Clause 2 - Control of borrowing
Local Government Bill
9:45 am
Mr Philip Hammond (Runnymede and Weybridge, Conservative)
I guess that the hon. Gentleman is right, in that the regulations propose that, for the time
being, the CIPFA code would be the matter to which regard had to be taken. I accept his point.
My other worry about the amendments concerns architecture. The hon. Gentleman wants to place on an independent third party a duty under primary legislation. The amendment states that the Chartered Institute of Public Finance and Accountancy
''shall prepare and issue a Prudent Code''.
Will it be paid for taking such action? What will happen if it does not do that? Will it be carted off to Pentonville? What would happen if it were disbanded? There is a difficulty in the architecture of the Bill whereby it could impose a duty on an independent third party.
We must accept that the Government have published draft regulations. Incidentally, I should express the gratitude of the Committee to the Minister for letting us have sight of the draft regulations. I do not wish to sound churlish, but they were not delivered early enough to have a huge influence on the drafting of amendments that would be unstarred for today. We received them only on Thursday evening. However, it is good that we have the draft regulations, as they set out that the Government's intention, at least initially, is to use the CIPFA guidance.
The clause is not perfect because the Government have the option of doing something else in the future, but I do not believe that the hon. Gentleman's solution would work. It would not allow for parliamentary scrutiny. It would not be workable in imposing a duty on a third body. While I sympathise with his intentions, we must all swallow hard, accept the draft regulation and the Government's good intentions on this occasion.