English Devolution and Community Empowerment Bill

Lord Wilson of Sedgefield Excerpts

Committee stage
Wednesday 4th February 2026 Grand Committee

[Lord Jamieson (Con)]

My Lords, I will also speak briefly in support of what the noble Lord, Lord Best, has raised with these three amendments.

First, Amendment 133

“would enable the Secretary of State to support the creation of Mayoral Development Corporations”.

Noble Lords have already outlined why development corporations are a good idea, so I will not repeat that. The one thing I will say is that, in getting things done quickly, there may be some issues with the wording; there is still a role for local councils, too, and we want to make sure that they are not forgotten.

I have a few specific questions for the Minister. First, how will the Bill directly strengthen the role of development corporations, both improving their effectiveness and ensuring that they are readily used to support strategic plan-making? Secondly, do the Government believe that the powers currently available to development corporations are sufficient to meet their ambitions on large-scale housing development and regeneration in mayoral areas? Finally, do the Government see development corporations as a central delivery vehicle for the future mayoral growth strategy? If so, why is that intent not reflected more clearly in the Bill?

If I understand them correctly, Amendments 240 and 242 are similar in effect, but one applies to public land and one to local authority land. They aim to secure the optimal use of public land,

“including when disposing of it”,

in pursuit of wider policy objectives. The intent behind these amendments is plainly sound. Numerous Governments have sought over the years to ensure that public land is used strategically, transparently and in a way that supports the long-term social and economic outcomes we all desire. The Government may have some issues with the drafting—in particular, taking into account whole council objectives, not just the specific objectives mentioned—but I hope that, in that spirit, they will reflect carefully on whether the Bill, as currently drafted, goes far enough to meet these ambitions, as well as whether there is scope for the legislation to do more to embed those principles in practice.

[Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)]

My Lords, I thank the noble Lord, Lord Best, for his keen interest in and support for the Government’s intentions on mayoral development corporations. I can announce that earlier today, Minister Pennycook announced a consultation on a development corporation for Greater Cambridgeshire.

I begin with Amendment 133 in the name of the noble Lord, Lord Best. Clause 37 and Schedule 18 extend the ability to establish mayoral development corporations to all mayoral strategic authorities. They are powerful delivery vehicles that let mayors bring together private and public sector expertise to tackle strategic spatial challenges in their area. However, it remains the decision of each mayoral strategic authority as to whether a mayoral development corporation is the right vehicle in its area and for each challenge.

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[Lord Shipley (LD)]

My Lords, I will be very brief because we ought to hear from the Minister on the range of questions that have been produced, and I do not want to simply restate them. I have always supported greater investment by local government pension schemes. I should declare an interest, since I have a very small local government pension from the days when councillors were able to be part of the scheme. I just make that absolutely clear, even though the sum I receive is really very small.

I have always wanted local government pension schemes to invest more in their areas to drive growth in their areas. It seems an entirely laudable objective, but it has to be consistent with the scheme managers’ fiduciary responsibilities. As the noble Baroness, Lady Scott, and the noble Lord, Lord Jamieson, made clear in their explanatory statements, scheme managers have to remain independent and focused solely on the interests of scheme members. There are those two competing requirements.

I want to support the Government’s objectives here. This has to be the right thing to promote, although one has to be extremely careful. At this stage, that statement of principle from me is probably sufficient, and it would be useful to hear the Government’s response.

[Lord Wilson of Sedgefield (Lab)]

I am grateful to the noble Baroness for Amendments 148, 149, 150 and 153. I will try to clarify the questions that she asked and, if I cannot, I am more than willing to write to her. Some of these pension aspects are very technical.

These amendments relate to the important requirement that strategic authorities work with the Local Government Pension Scheme funds in their area. This mirrors the duty to co-operate with strategic authorities placed on LGPS funds in the Pension Schemes Bill. The aim is to help strategic authorities to identify local projects that are appropriate for pensions investment and drive growth.

I recognise the noble Baroness’s intention, in tabling Amendment 148, to seek to broaden the provisions to include other employers participating in the scheme. The clause requires the strategic authority itself, rather than its constituent authorities, to co-operate with the relevant pension fund. In my view, this is the correct approach. Strategic authorities are responsible for driving local growth; as such, they should be aware of the interests of housing associations, admitted bodies and other local employers. An additional requirement for multiple other organisations to collaborate with the LGPS would place an unnecessary burden on those employers.

I turn to Amendments 149 and 153. I recognise the intentions to preserve the independence of LGPS-administering authorities and to reduce the burden of regulation on their functions. I assure noble Lords that the Government are not seeking to undermine the fiduciary duties of local pension funds in any way. The decision on whether or not to invest in a particular asset will be made by the asset pool, not the fund. This will help protect the fund against potential conflicts of interest, ensuring that all investments are made in the interests of the fund. Supporting guidance will be clear that investments should only ever be made where that investment helps the investing pension fund to meet pension liabilities.

The Government want to see funds and asset pools working closely with combined authorities, including corporate joint committees in Wales, in order to identify and develop appropriate investment opportunities so that the investment might of the Local Government Pension Scheme can drive local growth. I share the view of the noble Baroness that this requirement must be workable. For this reason, the high-level requirement does not put a restrictive framework on exactly how strategic authorities must work with the scheme. It will be up to strategic authorities to establish a system that is workable for them. Further, I point your Lordships to the existing guidance for strategic authorities on the development of local growth plans, which supports strategic authorities in establishing a productive relationship with investors.

I turn now to Amendment 150. I thank the noble Baroness, Lady Stedman-Scott, for asking important questions regarding a requirement for funds to participate in an asset pool. Asset pooling is the cornerstone of the Government’s investment reforms for the LGPS, bringing significant benefits of scale and expertise. As I have said, the Government are not seeking to undermine the fiduciary duty of local pension funds in any way. The responsibility to set an investment strategy—the key driver of investment returns—will remain with funds, ensuring that they retain local accountability and decision-making and that they can drive performance. The duty in this clause is complementary to the duty that will be placed on LGPS funds through regulations made under the Pension Schemes Bill. It will work effectively only if the concept of participation is defined in the same way in both pieces of legislation. That is why the Government are tabling amendments to this clause to reflect changes that have been made to the Pension Schemes Bill.

A question was asked about pooling. Integrated models in which strategic advice and investment management are both delivered by the same fiduciary manager are commonly used in private sector schemes and internationally. These models can deliver greater value for money and economies of scale. Asset pool companies will be required to have robust policies and procedures to identify and manage conflicts of interest. In contrast to external advisers, asset pools owned solely by LGPS AAs are expected to provide services in their interest. They do not stand to gain financially from the partner fund taking their advice or from providing poor-quality advice. I will look again at the noble Baroness’s speech in Hansard to make sure that we have covered all her questions and so that she has what we are doing in writing.

I turn now to government Amendments 151, 152, 154, 155, 156 and 157. These minor and technical amendments correct the definition of participating in an asset pool company. They will accommodate a pool company structure where the pool is owned by a holding company, thereby allowing an existing pool—the Local Pensions Partnership—to be included in the definition. This is not a change in policy but a correction.

[Baroness Stedman-Scott (Con)]

My Lords, the Government have now confirmed a substantial programme of reform of the Local Government Pension Scheme through this Bill and the wider pensions Bill. Taken together, these measures represent a significant moment in the evolution of LGPS asset pooling and governance.

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Schedule 21 agreed.

[Lord Wilson of Sedgefield (Lab)]

I am intervening as the Whip just to say that this is rather a large group, which will probably take us to the time at which we should finish, at 8.15 pm. It is in the hands of noble Lords whether we complete the group or whether we have to split it and end up discussing it again in the next session.

Clause 44: Health improvement and health inequalities duty

Amendment 158

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