Andrew Pelling (Croydon Central, Conservative)

I beg to move, That the clause be read a Second time.

It is a pleasure to serve under your chairmanship once again, Lady Winterton. I am cognisant that there are still further clauses for consideration, so I shall attempt to be brief in speaking on clauses for the rest of the day.

A good deal of attention was given to abatement of GLA members’ salaries when the Greater London Authority Act 1999 was considered. The then Minister for London, the right hon. Member for Greenwich and Woolwich (Mr. Raynsford), when pressed by the hon. Member for North Southwark and Bermondsey (Simon Hughes), gave good guidance on the issue of  MPs drawing full pay, either as members of the London assembly or indeed as Mayor, for two public posts. He said:

“It is proper that people should not be paid from the public purse for performing two functions without an abatement of their salaries.”—[Official Report, 4 November 1999; Vol. 323, c. 568.]

I must declare an interest in the matter as a member of the London assembly. Currently, assembly members who are Members of Parliament receive two thirds of the normal salary—they are abated by a third. Indeed, the finance officer of the GLA, the excellent Anne McMeel, was in my office the day after the general election to advise me of the good news that the abatement would take place. She gave the information with great enthusiasm. At least there was some saving for the London authority.

What has changed since the 1999 Act is that, quite properly, we have seen a significant increase in allowances for members of local authorities. That is most justified by the work that they do. Allowances for executive council members are now realistic in reflecting the amount of work done under the stronger executive model pursued by the Government. Thus by changes under the Local Authorities (Members’ Allowances)(England) Regulations 2001, following the guidance from Professor Malcolm Grant in his brief, “Making allowances: the remuneration of councillors in London”, and in work currently being done by Rodney Brooke CBE, significant allowances are now being paid to councillors. In London, under the current recommendation, the basic rate is £10,000: in some councils the rate is above that and in others it is below. However, payments for executive members can be anything from £32,000 to £51,000 per year. An executive member of a local authority who also sits as a London assembly member could receive some £100,000 a year from the public purse. It might be worth considering whether, in the changed circumstances since the 1999 Act, the abatement should also apply to senior executive members—not ordinary back-bench-level councillors or people chairing the licensing committee—who should be providing such a saving to the public purse.

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

I thank the hon. Gentleman for tabling the amendment, as it provides an opportunity for me to highlight one of the Government’s proposed minor changes from the GLA review, which we intend to take forward through an order following the passage of the Bill.

We propose to abate the salary of the Mayor or an assembly member who is also a Member of Parliament or a Member of the European Parliament by two thirds of salary, rather than one third. That proposal reflects one of the key recommendations of the Senior Salaries Review Body’s last report, in 2005, on the remuneration of the Mayor and assembly members. The SSRB’s reasoning for the level of abatement to increase to two thirds of salary, which the Government accept, was that membership of the assembly should generally be considered to be a full-time role and that it is unlikely that the Mayor and assembly members will hold dual mandates beyond a short period. It would also bring the GLA in line with the salary abatement arrangements for the Scottish Parliament and the Welsh Assembly.

We are aware, of course, that the hon. Members for Croydon, Central and for Bromley and Chislehurst are also assembly members and are accordingly subject to this order. I reassure them that the Government do not intend to bring a revised order into force until after the next mayoral and assembly elections in 2008.

Andrew Pelling (Croydon Central, Conservative)

That is most gracious.

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

We will also consult widely before making the order.

I am afraid that the Government cannot accept the amendment. As the hon. Gentleman said, the amendment would add local councillors who receive any allowance for executive responsibilities to the list of memberships explicitly referred to in section 25 of the 1999 Act which could be subject to the order by the Secretary of State. The Secretary of State already has the power to include councillors who are in receipt of an allowance for undertaking executive responsibilities, under section 25(1)(c), which allows the Secretary of State to specify the membership of other public bodies beyond the UK/European Parliaments to be covered in the order. Accordingly, the amendment is not strictly necessary and only highlights the fact that this category of political representative may be affected by an order under section 25.

Furthermore, the Government have no plans to extend our proposed revised order on the abatement of salaries to cover councillors who are in receipt of an allowance for undertaking executive responsibilities. Such an extension would raise a number of complicated issues, such as the treatment of councillors who undertake executive functions on a part-time basis, which would need to be considered carefully, as I am sure the hon. Gentleman would accept.

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

Does the Minister agree that the hon. Member for Croydon, Central mentioned a councillor with executive responsibilities on a salary of £51,000? That is the exception, not the rule.

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

I am sure that the hon. Gentleman is accurate. To reinforce the point that he has raised, the Senior Salaries Review Body has also not considered the issue to date. It seems sensible, from our point of view, for the SSRB—as an independent body with considerable expertise in deciding such matters—to consider the issue in any future reviews of the Mayor and assembly members’ remuneration before Ministers consider any legislative changes. If in future the board decides that such a legislative change is justified, I am sure that Ministers would want to consider the issue again. With that explanation, I request that the hon. Member for Croydon, Central consider withdrawing the motion.

Andrew Pelling (Croydon Central, Conservative)

I think the Minister’s suggestion that it might be of interest to the Senior Salaries Review Body is appropriate. I beg to ask leave to withdraw the motion.