---

Local Democracy, Economic Development and Construction Bill [Lords]

The hon. Lady makes a point that I am coming to in about two minutes. However, to return to the point about wasting money, I have written down about 20 examples, whose costs run into billions of pounds. The grossest one, for which I can find no local government equivalent, is the exams fiasco last year. A process that had previously cost £10 million nationally now cost £610 million and went completely wrong, so that young people taking exams did not know their results and, when they did know them, suspected that they were wrong. There is no evidence base for saying that central Government is better than local government, although I also looked at what Ministers have been saying. The most explicit quote that I could find was from my right hon. Friend the Member for Pontefract and Castleford (Yvette Cooper), who said that local taxing would lead to""the worst kind of nimbyism…inequalities and…conservatism"." I do not agree with her. I believe that local taxing, local democracy and the right to throw the rascals out, as the Americans put it in one presidential election, are absolutely fundamental to what our society should be about. Before I move on to the details of the Bill, I want to mention two principles that ought to underlie it, and to point out that the Bill does not live up to the requirement that they involve. Neither principle would be thought strange in most other democracies. One is that democracy and the local taxation of services are related. If someone stands for election, they should say what money they are going to raise, and win or lose the vote on that basis. The second would involve a pretty fundamental change in how we think about things in this country. It is that central Government should justify their spending decisions to local government, rather than the other way around, because the evidence is that local government is better at it. I shall turn now to the details of the Bill. Clause 1 covers duties relating to the promotion of democracy—a matter that was also raised in the debate in the other place. If we look at the House of Commons guide to the Bill, we see that the provisions, which will tell people how to become councillors, how to access services and how to send in information, are going to cost local authorities about £22 million. Compared with some of the sums that we are talking about, that is not a great deal of money. It probably equates to a couple of posts per local authority around the country. The provision is completely unnecessary, however. I asked one of the people who works for me to find out on the internet how to become a local councillor and how to get all the necessary information. Within five minutes, the Directgov website had pointed us towards other websites and we had all the information that we needed. As I have said, not a great deal of money is involved, but clause 1 is really unnecessary. The point was well made by the hon. Member for Meriden (Mrs. Spelman) as well as by some Labour Members that most local authorities already take petitions. The fact is that everyone, whether they write a letter or send a petition to a local authority, deserves a response and should get one. I very much doubt that we need prescriptive legislation to achieve that. We just need a statement to that effect. The biggest issue relating to local democracy in my area in the past 12 months was the referendum on the proposals for a congestion charge in Greater Manchester, which would have created the largest congestion charge zone in the world. However, there were no real powers in place to enable that referendum to be held. In fact, it was held under section 116 of the Local Government Act 2003, and it could have been held under section 170 of the Transport Act 2000. As a result, there were no real rules for holding that referendum, in which more than 1 million people participated. Covering such circumstances would have been a more useful purpose for the Bill. I certainly have doubts about referendums, but there is no doubt that the electorate out there like the idea of holding a referendum on certain key issues. The one in the northern region has been mentioned, and there was also the one in Greater Manchester. Both had a higher turnout than the local elections, and we have to respect people's views in this regard. It is within the terms of the Bill's long title for this legislation to become a vehicle for putting regulations in place so we no longer need to hold referendums under strange parts of the Local Government Act. Having to do that in Greater Manchester meant that the so-called returning officer, Sir Neil McIntosh, who was paid £30,000 to do the job, could decide to consult only the promoters of the relevant Bill on what question to put, and did not put into the main question on the referendum paper the most controversial aspect of the proposal—the levying of a congestion charge or a new tax on people. Also, he would not see people such as myself who were opposed to the proposals. I think that that is quite scandalous. More than 2 million people were entitled to vote in that referendum and more than 1 million people did, and we should use this Bill to codify the procedure so that that sort of situation cannot happen again. In fact, the returning officer was so biased that the arrangement actually worked in favour of the no rather than the yes campaign. We have already discussed the regional development agencies and I would like to ask Ministers to clarify some issues relating to the north-west and co-operation. I have always made my views on RDAs clear: they should not have been set up and they should be abolished as quickly as possible, because they have no role whatever. It is not a question of businesses liking RDAs, as the Secretary of State suggested. No, they do not like RDAs, but they like the possibility of getting grants from them. So long as the money is not abolished and does not disappear, businesses would be pleased to get rid of the bureaucracy and deal directly with local authorities. I would particularly like to ask my Front-Bench colleagues whether they agree with the following statement from Steven Broomhead, the chief executive of the Northwest Regional Development Agency, who said that there was""not a shred of evidence that local authorities can deliver economic development on the ground"." Does anyone in the Chamber agree with that? I think that it is the kind of arrogance that comes with unaccountable quangos; it is not a basis for co-operation. I hope that my right hon. Friend will take note of that statement; I can give her the full reference if she wants it. It remains the case that, sometimes with the encouragement of officials, these quangos see themselves as in competition with local elected councils. They could not be more blatant in seeing themselves as delivering better services than local authorities do. As with the delivery of services by central Government, however, the reality is different. Because these quangos and RDAs have no democratic mandate, it is difficult for them—I want to be fair—to take decisions. They reach lowest common denominator decisions, where everything becomes a priority: seaside towns are a priority, as are rural communities, Cumbria and core cities. Until we look at the numbers involved and find out what is being consulted on, it is difficult to establish what exactly is happening. When we try to look at where the money is going, it becomes inexplicable. RDAs should be spending money on two main areas: primarily, creating a better economy and more jobs, and supporting regeneration. However, the money does not go to the areas where we would expect the most added value. The centre of Manchester, for example, should be responsible for 40 per cent. of the GVA—gross value added—for the north-west, and the centre of Liverpool for a significant chunk of the funds, yet the money is spread out quite differently with no justification. My solution is for the Government to take decisions. They should inquire whether the money is there for economic development or to alleviate poverty in some way—the two main reasons for spending public money—and explain what is happening in a way that the RDA, as it runs around in different directions, does not. What is the Bill's response to that problem? It is to consult leaders panels, but that does not deal with the fundamental democratic deficit. What it does is take the level up and provide some form of fig leaf for the regional development agencies that allows them to carry on, but it does not allow people a say in the ballot box. Let me finish my remarks. The Bill is a lost opportunity. I believe that local authorities—they are not perfect, and some are poor—are better than quangos at delivering economic development and other services. Even more fundamental, however, is the fact that local authorities are immediately accountable to the people through the ballot box. One of the aims of the Local Transport Act 2008 was to transfer highways powers to the integrated transport authorities. Combining that with leaders boards or prosperity boards or whatever they may be called, consisting of indirectly elected people, may well remove not only the highways powers but a series of other powers from people. They will not be able to say "I do not want those double yellow lines in front of my shops, but I do want investment," because they cannot vote for or against those with whom they must deal.