Graham Allen
Main Page: Graham Allen (Labour - Nottingham North)Devolution in England
Graham Allen Excerpts
Mr Betts
We looked at that issue and it is clear that there have to be proper governance arrangements if local authorities are to have not just large amounts of extra spending to control, but greater tax-raising powers, as we also recommend. We looked specifically at the combined authorities, which is the issue my hon. Friend refers to, and we have said that different government arrangements might be suitable in different areas. A directly elected mayor might be appropriate in some areas and a strengthened Public Accounts Committee could scrutinise the work of the executive of the combined authorities. In other areas an indirectly elected mayor might be appropriate, as is the case in Bologna and other places in the world. There are different models available, but no single one is necessarily the right one for every area. We should not say that devolution cannot happen until an area has a particular model of governance in place, but it is clearly right that they should get a proper model in place.
Mr Graham Allen (Nottingham North) (Lab)
I support the remarks of my fellow Select Committee Chair. We have to make a start, particularly given that our country has been so massively over-centralised in Whitehall. It may be a halting start or it may take different forms, but the letter crafted by the Mayor of London, the leader of Greater Manchester, and by Liberal Democrats, Conservatives, Labour members and parish councils that appeared in The Times before Christmas called for devolution at all levels to be comparable—not identical—to that achieved in Scotland. Does my hon. Friend think there is something in the water in England that means that somehow we are incapable of devolving effectively over the long term in England?
Mr Betts
That is an interesting question. I do not think there is anything in the water of members of the Communities and Local Government Committee that would prevent that. Members on the two Front Benches probably have slightly different water that affects the way they think on certain issues. I will come back to that in due course.
Mr Betts
I was going to come on to equalisation. Some areas have a greater ability to create and get the benefits of growth than others. This was a difficult issue, and we looked at it. I see the former Minister the hon. Member for Bromley and Chislehurst (Robert Neill) in his place. We thought that what had been done with the business rate retention scheme, or at least the partial retention scheme, was actually quite a good model: a starting point where a certain amount of tax is collected and transferred to a local authority in exchange for the grant that is currently given. The extra receipts that come in through growth would be kept in that area. Some receipts might in future be disproportionate, perhaps because of a very large increase in rateable values that are not directly linked to the efforts of an authority, so there should be a resetting arrangement every so often to take account of that.
We thought that was quite a careful way of doing it. We have probably gone further, in that we recommend that the totality of business rates be kept at local level and there should be a right within a group of authorities, a combined authority or the Greater London authority to set business rates as well—and obviously the element of any increase in the business rate level should not be taken back by central Government. It is a complicated issue, but we thought that the Government had basically got it right in their business rate retention scheme, which could be used as a model for the totality of business rates, or for stamp duty or capital gains tax, bearing in mind the fact that stamp duty is much more a London issue and therefore slightly more complicated. We recommend the idea in principle, but we recognise that it needs to be looked at in the way the hon. Member for Bromley and Chislehurst mentioned.
We tried to deal with equalisation. We suggested that an independent body be set up to deal with problems of resetting and other issues where there might be a conflict between central and local government. The Government dismissed that and thought that they could do all those things. We thought it would probably be useful to have a body like the Office for Budget Responsibility in the local government sphere.
In principle, we are recommending that a framework be set out for how more powers could be devolved, with local authorities setting out their governance arrangements, how they will be fiscally responsible and the sort of strategy they have for using any powers that are devolved to them. We recognised that progress would probably be made more quickly in some areas than in others and that initially the GLA and the combined authorities would probably be best placed to take on those powers. We see them very quickly taking on place-based budgets, strategic planning and housing, and the sorts of health arrangements proposed for Greater Manchester—I will be careful to go back to that with my hon. Friend the Member for Wigan (Lisa Nandy) present. Indeed, the Government intend to introduce primary legislation to allow those sorts of powers to be taken by the combined authorities. We also recommended the devolution of 100% of business rates, setting the multiplier on business rates, stamp duty and capital gains tax, and flexibility with council tax bands as well.
Although all local authorities could go there, we thought there were some changes that could immediately be made to the powers available to all local authorities, including the complete freedom to set council tax. It is quite staggering that the one tax that local authorities have got—the one that is supposedly theirs—is one for which any increase by more than the Secretary of State thinks is appropriate has to be put to a referendum. There is no other tax in this country for which we have to have a referendum to increase it. Those sorts of freedoms could be given straight away. We thought there could be further freedoms by pushing the commissioning of the Work programme down to all local authorities and that controls over fees and charges could be freed up. Why should the Secretary of State fix fees and charges? They should be fixed at a more local level.
Mr Allen
My hon. Friend will know that the report from the Select Committee on Political and Constitutional Reform, which I chair, is tagged to today’s debate. We talk about the democratic aspect of this issue, which may reassure some of our hon. Friends and other hon. Members in the Chamber. Does he accept that although we might get a benign Government who wish to push power away from Whitehall, there may be Governments who want to take it back? Does he accept what I hope is the strong case made by my Committee that there needs to be some entrenchment of the independence and rights of local government? Otherwise, that possibility could come true in time.
Mr Betts
Yes, and I congratulate my hon. Friend and his Select Committee on the work they have done; indeed, we have worked together on a number of these aspects. He is absolutely right: there ought to be some fundamental commitment to the rights of local authorities to have these devolved powers. The worry is that everyone feels that this is a great thing now, but in five years’ time it could be reversed. There needs to be a degree of certainty about the direction of travel we are moving in.
Damian Collins
I agree that powers and decisions should not be forced on English communities by MPs who are not affected by the outcomes of their votes. However, I think that there is a case for devolution of the kind that we have seen in the Greater Manchester area to large English authorities—county authorities such as Kent county council, for instance—which should be able to take a strategic lead. My right hon. Friend is right about major infrastructure projects. Local enterprise partnership boards, for instance, are often better placed than someone in Whitehall to know which road and which rail network should be made a priority for funding and investment. Local leadership of that kind is greatly to be welcomed.
Damian Collins
I think that there are two important debates to be had, and that it would not necessarily be helpful for them to become entirely enmeshed. There is a debate to be had about English votes and English laws, which is very important to the settlement for the whole United Kingdom. As one who believes in the Union, I think that we must get that settlement right. We need to look at it again, and we are doing so. There is another debate to be had about the role of devolution to city regions and larger strategic authorities in England, which might cause some regions to look with envy at others and say, “We wish we had some of those more devolved powers.”
In some respects, that debate is more specific. I think that it should be led by city and other local regions, presenting their own proposals, and that there should be an active dialogue in which the presumption is that devolution should and could be possible for those regions. As I said earlier, I think that health and social care should be a priority, alongside economic development and infrastructure. That is why I was particularly pleased by the announcement about Greater Manchester.
Many local authorities are already considering how services can be better integrated, and, in my area of south-east Kent and in Dover, the Kent Health Commission has examined the issue in some detail. GPs in Folkestone and Dover have been working on a pathway of proactive health care enabling more joint decisions to be made by GPs and social services. Such a system often leads to better-quality interventions, better advice for patients, and fewer occasions on which patients are required to go to a major hospital because of a failure in their treatment and care pathway. Obviously that is not only inconvenient for the patient, but a more expensive and often less effective solution. What I am proposing are common-sense reforms.
We should look beyond the city regions to the county areas. We should consider the role that could be played by more strategic authorities in not only receiving powers from central Government but managing the relationships between county and district authorities, and parish councils as well. In Kent we have three tiers of local government, county, district and town parish councils. We often hear the challenging cry, “Who is in charge?” It can be frustrating when so many powers are split between authorities, or it is not clear which is the lead authority.
I think that a degree of simplification and clearer structures under the umbrella of a strategic authority would make sense. We see that in part already with district councils working together to share resources on the environment and waste management and on housing allocation and provision. In east Kent we have seen the East Kent Housing group bringing together different districts and boroughs to work together on common housing strategies. That is a sensible use of resources and will deliver a better quality of service for local residents, and we should see more of it.
Could there also be scope to look at other central Government agencies working with a strategic authority in areas such as Kent? For example, we already have local flood management run in part by the Environment Agency and by the county council. There are also major strategic national projects that are of great significance to my community but on a scale that makes it right for central Government to take the lead. For example, in respect of the completion of the sea defences at Dymchurch on the English channel coast in my constituency, investment that has already been spent and that is currently planned amounts to around £130 million. That is clearly a significant capital investment. Many other schemes are managed routinely by the Environment Agency, the local authority and the local drainage boards. Do we really need three different bodies to manage some of that work? Could it not be better managed by devolving it to a local strategic authority that could oversee some of the work currently done by Government agencies operating within a national framework? Could not such work be done better locally? Those are issues we should look at, too.
I said at the beginning of my remarks that I wanted to look at the scope for devolving powers to communities. We have seen this in a number of areas, such as the devolution, effectively, of the management of schools to academies, so that schools can now manage their own budgets and, indeed, roll them over. That was a significant reform. There are head teachers in my constituency who say that gives them greater certainty in planning for the future, and they are perfectly able to manage their budgets and are doing so very well.
There are other areas of devolved government, too. In Kent there has been a particular success in devolving youth service provision to local communities. That is contracted out. I declare an interest as chair of the Folkestone Youth Project. It receives a budget from the county council, and I believe it delivers a better and more flexible youth service than was delivered before—it is designed around the people who use it and it is not run by the county council. It is not necessary for the county council to run that. It may be responsible and commission and provide the resources, but the communities can design it. We are already seeing that in library provision on a voluntary basis, where villages and parishes are coming up to take over the provision of their local libraries. Often they can design and run that service more effectively than the council could.
Kris Hopkins
LEPs are a partnership between the local authorities and the business leaders who sit inside those groups, and it is up to them to negotiate that position and drive out the delivery of those services. I am confident that these emerging relationships—some of them are very strong at the moment; some still have a way to go—are giving a massive return on the limited amount of money we have to spend as a consequence of the economic situation we found ourselves in.
Mr Allen
I congratulate the Minister and his Government on the list of the measures to decentralise power that he has read out, but does he accept that any Front Bench may come forward with such a record of achievement in this area which could be imperilled by some future Government, and that the answer is to build in the rights and responsibilities of local government, and to entrench them beyond easy repeal on the whim of some future Government?
Kris Hopkins
The hon. Gentleman makes a good observation about the opportunity for a Government who are not as positive and decentralising as this one to follow another path, but I think that if local authorities are bold and understand what they want and ask for it, we will deliver that for them. I think that once they have been empowered they will be very reluctant to give up those powers.
The Government have built on the success of these approaches relating to enterprise zones and city deals to negotiate devolution settlements with cities. In November the Chancellor announced that Manchester will be taking advantage of greater devolution of powers and shortly will have its own directly elected, city-wide mayor.