Jim Fitzpatrick (Parliamentary Under-Secretary, Department of Trade and Industry; Poplar & Canning Town, Labour)

The clause amends section 85 of the 1999 Act to provide for separate component budget requirements for the Mayor and assembly. The GLA is a major precepting authority, and requires each London borough council to raise a certain amount annually from London council tax payers in its area to help fund GLA services. The 1999 Act sets out rules which the authority must follow in calculating its consolidated budget requirement which, in turn, allows the GLA to calculate the basic amount of its council tax—its precept. The GLA’s consolidated budget requirement is made up of the aggregate of the component budget requirements for the GLA itself and each of the four functional bodies.

The clause provides that, instead of a single GLA component budget requirement, there will be separate component budget requirements for the Mayor and the assembly. The assembly’s component budget requirement is the requirement in relation to the assembly’s functions: estimates of expenditure, allowances for contingencies and use of reserves in respect of assembly members and staff, goods and services procured solely for the purposes of the assembly, and the London transport users committee, known as London TravelWatch.

The Mayor’s component budget requirement is everything that would otherwise make up the authority’s component budget requirement. The clause provides for a transparent and discrete budget for the assembly’s functions within the existing structures of the budget-setting process. It gives London council tax payers a transparent statement of the cost of delivering the assembly’s functions and it offers the assembly the reassurance of having its own budget separate from that of the Mayor.

Michael Gove (Shadow Minister (Housing), Communities and Local Government; Surrey Heath, Conservative)

We approve of this clause, but we have tabled some subsequent amendments that relate precisely to how the assembly’s part of the budget might be calculated. I shall try not to stray into that territory now. I shall simply say that we want our amendments to underpin the reassurance of which the Under-Secretary spoke. We believe that it is absolutely right for the purpose of transparency and in the interests of Londoners that it is perfectly clear what the Mayor is spending on his executive function and what the assembly is spending to discharge its scrutiny role. For that reason, we welcome both the terms and the intentions of clause 12, but we fear that some of the later aspects of the Bill do not live up to the good intentions that it outlines.

Tom Brake (Shadow Minister, Department for Communities and Local Government; Carshalton & Wallington, Liberal Democrat)

I support clause 12. We support the principle of separate component budgets but, as the spokesman for the official Opposition—the hon. Member for Surrey Heath—says, we have concerns about the assembly’s budget. Those concerns  are reflected in the amendments that are associated with clause 13, so I suspect that we will have a much longer debate on that clause.