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Local Government

My Lords, this has been an extremely thoughtful and good debate. Like all noble Lords who have spoken, I am very grateful to the noble Lord, Lord Bowness, for all the experience that he has brought to this debate and for giving us the opportunity to exchange views. There have been excellent speeches from all around the House. I particularly pay tribute to the contribution from my noble friend Lady Hollis, which, as has already been remarked on, was the tour de force that we have come to expect. She is now moving into another area—where we had all better watch out. I welcome the opportunity to congratulate noble Lords on their powerful advocacy of the value and purpose of local government. I pay tribute, as many have done, to the quality, the leadership and the commitment that go into it and the value that it represents. Somewhat to my surprise, there is consensus on a series of issues across this debate. We have agreed—I certainly include myself in this—on the importance of strong local government and the need to take decisions at the most local level and at the right level. We have agreed the absolutely vital importance of engaging the citizen and of reconnecting the citizen to local government and thereby to national government. We have agreed that whatever changes might be anticipated, they should be driven from below and not imposed from above, and that there are wide geographical and political variations across our communities which must be reflected in the organisation itself. This debate comes at an important time in local government. I hope to be able to pick up on the main themes and to reassure noble Lords on our approach to the whole question of what it is right to do now, and what should influence our decisions. Much of what we are doing should be not only reassuring, but positively encouraging to all noble Lords who have raised these issues today. It is an important time not least because of the local elections. Again, I hope that people will turn out in their millions to vote; I hope that people will bother to vote. That, of course, is partly why we are having this debate. It is no secret that in the summer we intend to publish a local government White Paper. That will be about connecting local government to local people and developing better relationships between local and national government. Noble Lords would not expect me to pre-empt what will be in the White Paper. The discussions on it have been extremely wide-ranging—there is nothing covert here and I continue to defend the point that this is not a review. We have engaged with all areas of local government, with business and with the voluntary sector to discuss the options of what may be in front of us. I shall take the opportunity today to set out what I can on those issues. I shall answer as many detailed points as possible, but I may find myself writing to noble Lords in the usual way. I shall start where the noble Lord, Lord Bowness, began, by addressing the common concern about the neglect of local government in terms of how people respond to it, what that means in terms of disengagement from formal democratic politics and how serious the problem is. We should be clear that this is not the same as people being apathetic; they are not. They are deeply concerned about a whole range of issues that affect them, whether it is the environment, social care for the elderly or the quality of education. But as Sir Michael Lyons noted in his report, there is a genuine ignorance of what local government does and what it can do. At the same time, society is changing in all sorts of ways. People are better educated, more articulate and, through technology, able to obtain information and exert influence; I am talking about e-enabling, something that we have never been able to do before. We face an uncertain environmental future and stubborn inequalities in society, but at the same time we have new tools and new ways of looking at these things. As a government, we have tried to respond to these challenges over the years. As part of that, we need to debate the future shape and nature not just of local government, but of local governance. Let me say to all noble Lords who have raised these questions in different ways—here I mention the noble Lords, Lord Brooke and Lord Bowness, the noble Baroness, Lady Scott, and my noble friend Lady Hollis—that this is not a debate about how to centralise power in the hands of Whitehall and it is not a debate about how to impose regional assemblies by stealth. It is not a debate about imposing anything on local authorities either by stealth or openly, and it is not about a conspiracy to abolish counties or districts. It is a debate about how our future local government—and local governance—can be best equipped to do the job that it wants to do and can do best, a point made by the noble Baroness, Lady Hanham. This is all about developing the role of local government as a shaper of places. The Office of the Deputy Prime Minister is a key partner of local authorities in creating sustainable communities. Over the past seven or eight years, we have tried to achieve a balance—not sapping local authorities as suggested by the noble Lord, Lord Bowness, but strengthening them in relation to their functions. We have created strong national standards in the form of CPA and best value and so forth, but we have accompanied those with a significant increase in resources. Since 1997, the increase in government grant for local services has been 39 per cent in real terms. But even more important is increasing the capacity of local institutions through initiatives such as our capacity-building programmes. The results are there to see. The CPA framework has been assessed by the Audit Commission—I pay tribute to the work of the noble Lord, Lord Bowness, on this. Seventy per cent of councils are judged to be improving well or strongly, and 68 per cent of councils have achieved a three or four-star rating and, given the efficiencies, are delivering more for less. This year, there has been a council tax increase of, on average, 4.2 per cent. The councils should be congratulated on all these achievements. We have seen the effects in the outcomes—for example, the number of 15 year-olds achieving five or more GCSEs at grades A* to C has gone up by 20 per cent since 1997. So it is clear that local authorities have responded to the challenges. The context itself is more challenging because people’s expectations are higher and they are becoming increasingly adept at articulating them, at complaining, at knowing their rights and at seeking influence. We cannot leave education only to the teachers. Whether people are patients, parents or consumers, we know that they want to be able to shape and influence the services that they receive. I am entirely at one with the noble Baroness, Lady Hanham, on that. When we talk about the power gap, we mean the gap between what people want to be able to do and their sense that they do not have access to information and access to influence. Our response has been the idea of double devolution. This is certainly not devolution simply to the regions—and I shall briefly come on to that later—but devolution to the town halls and beyond, to communities and to individual citizens. We want to ensure that the decisions that affect people’s lives are taken at the lowest possible level. I think that there is consensus around the House about that, whether we are talking about individual budgets for disabled people or a community call for action which allows people to say when they think services are not coming up to scratch and to do something about it. We can see something like that in the Police and Justice Bill. When we refer to what we can achieve at the neighbourhood level—which is where people live—there is a very practical and simple agenda. Whether we are talking about extending the neighbourhood management model so that we can see the kind of transformation that has occurred in Broadwater Farm, or whether we are talking about the neighbourhood policing developments, where we want to see a neighbourhood team in every community, the agenda is extremely practical. I turn now to the role of local government and the wide-ranging debate that we have had about what we see as the way forward. Local government in today’s world has to have strong and visible leaders. It has to be not only a provider or a commissioner but also a shaper of places and a promoter of well-being—a very radical power—and it has to do this in a way which takes account of the circumstances of an area and its specific challenges, whether it is a rural area or an inner-city area. Whether you look at Corby or Gateshead or Bedford, local authorities are positing a vision for their local communities which they may see mediated through the arts, new industry and wholesale development. For that role to work, we need strong and self-confident local government—that is why we established the Leadership Centre for Local Government—but we also need accountable government. The Local Government Act started that process and, of course, introduced the leader and cabinet system and the elected mayors. I have not seen in any of the responses to our debate so far on the future of local government that people are calling for the return of the committee system. We have seen clearer executive leadership, and we need that. We need a choice of models of governance, specifically to reflect the sense that places are different. We also need stronger scrutiny. I should say to the noble Baroness, Lady Byford, that we are very much committed to reinforcing a distinctive role for local councillors, neighbourhood champions, leaders and advocates. The point about local area authority is that it gives more certainty and transparency in a very confusing system of hundreds of funding streams being brought together in partnership, with local authorities at the heart. That is why so many local authorities have come forward in the past year and have demanded to be a part of that. In the debate, we will of course have to look at the structuring and the way in which services are being delivered. I want to reassure the noble Lord, Lord Bowness, in particular, that driving this is not only the communities’ expectations for a more effective and responsive system, but an increasing appetite among some areas of local government for a more coherent and simpler system. This is a genuine debate about whether to open the door to reorganisation of the 34 two-tier English counties. It is not about imposing a single unitary system. It is the opposite of that; we are looking at what local authorities say that they need in order to deliver the benefits and services which are so badly needed. That is why the ministerial dialogues and round-table events have spread so far and wide across this constituency. It is not about structure for its own sake or about a battle between the supremacy of counties and districts; it is about whether we can respond in the future to changing needs. One size does not fit all and that is one of the principles that drives us. No decision has been taken about whether to go for reorganisation of the two-tier structure and we will continue the dialogue until we come forward with the White Paper. I say to my noble friend Lady Hollis, who made a magnificent speech, that we are looking at criteria and considering the issues that she mentioned. We must consider costs, because the benefits must outweigh the costs. We will have a full consultation on the White Paper, followed by a full debate. Let me say to the noble Baroness, Lady Hanham, that we expect and intend the 2007 elections to go ahead. We do not want to impose anything. The noble Lord, Lord Bowness, raised important questions about planning which point to the ways in which local authorities are responding and using their powers. They are using a system of planning that is more open and plan-led; they have a much more certain grasp through local development frameworks of what they are doing and they have to be responsive through the statements of community involvement to the local population in a way that they have never had to be before. That is a great strength in the system. But the noble Lord is right to raise those issues. The noble Baroness, Lady Byford, was concerned about the way in which planning is being delivered. We have put £600 million into the planning delivery grant to boost the capacity of local authorities to plan more intelligently for more quality for a greater number of people. On the regional agenda, I do not have to tell this House that we have no plans to hold further referendums until a region expresses an interest, but that does not mean that we do not commit ourselves to using what we have in the regions to reduce inequalities and promote economic growth across our country. With regard to the regional assemblies, RDAs and government offices, there is a lot of Conservative authority support. We must see how we can connect that agenda with the new agenda for cities. As my noble friend said, our cities drive our economic agenda, our innovation, our skills agenda and employment. We want them to make the most of what they can do because, although we have seen a renaissance in our cities, we are still not doing as well as European cities. We are still not in the same league and we need to be, for the sake of our young people. We are asking the eight core cities what is holding them back. We want them to give us a business plan for change and tell us how we can provide more support for ensuring that our cities and our city regions—which are so influenced by the cities and have so much to contribute—make the most of what they can do. In relation to what the noble Baroness, Lady Byford, said, our rural areas are just as important. The work of the Affordable Rural Housing Commission and the Joseph Rowntree Foundation points to the challenge of reinforcing the vitality of our villages and market towns while meeting a very diverse need which is local but has to address the wider issues of economic growth as well. I have not been able to address all the issues that have been raised, but I hope that this debate is the beginning of a longer conversation in this House about the White Paper, the GLA review and whatever will come out of them. I reiterate that, whatever changes we make, they will not be imposed or made covertly; they will have been brought to our notice because the evidence suggests that there is a better way of doing things. I end on that assurance. I again thank the noble Lord, Lord Bowness, for creating this opportunity for a very good debate.