New Clause 2
Local Democracy, Economic Development and Construction Bill [Lords]
1:45 pm

Paul Goodman (Shadow Minister, Communities and Local Government; Wycombe, Conservative)

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

It is a pleasure to see you in the Chair, Mr. Illsley. Although time is drawing on, the new clauses give us a chance to change the Bill from a centralising measure into a real instrument of localisation. The hon. Member for Manchester, Blackley (Graham Stringer) is not here to move his new clause—the Committee has previously discussed his mysterious disappearance from the Committee membership and have speculated about where he may be now—but we have decided, in a spirit of benign good will, to move the new clause for him and see how we get on.

Although the new clause may be technically flawed, so we are not absolutely insistent on pressing it to a vote at this stage, it gives us an opportunity to discuss and consider the whole principle of referendums in relation to local government. The new clause raises questions such as whether such referendums should take place, how often they should take place, and where they should fit in the general scheme of things. The big issue at stake, which my right hon. Friend the Member for Skipton and Ripon explored during part of his speech on Second Reading, is the balance that must be struck  in any democracy between representative democracy—electing Members of Parliament, councillors and so on to represent views in the Commons or, in this case, local councils—and direct democracy, which includes the use of referendums.

It has to be admitted that traditionally Britain has not used referendums greatly, and that the way of some places abroad, such as California and Switzerland, has been to use them more often. Since the 1970s, however, we have begun to use referendums at national level to decide important constitutional issues with greater frequency. There was a 1975 referendum on EU membership and there have been referendums in Scotland, Wales and Northern Ireland on whether Parliaments and Assemblies should be set up in those parts of the United Kingdom, so it seems right at this point to pause and consider whether it would be right to have local referendums run by local councils and, if so, in what circumstances.

If we take a step back from the new clause, it is clear that, in contemporary politics, the debate between when representative democracy should apply and when direct democracy should apply has become very live. It would be out of order for me to spend any time on the recent expenses debacle, but it is a sign of the degree to which the internet and modern communication and technology are leading many people to probe and question the traditional elected representative model. Indeed, we have heard calls, which I am sure will be considered in other contexts, for the recalling of Members of Parliament between elections. That argument is about the degree to which the traditional model of the electorate electing a representative and allowing them—as the electorate wish—to stand again for election should apply.

My hon. Friend the Member for Harwich (Mr. Carswell), who is sadly not a member of the Committee, and my former work colleague, Daniel Hannan, have written a book called “The Plan: Twelve Months to Renew Britain” in which they wish local referendums to be a major element in how local democracy works. I am kicking myself for not bringing my copy along to wave at the Committee and excite its interest even further. My hon. Friend and Mr. Hannan want quite a low trigger for local referendums.

Our view is that there has to be a balance, but that the traditional model, whereby it is assumed at local level that councillors will be elected and then put up for re-election every four years—just like Members of Parliament and the parliamentary cycle—and the referendum instrument can never apply, is not the right balance.

Stewart Jackson (Shadow Minister, Communities and Local Government; Peterborough, Conservative)

My hon. Friend is making a very persuasive and cogent argument for referendums. Does he agree that referendums seek to revitalise and rejuvenate local democracy, as seen, for instance, in the Greater Manchester congestion charging referendum, which was very successful in engaging people on the issue of expenditure and transportation? Before that, he will remember the Bristol city council referendum on council tax when people were engaged in discussion about local public expenditure priorities.

Paul Goodman (Shadow Minister, Communities and Local Government; Wycombe, Conservative)

I am grateful to my hon. Friend. He is right that local referendums can fulfil that role. The question is about where the balance lies, as it would be with national Government.

David Curry (Skipton and Ripon, Conservative)

My hon. Friend will recall that referendums have been held with built-in criteria on turnout. Those failed. If one does not have criteria, one could have a referendum, but not a legitimate outcome.

Paul Goodman (Shadow Minister, Communities and Local Government; Wycombe, Conservative)

My right hon. Friend is correct. The amendment simply sets out the machinery by which a referendum would operate. The question of turnout is extremely important. I must not get diverted to national referendums, but he will remember that the question of turnout was vital in the consideration of Scottish devolution between 1974 and 1979. He makes an important point. Where should the balance lie? We are persuaded that referendums should apply to council tax rises above the national threshold, as is stated in our Green Paper.

In conclusion, we think that referendums have a place. We would be very interested to hear what the Minister has to say about the new clause and whether the Government believe that there is no place at all for referendums in local government. That would be a basis for arguing against the new clause. However, we think that the hon. Member for Manchester, Blackley did well to table the new clause to allow debate. We are grateful to have the opportunity to consider it this afternoon.

Julia Goldsworthy (Falmouth and Camborne, Liberal Democrat)

In moving the new clause, the hon. Member for Wycombe raised an interesting philosophical question about the extent to which our democracy is a representative one or one in which more decisions should be taken by referendums.

However, I wonder whether the hon. Gentleman has a one-eyed view on how the proposal should work. For example, he speaks about the need for the issue to be addressed at local level, but not necessarily at parliamentary level to the same extent. Equally, he referred to his party’s suggestion for referendums if council tax increases are above a specific threshold. Presumably the flip side is that people should have the right to call a referendum if they feel that cuts in services extend beyond what they feel is acceptable. He did not seem to offer a balanced view.

Paul Goodman (Shadow Minister, Communities and Local Government; Wycombe, Conservative)

Of course, we have been calling for a referendum on the Lisbon treaty, which is a national referendum.

Julia Goldsworthy (Falmouth and Camborne, Liberal Democrat)

That is true. I have not had the pleasure of reading the document to which the hon. Gentleman referred, but it sounded as though it referred only to the need for a mechanism at local level, rather than to the equivalent national mechanism.

My hon. Friend the Member for North Cornwall and I are sympathetic to a facility for people living in a local authority area to have the right to trigger a referendum. Our question is on a theme that is familiar from earlier parts of the Bill: is it necessary to set that out in primary legislation? I would be interested to hear from the Minister the extent to which the facility is already available to local authorities that may wish to use it.

The new clause does not set out the precise mechanism. It merely requires that a mechanism be in place. We are sympathetic to the sentiment behind the new clause, but the Minister’s comments might be helpful in setting out the extent to which the option is already available to local authorities.

Rosie Winterton (Minister of State (Yorkshire and the Humber), Department for Communities and Local Government; Doncaster Central, Labour)

This is an important issue. Members of the Committee have asked whether the current powers should go further, and what they actually are. At present, under section 116 of the Local Government Act 2003, principal local authorities in England already enjoy considerable flexibility to hold advisory referendums. The power is widely drawn. It gives councils a great deal of freedom and flexibility to hold referendums on any issue relating to their functions or their powers of well-being set out in the Local Government Act 2000.

It may well be, as a result of the petitions part of the Bill, that local councils could decide to hold a local poll as part of their substantive response as required by clause 14, but that is about councils having the ability to choose a referendum if they feel that it would be the right thing to do.

While the petition provisions in chapter 2 of the Bill and the existing powers in section 116 of the 2003 Act permit councils to hold referendums, the new clause would require them to do so. We believe that it is right to give local authorities flexibility, but over and above that there would be an additional, uncosted burden. Therefore, the implications for local authorities could be considerable. We believe that the new clause goes too far in requiring referendums when there is already a power to hold them. I hope that the Committee will reject it.

Paul Goodman (Shadow Minister, Communities and Local Government; Wycombe, Conservative)

In the light of what the Minister has said about the effects of the new clause tabled by her hon. Friend the Member for Manchester, Blackley—she clearly did not like it very much—which would require local authorities to have referendums, we will not seek to press the new clause to a vote, although we have enjoyed the opportunity to have the debate. I beg to ask leave to withdraw the clause.