be clear, and I hope that the Minister will confirm, that that is what the Government think. Secondly, it says:

“Arrangements for strategic authorities must be framed so as to enable constituent local authorities to … pursue a long-term vision for the … development of their areas”.


We need to be clear that they

“exercise convening and coordinating functions in relation to public, private, voluntary and community sector bodies”

and that it is their job to

“integrate the provision of local services with wider economic, social and environmental outcomes”.

The conclusion in proposed new subsection (3) is that, in discharging this duty,

“the Secretary of State must not treat local authorities solely as administrative or delivery bodies for national policy”.

This is a fundamental problem. It is not clear to me from reading and rereading the Bill that that is actually the situation, so I look to the Minister to say that the Government indeed agree with that. We should bear in mind that it was the 2007 Lyons Inquiry into Local Government, under a Labour Government, that clarified that the role of local government was to provide

“democratic, place-based leadership and long-term stewardship of local areas, rather than acting solely as a delivery arm of central government”.

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[Lord Porter of Spalding (Con)]

My Lords, I was not going to speak on this group either, but my noble friend Lord Lansley raised some points. I need to declare a set of interests. I am a non-executive director of Norse Group, the part-owner of Porter and Verrells, a non-executive director of Elixr Earth and strategic adviser to Prodo. There is also Efficio and Peopletoo; I think that is it. They are all companies that will, if this legislation goes really well, probably find a way of doing something better. If this legislation goes badly, they will all probably suffer for it. So, one way or another, they will all be tied into this.

I had not realised, because I do not read the Bills like my noble friend Lord Lansley does, that the Government have not left a place in which they could add further powers to mayoral combined authorities as we prove the concept. At the moment, we know that the concept is different in different places. The team in Manchester is steaming away doing loads of brilliant stuff. Most of the other places are sitting further behind. We already have a landscape with different powers. If the Government do not find a way of putting that in after they reject my noble friend Lord Lansley’s amendment, will they consider putting something like a power of general confidence in there for strategic authorities so that they can actually start doing things that are necessary for the areas that they look after, which will be different in different places?

[Lord Shipley (LD)]

My Lords, I would like briefly to contribute in the hope that I can be helpful to the Minister at this point. There is a list of areas of competence in Clause 2. The noble Lord, Lord Jamieson, told us that this was a probing amendment. By implication, I think that that means some thought can now go into the list of areas of competence.

I just want to add one new thing. I was a board member of a regional development agency, One North East, for a number of years. There is a difference between the list of areas of competence that we had and this list. Let me explain. We had a rural role and a role in culture and sport, particularly capital investment. We had a clear role in tourism and in energy. We had no role in public safety, health, well-being and public service reforms, or community engagement and empowerment, and we did not directly address issues of poverty, although we did indirectly by the nature of what the RDA was trying to do. I wonder if the Minister might take on board all that has been said and look at those areas of competence. I hope that they are not seen to be a final list. In my view, they are not a final list but a very good basis for discussion. I hope that the Government will be willing to do that before Report.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank all noble Lords for their amendments on the areas of competence and for what has been a useful and helpful discussion on the subject. Many of the amendments in the group seek to probe the list of mayoral competences and I understand why noble Lords would want to do that, but I want to be clear that the areas of competence are deliberately broad to enable a wide range of activities to fall within the scope of strategic authorities. They are intended as a framework that mayors can adapt as their local areas determine where they should place the emphasis.

Amendment 8, tabled by the noble Lord, Lord Lansley, seeks to create a distinct area of competence of “community engagement and empowerment”. It is important that all tiers of local government work to deliver for their communities, as we all know. Strategic authorities, like any other tier of government, will be empowered to engage with those who live and work in their areas. Those already in place do so effectively.

Indeed, many existing combined and combined county authorities already use their powers to engage with their communities to ensure that their work meets local needs. For example, West Yorkshire Combined Authority has an established region-wide engagement platform, known as Your Voice, to strengthen dialogue with local communities. Through this initiative, alongside wider public engagement activity, the authority is gathering views to inform decisions on how its devolved funding is allocated.

The York & North Yorkshire Combined Authority has invested £1.9 million to support community building projects across the region. Funding has been given to buildings which play an important role for communities, such as the village halls in—I always hesitate to use the Yorkshire pronunciations, so forgive me if I get this wrong —Great Ouseburn and Kettlewell.

The areas of competence have been framed to enable a wide range of activity to fall within scope, including community engagement and empowerment. In this sense, it will be embedded within and throughout all the existing areas of competence. These competences are deliberately flexible. I take the point made by the noble Lord, Lord Lansley, about any power in the Bill, but we intend for it to be a framework; I will reflect on that point and come back to him.

The noble Lord, Lord Mawson, made a point about action and impact, as opposed to the broader framework. I refer him to the Pride in Place funding that does exactly as he was describing; it is £20 million of funding for each of 250 neighbourhoods. This is a long-term project, over 10 years, to make sure that each place is able to shape the things that are important to it. I refer the noble Lord to that important project, which shows how we are working with communities—not to them—to move forward the kinds of projects that he was talking about.

Amendment 9, tabled by the noble Baroness, Lady Bennett, seeks to create distinct areas of competence for

“reducing poverty and socio-economic inequality”,

and food security. She will not be surprised to hear that I share her objective of addressing poverty, socioeconomic inequality and food insecurity. The Government remain firmly committed to tackling these issues by addressing all the factors that underpin these challenges that we see in communities.

The areas of competence already enable strategic authorities to tackle poverty and socioeconomic inequality in a cross-cutting manner, via skills and employment support, economic development, investing in transport, tackling health inequalities and in many other ways. The same is true for food security. In Greater Manchester, the combined authority is taking concerted action to tackle food inequality and poverty through initiatives such as No Child Should Go Hungry, which has provided thousands of emergency food cards to residents. At a strategic level, mayors will take account of all the needs of their areas, and locally relevant information, such as the land use framework that colleagues in Defra are producing.

Amendment 3, tabled by the noble Lord, Lord Ravensdale, seeks to add energy to the existing transport and local infrastructure area of competence. The noble Lord and I have spoken about this Government’s energy plans and I have written to him today. With his permission, in a moment, I will quote briefly from that letter because I think it would be helpful for noble Lords to have a bit more detail. On the role that we intend strategic authorities to play in this space, while I am sympathetic to the noble Lord’s amendment, I do not believe at this stage it is necessary. As noble Lords will know, the themes of the areas of competence are, as I have said, deliberately broad in scope and include thematic policy areas such as local infrastructure and environment and climate change. Energy cuts across all these, as well as other areas of competence. Importantly, strategic authorities can, and will be able to, address their local communities’ energy needs through the areas of competence. Indeed, many are already doing so.

On future strategies, the Government are undertaking a number of pieces of work reviewing the benefits of local energy planning for meeting national goals, several of which will lay out our approach for local renewable energy. The forthcoming local power plan will be owned jointly by Great British Energy and the Department for Energy Security and Net Zero. That will outline our shared vision for the local and community energy sector. We are continuing to develop the local power plan with Great British Energy and updates will be provided soon. Similarly, the warm homes plan will cover housing retrofit and heat network zoning and will be published shortly. There will be more details in that plan on heat network zoning. The secondary legislation, rather than this Bill, will provide the necessary framework to empower local authorities to act as heat network zone co-ordinators under the Energy Act 2023. That is just a bit more information on those areas. For example, the Liverpool City Region is working to establish Mersey Tidal Power, with the aim of delivering Europe’s largest tidal power project by 2030, capable of powering up to 1 million homes. In the west of England, the combined authority has implemented its local energy scheme, which is funding community-led renewable projects.

Amendment 4, tabled by the noble Lord, Lord Freyberg, seeks to add tourism to the existing economic development and regeneration areas of competence. The Bill already makes provision for strategic authorities to support the tourism industry. Clause 41 extends local powers to strategic authorities to encourage and promote visitors. Combined authorities and combined county authorities can use these powers to promote tourism and host events attracting visitors to boost local businesses such as hotels and shops. Many existing combined authorities and county authorities are already making use of these powers. For instance, the West Midlands Combined Authority is investing £120 million into an economy, trade and tourism programme, supporting over 250 businesses and 10 major sporting and cultural events. This example demonstrates that prescribing an extensive list of industries and sectors within the area of competence is not required. The areas of competence will empower mayors and strategic authorities to determine their own priorities in the application of their powers, and many are already doing so to address local issues such as tourism.

Amendment 2, tabled by the noble Baroness, Lady Scott, would remove transport and local infra- structure from the areas of competence for strategic authorities. I note from the noble Baroness’s explanatory statement that her intention in tabling this amendment is to probe how the power to borrow will work for mayoral strategic authorities. I think the noble Lord, Lord Jamieson, was probing this during his speech. All existing mayoral strategic authorities already have the power to borrow for all their functions, including transport. Clause 12 will confer the power to all future mayoral strategic authorities. Strategic authorities have full discretion over the exercise of borrowing powers and allocation of resources, subject to obtaining the requisite support from their constituent members via the budget voting process.

Like the rest of local government, strategic authorities must also operate within the prudential framework— I think all noble Lords here would expect that. This framework comprises statutory duties and codes intended to ensure that all borrowing and investment is prudent, affordable and sustainable. It provides robust mechanisms for oversight and accountability. In practice, this amendment would remove transport and local infrastructure from the areas of competence for strategic authorities. That is clearly contrary to the aims of the Bill.

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[Baroness Scott of Bybrook (Con)]

My Lords, this has been an interesting debate. I have found that some of my views have changed slightly as I have listened to noble Lords. The amendment in the name of the noble Baroness, Lady Royall of Blaisdon, seeks to add rural affairs to the list of competences. Given the distinct challenges faced by rural communities, from connectivity to service provision and economic resilience, it is reasonable to ask whether the Bill adequately reflects the needs of communities.

While I was listening to the noble Baroness, I realised that I have concerns that in areas with large urban areas as well as rural areas, those urban areas could take out capacity and investment from the rural areas. When I go back into my history in local government, I remember the regional development agencies that did exactly that. I do not think that Wiltshire got a penny from the regional development agency; all of it went to Bristol and Bath. The Government should look at that to ensure that it does not happen now.

Amendments 52, 56 and 60, in the name of my noble friend Lady McIntosh of Pickering, relate to the appointment of a commissioner for rural affairs. I thank her for her extensive knowledge of this issue. She is right that rural affairs need to be at the forefront of policy-making, especially in authorities that may be predominantly rural but could be a mixture. However, I harbour some reservations about requiring mayors to appoint commissioners with competence for rural affairs. I believe that rural affairs should be a priority for the mayors themselves—the unitary authorities that make up the commission will, I assume, be both rural and urban—rather than delegating this responsibility to one commissioner.

We should remember that competences are not the same as powers or capabilities. Moreover, allowing mayors to make these appointments may result in the appointment of yes-men for the mayors, rather than individuals who could provide independent, robust scrutiny on behalf of rural communities. While I fully appreciate the intent behind these amendments, I am yet to be convinced that mayoral appointments of rural affairs commissioners will be the right mechanism to ensure that rural voices are heard.

Amendment 128 is also from the noble Baroness, Lady Royall of Blaisdon; I thank her for her continued commitment to rural issues. As I have said, it should be a fundamental priority for any authority covering rural areas to consider their particular needs, especially at a time when these communities are being required to absorb substantial housing targets and sprawling solar farms. They deserve a meaningful say if this Bill is really about community empowerment. As I have said, I have a real problem with the mixture of urban and rural, and the issue of the rural voice coming through.

The amendment from the noble Baroness, Lady Bennett of Manor Castle, raises the vital question of public and active transport provision in rural areas. Many of us who have been rural leaders over many years have struggled not just with providing that but with its cost and with making it the right type of transport for a particular area. The noble Baroness is absolutely right to highlight the need for infrastructure that is tailored to rural lifestyles and connectivity.

Since I am talking about connectivity, I will turn to another form: technology. When I go back to Norfolk, I can never get anything on my machine or any other machine. There is no IT and no phone connection whatever. Many of our rural areas are like that. There is a two-tier system in this country for technology, but that cannot go on.

Finally, Amendment 260, tabled by my noble friend Lady McIntosh of Pickering, underscores that the impact of the Bill on rural areas has not yet been fully thought-through. That is the big issue for me. It is entirely reasonable to expect the Government to be transparent about the costs and benefits for rural communities. They have to go back to the drawing board to look at how we can ensure that our rural communities have equal access to the capacity, capabilities and finances that the mayoral authorities will have and that the new unitary councils will be able to use.

I look forward to the Minister’s response on how the Bill can recognise and enshrine the needs of rural communities, which we have heard this evening. At the moment, rural communities are feeling a bit let down by the Government, and this is an absolutely key opportunity to change that.

[Lord Shipley (LD)]

My Lords, I agree with the noble Baroness, Lady Scott of Bybrook. What she said was very important: the Government have to go back to the drawing board on the issue of rural areas. I can imagine an argument that says that it is implicit in all the areas of competence that all those people will take responsibility for rural areas. However, it is my view that that will not be sufficient. In an earlier group, I discussed how the regional development agencies had a role in rural development. It is very important that the Government go back in order to get this right.

I agree with the noble Baroness when she said that it may not be a commissioner who would do this. In my view, doing that requires the knowledge of a council leader from a rural council, because the relevant immediate knowledge is needed. The noble Baroness was absolutely right to ask whether the Government would go back to the drawing board. I hope that, by Report, the list of areas of competence for strategic authorities is revised, so that rural areas are seen to be protected and developed by the structure. Otherwise, there will be public opposition to the strategic authority, for the reasons that the noble Baroness identified in relation to Wiltshire. I have heard that in most RDAs the money goes to the urban areas. That happens—it has often been the case—because the immediate growth can be delivered in an area of high population, whereas the long-term growth in a rural area can be delivered by financial support at a lower pace.

--- Later in debate ---

Moved by

[Lord Shipley]

13: After Clause 2, insert the following new Clause—
“Devolution of powers within strategic authority areas(1) A strategic authority may devolve to any local authority within its area any power which it holds.(2) In carrying out any action under subsection (1), a strategic authority must—(a) consider whether any of its powers may be exercised at a more local level, and(b) where it considers that to be the case, act so as to enable such devolution.(3) Each local authority within the area of a strategic authority must—(a) consider whether any of its powers may be exercised at a more local level, and(b) where it considers that to be the case, act so as to enable such devolution.(4) Within the period of one year beginning with the day on which this section comes into force, a strategic authority must publish a plan setting out how the strategic authority and its member local authorities intend to carry out their duties under subsections (2) and (3) (a “Community Empowerment Plan”).(5) A Community Empowerment Plan must set out how the strategic authority and local authorities within its area will consult local communities on the exercise of those powers which are not devolved to lower-tier bodies.(6) A strategic authority must review a Community Empowerment Plan at least once during the period of four years beginning with the day on which the Plan is published.(7) In carrying out any function under this section, a strategic authority must ensure effective collaboration with any local authority or other body to which it has devolved powers.(8) The Secretary of State may by regulations made by statutory instrument make further provision about the powers of a strategic authority in circumstances where the strategic authority considers there to have been a serious failure or breach of duty in relation to a power devolved to a more local level.(9) Regulations made under subsection (8) are subject to the affirmative procedure.”

[Lord Shipley (LD)]

My Lords, I am very grateful to the noble Baroness, Lady Bennett of Manor Castle, for signing my amendment. When I spoke earlier this afternoon, I said that there was a need to ensure that we do not encourage upwards mission creep in this Bill. This amendment seeks to provide statutory help to prevent that happening and to deliver greater empowerment for local communities.

I accept at the outset that there is an inherent tension in devolution policy between scale and geography. Strategic authorities will be large and will have to cover large areas, yet community empowerment will be on a much smaller scale. I submit that the Government’s commitment to empowering local communities will need some statutory backing, so I propose that we embed the principle of subsidiarity in the Bill. I propose that we embed a legal duty of subsidiarity across the whole of devolved English local government, including town and parish councils.

Further, I suggest that we need to legislate to give local and combined authorities the legal powers that they need to devolve their own responsibilities further. They would also need a statutory duty to collaborate on and publish community empowerment plans setting out how they plan to fulfil their duty; local communities and local councils should have the right to challenge both the content and implementation of these plans.

My amendment says:

“A strategic authority may devolve to any local authority within its area any power which it holds”.


This may sound quite revolutionary to some but, actually, it is at the heart of devolving power and this Bill is about devolution.

Secondly, the amendment says that the strategic authority must act in a way to enable such devolution to take place. Each local authority in a strategic authority area would, in turn, have to

“consider whether any of its powers may be exercised at a more local level, and … where it considers that to be the case, act so as to enable such devolution”.

I then propose:

“Within the period of one year beginning with the day on which this section comes into force, a strategic authority must publish a plan setting out how the strategic authority and its member local authorities intend to carry out their duties under”


the community empowerment plan. I also propose that that plan

“must set out how the strategic authority and local authorities … will consult … on the exercise of those powers which are not devolved to lower-tier bodies”.

Further, my amendment states:

“A strategic authority must review a Community Empowerment Plan at least once during the period of four years beginning with the day on which the Plan is published… In carrying out any function under this section, a strategic authority must ensure effective collaboration with any local authority or other body to which it has devolved powers”.


Then there is the issue of what the regulations should contain to ensure that this measure works well, but I hope the Minister understands that there is a major issue of principle here in terms of devolution. If this Bill is truly about devolution, as the Minister told us earlier today it was, in what way are we going to make sure that strategic authorities do not suck powers upwards but, rather, pass down powers to local authorities, which will, in turn, devolve powers to town and parish councils?

I hope the Minister will be open to thinking about how this must be done. There are so many statements in the Bill and Explanatory Notes about the importance of community empowerment, yet I do not see the means of that actually being delivered in the Bill, hence my proposal on how this might be done. It also requires that the Government just have to make sure that it happens. I beg to move.

--- Later in debate ---

[Baroness Taylor of Stevenage (Lab)]

We have set out clearly in the Bill—with the competences, for example—where we see strategic responsibilities lying and where local council leaders will be responsible for the services they deliver. As we go through the local government reorganisation process, we will have unitary authorities across the country delivering those services. What we do not want to do is muddy the waters by saying that there will be some areas that have different strategic powers from others. That is why we have set out the competences in the Bill.

It is not about what you deliver at local level because the strategic competences allow that to be flexible across different geographies and demographics. It is about ensuring that the strategic level is delivered by the combined authority and local services are delivered by the local authority. I do not think it would be helpful to muddy those waters by having the picture be different across the country.

[Lord Shipley (LD)]

My Lords, the Minister asked whether I was satisfied by her responses; I am actually more worried now than when I started. I agree entirely with what the noble Lord, Lord Jamieson, has just said.

I will give an example of where the Government are heading for great difficulty. Let us take the area of competence for transport and local infrastructure. “Local” is not defined—I think my noble friend Lord Wallace of Saltaire will come back on the issue of definition at a later stage. I understand that strategic transport and major capital infrastructure, such as on a new railway line, is a strategic matter for a strategic authority, but I hope that transport and local infrastructure does not mean that every traffic-calming scheme in every residential road of a local authority has to be signed off by the mayor. I am keen for the Minister to be clear about what these terms mean because the Bill is not clear.

I jokingly referred to the powers I am proposing being revolutionary. They are very different, but they are an attempt to get everyone to understand that if you have a devolution Bill and think it is about devolution, it has to be devolution from the strategic authority where the mayor and the authority think their powers could go to local government. That debate has to be had. It is not, as the Minister said, about ending up with a patchwork of powers. Of course there will be differences in local areas. That is a positive, not a negative thing. Let us not call it a “patchwork” because that means that Whitehall and Ministers want to run 56 million people in England. In the end, having a standard system that everybody must fit into will not work. It will be a cause of great difficulty.

I am encouraged by some of the things that the noble Baroness, Lady Scott, said—that there are correct things in it, there are principles and it is well intended. The test of successful devolution is a willingness to devolve power from yourself rather than demanding it to yourself. The test is for the strategic authority to say, “We think the powers we have in this area could well be carried out by a local authority, so let’s talk about it”, and say to the local authority, “You in turn must decide whether you need to undertake these powers directly or can devolve them to others, including town and parish councils”. I do not believe that the Government will ever succeed with community empowerment plans unless they empower communities. This Bill is not doing that.

Paragraph 16 of the Explanatory Notes to the Bill says:

“The Bill will introduce a requirement on all local authorities in England to establish effective neighbourhood governance, to move decision making closer to residents, empowering ward councillors to address the issues most important to their communities at a local level”.


What it does not say is that that would not include the planning process or a whole set of services that local people might want to have some say in. The Government cannot make statements like that without then delivering the means to increase community empowerment. I will not give up on my Amendment 13. True devolutionists must follow their desire to give power to others to use in a country of 56 million people. For the moment, I beg leave to withdraw the amendment.

Amendment 13 withdrawn.

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[Lord Lansley (Con)]

My Lords, I have two amendments in this group: Amendments 21 and 24. My noble friends on the Front Bench have pretty much all the other amendments, with the exception of Amendment 28 in the name of the noble Baroness, Lady Pinnock. It is a pity that she cannot be here, but I join in sending her our very best wishes and look forward to her return to the Committee.

Amendments 21 and 24 are in the same area of where proposals can be brought forward for the establishment of new combined authorities. Before I go on, I could have tabled—I neglected to table—two further amendments about county combined authorities in exactly the same terms as Amendments 21 and 24, which relate to combined authorities. Therefore, perhaps the arguments I am making on combined authorities can be taken as read-across.

The purpose of my Amendments 21 and 24 is to challenge the process by which the Secretary of State would make a decision on a proposal for a combined authority or a combined county authority that is brought forward by the constituent councils in an area. As things stand under the existing legislation, which was set up in the Levelling-up and Regeneration Act but, for the purposes of combined authorities, is in the Local Democracy, Economic Development and Construction Act 2009—LuRA 2023 has the same for combined county authorities—the way it works is that those proposals come forward for an area and are subjected to tests.

I am interested, in terms of how the tests are currently applied, in whether they are likely to improve

“the economic, social or environmental wellbeing of some or all of the people of the area”.

Additionally, I suggest that the proposal should be required to include the purposes that are intended to be achieved by the establishment of this combined authority or combined county authority. The Secretary of State would have to look at and assess—these are the tests—whether those improvements in economic, social and environmental well-being as well as the purposes included in the proposal are likely to be met.

To me, these are two elements of the test of whether a proposal coming forward from an area should be accepted. The first is an objective test: will it improve the well-being in the area in various ways? The second is more subjective but none the less purposive: the people in this area and the constituent councils have said why they want to have this authority, so the Secretary of State should look at those purposes and say whether they are likely to be met. In this Bill, the question put to a relevant proposal—what purposes are you trying to achieve?—is simply swept away. There is no requirement for such a proposal to have those purposes any more.

Amendment 21 would remove the requirement to have purposes so that they cannot form part of a subsequent test. The test that is to be applied would no longer be the test of economic, social or environmental well-being, which is an objective test related to the benefit to the people living in that area, and would be replaced by a statutory test: is it appropriate to make the order in relation to the area, having regard to the need to secure effective and convenient local government in relation to the areas of competence? In those words, “convenient” leaps out in particular. It makes one think that what my noble friend Lady Scott of Bybrook was just saying about the desirability of having conformity is what is actually driving these decisions now, rather than, “What is going to happen to benefit the people who live in this area?”, which should be the objective test.

That question did not escape the notice of the Lords Constitution Committee. In its 16th report, published on 13 January, it stated:

“We draw this provision to the attention of the House. It should satisfy itself that it is content to grant the Secretary of State this power within Schedule 1 to subject the new arrangements for a combined authority to such a broad and potentially subjective test”.


Of course, in the text at which the committee looked, what the committee means by “broad and potentially subjective” is, by implication, a bureaucratic test—“Is it convenient for us to have a combined authority?”—whereas what we have at the moment, which is what the committee is referring to, is, in essence, a test of the benefit. It is intended to be able to be determined more objectively, and it is certainly more relevant to the people who live in an area whether a combined authority is or is not in their interests.

When we go on with this Bill, I hope that the Government will in each of these respects think whether the statutory test should have perhaps both the bureaucratic element of whether it is convenient and the objective element of whether it can demonstrate that it will bring benefit to the people who live in this area.

My noble friends have two amendments in this group, Amendments 22 and 36, the purpose of which, as far as I can see, is to remove the power for the Secretary of State to direct the establishment of combined authorities and county combined authorities. It seems to me that although the Minister said this is an exceptional power, there is a risk that once this power is available—again, because it will be convenient to do so—we will be instructed to have combined authorities according to the Secretary of State’s proposals rather than the ones brought forward from within the area itself.

[Lord Shipley (LD)]

My Lords, I am very happy with the amendments spoken to so far, so I will not repeat what has been said. Amendment 28 in the name of my noble friend Lady Pinnock relates to whether the Secretary of State determines local boundaries and whether decisions on local authority boundaries within a combined authority area are a matter for central or local government. In the spirit of this Bill, which is about devolution, I can see no reason why central government has to be involved. It ought to be a matter for local councils to decide on. Perhaps the Minister might explain why my noble friend Lady Pinnock has got this wrong; it seems to me that she has got this right.

[Baroness Taylor of Stevenage (Lab)]

There were a lot of amendments in this group, but we whipped through it very quickly, so I thank noble Lords. The amendments in the group tabled by the noble Baroness, Lady Scott, seek collectively to remove the Secretary of State’s new powers to direct the creation or expansion of a combined authority or combined county authority or to provide for a mayor. The Government have been clear that devolution can deliver growth, unlock investment and deliver the change the public want to see, led by local leaders who know their areas best. That is why we want to see more parts of England benefit from devolution.

As I have said, I have been involved in local government for a very long time. We have tinkered around with this issue for a very long time indeed, and it is time we provided some certainty and stability. Our engagement to date with councils across England has demonstrated the appetite for devolution within local government. I have spoken to many of them and visited many areas that do not currently have those devolution arrangements.

Devolution, of course, should be locally led wherever possible, and the Government remain committed to working in partnership with local government to deliver that vision. At the same time, we have been clear that we cannot accept proposals that would block other areas accessing devolution—that would be very difficult for those areas—or risk creating devolution islands. The backstop mechanism in the Bill will allow the Government to establish strategic authorities in areas where local leaders have not been able to agree on how to access devolved powers. That will ensure that all of England can benefit from devolution and nowhere is left behind.

English Devolution and Community Empowerment Bill

Lord Shipley Excerpts

2nd reading
Monday 8th December 2025 Lords Chamber

[Lord Shipley (LD)]

My Lords, I remind the House that I am a vice-president of the Local Government Association and the recipient of a small local government pension. I thank the Minister for introducing the Bill, which I welcome in so far as it sets us off on what will be a long road towards true devolution in England.

The aim of the Bill is to transfer power out of Whitehall, which I strongly welcome. No Government can run England, with its population of 56 million, out of London, yet that is what Westminster and Whitehall try to do. The devolved nations get their block grant, and Ministers in Whitehall manage—indeed, micromanage—England.

However, despite its title, the Bill is not about devolution but decentralisation. Even then, the Bill creates a centralised structure through mayors, who, in practice, will be managed by Whitehall, and in particular by the Treasury, because mayors will be forced to compete against each other for resources. There is also a huge centralising power in mayors having the right to hire commissioners, as opposed to elected councillors, to drive policy and delivery. The terms of these appointments will need challenge in Committee.

Having said that, I want to work with the grain of the Bill, because it represents a start on which we can build. I see it as a staging post to direct elections to combined authorities in the course of time. Time will be needed anyway to build capacity at combined authority level to take on all the extra powers and responsibilities proposed.

I am content with the need for there to be a strategic planning tier, and I welcome local growth plans, but can the Minister confirm that all Whitehall departments are signed up to the Bill? Paragraph 15 of the Explanatory Notes confirms a long list of changes that will be delivered by the Bill, but these can be delivered only if all parts of Whitehall are committed to delivery of the Government’s ambition. Are they?

Will the Bill fix the foundations of local government, as Ministers suggest? I fear that it will not, for the reason that resources to do so are insufficient. We are told that mayors will be able to raise revenue, which is welcome, but in Committee we will need to explore what this really means. Fiscal policy is sadly lacking in the Bill; it is not just about the community infrastructure levy.

In terms of local growth, I hope that in Committee we can examine community banking. I want to see simplification of the regulatory requirements involved in establishing new banks to respond to local communities’ needs for access to banking in the face of branch closures. Such banks could be supported by local authorities in their duty to promote growth. There are many useful examples of success in this field in Germany and the USA that we can draw on.

I am pleased by the proposal to end the first past the post election system for mayors, but why stop there? Do we not need proportional representation across all local government in England to have effective governance?

I welcome the end to upwards-only rent review clauses for commercial leases to help regenerate our high streets, although I accept that we may need to review the detail of that carefully in Committee. I like the principle of micromobility schemes; I like the new health duty to be imposed on all strategic authorities; and I am strongly in favour of proposals for Local Government Pension Scheme funds to help drive growth.

I compliment the Minister and the Government on their proposals on local audit, which are hugely important. They matter because we cannot devolve power successfully if there is no audit system examining proposals and spending commitments alongside decision-making.

I have two negatives. First, I do not understand why culture, creativity and heritage are missing from the Bill. Secondly, it is wrong to enforce an end to the local government committee system. The Government claim:

“The committee system is a less effective form of governance for local authorities”.


I invite the Minister to publish the evidence for that assertion, because I have never seen any.

Finally, can the Minister say more about effective neighbourhood governance structures? It is easy to say but, as previous speakers have said, I fear that this ambition cannot be delivered given the current state of local authority budgets. Does the Minister really think it can?

Planning and Infrastructure Bill

Lord Shipley Excerpts

Report stage
Monday 27th October 2025 Lords Chamber

[Lord Shipley (LD)]

My Lords, like the noble Lord, Lord Best, I hope the Minister will be in a frame of mind to accept the amendment that I too have signed. The case has been very amply made by the noble Lords, Lord Lansley and Lord Best, and I will seek to be brief as I possibly can. I believe that the Government will not deliver the objectives of the Bill unless they raise the status of planning within local authorities, and I believe it should be a statutory requirement, as it has been in Scotland since April 2024, for there to be chief planning officers in each local planning authority reporting directly to chief executives.

The reasons have been clearly stated both now and in Committee: good decision-making in planning requires well-qualified and professional planning officers at a very senior level who can integrate development management and development planning.

As we have heard, given that more decisions are going to be delegated to officers, the public interest, I think, requires that the quality of decision-making be sound and must generate great confidence within the general public. I think that this amendment would actually deliver that objective. As the noble Lord, Lord Lansley, said a moment ago, a chief planning officer would be an authoritative source of advice. As the noble Lord, Lord Best, has just said, there is a new recognition of the value of planning in local government, which will deliver this Bill—it can deliver this Bill—but only if the status of planning has been enhanced. The key way to do it is to have a statutory chief planning officer in each local planning authority.

[Lord Jamieson (Con)]

My Lords, I support this very sensible amendment. We need to ensure that every local authority has the support of a professional, well-qualified head of planning—a chief planner. If we are going to have sensible planning, we need this. I recall a comment earlier—but I do not remember who said it—about the hydra of planning; it becomes more and more complex, and this Bill, frankly, is not helping particularly. Having a qualified head of planning, a chief planner, is critical if we are going to maintain and develop planning, as other noble Lords have said. I do not think I need to say any more—I am just puzzled why the Government are not accepting this.

Building Safety Levy (England) Regulations 2025

Lord Shipley Excerpts

Wednesday 15th October 2025 Grand Committee

[Lord Shipley (LD)]

My Lords, I was interested to listen to the noble Lord, Lord Fuller. I note his concerns and hope the Minister will respond to them, but this is such a fundamental issue that it is important that I state that we support the substance of the levy as set out. Indeed, I noticed that the noble Lord, Lord Fuller, said that there is a general acceptance by the industry, despite some of the problems that the Minister will need to address.

I support entirely every point made by the noble Lord, Lord Young of Cookham, and the conclusions that he has reached. I share his concerns about the speed of action—it has been too slow—and the fact that for many leaseholders, nothing in practice has changed. As we have heard, there are deadlines, of 2029 and 2031, which are not far off. However, I hope the Minister will be able to confirm the statement made by the noble Lord, Lord Young of Cookham, that the Treasury might be willing to increase the level of loans to the department. I very much hope that that will prove to be the case.

I have two specific questions for the Minister before I say a few further words. First, I have not understood from the Explanatory Memorandum why there is a three-year review period, as opposed to a shorter one. In the context of what the noble Lords, Lord Young of Cookham and Lord Fuller, said about speed, reviewing after three years seems to be too long a period. Secondly, why does the purpose-built student accommodation have a threshold of 30 bed spaces for exemptions, as opposed to some other number? Why was the figure of 30 decided on?

These are vital regulations, as they implement one of the cornerstones of the Building Safety Act that was the response to the Grenfell Tower tragedy. As we know, the purpose of the levy is to provide funding for remediation that is essential in many residential properties in order to assure the safety of residents. This statutory instrument provides the considerable detail needed, including, for example, exemptions for small developments and social housing, which seem to us to be reasonable.

It also seems right that the levy is based on square metres of floor space, that brownfield sites will have a levy at a lower rate, and that the levy varies according to general property values in a local authority area. The Government broadly have the approach right. However, as the noble Lord, Lord Young of Cookham, so rightly identified, the problem is that many leaseholders are still being penalised by freeholders and managing agents where properties have not yet been remediated. The penalties imposed are via the substantial increases in service charges and, on top of this, innocent leaseholders are paying huge household insurance costs. Will the Government review their approach to defining those buildings at risk? These are not the same as the assessment made by the insurance market, and it is leaseholders who then pay the price, as well as finding that the value of their property has plummeted.

In conclusion, will the Government commit to a review of at-risk properties and the external wall system assessment to provide some hope for leaseholders caught up in a nightmare that is not of their making?

[Lord Jamieson (Con)]

I declare my interest as a councillor in central Bedfordshire. Fortunately, we do not have many high-rise buildings in rural areas.

In response to the Building Safety Levy (England) Regulations 2025, the principle is absolutely right that those who have profited from residential development should contribute to the cost of making homes safe. It is both fair and necessary. This levy was set up by the Building Safety Act 2022 under the previous Conservative Administration, and it is an important part of wider efforts. I make very clear that we support this, but some issues need addressing.

The Government anticipate that the levy will raise approximately £3.4 billion over the next decade to help fund remediation of historic safety defects, including dangerous cladding. For too long, thousands of residents have lived in buildings that they know are unsafe. They suffer the stress and emotional toil of being in an unsafe building and, as my noble friend Lord Young of Cookham pointed out, they are unable to sell and to move on with their lives. The situation is not of their making. My noble friend made a number of points, and it is crucial that this is done faster and better. I would very much like to know whether the Minister believes that the two deadlines of 2029 and 2031 will be achieved given that, as my noble friend pointed out, around half have not even started. I cannot remember the exact phrase—

Planning and Infrastructure Bill

Lord Shipley Excerpts

Committee stage
Monday 15th September 2025 Lords Chamber

In short, the amendment deals with the symptom—overlaps in jurisdiction—but not with the cause, which is the lack of a clear statutory framework for how development corporations fit into a devolved governance.

[Lord Shipley (LD)]

My Lords, having listened very carefully to the debate so far, I think the next best step would be to hear from the Minister, but I want to express some support for Amendment 362 in the name of the noble Lord, Lord Lansley, and Amendment 195A in the name of the noble Baroness, Lady Scott. I hope the Minister will provide clarity on those when she replies.

On 3 April, guidance was issued by the Government to clarify the legislation, scrutiny and governance of mayoral development corporations in combined authorities and combined county authorities. I am pleased that steps have been taken to incorporate the recommendations of the Tees Valley Review, published over 18 months ago, to clarify the regulations for the Tees Valley Combined Authority and the South Tees Development Corporation. It is important to ensure that there is absolute clarity about oversight, reserved matters, consent and stranded liabilities, and I welcome the Government’s firm intention to do so.

However, it has puzzled me that the words “risk” and “risk management” do not appear in the guidance published in April. There is also nothing about capacity building; that point was raised a moment ago by the noble Baroness, Lady Scott. It is very important that development corporations have the capacity to fulfil the expectations of the Government.

There is an issue, which we may come to in the next group of amendments, about where the development corporations will get their income from. I look forward to that discussion. I am concerned about how the mayoral development corporations will be structured to ensure that full risk analysis takes place on the decision-making for what will be major capital infrastructure investment. Overview and scrutiny are overview and scrutiny: scrutiny is scrutiny of a decision, and overview is overview of how decisions are being made. Risk and risk analysis come at the start of a decision to invest money, so this is not just about overview and scrutiny; it is about preventing risky investments.

When the Minister replies, will she explain who is going to pick up the bill if risk is not properly considered at the right point in the decision-making process? At the moment, I suspect that the bill will be carried by council tax payers in the area concerned and I would like that point to be clarified, because I do not think that a system based on the council tax payer being the body of last resort to make up a loss would be appropriate. I very much hope to hear the Minister’s views on those matters.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I will start with the notice from the noble Baroness, Lady Scott, opposing Clause 93 standing part. I welcome the opportunity to explain the intentions behind this clause. Clause 93 clarifies and extends areas for development and the remit of development corporation models. It includes changes to legislation that would extend the remit of mayoral development corporations, so that they can deliver regeneration and new town development rather than just regeneration. It also allows that separate parcels of land can be designated as one new town area, overseen by one new town development corporation.

The current framework is outdated and not fit for purpose. Each development corporation model was developed to address a specific circumstance at the time of its introduction. This poses a significant risk to the effective delivery of the development corporations. For example, mayoral development corporations can be used only for regeneration projects, as the model was developed initially for London but then widened out to areas outside London, including rural areas. The English Devolution and Community Empowerment Bill will enable strategic authorities to create more mayoral development corporations, so it is even more important to ensure that the legislation is fit for purpose.

Amendment 195A aims to remove the power permitting new town development corporations

“to do anything necessary or expedient for the purposes or incidental purposes of the new town”.

I reassure the noble Baroness that this is not a new addition to the new town development corporation framework. This provision is already written into primary legislation underpinning new town development corporations, as well as urban development corporation models. The changes to the infrastructure provision include listing specific functions and bringing them in line with mayoral development corporations, with the addition of heat pumps, which have been added to the list of infrastructure that can be delivered by all models.

As development corporations are used to respond to the specific needs of developments or regeneration schemes, it is important that the legislation offers this level of flexibility so that they can be tailored accordingly. We all want to see large-scale developments and infrastructure projects that will support housing and economic growth, but they need to be supported by the right infrastructure without compromising existing provisions. It would be a step backwards if we were to take the power away from new town development corporations and instead provide only a list of infrastructure, as some developments may require new technologies. Decisions to establish development corporations and the powers each will have will be made via regulations. Their oversight will be carefully designed and subject to statutory consultation.

Amendments 351ZA and 362, tabled by the noble Lord, Lord Lansley, would standardise and extend powers in respect of mayoral development corporations to mayors of all strategic authorities outside London. I welcome his proposal. It is vital that we empower local leaders to transform underused sites to create thriving communities tailored to local needs. For this purpose, mayoral development corporations should be part of every mayor’s toolkit. However, we believe these amendments are unnecessary. The changes the noble Lord is proposing are already being made through the English Devolution and Community Empowerment Bill introduced on 10 July 2025. Given its scope, that Bill is the most appropriate vehicle for these changes. I take the noble Lord’s point about delay, but I am not under the impression that there is going to be any grass growing under the feet of the English Devolution and Community Empowerment Bill. I think that is going to get moved on at pace and I hope that it will be appropriate for the changes that we are talking about.

--- Later in debate ---

[Lord Shipley (LD)]

Can the Minister explain who the funder of last resort is when a loss is delivered by a mayoral development corporation? Is it the council tax payer for the geographical area of the development corporation, the combined authority or the Government? To put it another way, who makes up, pays for, a loss if a development corporation makes one?

[Baroness Taylor of Stevenage (Lab)]

Of course, we all hope there will not be a loss, but we must always have provision in place for that. I know that there is ongoing discussion with Sir Michael Lyons and others in the taskforce about how the financial details and programme work, so it is probably best if I reply to noble Lords in writing on that issue.

In relation to the points about capacity, which were very well made, again, discussions are going on with Sir Michael Lyons about how we make all this happen. We have already allocated £46 million to planning, but we will continue to have those discussions with the taskforce about what the delivery mechanisms are to be. That said, I hope that the noble Lord has had some reassurance and that he will agree not to press his amendments.

--- Later in debate ---

[Lord Fuller (Con)]

My Lords, I shall speak also to my Amendments 190 and 192. I welcome the broad thrust of empowering and reinvigorating the development corporations contemplated in the legislation. This is the best part of a complex Bill, although we know that it has already been overtaken by the devolution Bill launched in the other place.

Clause 94 seeks the achievement of sustainable development, and the mitigation of and adaption to climate change, but there would be no sustainable development without commercially sustainable financing of the proposals that the corporations bring forward. My amendment seeks to bring sustainable finance alongside those other sustainability issues. I approach this subject in the knowledge that local authorities may be reorganised and that mayors may be created in what we now learn to be a cat’s cradle of overlapping and competing responsibilities. Regardless of that, the day-to-day financial pressures felt by national and local government have never been greater.

In a former time, development corporations would simply hold out their hand to the Government or local councils for funding. Of course, that route may still be open, but we need to recognise that the old ways, with joint severability between various tiers of local government, are falling away. Building new towns is the work of generations; it goes beyond political cycles. Relying on national and local politicians will not be enough in a world where building a secondary school costs £40 million and a flyover £100 million. In the pursuit of sustainable development and delivery on the plans, the money needs to be right, because without the money, how can all the desirable options in Clause 94 be delivered?

We need to give the development corporations powers to exploit the difference between funding and financing—by explanation, funding is writing the cheque, but financing is putting the deal together. It is no surprise that it is the financiers in the City of London who are the highest paid, because their task of turning those good ideas into reality is the hardest.

Development corporations are independent, but they have the benefit of being able to lean on the covenant strength that comes from being a statutory body. I will not dwell too much on the significance of the governance of development corporations, but I will make the factual observation that strong governance leads to higher covenant strength, the ability to take a higher credit rating, and the willingness of institutional investors to pony up the cash. We need to make it easy for development corporations to raise funds in new and creative ways at the lowest possible coupon. My amendments would path find those.

Get this right and we will provide investable opportunities for pension funds that desire to invest in infrastructure bonds, for local people who want to invest in local facilities that benefit their area, or for sovereign wealth that seeks a home for its money within an advanced economy with well-defined property rights. But the well of wealth from these sources may not be enough, and there may be other ways to skin the cat. The corporations need to be empowered to engage in all manner of financial instruments, including the traditional issuance of bonds, debt or similar instruments. But we should contemplate other sources of finance. That extends to entering into joint ventures with landowners whose land is to be incorporated as an in-kind contribution to the whole, so that they may enjoy the uplift over a long period rather than cash up front. 

It should not be right that development corporations feel they need to reach for the CPO lever by default and then be forced to pony-up a premium price to the owner up front after the unpleasantness of the process—there are lots of “p”s in that sentence. In other words, development corporations need to have powers not just to assemble land but to be creative in the assembly of that land. The creative concept of the joint venture would allow more money to be spent on upfront infrastructure than on land acquisition. That is a better-value enterprise. By thinking creatively like this, the amount of upfront funding will be less and the ability to deliver essential infrastructure at the outset greater. 

 I want to place finance in its widest possible context, not just rooting it in the sort of funding where you stand on the street corner with your hand out. Let us seed these stand-alone corporations away from the other financial pressures that afflict local government and free them from the apron strings of those local authorities. While I accept that the development corporations can plan for an area and have regard to all manner of desirable outcomes, contemplated in Clause 93, ultimately those plans or outcomes will stand or fall on whether the money can be raised and the finance deals put together. That is what my amendments seek to achieve. I beg to move.

[Lord Shipley (LD)]

My Lords, in the absence of other speakers, I am interested in the points made by the noble Lord, Lord Fuller, and will be even more interested in the Minister’s response, bearing in mind what I said in the previous group about management of risk and who underpins a development corporation in the event of financial loss.

Amendment 197 is very important. There are two issues: the automatic

“removal of hope value from the valuation of the relevant land”

proposed for development and, secondly, whether land purchases by development corporations should be seen as

“public sector investments to be counted against departmental expenditure limits”.

This amendment in the name of the noble Lord, Lord Liddle, is important and I hope that the Minister will respond to it.

[Baroness Scott of Bybrook (Con)]

My Lords, I thank my noble friend Lord Fuller for his amendments. The financing of development corporations is an important issue and we will continue to engage on it. I look forward to the views of Sir Michael Lyons’s task force on the issues raised by noble Lords in this and the previous group on the financial aspects of development corporations.

We need to ensure that financing is long term and sustainable. If corporations are to take on debt to fund infrastructure, they and their lenders will need confidence that the debt will be repaid. This is a particular issue as a current Government cannot bind a future one. I will not comment on the issues in Amendment 197 as it has not been spoken to, but I assume that they will be discussed in group seven.

Planning and Infrastructure Bill

Lord Shipley Excerpts

Committee stage
Thursday 4th September 2025 Lords Chamber

[Lord Lansley (Con)]

My Lords, Amendment 162 in my name is in this group and I am very grateful to the noble Lords, Lord Best and Lord Shipley, who have also put their names to it. I am glad that we have included it in this group and brought it forward, because it adds to the debate we had on the previous group—and this one—about how we arrive at a resourced and professionally effective overall planning function in local planning authorities. The last debate was principally about the resources that are available; this group and this debate tells us the importance of understanding the scope, complexity, breadth and degree of professional expertise that is required to deliver a successful planning function, and the planners themselves. The amendments that lead this group, on issues relating to health, the environment and so on, have amply demonstrated the degree of influence and importance that should be attached to the planning function in a local authority’s activity. I was delighted to hear what my noble friend Lord Moynihan had to say. I hope, when we reach Clause 52, he will note its value in showing that spatial development strategies should focus on health effects and inequalities. I hope that we can develop that important point.

Planners are often in this space already. Chapter 8 of the National Planning Policy Framework includes precisely the issues that relate to delivering on healthy and safe communities, including promoting healthy living. I am sometimes in awe of what is needed, as my noble friend Lord Fuller said, when putting together a local plan: the range and complexity of what needs to be included in it and the extent to which one has to anticipate the many issues that many communities will face in order to deliver it.

The new clause proposed in Amendment 162 says that local planning authorities should have a chief planner and, in doing so, they can—if they choose to do so—join together and appoint a chief planner for more than one authority. I say this advisedly, knowing that in my own area Cambridge City Council and South Cambridgeshire District Council jointly run a shared service, with the Greater Cambridge Shared Planning service at its head. The clause would allow for what is current best practice. It would also flexibly but necessarily require of local planning authorities that the person they appoint to be a chief planner must have the relevant expertise and experience to justify their doing so. I hope that we could say that was always the case; it is pretty nearly always the case, but it is necessary when giving them a power and requirement to do so that we should be clear that it should be exercised in this way.

Why do we need this? Many local authorities have a chief planner—but not all. I was very struck in the briefing that we received the Royal Town Planning Institute—and I am very grateful to it for inspiring this amendment—by how important this could be in terms of supporting the professionalism and development of the profession. We want more planners; I agree with the Minister about managing to maintain level 7 apprenticeships if we possibly can—these have been very important. We need more planners, and I welcome the Government’s financial support for additional planners. However, we need not only more planners but to make sure it is very respected profession.

What will bring people into planning as a profession is an understanding that there are professional leaders. I suppose my pitch for Amendment 162 is that not only should we be resourcing planning and increasing the number of planners but we should recognise that leadership matters in every walk of life, and that we should encourage local planning authorities to have chief planners who are themselves leaders of their profession. In future there will be fewer local planning authorities than there are now. I hope that through the chief planner role, we can encourage them to look to have that kind of professional leadership.

The example we might look to is the Ministry of Housing, Communities and Local Government itself. My noble friend Lord Fuller talks about relevant planning functions and decisions made by Ministers; they are informed by professional expertise within the department. That is a profession led by the chief planner, who herself demonstrates the value of a chief planner role in relation to the planning functions of any organisation.

Interestingly, when the Government published their technical consultation on reform of planning committees—we will come on to more about that in the next group—they referred specifically to the question of a decision being made about the allocation of decisions to planning committees to tier A and tier B, and said that it should be done by the chief planner, together with the chair of the planning committee. That seems to me to be a present, important illustration of the independence of the professional expertise that should be brought to decision-making in local authorities.

If we are to rely on that, not least in relation to the national scheme of delegation, as a basis for making solid decisions about the allocation of decision-making, we absolutely need assurance that there will be a chief planner in each of these local planning authorities. I hope that when the Minister comes to respond to this debate, this might be one of the things that she has written against it not “resist” but “agree to consider”.

[Lord Shipley (LD)]

My Lords, I will speak in support of Amendment 162 in the names of the noble Lords, Lord Lansley and Lord Best, as well as mine. As the noble Lord, Lord Lansley, has rightly pointed out, this is an issue of professional leadership. It also underpins the delivery of the Government’s objectives with this Bill.

I add my support on the importance of comprehensive training for those involved in making decisions on planning matters. There are some very wise additional proposals in Amendments 99A to 102, and the case made by all those amendments is overwhelming. Someone in a local planning authority has to manage the training process, which has to be done at a senior level. That is one reason why I support the statutory requirement for local planning authorities to have a chief planner—but there are other compelling reasons, as the noble Lord, Lord Lansley, has identified.

Yesterday in Grand Committee, there was a statutory instrument to devolve housing and regeneration powers to Buckinghamshire, Surrey and Warwickshire councils. It was most welcome, it was approved, and it is a decision by the Government in their drive to devolve more decision-making to a local level, but it will succeed only if the capacity is there to deliver the desired outcomes. That capacity relates to the number of planning officers, their status and the training they have received. As we have heard, in recent years there have been rising levels of complaints about the planning system, its complexities and its delays. As we have heard also, one major cause is the lack of qualified planning staff and the downgrading of the status of planning, given the low number of chief planning officers reporting directly to the chief executive of a local authority.

We should recognise that Scotland has, for a year, had a requirement for statutory chief planning officers to be appointed by local authorities. I submit that we should do likewise if the planning system is to be speeded up in England and if the Government are to deliver their devolution agenda.

[Lord Best (CB)]

My Lords, I support Amendment 162 in the name of the noble Lord, Lord Lansley, supported by the noble Lord, Lord Shipley. It calls for every local authority to appoint a chief planner, and I thank the Royal Town Planning Institute for championing it. I must declare various interests as I have not already contributed in Committee: I am an honorary fellow of the RTPI and a vice-president of the Town and Country Planning Association and the Local Government Association.

Local Audit (Amendment of Definition of Smaller Authority) Regulations 2025

Lord Shipley Excerpts

Wednesday 3rd September 2025 Grand Committee

[Lord Fuller (Con)]

My Lords, I declare an interest as I have, in the past few days, stepped down as the vice-chairman of the local government resources panel, which has oversight of audit and accountancy within the Local Government Association. In that guise, I have been very well acquainted with the difficulties in local government audit.

If there is a villain of the piece—I use that word advisedly—the noble Lord, Lord Porter, when he was chairman of the Local Government Association struck a wonderful deal that established the PSAA, referred to by the noble Lord, Lord Sikka. He drove down those costs and council tax payers benefited from low-cost audit for many years. With the benefit of hindsight, however, perhaps he did too good a job, because it came to pass that it was very difficult for audit practitioners to recruit the right staff at the right level, and they got behind.

We ended up in regrettable circumstances—through no fault of the noble Lord, Lord Porter, I stress—aggravated by Covid, in which a number of local authorities had failed to sign off their accounts. I cannot remember the precise details but some were four or five years old—so old, in fact, that the authorities concerned no longer existed because they had been reorganised away. I am very pleased that the previous Government, belatedly perhaps, took a grip. A line was drawn in the sand and some transitional arrangements made, and now things are much better.

However, I am very concerned that we now see the increase in the threshold. I appreciate that we need to increase the threshold value, but going from £6.5 million to £15 million is a huge increase—of 230% in one bite. That will mean that some of the smaller authorities, which hitherto have been contained within the audit regulations—I will give some examples presently—no longer will be.

I am seeking reassurance because we are establishing the definition of a smaller authority. I cannot be blind to the notion—the Minister referred to it in the earlier debate—that we have a local government devolution and reorganisation Bill in the other place; it passed Second Reading yesterday. In that circumstance, we will see a large number of smaller principal authorities, which are subject to the full audit regime, fall into the third tier of local government—that is, they will not be subject to the 5% or £5 council tax increase cap, if I may use that word.

I want to highlight the example of Salisbury City Council. It used to be a district council and a principal authority but, since the reorganisations in Wiltshire, that is no longer the case. In the past four years, it has jacked up its council tax by 44%. I note that its total precept for this year is only £6.065 million, marginally below the threshold limit to which it is subject. Its gross income is £8.64 million. Currently, it is part of the arrangement to have a full audit. Having jacked up council tax by 44% over the past four years, I think it should be. If it is increased to £15 million, however, what assurance can the local people—the long-suffering residents of Salisbury—have that the council has their best interests at heart? By contrast, the Wiltshire unitary authority, which has assumed responsibility for most of the expensive services, put its council tax up by only 4.5% last year.

I am concerned that this definition will, in due course—not today, because I am conscious that we are concerned solely with audit—be used, as we go through local government reorganisation, to give a free pass to some of the smaller city councils and larger town councils, which will inevitably will fall out of the LGR process and let them let rip. Of course, it is not just the district councils, it is the internal drainage boards. I am concerned about the case of Great Yarmouth Borough Council, which had an increase in the internal drainage board levy of 91% last year, which the council was mandated to pass on to local taxpayers. Over the past few years, it has gone up by 117%. That means that because the district council in Great Yarmouth is a principal authority, it could put its council tax up by only £5, but 91% of that was as a result of the unavoidable increase from the internal drainage board that lies within it. That meant that only 9%, just £26,000 of the increase in council tax in that historic borough—I declare an interest because my business is in that borough, but I do not pay council tax there—could be devoted to the provision and improvement of local services. We shall see a whole class of authority that would currently be within the £6.5 million but will no longer be caught if the threshold rises to £15 million.

I want to highlight the example of the Broads Authority, which is well known for its governance failings. It is well known to be a dysfunctional organisation and, in the interests of transparency, I have in the past made complaints to that body through the mishandling of certain planning matters. Its gross budget is £9.7 million. If ever an organisation needed the close scrutiny of a full audit, it is the Broads Authority and now it will be given a free pass. It will be let off from public scrutiny. This is the unintended consequence of this legislation.

Finally, I want to get the definition of “smaller authority” on the record in the context of local government reorganisation, and ask the Minister what the Government’s intentions are. If it is contemplated that this definition of “smaller authority”—the £15 million threshold—will be used post local government reorganisation, when some of these smaller cities, such as Salisbury, or larger towns such as Scarborough or Shrewsbury, which are certainly covered by the audit now but would not be in future, is it proposed that this definition will cap them at £5 or 5%? There will have to be some reckoning. We cannot have a situation whereby only the large unitary authorities that will be formed after LGR have their council tax capped at £5 or 5%. What is the Government’s view about capping, limiting and putting the local taxpayer first from some of these much larger authorities, which will take on other responsibilities—possibly for local culture, parks and dog bins—when their current responsibilities for social care, planning, housing and homelessness are removed? We cannot have a situation where a 230% increase in threshold allows a new class of large, small authority to let rip at the expense of local taxpayers.

[Lord Shipley (LD)]

My Lords, I am grateful to the Minister for explaining the statutory instrument. I share many of the perspectives of the noble Lords, Lord Sikka and Lord Fuller. I hope the Minister, in replying, will be able to meet some of the concerns expressed. The context, as we have heard, is the abolition of the Audit Commission 10 years ago. It was supposed to save £100 million a year but it did not do that. It was supposed to make local audit more efficient and it did not do that. It has not saved money. Costs have risen substantially since 2015. The private sector was supposed to take over from the Audit Commission but it has not worked like that, because there have been nowhere near enough trained auditors. There have been, as we have heard, huge delays in the audits of English local authorities. That is the background to this draft statutory instrument.

--- Later in debate ---

[Lord Fuller (Con)]

As the noble Lord, Lord Shipley, was speaking, I was looking at the RPI tables from the Office for National Statistics. Had the £6.5 million been increased by inflation, it would have been £10.3 million. So we are seeing a proposed threshold that is fully 50% greater than the increase in inflation over the same period. I just wonder whether that might help the noble Lord’s argument.

[Lord Shipley (LD)]

I thank the noble Lord for that intervention. It may be that RPI is the right way of doing it. I do not know why he took RPI there and not CPI. However, the issue is: why, in fact, are the Government not going to peg the £15 million to inflation? At what point will that figure then be adjusted because inflation continues to rise? We have to have a debate about that fact, but I thank the noble Lord, Lord Fuller, for explaining the RPI figures since 2014. Clearly, it may be that £15 million is the correct figure, but I would like to know what assessment the department has made of the implications of that figure on the number of local authorities that will be taken out of the full audit requirement?

[Lord Jamieson (Con)]

My Lords, again, I raise my interest as a councillor in central Bedfordshire, which, just being slightly boastful, is a council that for the 10 years I was leader had its accounts audited and signed off every year within the deadline and was one of the few councils to do so.

I am grateful to the Minister for introducing this statutory instrument. The instrument raises the threshold, as has been discussed, to £15 million in annual income or expenditure. Public bodies below this will no longer need to have the full audit and can follow the streamlined annual governance and accountability return—AGAR—process.

This reform is in response to the long-standing and well documented challenges that England’s local audit system faces. It is worth noting that this is not a new policy initiative. The foundations were laid under the previous Conservative Government, who published the consultation in December 2024, setting out proposals to overhaul the local audit framework. The consultation highlighted widespread concerns around audit capacity proportionality and long-term sustainability. A formal response was subsequently published on 9 April 2025. I ask the Minister to update the Committee on progress towards implementing the remaining elements of this broader strategy.

We believe that the instrument before us is a pragmatic and proportionate reform. It recognises that many smaller authorities do not carry the same level of financial risk as larger bodies and should not be burdened with audit requirements that are both costly and unnecessary where they are unnecessary.

The Government have suggested that this change will ease the financial and administrative burden on smaller authorities, reduce the pressure on the over- stretched audit market and allow scarce audit resources to be better focused on higher-risk councils where scrutiny is most urgently needed. We note that 55% of the consultation respondents supported raising the threshold, indicating that the proposal carries a degree of support from within the sector itself.

In closing, I would be grateful if the Minister could address a few further points. First, what safeguards are in place to ensure that smaller authorities, no longer subject to the full audit, continue to operate with high standards of financial transparency and sound governance, which I think addresses the point that the noble Lord, Lord Sikka, was raising? While £15 million is a sensible threshold, will other factors be taken into account, such as the debt levels of councils? A council that is heavily in debt, even if it is just below the £15 million threshold, is clearly at much higher risk than one that is just above it and has no debt.

Secondly, will the department be issuing updated guidance to support these authorities as they continue using the AGAR framework? As my noble friend Lord Fuller mentioned, are there other consequences that are not in this paper, and that are coming as a change to this definition, that we are not considering today and should be considered?

Finally, can the Minister provide an update on the progress of the wider local audit reform programme, as set out in December 2024? In particular, will she address the issues of proportionality, risk-based accounting and focusing that limited resource on higher-risk areas and not on low-risk, bureaucratic processes?

I have one other question; I apologise. Can the Minister update the Committee on how the Government are addressing the shortage of local government audit practitioners?

These are my last few sentences. We support this instrument in principle. It is a sensible step forward towards a more proportionate, risk-based local audit regime. However, I raise those various issues. We need to ensure that there is robust oversight, transparency and regular review, to ensure that public accountability is not diminished in the process.