Elected Mayors and Local Government

Mark Pawsey Excerpts

Thursday 9th July 2015 Westminster Hall

[Mark Pawsey (Rugby) (Con)]

The right hon. Gentleman said that we did not have enough high-technology jobs in the west midlands, but then went on to say that we did not have enough high-technology skilled workers.

[Liam Byrne]

Correct.

[Mark Pawsey]

Is it not the second, rather than first?

[Liam Byrne]

We are trapped in a low-pay, low-skill equilibrium, as the OECD calls it. We have to break out in two ways. First, we must build a bigger research base. Where we have done that—in places such as the advanced manufacturing centre at Warwick—we have shown that we are capable of soliciting and securing the most extraordinary new investment, but alongside that new investment there must be an effort to build a technical education system. If we are to build a new generation of technical university trusts across the region that would allow young people to study on an apprenticeship track up to a degree level of skill, the region must take control of funding that is currently locked up in Innovate UK, the Higher Education Funding Council for England, the Skills Funding Agency and the apprenticeship budget. That is the only way we can line up academies and university technical colleges with a new careers service, a region-wide apprenticeship agency, more specialisation in our further education system and a new partnership between further and higher education that would allow apprentices to go on to study to a degree level of skill. I hope the Minister will tell us that they are all powers that are within scope.

Secondly, there have to be changes in how the Department for Work and Pensions works. Combined authorities have to acquire more power over the way in which the Work programme works, because that is the only way that we will be able to line up our skills system and our back-to-work system for the first time. Most Work programme providers are not doing a great job and will say that they could do a much better job if they were able to get their hands on skills funding.

Thirdly, there must be new powers over transport infrastructure. The argument for the west midlands is well rehearsed. Some 90% of UK businesses are within four hours, but the transport system is shambolic. There are big new investments coming in, but we have to take powers over both bus and train franchising if we are to deliver the integration that is possible. Crucially, we need the Highways Agency and Network Rail to give us the latitude to control prioritisation within their investment programmes in the years to come.

I have two more points. The fourth set of powers that the combined authority needs are around culture. The west midlands boasts the greatest British cultural brand in the world: William Shakespeare. That is why I hope that the combined authority brings Stratford-upon-Avon into its ambit as quickly as possible. Stratford-upon-Avon is not a big council; it is small. It does not have the investment required to unlock the potential of that brand. The region is so disjointed that if someone goes to tonight’s performance of “Volpone”, which finishes at about 10.40 pm, it is impossible to get the train back to Wolverhampton or Sandwell, and if someone wants to get the train back to Coventry, it will take 1 hour and 40 minutes. They can get the train to Solihull or Birmingham after the curtain falls, but in most of our region we cannot go to the glorious new theatre in Stratford-upon-Avon and make it home after the final performance.

Finally, I want to make a moral point. Our region is scarred by some of the worst child poverty figures in the country. About a third of children in Birmingham, Sandwell and Wolverhampton grow up in poverty. About a quarter of children in Coventry and Dudley grow up in poverty.

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[Mr Geoffrey Robinson (Coventry North West) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Brady, as always. I congratulate my hon. Friend the Member for Coventry South (Mr Cunningham) on securing the debate, and I thank Mr Speaker for granting it. It is an important one and an opening for many more, although there will probably be more local than national debates. It is important for us to realise that elected mayors affect local, not national, government.

It would be far better to take a practical or bottom-up approach, as others have described it, to the problem than to go for the jugular, as recommended by one of the participants in the debate. Perhaps he should put his own jugular on the line first and see how it feels before he recommends that we collectively do the same, but that is for him to decide. It would be fatal to rush into this blindly. That suggestion shows no understanding of the reality of the complex organisation that we are about to create, or of what it is like in the private sector, let alone the public sector. In the private sector, the shareholders are seen once a year, which can be a pain or a pleasure, depending on how the organisation has done. With this type of organisation, however, there is regular accountability through newspapers and other means all the time, quite rightly, and through weekly party and council meetings. It is a completely different kettle of fish from a private sector organisation.

We learned a lesson from the 1970s that you may remember, Mr Brady—I don’t think you were in the House, but you may have studied it. I was not in the House either but I studied it from quite close up—from Smith Square, where I was at the time. The then Prime Minister, with great executive thinking, brought a private sector approach to things. He said, “We’re going to do this, and we’ll do it from the top down. We’ll impose it and have a nice blueprint.” The then Secretary of State, who had a very distinguished service record in the public sector and a very successful record in the private sector—rather like Lord Heseltine—thought, “We’ll do a proper merger, have a blueprint and make sure that we do it exactly as we have told them.” It was a theoretical blueprint that bore no relation to the different sets of circumstances, and as my hon. Friend the Member for Coventry South and my right hon. Friend the Member for Birmingham, Hodge Hill (Liam Byrne) both said, within 10 years it broke down in the reality of the complicated democratic processes that Governments have to work with in the public sector.

We should forget all that. Let us deal with the situation as it is, and take a practical approach. I speak as one who is second to none in my admiration for Lord Heseltine, and indeed Lord Walker before him, who did the ill-fated 1970s reorganisation. Let us be practical people, with a depth of experience of the public sector and its needs, when we come to deal with this very difficult task.

Some of us in Coventry feel two things. It could well be that we have been slightly behind the game and have not joined in or been promoting this idea early enough or strongly enough, as a west midlands entity, but that is because we have never really felt the same identity of interest with Birmingham and the black country as we perhaps have with Warwickshire, which is our more natural—

[Mark Pawsey]

Will the hon. Gentleman give way?

[Mr Robinson]

I would, but we are all limited by time, and the hon. Gentleman, whom I know very well and share many interests with, will have time to make his own speech in a moment.

Coventry is a proud city in its own right. I have told the House before how some decades ago, when I was first selected as a candidate, my party chairman took me to one side and said—I had just been selected, Mr Brady, and you know what local parties can be like—“Now Geoffrey, you have to understand one thing.” I was fairly new to Coventry at the time. He said, “The most important point you have to understand as a Coventry MP is that there is only one good thing that comes out of Birmingham. Do you know what that is?” I had no idea. I suggested cars, machine tools, motorbikes and so on. He said, “No, no. It’s the Coventry road.” That was a silly, parochial approach, and we are no longer— thank God—bound by those sorts of considerations. I would certainly never dream of giving that advice to anybody who might succeed me in decades to come. However, Coventry is a proud city and I believe that Wolverhampton, which has gained city status more recently, feels as Coventry does in many ways.

--- Later in debate ---

[Mr Reed]

My hon. Friend’s comments emphasise the fact that discretion over the model of governance should be in the hands of the local community and the local area affected, not in the hands of a Minister who takes such decisions centrally here in Whitehall. That is not just a Labour view. The cross-party Local Government Association, which is currently led by a Conservative, believes:

“People should be free to choose the appropriate model of governance for their community.”

In reality, however, the Government claim to be committed to devolution but insist on telling communities how they will be run and governed. There is a clear contradiction in that, which I hope that the Minister will resolve for us.

[Mark Pawsey]

I beg the hon. Gentleman’s indulgence in pursuing the local issue raised by the hon. Member for Coventry North West (Mr Robinson). We are talking about local people having the right to make the decision, and I want to dwell on what is best for Coventry. I argue that Coventry would best be served by working with Warwickshire, just as the two areas have come together under the local enterprise partnership. I agree with him about the need for more time, because Coventry seems to be in a rush to join the combined authority. Does the shadow Minister agree that there needs to be an effective discussion in Coventry and Warwickshire about the merits of a Coventry and Warwickshire solution, rather than Coventry leaping into the combined authority?

[Mr Reed]

My view of localism is that that decision should be debated and determined locally, rather than by politicians here in Whitehall.

Just three years ago, which is not so long, the Government defended having referendums on metro mayors because

“it ensures local people ultimately decide”.

What has changed in the intervening three years for the Minister to stand up and say the polar opposite, as I suspect he will today? It might be because most of the areas that were asked whether they wanted a metro mayor voted not to have one and the Government now wish to override those democratic decisions, but it might also be because the Government are looking for a political fix to advantage their own side. The Government have seen how people voted in many of the great conurbations across the country and how few Conservative councillors are being elected, and they are clinging to the hope that, if they are able to impose a mayor, there will be at least one last chance to get some Conservative control over areas that have consistently rejected local Conservative rule.

Finally, devolution will not work if resources are not devolved along with decision making, so that local people are able properly to exercise their powers. The areas that have been identified for the first round of devolution tend to be those that have suffered the greatest cuts, and there is a fear in those areas that they are being set up to fail, although they welcome devolution. The Government are centralising funding decisions in Whitehall but seeking to localise the blame for cuts on the combined authorities or localities where decisions will be taken on how those cuts are to be implemented. An important opportunity is coming up in the spending review for the new Secretary of State to change course and protect those communities, given that they have already borne the brunt of the national cuts made by Departments over recent years.

I invite the Minister to explain why he will not end the “Whitehall knows best” culture and let local areas choose how they want to be governed and why he will not stop putting artificial barriers in the way of devolution where local areas want it and where it would offer many benefits.

--- Later in debate ---

[Mr Jones]

The important point that a number of right hon. and hon. Members have missed is that it is for local authorities and areas that seek devolution to make proposals. The amount of democratic accountability that the Chancellor seeks will be determined by an area’s ambition, and the deal going through at the moment is an example.

Concerns have been expressed about what is seen as the imposition of metro mayors, to which the hon. Lady alludes. In 2012, a number of cities, including Coventry, voted against introducing a directly elected mayor. I wish to make it clear that, to be successful, decentralisation must be about not only devolving powers and budgets but having the necessary leadership in each place, which brings me back to my point. We need governance and accountability so that powers can be exercised properly and effectively, for the benefit of all.

Mayoral governance is an internationally proven model of governance for cities. Hence, as the Chancellor has made clear, we will devolve major powers only to cities that choose to have an elected metro mayor, but the Chancellor has also made it clear that we will not impose a metro mayor on anyone. Our Bill therefore provides for metro mayors, while also making provision for devolution and governance changes in circumstances where a metro mayor is not seen as an appropriate governance arrangement. The Bill allows for local governance to be simplified, but only with the consent of affected councils and the approval of both Houses.

The crucial point is that all the Bill’s provisions are to be used in the context of deals between the Government and places; nothing is being imposed. I reiterate that where there is a request for the ambitious devolution of a suite of powers to a combined authority, there must be a metro mayor, but no city will be forced to take on those powers or to have a metro mayor, just as no county will be forced to make any governance changes.

In that context, I congratulate the seven metropolitan councils of the west midlands on the launch of their statement of intent to establish a combined authority, which is the first stage in a process of consultation and engagement with other councils in the area. We welcome that development, and we are determined to hand as much power as possible to places with a clear, strongly led plan. With their proposal, the seven west midlands councils are showing what can be achieved by working together to bring greater opportunity to their area. We look forward to working with them as they develop their proposals.

In yesterday’s Budget—this answers a point raised by several hon. Members—the Chancellor strongly welcomed the statement of intent for devolution in the west midlands, which he sees as a proposal for a strong and coherent west midlands combined authority. He has shown great ambition for the midlands, and he sees the “midlands engine” as an integral part of the Government’s long-term economic plan.

[Mark Pawsey]

The Minister is making a strong case for the urban areas of the west midlands to come together. It is a big engine and could be a powerhouse of development. May I tempt him to comment on the appropriateness of shire counties on the periphery of such an urban area being involved? Should they, too, be pulled into that move?

[Mr Jones]

Locally elected leaders and members must decide whether they want to be part of any particular configuration of combined authorities. It is for local people to put proposals to us in the Department, rather than having a top-down solution imposed on a county area such as my hon. Friend mentions.

I will respond to some of the points that the hon. Member for Coventry South made. My hon. Friend the Member for Torbay (Kevin Foster) hit the nail on the head—the principle of combined authorities is perhaps being confused a little. Many people want to paint it as an amalgamation of councils and their current governance arrangements. Actually, we are talking not about breaking down the structure of the authorities in the west midlands but about devolving the additional powers that those authorities are seeking. My hon. Friend the Member for Solihull (Julian Knight) made that very point.

On whether the west midlands will have a mayor, as I said, that is a bottom-up process. It is for the west midlands to come forward and tell us the level of its ambition. It has set out an initial document, but it is early days. It was implied in the debate that the Government are leaving the west midlands behind. That is certainly not the case, and we are encouraging people from across the west midlands and the wider midlands area to think about how power can be devolved. As I said, my right hon. Friend the Chancellor made it clear in his Budget that he welcomed the initial work being done in the west midlands.

The hon. Member for Coventry South mentioned the devolution arrangements that were previously made for the west midlands. Those arrangements were made many years ago, but funding and powers to carry out the projects that he mentioned were never directly devolved. They were very much directed by central Government, which is why the scenario being suggested now is different.