Cities and Local Government Devolution Bill [HL]

Lord Liddle Excerpts

Wednesday 24th June 2015 Lords Chamber

[Lord Beecham]

My Lords, I entirely agree with the noble Lord. I apologise for omitting reference to two amendments in my name, which partially deal with the points that he has made—Amendments 31 and 32. The Bill permits the suspension of a mayor’s PCC role, and Amendment 31 would allow for any person who has had a PCC function delegated to them by the elected mayor to be suspended also. Similarly, where there is a disqualification of a mayor’s PCC role, the amendment would allow for the disqualification of any person who has had that function delegated to them. I apologise to your Lordships for not having referred to those points in my relatively brief opening remarks. I hope the Minister will be able to deal with them in due course.

[Lord Liddle (Lab)]

My Lords, I hesitate to disagree with my noble friend Lord Beecham, for whom I have enormous respect. However, my recollection of the police and crime commissioner thing is that, when it came to this House a few years ago, on this side of the House we all thought that it was a pretty bad idea. We were rather confirmed in that view by the fact that the percentage polled by these people in the elections was pathetic and they really have very little democratic legitimacy.

Certainly in my own area, the commissioner is seen to regard himself as a very big noise, to be driven around in chauffeur-driven cars at public expense, employing advisers on his behalf. Surely we want to get rid of all this. Surely, being able to transfer those functions into the functions of an elected mayor is something we should welcome. The whole point of an elected mayor is to bring a breath of fresh air into the democratic politics of local government. I have devoted not nearly as long a part of my life to local government as the noble Lord, Lord Beecham, but I have done about 15 years of service one way or another on local authorities and I think the elected mayor idea has the potential to bring democratic life to big cities and to introduce a new style of politics. If we are to have elected mayors, the police and crime function naturally fits in.

There are obviously boundary issues that someone has got to sort to out, but that must be the Secretary of State—no one else can do it. The idea that everything has to be done by the agreement of existing authorities is a recipe for the status quo, and I feel that we are somehow on the wrong track.

[Lord Storey]

My Lords, it has to be about more than swapping the police and crime commissioner’s police car for the mayoral car; the appointments process is hugely important. However, I want to speak to Amendment 28 in the name of the noble Earl, Lord Listowel. Unfortunately, he cannot be here at the moment, so I volunteered to say a few words on it. It makes perfect sense—

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[Lord Flight (Con)]

My Lords, I support my noble friend Lady Wheatcroft’s excellent amendment. If you go to America, you will find that cities have retained the right to finance infrastructure projects with municipal bonds. Indeed, income from bonds even enjoys the advantage of being tax-free. However, as she pointed out, much of the heritage of our great cities of the last century and much of their infrastructure investment were financed by municipal bond issues. That came to an end, sadly, during the Attlee Government after the Second World War. The argument was that the Government could borrow more cheaply via gilts and thus dosh out the money. What actually happened was that the money never got doshed out and the municipalities were unable to have their own bond issues.

For me, this subject is absolutely central to the reality of devolution to cities. It is about their ability to raise money and to invest in their own infrastructure. I, too, look forward to hearing of the opportunities in the sports world, but there is masses of scope for infrastructure investment. I raised this issue at Question Time in the House earlier this year I think, and got a response which seemed to be saying that, yes, the Government agreed with this and would include it in future legislation. Over a year ago, when I discussed the territory with the Mayor of London, he absolutely supported the idea that it should be a fundamental part of devolution to our cities.

I very much hope that the Government will accept my noble friend Lady Wheatcroft’s amendment, which, quite rightly, is designed to be cautious and not to allow the ability to go overboard. It would make a start and a crucially important contribution to real devolution.

[Lord Liddle]

My Lords, I express support for the principle of the amendment moved by the noble Baroness, Lady Wheatcroft. The combined authorities need more independent power to raise money for good local projects and I accept that we have to break away from the kind of Treasury stranglehold, as it were, that operates in this area. I would be interested to see how far the DCLG and its excellent Ministers, who are very committed to devolution, are getting on with the Treasury on this question. We look forward to the response on that. However, there are two problems, which I know the noble Baroness, Lady Wheatcroft, will have thought of. The question is what the answers are—they may be in the response to the proposal.

First, there is the question of risk if something goes badly wrong. Not only would that be a failure for the combined authority that had sponsored the proposal but it would result in severe losses for local savers. Is there any way of spreading the risk and/or any form of insurance that could maybe bring the big institutions in to bear some of the risk? I am not a finance person, but the noble Baroness is and I am sure she will have thought about this.

Secondly, with a proposal of this kind you need to ask how the market in these bonds would operate. After all, people might have enough money to invest £10,000 or something in the future of their city—I could imagine people being very happy to do that—but their personal circumstances can change. They might want to be able to dispose of that bond. How would a secondary market operate in something that had initially been limited to residents of the area? However, in principle, this is exactly the kind of radical thinking that we need to revive municipalism.