Combined Authorities (Consequential Amendments) Order 2014

Lord Shipley Excerpts

Monday 24th March 2014 Grand Committee

[Lord Shipley (LD)]

My Lords, I strongly welcome these draft orders, and the fact that the north-east draft order is on its way, making four orders in total, with the potential for more to come in the months ahead. As we have heard, combined authorities are important on the grounds of geography and scale because they reflect natural regions and travel-to-work areas. In terms of scale, so many councils are comparatively small that investment and risk management are much more difficult for them, so pooling with neighbours is a much better way in which to proceed.

I noted that the leader of Manchester City Council has said that this Government have devolved more in three years than the previous Government did in 13 years. He is right. The importance of this devolution is that it is essential to help to drive growth outside London and the south-east effectively. Combined authorities, working closely with their LEPs, will be responsible for regeneration and economic development, and for strategic transport investment and management, as the Minister confirmed. That is a hugely welcome change. I have been involved in the first and second waves of city deals, which have been very important in increasing the understanding that councils have with their LEPs in terms of their leadership role in promoting economic development. I have no doubt at all that the creation of combined authorities will help enormously with that process.

I would like to raise one important issue of principle with the Minister, which concerns the membership of the combined authority. I listened carefully to what the Minister had to say earlier. I understand that the overview and scrutiny committees will be politically balanced so that minority parties in councils will have representation in the governance of the combined authority. Can the Minister say, either now or at a later date in writing, a little more about how proportionality will work, whether an opposition member will be required to chair them and how agendas will be constructed to ensure that debate is not stifled by individual party political interest? That is a very important issue and there have been a lot of discussions around it.

There is a strong case for saying that minority parties should have access to the main deliberations of the combined authorities. However, it would help significantly to know now that the Government understand the issue and are prepared to ensure that the rights of minority parties are guaranteed in the orders when they are finalised, either now or at a later date. In terms of principle, it is important, as my noble friend Lord Storey said, that the public have confidence that this is not to be the creation of a one-party state.

[Lord McKenzie of Luton (Lab)]

My Lords, I thank the Minister for introducing these important orders in a clear and comprehensive way. As the noble Lords, Lord Shipley, Lord Alton and Lord Storey, said, and as would have been clear from the debate in the House of Commons, we thoroughly support these orders. Indeed, why would we not, given that the authorities involved are largely Labour and that the primary legislation from which they spring—the Local Democracy, Economic Development and Construction Act—was legislation of the previous Government? We acknowledge that the work of the noble Lord, Lord Heseltine, has spurred the coalition Government to take the opportunities that that legislation offers, and we acknowledge the Government’s current commitment to localism. I am bound to say that those of us who spent many hours ploughing through the Localism Bill and its detail will recall that it seemed to us then to be as much about power for the Secretary of State as about freedoms for local government, but it would be wrong to be too churlish on this occasion.

As for growth, of course we welcome the improvement in the economy. We will have to see how sustainable it is and how much of it genuinely comes from a rebalancing of the economy, a point touched upon by the noble Lord, Lord Alton. We agree that local authorities working together in the interests of their communities can be a real engine for growth, particularly outside London. As my honourable friend Andy Sawford put it when this matter was debated in the Commons:

“The new combined authorities will bring many benefits, including the strong and visible collective leadership of an area with democratic accountability and an influential and unified voice. That leadership will be able to have a single conversation with the Government, national agencies and business leaders and to align decision making and economic growth at a strategic level”.—[Official Report, Commons, 18/03/14; col. 707.]

As the noble Lord, Lord Shipley, said, combined authorities should enable more effective engagement with LEPs and facilitate delivery of city deals.

The issue that York is currently a non-constituent council in the West Yorkshire Combined Authority was the subject of some discussion in the other place, particularly following an earlier intervention from my right honourable friend Hilary Benn. We took it from the Minister’s reply in another place that the current problem is that combined authorities require whole local authority areas that share the same boundaries. The Minister undertook to consult in the next few weeks about how the legislation could be changed to address that problem. Perhaps the Minister could add a little more about the propositions that are being developed in that regard.

We welcome the commitment to see the combined authorities brought within the VAT refund scheme, which is another matter that was discussed in the other place.

--- Later in debate ---

I hope that I have been able to address all the points that have been raised today. I think we are in general agreement that establishing these combined authorities will support these councils in driving their commitment to deliver growth and prosperity for their area. That is a priority which should be at the heart of everything councils across the country do, and I commend these orders to the Grand Committee.

[Lord Shipley]

Will the Minister give further guidance on the overview and scrutiny structure? She referred to good practice. Will she write to the councils that form combined authorities about what that good practice might entail? In particular, will she advise that having an opposition chair of scrutiny, which anyway is common practice in many councils for the overview and scrutiny process, might be recommended by the department? Will she also advise on whether all members who are appointed to serve on an overview and scrutiny panel are able to place items on the agenda? I am seeking to avoid a situation in which the majority party on the combined authority chairs the overview and scrutiny panel and then controls the items placed on the agenda. Good practice is what I would expect to happen, and I am sure that in the case of the combined authorities orders we have today, and get in the future, that would be deemed to be good practice, but it might help if the Minister defined clearly what good practice actually means so that everybody can be aware of it, including those authorities that are yet to put in their proposals.

[Baroness Stowell of Beeston]

My noble friend raises some very important points. As a point of principle, I or one of my ministerial colleagues would be happy to write to the combined authorities, and I will discuss with them the precise detail to put in such a letter.