Local Communities — Debate

Part of the debate – in the House of Lords at 1:07 pm on 1st July 2010.

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Photo of Lord McKenzie of Luton Lord McKenzie of Luton Labour 1:07 pm, 1st July 2010

My Lords, I congratulate the noble Baroness, Lady Perry, on securing this debate and giving us an early opportunity to discuss this aspect of the coalition Government's proposals. It also gives us the opportunity to take stock of progress made in recent years and of where we are today, and to set out an optimistic vision for the future. I add my congratulations to my noble friends Lord Knight and Lord McAvoy and the right reverend Prelate the Bishop of Derby on their impressive maiden speeches.

The proposition that the noble Baroness advanced is effectively that we have an overcentralised government that is stifling local activity. But, listening to the debate, what has struck me is that pretty much every contributor has given us an example of what is happening locally in their patch and their environment in their town. The noble Baroness herself made reference to the third sector flourishing, and I agree, as well as to the work of the churches and the community land trusts.

The right reverend Prelate talked about his work with the Inter Faith Network. I pay tribute to that, but I ask him what that network would have looked like 13 years ago; I bet it was much less developed than it is now. Community safety partnerships were created under the previous Government, as were local strategic partnerships.

My noble friend Lord Knight reminded us that even if, as we should, we support devolution and power going to individuals and communities, we would be quite wrong to brush aside the importance of central government and the role that it can play. To my noble friend Lord McAvoy I can say in all honesty that as I am now no longer responsible for getting Bills through this place, I hope that he does not wait another 14 years before he makes his next speech.

When Labour took power in 1997, many public services were on their knees. In the preceding four years local government had received a 7 per cent reduction in real-terms funding. Contrast that with a 45 per cent increase in real-terms funding under Labour which, together with a drive for efficiencies and tough capping powers, has led to the lowest council tax rises on record.

It is undoubtedly the case that local services are now more effective and that the existence of rigorous targets and inspection regimes helped to bring this about. But things should not stand still. In July 2008 we published Communities in control: real people, real power, focused on passing power to local communities and giving real control over local decisions and services to a wider pool of active citizens. We published a progress report on it last year.

We should have high expectations of local public services, where residents and communities have the right and ability to shape the area in which they live and the services that they receive and provide. We believe that local services can be higher quality, more personalised and lower cost. Notwithstanding progress over recent years, we accept that there is much still to do. We want greater local flexibility and responsiveness, so that services are shaped around the personal needs of citizens and their entitlements, not the silos of government departments. For us, it is not about cutting services; we believe that there is the opportunity to achieve more and save money. We support the role of elected local authorities in driving change, and we support giving local public services more freedom, fewer targets, less ring-fenced finance and slimmer, more effective inspections-a process which is under way.

We have the chance through the Total Place approach-I did not realise that we had to expunge this phrase from our vocabulary; I ask noble Lords to forgive me if I do not-to look at all local spending across all local agencies, giving local services the opportunity to bring together bodies such as the police, councils and the NHS to save money, but also radically to improve services. As the LGA put it:

"To achieve real reform and devolution, there must be a transformation of the way the public sector works. Area-based budgeting would deliver real savings by giving power to the people who know their areas best".

There is no mention of Total Place in the coalition agreement. On the basis of what the noble Baroness, Lady Hamwee, has said, I perhaps now understand why that is. The Minister might take this opportunity to say whether the coalition Government plan to continue to develop this approach, with all its advantages.

The signs do not look altogether promising, as actions proposed in the coalition document look effectively to be reinforcing rather than breaking down silos. Total Place is not just about local government policy. It makes sense only as local public services policy; it needs all the partners coming together. The coalition Government's proposals threaten to bypass local councils rather than put them at the centre of a dynamic and holistic approach to delivering local services. Academies and free-school proposals marginalise the role of councils. Direct elections for police commissioners and health bodies will create competing mandates with local authorities. The Conservatives have repeatedly attacked independent inspections of local public services, and the coalition is to scrap the CCA, stripping away inspections and scrutiny and making it easier to hide cuts

As my noble friend Lord Rosser said, the Secretary of State for Local Government, Eric Pickles, has not made a good start. He has acquiesced in £1.2 billion of the early cuts falling to his department and has then imposed them on councils unfairly, hitting the hardest-pressed communities most. Included is the funding for Connecting Communities and the Working Neighbourhoods Fund, focused on community-led approaches and capacity-building. In his passion for localism, the Secretary of State has by diktat stopped councils choosing whether to trial different ways of managing waste recycling by stopping "pay as you throw" pilots. These actions do not sit well with a Government who seek to devolve greater powers to councils and neighbourhoods.

The noble Baroness, Lady Hamwee, touched on council tax freezes. Implementing a council tax freeze in 2011-12 is all very well, but we shall have to see the detail of how it will work in practice. Does the Minister accept that council tax is effectively being set from a desk in Whitehall? If so, it is hardly a spur to localism. The noble Lord, Lord Rennard, spoke about local government finance, an intractable issue. We shall have to see what comes from the review of local government finance. The first one that I can remember was the Layfield commission in 1976, which I read avidly. I do not think that I have read avidly everything that has followed that, but I shall try to do so this time.

The Secretary of State is obviously warming to his theme of controlling from the centre in his latest announcement of a crackdown on newspapers produced by local councils. This is notwithstanding the fact that, as the LGA has made clear, most council publications are distributed only a handful of times a year and are not significant competitors for advertising revenue. They are an effective means of keeping residents informed about the services on offer where they live and how they might get involved.

The noble Lord, Lord Taylor, among others, referred to issues around directly elected mayors. As we have heard, there are proposals for the creation of directly elected mayors in the 12 largest cities in England, subject to confirmatory referendums. Opportunities already exist of course for bringing forward proposals for a referendum on a mayor, and presumably these will be retained. The Minister may wish to confirm this. It would seem that implementation of the proposal for directly elected mayors will test how localist the agenda truly is. Perhaps the Minister will tell us how the Government have defined the "12 largest cities", what powers the elected mayor will have, whether there will be a standard model, whether the provisions will apply automatically to the designated cities or whether the onus will be on them to come forward if they wish to avail themselves of the opportunity.

Residents are to be given the power to instigate local referendums on any issue and the power to veto excessive tax increases. What safeguards are proposed in respect of the former to prevent the rich and powerful pursuing their prejudices? And I speak as someone who was living and working in San Francisco when Proposition 13 was on the ballot paper. Why are there no rights for people to veto excessive cutting of services to keep council tax low? Will a power of general competence in practice add much to the well-being power?

The coalition Government's proposals to scale back RDAs-referred to by the noble Lords, Lord Wei and Lord Taylor-at a time when economic recovery is still fragile, do not seem to be well placed. Instead, as we have heard, they plan to replace them with local enterprise partnerships, bringing together business and local authorities to establish local accountability. RDAs have acted as key drivers for regional economies since 1999. Free from short-term political considerations, they have taken strategic economic decisions that have not only supported businesses, enabled skills training and created thousands of jobs but also helped co-ordinate and fund regeneration projects to build stronger communities. I say to the noble Lord, Lord Wei, that they have helped to attract inward investment and channelled it where it is needed to boost jobs. They have shown their importance in times of regional economic crises; for example, the collapse of MG Rover in the West Midlands in 2005. Local enterprise partnerships would risk short-term political considerations determining key investment, infrastructure and planning decisions, leaving regional economies fragmented. Business leaders, including the CBI and the British Chambers of Commerce, have voiced their opposition to changing RDAs.

We have heard again today about plans to scrap regional spatial strategies and to devolve powers to local authorities. We have also heard from the Chancellor about incentives being offered to encourage households to give the go-ahead for controversial building projects. The LGA has made an urgent plea for clarity about how all this is to work in practice. It is not easy to see how the sum total of decisions, particularly on housing at local, even sub-regional, level, will be consistent with our national housing needs, let alone how it will work for particularly disadvantaged communities such as the Traveller community to which my noble friend Lady Whitaker referred. This has the smack of pandering to nimbyism, but next week's debate will give us an opportunity to probe this in more depth.

This has been a useful canter around a subject which will no doubt occupy much of our time in the upcoming months. We believe that the next great challenge for the reform of public services is the way in which local public services are delivered. This transformation is already under way and we want it to succeed.