Clause 1 — Matters to which this Part applies

Prayers – in the House of Commons at 1:39 pm on 12th March 2010.

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Photo of Christopher Chope Christopher Chope Conservative, Christchurch 1:39 pm, 12th March 2010

I beg to move amendment 8, page 1, line 12, leave out 'section' and insert 'significant section'.

Photo of Sylvia Heal Sylvia Heal Deputy Speaker

With this it will be convenient to discuss the following: amendment 9, page 1, line 15, leave out 'or' and insert 'and'.

Amendment 10, page 1, line 19, at end insert

'at the point of use of the public service by the public'.

Amendment 1, page 2, line 3, at end insert-

'( ) Before making any regulations under this section the Secretary of State must consider their potential effect on small businesses and voluntary or community interest organisations.

For this purpose-

"small business" means a business that employs fewer than 50 employees;

"voluntary or community interest organisation" means an organisation (other than a local authority or other public body) whose activities are carried on-

(a) otherwise than for profit, or(b) for the benefit of the community on the basis that any profits are reinvested in the business of the organisation or applied for the benefit of the community.'.

Amendment 6, page 2, line 4, at end insert-

'(8) The Secretary of State must on an annual basis review the meaning of a "designated authority or person", with a view to removing any authority or person that no longer meets the definition of a "designated authority or person".'.

Amendment 14, in clause 3, page 2, line 15, leave out 'negative' and insert 'the affirmative'.

Amendment 17, page 2, line 31, at end insert-

'(i) only where that person is reasonably able to attend and answer questions within their personal resource base or that of the organisation they represent, and

(ii) only where the requirement for such attendance is not in contradiction to part of an existing formal agreement the person or the organisation they represent has entered into to provide public services'.

Amendment 18, page 2, line 42, leave out 'person' and insert 'the role of the person'.

Amendment 16, page 3, line 1, leave out 'negative' and insert 'the affirmative'.

Amendment 21, in clause 4, page 3, line 15, leave out 'two' and insert 'three'.

Amendment 22, page 3, line 20, at end insert-

'(i) only where such compliance is reasonable within the resource base of the designated organisation or person.

(ii) only where such compliance is not in contradiction to part of an existing formal agreement the designated organisation or person has entered into to provide public services'.

Amendment 20, page 3, line 23, leave out 'negative' and insert 'the affirmative'.

Amendment 23, in clause 6, page 4, line 16, leave out from 'England' to end of line 17.

Amendment 24, in clause 7, page 5, line 15, at end insert-

'(5) The Secretary of State must bring forward regulations to allow for joint overview and scrutiny committees to be established between county councils and one or more district councils in their area, as provided for in the Local Democracy, Economic Development and Construction Act 2009, before the provisions of this Act come into force.'.

Amendment 26, in clause 10, page 6, leave out lines 9 to 12 and insert-

'(3) All regulations under this Act are subject to "the affirmative resolution procedure", and the regulations must not be made unless a draft of the statutory instrument containing them has been laid before and approved by a resolution of each House of Parliament.'.

Amendment 27, page 6, leave out lines 13 to 15.

Amendment 28, page 6, leave out lines 16 to 18.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch

I am speaking to these amendments on behalf of my hon. Friend Justine Greening, who represents the constituency in which I had the privilege to be born-some years ago.

Amendment 8 would leave out "section" and insert "significant section"; amendment 9 would leave out "or" and insert "and", and amendment 10 would insert

"at the point of use of the public service by the public".

These three amendments, along with the others in the group, are part of a theme. I know that my hon. Friend the Member for Putney, like me, does not agree with too much prescription in local government. Indeed, we can now see that the Local Government Act 2000, which required most local authorities in England to abolish the traditional committee system of governance and to adopt new executive structures, was unnecessarily prescriptive. That is why my hon. Friend seeks through the amendments to reduce the level of prescription and the extent of the regulation-making powers.

Let us look at the amendments in more detail. Amendment 8 would narrow the definition of a "public service" for the Bill's purposes. In order to fit in with the Bill's parameters, "public service" would be

"a service provided to the public, or a significant section of the public, that...is provided in the exercise of functions of a public nature or under statutory authority,"

"and"-rather than "or", as affected by amendment 9-

"is wholly or partly funded by grants, subsidies or other financial assistance from central or local government funds".

Those two amendments are complemented by amendment 10, which changes clause 1(3)(c) by adding additional words that would make it

"irrelevant whether a service is provided on payment or without payment at the point of use of the public service by the public".

Effectively, the promoter and his supporters think that local authorities should branch out from their core business into the business of looking at local public services other than the ones run by the council itself. They believe it would be a good idea for the local council to hold these other public services to account, irrespective of whether they are provided by other public bodies or private companies delivering public services. The promoters argue that councillors will have the ability to shine a spotlight on services that they do not think are delivering for local people and will be able to demand action on behalf of their communities to resolve local problems.

As I see it, however, the difficulty is that we already have local authorities up and down and country that are not even getting on properly with their core business. If they cannot cope with their core business and are always complaining-well, not always, but quite often-about the lack of resources they have to discharge that business, why should we let them nose around in other public services in the area? Why cannot we leave the people charged with taking responsibility for those services to get on with providing them and to be accountable to the public either through their Members of Parliament or through some other means? If they are in receipt of public funds, all sorts of methods and avenues of accountability are available. Why should we want to get the local council involved in all that?

I remember saying, when I was leader of a local authority, that it was a legitimate part of an authority's business to transfer powers from another authority: for example, to abolish the Greater London Council and give its powers to the London boroughs, or to abolish the Inner London Education Authority and give its powers to local councils. However, I think that that is different from the arrangement envisaged in the Bill, which would enable councils to sick their noses into activities that were not part of their core business. Amendments 8, 9 and 10 are designed to mitigate the adverse consequences of that.

I am delighted to see that Mr. Raynsford is present. His amendment 1 states:

"Before making any regulations under this section"- clause 1-

"the Secretary of State must consider their potential effect on small businesses and voluntary or community...organisations."

That strikes me as an important and sensible safeguard, which accords with the view of my hon. Friend the Member for Putney that local authorities should not start interfering in areas where they ought not to interfere. If before making regulations the Secretary of State had to consider their potential effect on small businesses and so on, it would probably be to the good, particularly if that Secretary of State was a member of a Conservative Government.

Amendment 6 proposes to insert the following provision in clause 1:

"The Secretary of State must on an annual basis review the meaning of a 'designated authority or person', with a view to removing any authority or person...that no longer meets the definition of a 'designated authority or person'.'."

I admit that I have not discussed the wording with my hon. Friend the Member for Putney, but it seems pretty innocuous and sensible to me-as, indeed, does amendment 17, which proposes to insert in clause 3 the words,

"only where that person is reasonably able to attend and answer questions".

Clause 3 is headed "Power to require information", and states:

"An overview and scrutiny committee may by notice in writing require a designated authority or person...to provide...information".

Subsection (1)(b) provides that the overview and scrutiny committee may

"require a designated authority or person...for that purpose to send an appropriate person to attend before the committee to answer questions."

Amendment 17 suggests that that should not be a general power, but should be limited to circumstances in which the person who is asked to attend

"is reasonably able to attend and answer questions within their personal resource base".

That is not an expression with which I am familiar, but I imagine it means information that it is in their power to give. My hon. Friend the Member for Putney might, for example, have had in mind the brain of the person who is being asked to answer the questions, because one could describe one's brain as a "personal resource base"-I am now speculating a little, however.

It is also necessary to ensure that this could only be done

"where the requirement for such attendance is not in contradiction to part of an existing formal agreement the person or the organisation they represent has entered into to provide public services".

That addition speaks for itself, and it would limit the power to require information under clause 3.

The same can be said of amendment 18. Clause 3(3)(b)(v) currently refers to

"the description of person who is (or is not) an appropriate person."

The amendment would replace "person" with

"the role of the person", and I think that is what the drafter of the Bill intended. He was concerned about not the description of the person-such as whether they had long or short hair-but the role of that person. I am therefore sure that my hon. Friend's amendment is a more accurate reflection of the original intentions of the Bill's promoter.

The other amendments in the group refer to a number of further issues, such as whether there should be affirmative resolutions.

Photo of Simon Burns Simon Burns Opposition Whip (Commons) 1:45 pm, 12th March 2010

Does my hon. Friend agree that it is desirable and important that we have the affirmative, rather than the negative, procedure? Given that one is not able to amend a statutory instrument or regulation, and that instead they have to be taken on an all-or-nothing basis, having the affirmative procedure guarantees, or at least enhances, the chance that they will actually be debated so that the Government of the day can be held to account on the contents of the order or regulation.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch

As so often, my hon. Friend makes a very important point. We are talking here about interfering with another elected body-local authorities-and we should not change their regime without giving proper notice and ensuring that we can have a proper debate in this House. We should pay due respect to such democratically elected bodies. We are also talking about the implications for other public sector bodies in respect of their interactions with local authorities, and that is another important issue. If we are going to change these regimes, we must ensure that there is a chance for proper debate. Although we would not be able to make any amendments, of course, there would be more chance of any consultation beforehand being meaningful if it were conducted in the knowledge that the statutory instrument could not just go through on the nod, and that there would have to be a debate in this place. I think that all my hon. Friend's amendments dealing with changing the way in which regulations could be amended are very important.

Amendment 22 to clause 4 states:

"page 3, line 20, at end insert-

(i) only where such compliance is reasonable within the resource base of the designated organisation or person.

(ii) only where such compliance is not in contradiction to part of an existing formal agreement".

That is similar to the one that I described earlier.

Then we come to amendment 23 to clause 6, which states:

"page 4, line 16, leave out from 'England' to end of line 17."

That is a sensible way of restricting the ambit of clause 6, which is the interpretation clause. It states:

"'designated authority or person' has the meaning given by section 1(4);

'local authority' means-

(a) a county council in England,

(b) a district council in England, other than a council for a district in a county for which there is a county council'" .

Under the amendment, the reference would be to all district councils, rather than just to those in a county.

Photo of Simon Burns Simon Burns Opposition Whip (Commons)

Perhaps I should intervene on the Minister later for an answer to this question. In the interpretation clause, there is no mention of borough councils, only district councils. There may be a logical reason for that, but as my hon. Friend knows, there is a subtle difference between the two.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch

It is true that there is no reference to borough councils, except London borough councils. Colloquially, people often talk about "the borough council". For example, they talk about Christchurch borough council, but in strict parlance, Christchurch council is a district council, rather than a borough council.

Photo of Simon Burns Simon Burns Opposition Whip (Commons)

My hon. Friend is right, as usual. The reason I asked is that in the area that I represent, the council is called Chelmsford borough council, whereas in the neighbouring two districts, the councils are Braintree district council and Brentwood district council. Perhaps the Minister can deal with that.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch

Indeed. The more important issue that the Minister needs to address is why a local authority is defined in clause 6 as not including a district council which is

"a council for a district in a county for which there is a county council".

It would be useful to find out why that wording is included. Amendment 23 tries to tease that out of the Minister in the course of the debate.

Amendment 24 to clause 7 states:

"page 5, line 15, at end insert-

'(5) The Secretary of State must bring forward regulations to allow for joint overview and scrutiny committees to be established between county councils and one or more district councils in their area, as provided for in the Local Democracy, Economic Development and Construction Act 2009, before the provisions of this Act come into force.'.

Of all the amendments that have been tabled, this is the most relevant to my own experience. In Dorset, we are lucky enough to have two-tier local government, where we have a county council and some good district councils. They are almost invariably under the control of the Conservative party, but that is another story.

At the moment, the district councils and the county council are working closely together to ensure that best value for money is obtained. The idea that there might be joint overview and scrutiny committees is an imaginative one, which will further build upon the co-operation that is already present to a large extent and growing all the time between Dorset county council and the district councils in its area. I hope that amendment 24 to clause 7, entitled "Consequential amendments", will find favour with the Bill's promoter or his representative today.

That brings us to the last group of amendments in the list, amendments 26 to 28 to clause 10. Their result would be to leave out lines nine to 12, subsection (3), and insert the words in amendment 26. That is the text relating to the desirability of having affirmative resolutions, which we touched on earlier, the consequence of which is that we need to leave out lines 13 to 15 and lines 16 to 18 of clause 10.

It is always an invidious task to speak to amendments on behalf of somebody else, who has probably spent a lot of time preparing them, and to get the right tenor of those amendments. I hope that I have done justice to the intent of my hon. Friend the Member for Putney and that when she sees the Official Report she will be not discontent with the way in which I have put her case. I look forward in due course to being able to respond to this important debate.

Photo of Nick Raynsford Nick Raynsford Labour, Greenwich and Woolwich 2:00 pm, 12th March 2010

I should say at the outset that I am taking the Bill through its remaining Commons stages on behalf of my hon. Friend Mr. Chaytor, and that is why I am speaking to this group of amendments. I should also repeat the declaration of a non-pecuniary interest that I made on Second Reading and in Committee: I am chairman of the Centre for Public Scrutiny, a body that promotes good quality scrutiny by public authorities.

This large group of amendments all deal with the range and scope of the regime, and the extent to which the powers may be exercised by local authorities. In Committee, I accepted the importance of amending clause 1 to safeguard against potential burdens that may arise on designated bodies, in particular, to ensure that it does not have the unwanted effect of unduly burdening small business and charities. Throughout, we have been clear that this scrutiny regime must be proportionate.

Amendment 1 builds in such safeguards for small business and voluntary or community interest organisations. It does so by requiring the Secretary of State to consider the potential effect on small business and voluntary and community interest organisations before making an order designating bodies as subject to the regime.

The definitions in the amendment are generous. "Small business" is defined as

"a business that employs fewer than 50 employees," and it is consistent with the definition in section 382 of the Companies Act 2006. Similarly, a "voluntary or community interest organisation" for these purposes means

"an organisation...whose activities are carried on otherwise than for profit, or for the benefit of the community on the basis that any profits are reinvested in the business of the organisation for the benefit of the community."

That covers a wide range of third sector organisations, charities, voluntary and community groups and social enterprises alike. Taking those provisions together, the amendment would ensure that specific consideration were given to those specific groups. Mr. Chope seemed sympathetic to the amendment, and I trust that he will support it.

Amendments 8 and 9 would simply serve to limit the scope of the scrutiny regime, rendering it less effective and less able to scrutinise matters of local concern. I am a little surprised that the hon. Gentleman has spoken to those amendments on behalf of Justine Greening, because they are very inconsistent with the position that the hon. Lady adopted on Second Reading.

The hon. Gentleman was not at that debate and will not be aware of what the hon. Lady said, so I shall remind him. She appreciated the Bill's intentions to give councils

"much greater powers to scrutinise local public services," and she noted

"a growing recognition that overview and scrutiny committees need to have powers over a wider range of external organisations as they become more involved in local public services".-[ Hansard, 5 February 2010; Vol. 505, c. 524.]

That view is supported by the Local Government Association, which has noted that

"much public spending...is in the hands of agencies with little or no democratic accountability."

It is also

"pleased that this Bill proposes to strengthen the powers of scrutiny available to councils".

So, far from imposing unwanted obligations on councils, as the hon. Gentleman implied early in his speech, the Bill responds to councils' aspiration for a more coherent framework in which to scrutinise local services. I find it curious therefore that he seeks to adopt a contrary position to that which his hon. Friend took on Second Reading just a few weeks ago.

Amendment 10 is otiose. It is simply unnecessary and would add nothing to the Bill. Amendment 6 is also unnecessary. The hon. Gentleman admitted that he had not discussed it with the hon. Lady, but had he done so and looked into it, he would have discovered that a "designated authority or person" is simply an authority or person designated by regulations made by the Secretary of State. Requiring the Secretary of State to revisit that designation every year would therefore have absolutely no purpose, and I hope that the hon. Gentleman will accept that the amendment is unnecessary.

However, I am sure that the Under-Secretary of State for Communities and Local Government, my hon. Friend Barbara Follett, will be able to reassure us that, as a matter of course, the Government will keep under review the list of designated authorities or persons alongside that of the operation of the enhanced scrutiny regime itself. I think that the amendment's objective was to ensure a periodic review of the scope of the regulations and the organisations covered, and I am wholly sympathetic to that, so I hope that my hon. Friend the Minister will be able to provide such reassurance.

Amendments 14, 16, 20 and 26 to 28 seek to subject to the affirmative procedure all regulations made under the Bill. The key issue in the operation of the regime is the designation of the bodies that will be subject to it, and that is what determines the scope of the new powers. I recognise that that power can be said to have special importance, and that is why, under the Bill, it is subject to the affirmative procedure. That approach was adopted to provide hon. Members with appropriate, ample opportunity to scrutinise and debate any designation prior to regulations being made.

I do not, however, agree that the supporting regulations for the regime merit the same requirements. Those regulations will deal with some of the detail and technical matters relating to the operation of the regime, but there is no reason why they should be subject to a procedure that, as all Members know, is reserved for the most significant delegated powers, such as those creating new criminal offences. Furthermore, regulations will be made following consultation, and in Committee the Minister undertook that such consultation will take place. So, there will be an opportunity for people outside the House to have their say before regulations on those issues are drafted, and hon. Members will obviously be able to have their say as well.

The negative procedure provides hon. Members with the opportunity to secure a debate if they are so minded; I remind the House that Members have not sought such an opportunity to debate similar supporting regulations, on proportionality and the operation of the scrutiny regime covering local area agreement partners, that were introduced by the Local Government and Public Involvement in Health Act 2007. It would seem inconsistent to seek the affirmative resolution in respect of the supporting regulations in the Bill.

Amendments 17 and 22 would undermine the Bill's objectives; they would make it easy for any designated body or person to argue that their resource base was insufficient to comply with the requirements of the scrutiny regime. Like the previous amendments, they are also inconsistent with the view taken by the hon. Member for Putney on Second Reading. I quote her comments once again:

"Overview and scrutiny committees perform an important function, reviewing policy and performance and holding local public service providers to account. Currently, those committees have the power to require information from a range of organisations including councils, NHS bodies, law and order bodies and partner authorities that are involved in local area agreements. The committees can also summon representatives of most of those bodies to appear before them, and they can require such officials to respond to reports and recommendations that have been issued to them. However, that does not happen with all bodies-for example, partners that are involved in delivering local area agreement objectives. Indeed, many other local bodies are not required to submit to the same level of scrutiny by local authorities, so their voluntary participation in scrutiny is not guaranteed."-[ Hansard, 5 February 2010; Vol. 505, c. 524.]

The hon. Lady supported the Bill on Second Reading because it was creating a more coherent framework for scrutiny, and one without the holes that exist in the current situation. Unfortunately, the amendment would create another very large hole because it would allow any organisation-even the largest and most wealthy-to claim that it simply did not have the resources to attend a scrutiny hearing. I hope that the hon. Member for Christchurch will give further thought to that.

Amendment 18 would add nothing to the current draft, which would see any description of persons in regulations by reference to their role.

Given that existing scrutiny regimes provide for responses to scrutiny reports and recommendations within two months, amendment 21 would complicate the scrutiny landscape, leading to confusion in respect of not only scrutiny committees, but bodies subject to scrutiny in all its forms. Under some powers they would be required to respond in three months, but under others they would have to respond within two. That does not seem at all helpful. The two-month time frame for responses is already in place, under the Local Government Act 2000 and the Local Authorities (Overview and Scrutiny Committees) (England) Regulations 2009.

Contrary to the concerns expressed in Committee about proportionality and the potential burden of the scrutiny regime, amendment 23-and I suspect that the hon. Member for Christchurch is not aware of this-would increase potential burdens on other bodies. The hon. Gentleman was having a little difficulty at that particular point in his speech, and I suspect that he had not grasped that amendment 23 would allow a series of different district councils in county areas to have simultaneous scrutiny of the same organisation. Clearly, that would impose an unreasonable burden.

The purpose of the provisions in the Bill is to ensure that there is a proportionality and that within county areas where there are district councils as well as the county council, there should be a joint approach rather than separate scrutiny powers being available to all the separate bodies.

Photo of Simon Burns Simon Burns Opposition Whip (Commons)

Perhaps the right hon. Gentleman will be able to answer my question; I genuinely do not know the answer. In such circumstances, what would happen in a county where there was a borough council rather than a district council?

Photo of Nick Raynsford Nick Raynsford Labour, Greenwich and Woolwich

The hon. Gentleman raised that issue in an intervention on the hon. Member for Christchurch. I am happy to give the reassurance that I think they were working their way towards during their exchange. The formal designation relates to a district council and therefore the concept of a borough council has no impact at all.

The purpose of the provisions is to avoid unreasonable regulatory burdens that would result from different bodies scrutinising separately. I hope that the hon. Member for Christchurch will recognise that his amendment would open up the scope for extra regulatory burdens on business and voluntary organisations and will not press the amendment.

I listened carefully to the hon. Gentleman's comments, and I consider the amendments other than amendment 1 to be unnecessary. I hope that he will now agree not to press them, and to support my amendment 1, with which he seemed to have a great deal of sympathy.

Photo of Barbara Follett Barbara Follett Minister of State (the East of England), Regional Affairs, Parliamentary Under-Secretary of State (the East of England), Department for Communities and Local Government 2:15 pm, 12th March 2010

I will be as brief as possible. First, the Government wholeheartedly support amendment 1, tabled by my right hon. Friend Mr. Raynsford, which addresses concerns raised in Committee about the potential impact of the enhanced scrutiny regime on small businesses and voluntary or community interest organisations. I urge hon. Members to support it as well. I am happy to give my right hon. Friend the commitment that he sought by confirming that the Government intend to keep under review the list of designated authorities or persons throughout the continuing operation of the enhanced regime.

I agree with my right hon. Friend that the other amendments, tabled by Justine Greening, are entirely unnecessary and would in fact hamper the effective operation of the enhanced scrutiny regime. On amendments 14, 16, 20 and 26 to 28, I gave a commitment in Committee that the Government would consult widely before making any regulations under the provisions of the Bill. I repeat that commitment today, and I hope that that will satisfy the concerns.

On the hon. Lady's amendments 23 and 24, we have yet to make regulations to allow for the establishment of joint overview and scrutiny committees involving a county council and one or more district councils. As my right hon. Friend the Member for Greenwich and Woolwich said, in this case that includes borough councils. The power to make such regulations was originally included in the Local Government and Public Involvement in Health Act 2007, and following consultation we strengthened it in the Local Democracy, Economic Development and Construction Act 2009. We recognise the importance of those regulations and see them as a high priority for the next Parliament, so that we can ensure that district and borough councils have a full role in the enhanced scrutiny regime being established in the Bill.

In closing, I echo my right hon. Friend's comments by saying that I hope the Opposition amendments will be withdrawn. They are entirely unnecessary and in fact detrimental to the local government scrutiny regime that the Bill establishes.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch

It is a pleasure to wind up the debate. I thank Mr. Raynsford for having resorted to what is rather an old-fashioned practice in the House of actually responding to the points put forward in the debate. The Government, whom he supports, are a less powerful body as a result of his not being a member. Although I do not agree with the Government, he knows this subject and a lot of others well, and he has always treated us with respect and listened to the arguments that are put, over however short a period they have been developed. Unfortunately I have not had a hotline to my hon. Friend Justine Greening to be able to take her further instructions on his points.

I am not sure that I go along with the right hon. Gentleman's argument about the case against the affirmative resolution procedure. The mere fact that the negative procedure has not been utilised does not, I submit, mean that it is not appropriate to have the safeguard of the affirmative procedure.

I take the right hon. Gentleman's point about the complexity of having a whole series of district councils scrutinising one body, but there are situations such as that in Dorset, where each individual district council has a different take on the performance of the fire and rescue service as it operates in its own area. Last night, my hon. Friend Adam Afriyie introduced an interesting debate on sustainable communities and the operation of the fire service in Windsor. I am not sure that the complexity of the situation would be resolved if the House failed to accept the amendment tabled by my hon. Friend the Member for Putney. Ultimately, one would hope that if the district and county co-operate, with a combined scrutiny committee, they can decide for themselves which issues to raise. The fire authority could be brought before the scrutiny committee if Christchurch borough council were concerned about its activities. It would not be easy for the council to rely solely on a scrutiny committee comprised of members of other district councils and the county council.

That, however, is a debate that we can hold at much greater length on another occasion. The answer is to reduce the overlap between these different bodies, and I would certainly like to see directly elected police authorities, which would be a much better arrangement. I would also like to see-this is my personal view-directly elected and accountable fire authorities. That is probably a better way forward than introducing a complex system of joint scrutiny. The amendment tabled by my hon. Friend the Member for Putney accepts in a sense that that is the situation-we do not have directly elected fire authorities, police authorities, and a whole lot of other quangos involved in local government, which is why the solution is complex.

I look forward to a further discussion with my hon. Friend on the subject. It would be churlish, as I, like the Minister, support amendment 1, not to seek leave to withdraw amendment 8, and urge the House to accept amendment 1.

Amendment, by leave, withdrawn.

Amendment made: 1, page 2, line 3, at end insert-

'( ) Before making any regulations under this section the Secretary of State must consider their potential effect on small businesses and voluntary or community interest organisations.

For this purpose-

"small business" means a business that employs fewer than 50 employees;

"voluntary or community interest organisation" means an organisation (other than a local authority or other public body) whose activities are carried on-

(a) otherwise than for profit, or

(b) for the benefit of the community on the basis that any profits are reinvested in the business of the organisation or applied for the benefit of the community.'.- (Mr. Raynsford.)