East Midlands Combined County Authority Regulations 2024

Lord Shipley Excerpts

Monday 19th February 2024 Grand Committee

[Baroness McIntosh of Pickering (Con)]

My Lords, I am grateful to my noble friend for setting out the contents of the regulations before us, which follow the same sort of model that has been used for the York and North Yorkshire Combined Authority and its mayor, as well as the North East Combined Authority and its mayor. I have a couple of questions.

If the housing responsibilities are transferring from the combined authority to the mayor, what will happen in the instance of planning for a major housing scheme? For example, if people have concerns about the impact of flooding and the lack of sustainable drains or similar, which authority will consider that application? It concerns me that the planning process seems to be separated out from what has previously happened in a straightforward way. If all the county councils to which my noble friend the Minister referred are now being transferred to a higher authority, it may not have the facility or means to understand planning issues. It may focus on what it perceives to be the need for increased housing; for example, it may focus on a four or five-bedroomed housing scheme and not on a one or two-bedroomed scheme, which might be preferred or more required in a rural setting.

My noble friend referred to the power to issue a precept. How much of the funding that she set out to the Committee this afternoon is new funding and how much is simply replacing what is already available in the terms of schemes? I will draw a parallel with the area that I know best. For example, if we look at the Tees Valley Mayor, he has an awful lot of new funding at his disposal at virtually every turn. I understand that that will not be the case for new combined authorities and mayors, such as the subject of these regulations. What new funds are going to be available? Are the funds being transferred from the combined authority to the mayor? Is it going to be the case that there is no new money so, in fact, as set out in the regulations, the power to raise a precept will be relied upon in virtually every case, in which case the council tax will have to go up? Was that put in the consultation that was put to the public to which my noble friend referred?

Finally, on the consultation, as a democrat I find it incredibly difficult to accept that when 52% of those responding, if I understand the Minister correctly, rejected the model for a mayor in this instance, the Government and the Minister’s department are proceeding. Would it not be a good idea to pause, reconsider and go back on the proposals? Even though my noble friend says authoritatively that all the legal requirements of the consultation have been met, I urge her to consider the democratic implications of rejecting what 52% of the population said.

[Lord Shipley (LD)]

My Lords, the noble Baroness, Lady McIntosh of Pickering, has raised a number of pertinent points and I am looking forward to hearing the Minister’s response to them. She particularly raised the consultation and the responses. There has been a continuing problem with consultation on combined authorities because the number of people who respond is very low. In the case of the East Midlands, I think Ministers have taken the view that elected councillors would have to make the decision about the mayor. Nevertheless, there is a question about how the Government and combined authorities can engage with people to a much greater degree so that response rates to any question would be much higher than in this case. Having said that, I thank the Minister for her explanation of these regulations. It is very good to see the close working of the local authorities in the East Midlands Combined County Authority. I wish it every success in its work. We want it to succeed.

I have previously raised issues of scrutiny, audit and risk in relation to this combined county authority and other mayoral combined authorities. I noticed that the Secondary Legislation Scrutiny Committee commented on this public consultation. Paragraph 45 of the report cites the Department for Levelling Up, Housing and Communities explaining that

“the Secretary of State has noted respondents’ concerns about the EMCCA’s governance model and the position of a Mayor but is satisfied that these draft Regulations would ‘provide the necessary check and balances on the governance of the EMCCA and its Mayor’”.

I draw the Minister’s attention to the Tees Valley Review dated 23 January 2024. I will quote from it, because what it says is important to all combined authorities. The question I pose to the Minister relates to whether any of the deficiencies identified in that report, published a few weeks ago, could occur in the East Midlands Combined County Authority. I quote specifically from paragraph 1.7 of the report’s executive summary, which said that

“there are issues of governance and transparency that need to be addressed and a number of decisions taken by the bodies involved do not meet the standards expected when managing public funds. The Panel have therefore concluded that the systems of governance and finance in place within”

the Tees Valley Combined Authority and the South Tees Development Corporation

“at present do not include the expected sufficiency of transparency and oversight across the system to evidence value for money”.

Recommendation 6 then went on to say that the Tees Valley Combined Authority cabinet should

“review its current delegations and directions to STDC to ensure it meets its statutory obligations, including appropriate oversight by Overview and Scrutiny Committees, to enable value for money to be delivered and evidenced through effective scrutiny of significant decisions”.

The Secretary of State has said that the draft regulations would

“provide the necessary check and balances on the governance of the EMCCA and its Mayor”.

Can the Minister, either now or perhaps later in writing, explain how these draft regulations actually provide the checks and balances necessary to ensure that a report such as that written on Tees Valley could not be written on the East Midlands?

The Minister is aware that I have raised issues of security, audit and risk repeatedly during the passage of the levelling-up Bill and on other occasions, and I find those words in the Tees Valley Review worrying. I hope that this cannot possibly happen elsewhere. I am surprised by what has been said on Tees Valley but, given that, what structure is in place—I cannot find it in these regulations—to prevent a repetition of what seems to have occurred in the Tees Valley from happening in the East Midlands or in any of the other mayoral combined or combined county authorities?

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the Minister for setting out the basis for this new type of mayoral combined county authority. The regulations establish the East Midlands combined authority and are required in advance of the first planned combined authority mayoral elections in May this year. We consider them to be very important for the economic and social development of the region and its population, so we will not be objecting to this important SI, but that does not mean that we do not have any questions about it. Indeed, we are very excited and hopeful that our candidate, Claire Ward, will be the first East Midlands mayor elected and, as mayors do up and down the country, will make a great difference to communities in the areas that the Minister set out—housing, transport, public health, and education and skills.

We also noted the degree of consultation that took place from 14 November last year to 9 January this year, but further note, as did the noble Baroness, Lady McIntosh, and the noble Lord, Lord Shipley, that the numbers are very low in these consultations. We need to think about how we engage the public more in these very important discussions about the future of their areas. We also noted that there is a distinctive emphasis in this devolution deal on the combined authority reflecting the local communities within the combined authority area. We can do more of that, and I think that might help to engage people even more.

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[Baroness Scott of Bybrook (Con)]

My Lords, I thank noble Lords who have spoken in this debate, particularly for their support for the East Midlands. I know that will be well received. Once again, we all wish it well. I will respond to a number of questions— I will look at Hansard and write if I miss any—starting with my noble friend Lady McIntosh.

The response rate to the consultations the constituent councils did was very low. The noble Baroness, Lady Taylor of Stevenage, and the noble Lord, Lord Shipley, mentioned that 4,800 responses from 1.6 million people is not a lot, but you cannot force people. My experience is exactly the same. People will tell you, “We just want people to lead our council, keep us safe and economically viable and to spend our money wisely”. Sadly, that is what happens in all these cases, but that is how it is.

My noble friend Lady McIntosh of Pickering asked whether this funding is new. Yes, the funding to the East Midlands is new, as was the case in Tees Valley; that was new funding, too. My noble friend also mentioned planning powers. No planning powers or housing powers are being transferred from existing planning and housing authorities. We made that clear in passing the then Levelling-up and Regeneration Bill, which is now an Act. Therefore, those authorities will be responsible. That is part of the challenge; they must work together for the good of their area.

The East Midlands devolution deal is a level 3 deal, with strong devolution alongside the establishment of a mayor. There was concern that 52% of those who responded to the consultation did not want a mayor; the problem is that they also said they wanted a level 3 devolution deal, with the large amounts of money and power that come with it. It was for the Secretary of State to make the decision that the result of the East Midlands consultation should be a level 3 deal, which requires a mayor.

The noble Lord, Lord Shipley, the noble Baroness, Lady Taylor of Stevenage, and my noble friend Lady McIntosh brought up Tees Valley. As they will know, the report came through very recently. We are considering the two recommendations in it. The noble Lord, Lord Shipley, is absolutely right: risk, scrutiny and audit are very important here, as they are in all local government. The mayor from Teesside has been asked for his response by early March; once it comes through, I will write a further letter on the Government’s response. What I think will happen is that we—the Government—will learn from that report, as will the East Midlands. As with all local government, as I say, scrutiny, audit and risk are important.

[Lord Shipley (LD)]

Since we are on that specific issue, may I ask two questions? The Minister said that there were two recommendations but, actually, there are 28 altogether.

[Baroness Scott of Bybrook (Con)]

I was talking about the ones on scrutiny.

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[Lord Shipley (LD)]

Right, but there are others which relate indirectly to the scrutiny, risk and audit function.

Secondly, this is not just about the East Midlands Combined County Authority. This issue relates to all mayoral combined authorities: those that currently exist and those that are about to come into existence. I hope that, when the Minister writes to us, there will have been an in-depth examination by the department of how the criticisms of Tees Valley’s arrangements could not occur in all of those other authorities. I hope that I am making myself clear: there needs to be an examination of the constitutional and working arrangements in all those combined authority areas.

[Baroness Scott of Bybrook (Con)]

I agree with the noble Lord. This is what we will do: we will look at the report in detail and respond accordingly on the things in the report that reflect, first, on the department itself and, secondly, on future combined authorities of whatever type because of the importance of that.

There are currently no limits on mayoral precepts; the power does exist to set limits. That would need the approval of the Commons, though, if it were to happen so we will watch that as it moves forward. I think it was the noble Baroness, Lady Taylor of Stevenage, who brought up the issue of a political adviser. The combined county authorities can have one political adviser; the post, like local authority political advisers, is not politically restricted in the way that other officers’ posts are, but they can have one.