Second Reading

Localism Bill – in the House of Lords at 3:50 pm on 7th June 2011.

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Moved by Baroness Hanham

That the Bill be read a second time.

Photo of Baroness Hanham Baroness Hanham The Parliamentary Under-Secretary of State for Communities and Local Government 3:51 pm, 7th June 2011

My Lords, the Localism Bill marks a turning point. For generations, different Governments have concentrated power in Whitehall. They have done so with good intentions, but as centrally dictated measures have accumulated, the result has been to tie councillors' hands over what policies they can implement, to make public services everywhere similar and to limit the ability of local communities to influence what happens in their area. This Bill is designed to achieve an historic shift in power. It will devolve authority from Whitehall to town halls, create new rights for local communities to become more involved in local affairs, and free professionals on the front line of public services to do things in response to what communities need rather than to government demands.

The Bill was first introduced in the other place in December, but most of its measures have been the topic of debate for years. There has, I am glad to say, been widespread welcome for the Bill. The Local Government Association called it a "long-awaited and much-needed measure". In the other place there was a strong majority in favour of its principles. During House of Commons considerations, parts of the Bill of course raised considerable debate-I appreciate that we will return to them again-such as aspects of the provisions on mayors, particularly shadow mayors, the impact of social housing reforms and the fine detail of some of the planning provisions. The Government consistently sought to build on common ground and consensus. In keeping with this, we will seek to make amendments, where they will improve the Bill, that arise from the discussion at each stage.

Already in response to concerns raised in the other place, the Government have brought forward a number of amendments-in particular, to strengthen strategic planning by bolstering the duty to co-operate and to widen provisions on neighbourhood planning to make neighbourhood forums more inclusive of both local people and local businesses. As we start our considerations, I can assure noble Lords that the Government will continue to listen and, where possible, make amendments that are justified and supported across the House. There will be parts of the Bill on which we may not be able to reach agreement, but I hope that they will be few. My colleagues and noble friends Lord Taylor of Holbeach and Lord Attlee and I will want to take account of what is said and to develop consensus where possible.

I shall now turn to the main provisions of the Bill. Noble Lords will know well the importance of local government in providing leadership and essential services to their local communities. The Bill seeks to give local government wider discretion to get on with that vital job. At the heart of the Bill is the general power of competence. Currently, councils can do only what legislation explicitly says they may do. With the general power of competence, they will be able to do anything that an individual can legally do. Concerns have been raised that the Bill means that local authorities will be able, for example, to stop providing valuable services. That is not so. Just as individuals have to obey the law, so councils will continue to be bound by their legislative duties. What the general power of competence will do is give councils freedom to formulate new ideas and to do things in different ways in response to what local people want without having to look over their shoulder for permission from the centre to do so.

Under the Bill, the Secretary of State will have delegated powers to remove legislative barriers that prevent local authorities exercising the general power. There was debate in the other place about the extent of these delegated powers, and amendments were made there to ensure that robust safeguards are in place.

The Bill will abolish the unpopular standards board regime, provide stronger sanctions against serious unethical behaviour by councillors and clarify the predetermination rules. It will lay the ground for a new generation of mayors in England's largest cities. I am aware that this measure has generated a good deal of interest and some controversy. It is our view, however, that directly elected mayors have the potential to provide stronger leadership and enhance the prestige of their cities. It would, of course, ultimately be for local people to decide, via a referendum, whether they wanted an elected mayor for their city. The Bill will devolve to the Mayor of London greater powers over London's housing, regeneration and economic development.

With central direction having been rolled back, it will also be necessary to ensure that local authorities are accountable for all the decisions they take. For example, where authorities fail to act in accordance with EU directives, and where this results in the EU taking infraction proceedings against the United Kingdom, it will be important that culpable local authorities take responsibility for their actions.

Localism does not mean simply that all power should rest in the hands of local authorities. Although the town hall plays a crucial role in local life, it is often local people-conscientious neighbours, responsible residents, volunteers and social entrepreneurs-who undertake the responsibility of making communities stronger. As a general rule, however, they can get involved in local decision-making only to the extent that their council welcomes and encourages their involvement, so the Bill creates new rights for local people and local community groups. Under the right to challenge, social enterprises, voluntary and community groups and parish councils will have the right to challenge the council to consider seriously their proposals for the improvement of local services.

Similarly, the Bill will give community groups the right to bid to buy assets of community value. Where buildings and businesses such as local shops, pubs and community facilities are listed under the Bill's provisions as being important to local people and come up for sale, community groups will be given time to put together a credible bid to buy the facility that will have to be taken into consideration before the vendor can continue with the sale.

Local people will have the right to petition their council to hold a referendum on any local policy or issue that is contentious and important to them. Councils will be required to hold a referendum where they propose to charge a council tax in excess of an agreed percentage increase. Local people, rather than the Secretary of State, will therefore be able to veto the rise.

We turn now to planning. The trend towards central control has been particularly damaging in the planning system and the Government believe that it is now time to introduce far greater democratic and local control. The regional strategies, which set housing targets for different parts of the country and then had to be implemented by local authorities, will be abolished. They did not result in more houses being built. Indeed, last year, rates of housebuilding hit their lowest point in peacetime since the 1920s.

The Bill will transfer the power to make decisions on nationally significant infrastructure projects such as power stations, airports and major roads from appointees in the Infrastructure Planning Commission to democratically accountable Ministers. It will introduce a duty to co-operate, requiring local authorities to work together on strategic planning issues. At a more local level, it introduces a duty on developers to consult local communities before they put forward applications for large developments. Most radically of all, it will allow people to have a stronger say in the planning of their neighbourhoods. Under these provisions, local people will be able to come together to form a neighbourhood forum and produce a neighbourhood plan for developments in their area, such as where they consider would be most suitable for new homes, shops and businesses. As long as these plans are consistent with the national planning policy framework and the local plan, development can be granted through a neighbourhood development order so that construction can go ahead quickly. At the same time, the new homes bonus and the community infrastructure levy will benefit local communities where new development takes place.

Ultimately, it is right that local responsibility and local incentives replace top-down control, creating the right conditions for communities to welcome development and growth in their areas. The Bill makes clear that the use of financial incentives, such as the community infrastructure levy, can be a material consideration in the planning process, although they do not have to be.

Lastly, I turn to the Bill's provisions on housing. Social housing will provide 8 million people in England with a home. The Bill proposes a much greater level of discretion for councils and social landlords to manage social housing more flexibly. New provisions will give social landlords more flexibility over the length of tenancy they may grant. The minimum length will be two years, although we expect that longer terms will be offered in the majority of cases. There is a clear acknowledgement that where tenants are likely to remain in need, long-term tenancies will be the norm. Vulnerable and existing tenants will not be affected by these changes. Councils will of course continue to be able to offer lifetime tenancies.

We have also discussed in depth in the other place, and with practitioners, the Bill's proposals to let local authorities meet their homelessness duty by providing applicants with good quality homes in the private rented sector. This option could provide an appropriate solution for people experiencing a homelessness crisis at the same time as freeing up social homes for people on the waiting list. The Bill will also change the way in which social housing is funded, passing more power to a local level by replacing the complex and unpopular housing revenue account subsidy. Councils will be able to keep the rent raised locally to maintain their social homes. This will give them a more predictable and stable basis to plan for the long term.

Finally, the Bill will reform the way in which social housing is regulated. The Tenant Services Authority will be abolished and landlords will be expected to support tenant panels-or equivalent bodies-in order to give tenants greater opportunities to scrutinise the services that are being offered and that they are receiving.

This is an important Bill, with measures that will have a great impact on every aspect of the responsibilities of local government and the rights of local people in the future. As I said at the beginning, there has been much consensus already about its provisions. I hope that, when there has been such agreement in the other place, that will guide considerations here. We have much to do, and the noble Lord, Lord Taylor, the noble Earl, Lord Attlee, and I look forward to the forthcoming debate. I commend the Bill to the House. I beg to move.

Photo of Lord Beecham Lord Beecham Shadow Spokesperson (Communities and Local Government), Shadow Spokesperson (Health) 4:04 pm, 7th June 2011

My Lords, I congratulate the Minister on the customary skill and charm with which she has introduced this Bill. It was an impressive example of carrying out my ancestral trade of making bricks without straw. I am delighted that the noble Baroness's long service to local government is about to be recognised by the conferment upon her of the freedom of the Royal Borough of Kensington and Chelsea, of which she was such a distinguished leader.

This Bill, which purports to herald the renaissance of local government and shape a new localism, sprawls over 510 pages, with 215 clauses and 25 schedules. Together with 111 pages of Explanatory Notes, it weighs two pounds, 13 ounces, to which must be added impact assessments weighing all of eight pounds, 11 ounces. As Churchill might have said, "Some impact, some assessment". No wonder the Government have had second thoughts about their plans for forestry.

There are some welcome provisions. The local government world has long called for a power of general competence, although candidly when asked what difference it would make, many of us have had some difficulty in identifying what the practical effects would be, given the existing powers to improve the environmental, social and economic well-being of areas. However, changes to small business rate relief and the housing revenue account, the latter building on work initiated by the last Government, and the promotion of a duty to co-operate are also being well received, and few except some estate agents will mourn the passing of home information packs.

But overall the Bill, studded with populist gesture politics, is redolent of the prejudices-indeed, it would not be an exaggeration to say some of the obsessions-of the Secretary of State. I cite, for example, provisions about chief executives and pay, or the banning of charge and reward schemes for waste collection. The Secretary of State takes to himself 142 powers and, in what seems a remarkable echo of the Public Bodies Bill, powers to abolish or amend by order up to 1,296 statutory duties. Even the vaunted power of general competence is qualified by Clause 5(3), giving the Secretary of State power by order to prevent local authorities doing anything he specifies.

It is impossible in the 15 minutes available to me to enumerate, let alone discuss, all the concerns raised by the Bill's provisions. I will concentrate on the issues of governance, and on the impact of the measure as a whole on local government and representative local democracy. My noble friend Lord McKenzie will speak to the planning and finance issues, and my noble friend Lord Patel of Bradford on housing and community engagement. I am sure that many noble Lords on all sides of the House will wish to raise many of the detailed provisions of the Bill and the accompanying documentation.

The Government's approach seems in many respects to be driven by a belief in an apparently inexhaustible appetite on the part of citizens to vote-for elected mayors or police commissioners, or in referendums called by a fraction of the electorate, a neighbourhood forum, or a handful of councillors. This assumed insatiable thirst for Athenian-style democracy-and Mr Pickles is, after all, only two letters short of Pericles-is matched in ministerial minds by a demand on the part of the public directly to manage local services. Let me be clear. There is, and must always be, space in a mixed economy of provision for voluntary and community organisations as service providers. Their commitment and capacity to innovate enrich civil society. But most of those engaged in the sector acknowledge that they complement the statutory services and neither wish, nor expect, to replace them.

I turn to some of the more problematic provisions of the Bill, rooted as they are in the philosophy I have just outlined. I begin with mayors. At any time in the last 10 years a mere 5 per cent of the electorate could have requisitioned a mayoral referendum in England's towns and cities. Few have been called, fewer still have approved the idea, and neither in referendums nor in any ensuing mayoral elections, except when they have coincided with general elections, has the result been higher turnouts than in traditional local elections.

I have always been sceptical of the argument that a direct personal mandate is a necessary condition of effective local leadership. The concentration of power in a single pair of hands is inherently undesirable, and it is also unnecessary; it diminishes the role of other elected members, and there is no reason why the grant of more powers to local authorities, which would be welcome, should be conditional on there being a mayoral system. But if sufficient people want elected mayors, they can easily secure the process, set it in motion and achieve their objective now. It is perhaps not without significance that Nick Boles, now MP for Grantham, succeeding my noble friend Lord Davies, urged the adoption of the mayoral system as potentially providing a ladder back to power for the Conservative Party in places like Manchester, where its prospects under the existing system continue to look a little bleak. The Bill, however, requires confirmatory referendums to take place in 12 English cities where the Government ordain that the mayoral system should apply. When she replies to the debate, perhaps the Minister would give a definitive answer to the question of whether and in what circumstances the Government would extend this requirement to other local authorities.

Much worse than that proposal are two further extraordinary provisions concerning shadow mayors, to which the noble Baroness made glancing reference, and the delightfully euphemistically termed "mayoral management arrangements". Under new Section 9N in Schedule 2 the Secretary of State may order a shadow mayor to be appointed in an authority due to hold a referendum, in the first instance in the 12 authorities targeted for next May, who will be the executive leader at the date of the order. He will have the full range of mayoral powers until either the referendum fails or an elected mayor takes office. In Birmingham, for example, a Conservative council leader would be appointed shadow mayor and continue to hold office, assuming a referendum next year confirmed the mayoral model, for a further year from next May even though it is highly probable that Labour will take control of that council then. The nearest precedent that occurs to me, though absolutely without the horrific overtones of the original, is the Anschluss: occupy Austria first and have a referendum afterwards.

Yet that is not all. In those of the 12 authorities which end up with elected mayors, the positions of mayor and chief executive will have to be combined while other authorities with a leader and executive model will have to consider this novel, and in my judgment, wholly inappropriate conflation of the political and officer roles. It does not seem appropriate that the political head of a local authority should effectively be the head of paid service. Contrast this with the separation of roles prescribed by the Cadbury rules in the private sector. This is not local democracy but local autocracy. These two proposals are the most objectionable in what is in many respects a deeply flawed Bill. I trust that through today's debate, if it does nothing else, the House will send a clear message to the Government that those proposals are totally unacceptable, and an affront to democracy and good governance.

Less fundamental but still serious misgivings arise from other proposals. Take, as an example, the provisions for referendums. Non-binding referendums may be called by 5 per cent of the authority's total electorate or, in the case of a single electoral area-or two or more contiguous electoral areas or wards-by 5 per cent of the electors in that area or areas. They may also be called by one or more members of the authority, or in the case of a ward by a majority of members for the relevant area, or by one member if there is only one representing that ward. There are very limited grounds on which a council can decline to hold such a referendum. I fear that the potential for mischief here is simply enormous.

Political, religious or ethnic groups, possibly people with extremist views-perhaps even worse, disgruntled or attention- or election-seeking councillors in their wards-could generate referendums without limit, damaging community cohesion or effectively delaying the implementation of properly derived decision-making. There are better alternatives at present: for example, the councillor's call for action, citizen's petitions-the provisions for which the Bill, incidentally, abolishes-and the right to address councils. In any case it is the practice of most although, I have to submit, not all councils increasingly to engage their local communities about the decisions which affect them.

As the noble Baroness pointed out, the Bill provides for compulsory referendums on the council tax levy where it is deemed excessive by the Secretary of State. This is capping by the back door, applied perhaps in different ways to different classes of authority, but without any close regard to the circumstances of the individual authority and with no ability to modify the cap after a referendum, as would be the case under the present-and, in the views of many of us, still unsatisfactory-system. But why should a referendum on council tax, especially given the complexity of the local government finance system, displace the role of the ballot box and elections in holding councils to account?

When it comes to planning and what the Bill terms "community empowerment", there are again many problems. In these areas, the impression is given that communities are inherently self-contained, able in large measure to determine their own preferences in isolation. Of course, for some purposes and in some areas-for example, parish councils-this may well be true, but if I look at my own experience in the ward I represent in the west end of Newcastle, I can count around 23 distinct areas in that ward alone, with a population of some 11,000. Those are in addition to communities of interest, based-as they might be-on age, gender, ethnicity, class or employment. It is the function of local government to mediate those interests and, with its partners, to shape the future not only of the individual areas but of the whole city or county.

The raft of propositions about neighbourhood forums-now expanded from the original three men and a dog in the first draft of the Bill to 21 people-the significantly named "community right to challenge" over the provision of services, and the provisions relating to community expressions of interest all have some potential for good. However, they also raise the dangers of nimbyism and the atomisation of local governance, which are of a piece with other government policies, such as those we see in education or the wholesale abandonment of regional or sub-regional structures, except for a vague duty to co-operate. Others will no doubt enlarge on these and other issues during this debate and in more detail in Committee.

I wish to conclude with two more worrying matters. The first relates to issues of propriety. I am disturbed-and so are some of the professional bodies-by the provisions relating to predetermination on the part of members in relation to planning matters. This appears to me to breach the quasi-judicial approach appropriate to such issues in planning and licensing. In addition to that, there is the proposal to make the existence of a community infrastructure levy a material consideration in planning. That could be regarded in effect as an inducement to sell planning permissions by the local authority.

The second concern is again a matter touched on lightly by the noble Baroness the Minister. It is the power under Part 2 of the Bill to require councils to pay fines levied by the European Union in respect of breaches of treaty obligations. I recently tabled a Question to ask what estimate had been made of the potential UK liability in this respect, rumoured to be in excess of £1 billion. The reply from the noble Lord, Lord Sassoon-who is not in his place-was that no such penalty had been incurred by the UK and none was anticipated. In which case perhaps the noble Baroness the Minister could say why there is such a provision in the Bill at all?

Finally there is one delicious irony in the Bill. Clause 28 repeals the duty to promote democracy which is established by Part 1 of the Local Democracy, Economic Development and Construction Act 2009. A Bill purportedly about local democracy repeals the duty to promote it. I need not-and your Lordships will be pleased to hear that I will not-say more.

Photo of Lord Tope Lord Tope Liberal Democrat 4:19 pm, 7th June 2011

My Lords, I, like the noble Lord, Lord Beecham, begin by congratulating the noble Baroness Lady Hanham on receiving the freedom of the Royal Borough of Kensington and Chelsea. I am not sure what privileges that confers upon her-she shakes her head rather sadly. Nevertheless it is a well-deserved honour. I also thank the Minister for the manner in which she introduced this Bill today. I welcome particularly her statement that the Government are still willing to listen and to try to address remaining concerns in the Bill where that is possible. That is certainly the approach that my noble friends and I will adopt and I hope it is one that will be shared on all sides of the House. To this end, it will be helpful if the Minister can agree today that any further amendments that the Government already have in mind will be introduced in Committee so that they can receive proper scrutiny and debate then and, if necessary, at later stages of the Bill.

As has been said, this is a huge Bill with many important and quite difficult provisions. I have half the time available to me that the noble Lord, Lord Beecham, had, and he began by confessing that he was unable to address most of those provisions. My 10 Liberal Democrat colleagues who will speak later in this debate will certainly refer to many of them, notably those on housing and planning. If time had permitted today, I would have dealt with some of those in the early parts of the Bill, such as why some councils will have to wait three or four years-until after their next elections-to implement the governance changes they may wish to make. I would also have referred to the imposition of the EU fines and the many issues that are raised by the provisions on local referendums. Above all, I would have wanted to know how the imposition by the Secretary of State of unelected shadow mayors can possibly fit in a Bill entitled "Localism".

Instead, as this is the Second Reading, I shall confine my remarks to the principles of localism. I declare an interest as an executive councillor in the London Borough of Sutton. I have now been a councillor there for 37 years and was a Member of Parliament for exactly half that time. I was initially in the other place for a short time before I was first elected as a councillor. Shortly after I became a councillor, when I still had slightly longer service as an MP than as a councillor, the Conservative leader on my council, who was also the Conservative leader on the then Association of Metropolitan Authorities, told me I would find that there were really only two parties-the central government party and the local government party. In the years since I have found that he was absolutely right. I see that the noble Lord, Lord Beecham, who has similar experience, agrees with me. I suspect we will find this many times during the progress of the Bill through your Lordships' House.

If I must declare myself as a member of either of those parties, I am firmly in the local government party. However, it is not as simple as that. My commitment is not particularly to a system, or a level-I prefer the word "sphere"-of government; it is to local democracy, and to local government only as the best vehicle for delivering local democracy. I am the first to say that local government is not always very good at doing that. Indeed, some local councils can be as controlling and reluctant to share their power as any central Government. Therefore, I was delighted when I first learnt that the coalition Government intended to introduce a Bill that would give effect to my party's long-held commitment to localism, or rather to local democracy. I must admit that the same commitment from our coalition partners does not have quite the same long pedigree, but blessed are the sinners who repent and we should welcome the zealousness of the converts.

However, too many statements and some actions by some Ministers have led me to wonder whether we share the same understanding of the word "localism". Indeed, parts of the Bill lead me to the same conclusion. I looked up "localism" in my dictionary, which defines it as,

"a pronunciation, phrase, etc., peculiar to a particular locality", or "another word for provincialism"-another word I had never heard of. I suppose that is a little better than "subsidiarity", which is not in my dictionary at all. I will not attempt a definition today, but it seems strange that we should have a Bill with a one-word title that clearly means very different things to different people, and parts of which seem to contradict a common understanding of its title.

To me, and I am sure to all my Liberal Democrat colleagues, it means local democracy and subsidiarity: decisions being taken as closely as possible by and with the people they affect. That includes the right to make the wrong decisions or, more accurately, decisions with which some of us, including and perhaps especially central government, may disagree. We on the Liberal Democrat Benches will judge the Bill by the extent to which it enables and enhances local democracy, and the extent to which it reduces or removes central control and interference.

Here it is important to understand that local democracy is not populism. It is not rule by the best organised, the most articulate, those who shout loudest or have the greatest vested interests; it is a system that allows all voices to be heard and listened to with equal respect, allows the decision-makers to be better informed when they make decisions and ensures that such decisions are made in the interests of the whole community. Above all, it is a system that ensures that the decision-makers are properly and effectively accountable to all the people affected by those decisions. We might even choose to call such a system "local government". For localism to work it is not necessary for central government to like local government, still less to like all that it does, but if central government is genuinely committed to localism it has to trust local government, and to demonstrate that trust.

My noble friends and I look forward to working with the Minister to ensure that by the time this Bill leaves this House it is truly worthy of its title as the Localism Bill, a Bill of which we can all be proud.

Photo of Lord Best Lord Best Crossbench 4:25 pm, 7th June 2011

My Lords, I declare my local government interests as president of the Local Government Association and deputy chairman of Westminster City Council's standards board. I declare my voluntary and community sector interests as a member of the NCVO advisory board and a trustee of the RSA and other voluntary and charitable bodies, my social housing interests as chair of the Hanover Housing Association, and my planning interests as vice-president of the Town and Country Planning Association. There go my seven minutes.

These interests sometimes lead me to take contradictory positions in the localism debate. One day I could be advocating more "power to the people" when arguing against an apparently high-handed central or local government decision; the next day I may be fearing that a so-called local community group really comprises self-appointed and self-interested individuals intent on blocking a much needed social or economic development for purely selfish reasons. I am a champion of decentralisation from Whitehall but, wearing my social housing hat, I can feel outrage when the Supporting People grants for local councils to help homeless and vulnerable people are siphoned off by some authorities for quite different purposes. I am concerned that stepping back from national standards in the planning system could mean poorer design. I am nervous about measures to remove national protections on rent levels and security of tenure for social housing tenants. I sympathise with those who decry the postcode lottery when a council uses its autonomy to cut disabled facilities grants that are so vital to helping people live independently at home.

There are inherent ambiguities and contradictions in the localism theme. By definition, fewer impositions of national requirements mean more local variations in services, and that inevitably means losers as well as gainers, especially when, as now, resources are being fiercely cut back. However, colours must be nailed to the mast; I for one accept that despite some discomfort and the inevitability of some local mistakes, the overarching intent of this Bill to move down the path of localism is sensible and worthwhile. Unless national government gives councils room to stand on their own feet and to learn to use their local knowledge, local ideas and local talent, the dead hand of centralism will for ever demoralise and disincentivise, national standardisation will suppress initiative and innovation, and Big Brother taking the decisions will deter local involvement and put people off participating as councillors and community leaders. Scrutiny in Committee will need to test whether the Bill really moves us in this direction, or whether for every step forward there is a step back.

My local authority colleagues argue that the 146 new central government powers-from processes for appointing local mayors to the powers for levying EU fines, the arrangements for referendums and the bureaucratic procedures for implementing new community rights-all mean that the Bill has tightened the grip of the Secretary of State. Others argue that double devolution to the neighbourhood level introduces a nimbys' charter that will undermine the new financial incentives, through a new homes bonus and a community infrastructure levy, for councils to secure badly needed extra homes.

On the theme of housing, I want to address the proposals for the reform of the local authority housing revenue accounts. I fear that they have missed the opportunity to allow councils to act more like housing associations in their freedom to borrow private finance and to recycle proceeds from land and property sales. One step forward, one step back? At this stage of the Bill's progress, I have both fears and hopes. I fear that until greater financial autonomy is passed down the line, local authorities will remain ultimately the creatures of the mighty Whitehall departments. I recognise that at this moment it is particularly difficult for localists to argue against civil servants who say, "Yes Minister, but not now". I hope that the Government will be a bit braver in letting go, supported by the noble Baroness, alongside many amendments on specific topics. I hope that your Lordships will remove some of the measures that undermine the Bill's localising objectives and that we will end up with legislation that genuinely decentralises to democratic local councils and gives them confidence to devolve decisions to communities keen to play their part in resolving local issues.

If we are to stimulate a more empowered, more resourceful local government sector that will attract leadership of the highest calibre and to unlock the energy and good will of a big society, a good society, we must ensure that the Bill takes us two steps forward.

Photo of The Bishop of Norwich The Bishop of Norwich Bishop 4:31 pm, 7th June 2011

My Lords, I begin by saying that a family bereavement this morning means that if the House sits much longer than the estimated rising time I may have to leave to return to Norwich. I hope that that will not be necessary, but I apologise to the House if that proves to be so.

There have been frequent pleas from these Benches over the years to listen to the voice of local communities, so the overall aim of the Bill is certainly to be welcomed. Widespread disengagement from the political process is often linked with a feeling of powerlessness, and there is a need to restore a belief that the structures of our public life are not too complex to navigate or framed wholly in favour of those who already have power or wealth.

The Bill goes some distance in its effort to counter that widespread impression, and so wins my heart. It is my head that needs more convincing, because the Bill's 400 pages-I see that they have grown to 500 pages according to what the noble Lord, Lord Beecham, said-are so complex. Will the very complexity of what we are being offered undermine the Bill's good intentions? Will the politically literate, the well resourced, be likely to make the most use of its provisions; and do we need quite so many separate powers to regulate this, guide that or control the other?

As I attempted to navigate my way through the proposals, one of the episodes of "Yes, Prime Minister" came to my mind. Your Lordships may recall that, for a short time, Jim Hacker toyed with the idea of taking power away from the local government machine and returning it to the people. The proposal was to create city villages, each with its own little council, a sort of Hackeresque neighbourhood forum. At the time, Hacker was locked in almost mortal combat with a glamorous left-wing council leader, Agnes Moorhouse, but they eventually found common cause when they realised that plans for truly representative local democracy would entirely undermine the party-political machine. I could not help wondering whether some elements of the complexity of the Bill were not driven by a similar dynamic. Only about 35 per cent of the population of England live in areas where there is a parish or town council. The bulk of the population of this country, urban as it is, lives in unparished areas, as many noble Lords will know. Intriguingly, the only genuinely parished organisation is the Church of England. More people serve on parochial church councils than parish councils.

The power of the PCC, elected bodies all, is one reason why local decision-making is still so significant in the Church of England. It is one reason why it is almost impossible to get a clear answer when asking what the Church of England thinks about anything. There are around 16,000 answers to any question. There are very distinctive differences between one neighbourhood and another. Indeed, even defining "neighbourhood" is not without its problems. It is left largely undefined in this Bill, yet there is a vast difference in a diocese like mine between rural settlements of little more than 100 people-we still call them villages in Norfolk-and city parishes in Norwich with 20,000 people.

In the "Vicar of Dibley" you can never quite tell whether it is the parochial church council or the parish council that is meeting, such is the entirely understandable overlap between village and church affairs. Yet in an urban parish of 20,000 people, which likes to think of itself as a neighbourhood, a handful of activists can be the voice of the local community or church while the neighbourhood, such as it is, feels largely disengaged from them. In a complex Bill, that real complexity on the ground is not recognised.

The positive features of this Bill-neighbourhood plans, forums and development orders, as well as any potential for further directly elected mayors and local referenda-all require lively agencies of local democracy. These have traditionally included local newspapers and, in the past generation, local radio. The dramatic decline in advertising revenue in local newspapers has made that sector very fragile. It has meant that the number of young journalists cutting their teeth in the local and regional press has been dramatically reduced. Some cuts in BBC local radio now seem inevitable with the freezing of the licence fee. Local and regional commercial radio now carries very little news at all. Only community radio, staffed largely by volunteers, beats the trend and could serve the purposes of this Bill well if sufficiently funded.

The restrictions on councils producing their own newspapers may be understandable but, if they could afford it, is there anything preventing local neighbourhood forums from publishing their own local newspaper, or would they be subject to the same restrictions? I am not yet convinced that online communication, democratic as access to it is, fully replaces these other agencies of local democracy. I would be grateful if the Minister would comment on how this Bill relates to the Government's wider policy on the local and regional media. There seems to be some distance between them.

It is inevitable that passing authority to the local and neighbourhood level will create more local argument. Individuals in neighbourhoods speak with more than one voice. We should not fear this, and I presume this is why local referenda are included as a means of resolving local disputations. A closely fought referendum, although it may decide an issue, leaves a lot of losers. There may be some healing of wounds to be done in local communities if the good purposes of this Bill are fulfilled. The role of our church communities and their clergy and other community groups in the healing of such wounds might well be needed. However, we ought to recognise that more localism may not mean more harmony and unity in society. If we do not recognise that, we will be doing all the purposes of this Bill and the people it serves a disservice.

Photo of Baroness Eaton Baroness Eaton Conservative 4:38 pm, 7th June 2011

My Lords, first, I declare an interest as chairman of the Local Government Association. That is a great honour which I will hold for only a few more weeks. However, after that time, I hope to continue to contribute on behalf of local government in this place. Having the pleasure of speaking after the right reverend Prelate the Bishop of Norwich and other noble Lords, I am reminded of the wealth of experience and knowledge in this House that continues to benefit local government enormously.

As a councillor, I have represented the ward of Bingley Rural since 1986 and served as leader of a large metropolitan authority, Bradford, from 2000 to 2006. I have seen first-hand how local government makes a positive difference to the lives of local people, whether through involving communities closely in local planning and development or responding to local demand for new services, new facilities and new ideas. Councils and councillors really are at the heart of their neighbourhoods, but equally I have experienced huge frustration when, as a councillor, I have been told, "You don't have the power to do that" or "You can't stray outside Whitehall guidelines". This gave the impression that local government was nothing more than the delivery agent for central government policy. This did a disservice to the excellent, innovative thinking from councillors and officers and led to a relationship in which councils felt compelled to wait for central government guidance on all sorts of issues in case they got a ticking off from Whitehall for being too keen.

That is why I, and so many others in local government, have welcomed the Government's localism drive. In October last year the Secretary of State said:

"The years of government interference and micromanagement are over. Instead, we're starting an era of genuine local leadership ... part of my campaign to replace the command and control approach to local government with genuine localism".

This was cause enough for one of those street parties that the Government have been so keen on in recent months. There have been many positive moves in the past year that demonstrate a real commitment to localising and devolving power. We have seen the end of ring-fencing and the scrapping of the comprehensive area agreement, a barrier-busting exercise to scrap rules that block local government from doing its job. This is important work and it has been welcomed across local government. Now, in the Localism Bill, the Government have set out their radical vision for how local people will be much more involved in the decisions that affect their neighbourhoods.

The Bill is full of good ideas. Local government has particularly welcomed the general power of competence, something which we have requested for many years. The well-being power, which the general power will replace, was found to be wanting and left councils unwilling to use it for fear of their good work being overturned by the courts. A much stronger, more robust power of first resort has long been needed, and I am glad to see this in the Bill. The reform of the discredited and overcomplicated housing finance system is also very welcome, and I hope that the Government will look at expanding this reform to give councils the freedom they need to invest in social housing.

The Local Government Association has applauded the Government's intentions, but also expressed concern that in some places the Bill continues to use the legislative tools of times gone by, tools that have now been discredited. What we do not want to see-I am sure that my noble friend the Minister will agree-is an overly bureaucratic approach to localism that brings with it reams of Whitehall prescription and guidance. This approach can only block creativity and innovation.

Councils do not need more guidance to follow. In fact, this is the very mindset that we need to get away from. What works well in central Manchester will not be suitable for rural Cumbria, and centralised prescription takes no account of this. I do not believe that any council requires detailed rules on how to hold a referendum or how to keep a list of community assets. I am sure that this House will look closely at all parts of the Bill that give Whitehall powers to issue guidance and determine whether these are necessary or appropriate in the post-bureaucratic age we now live in.

It is also important that the Localism Bill does not allow for central government to force its will onto local people. This is antithetical to everything that the Government are trying to achieve and I do not believe that it was ever Ministers' intention. I am concerned that the policy on mayors, which will allow central government to require an area to have a "shadow mayor" and then hold a confirmatory referendum, is the wrong path to take. The change should come only after local people have decided that it is desirable, not before. I also do not think that elected mayors should be required to merge with chief executives. Their roles are resolutely separate, and the political impartiality of the chief executive is an important and long-standing precedent.

I also look forward to detailed discussion of the provisions on referenda. There are five different types of referenda, as the noble Lord, Lord Beecham, mentioned, that are legislated for in the Bill. Each comes with guidance and rules to follow. We will see local referenda on council taxes if a council suggests a rise above the maximum rate; referenda on any local matter, subject to determination by the Secretary of State as to what constitutes a local matter; and confirmatory referenda for shadow mayors and neighbourhood plans. I half expect to see a referendum on holding a referendum.

It is important that we do not sideline local democracy in the push for local action and that we remember that councillors are democratically elected to take decisions on behalf of the people they serve. It would not be right for a referendum to be held simply to please Whitehall when there was no local demand for it or when it negated an elected council's mandate. This would be expensive, damaging and wasteful, at a time when we in local government are doing everything we can to curb waste.

Councils are also very worried about the EU fine clauses that we have already heard about. The Local Government Association has argued that these are unfair and unconstitutional and noted that they give unprecedented powers to Ministers to fine councils without scrutiny by Parliament or by the courts. Certainly there is concern that this policy, if unamended, could lead to long, expensive court proceedings as one part of government seeks to pass blame to another. This is not a situation that any of us would like to see, and we should do all we can to avoid it. Councils have committed to working closely with government to ensure that we are not fined in the first place. I hope that the Minister will reconsider this part of the Bill in Committee.

I stress in conclusion that I entirely support the intentions of the Bill. Local government has spent too long ticking boxes and kow-towing to the demands of central government, and it is very clear that this must come to an end. We must then ensure that the Bill achieves its lofty aims. I look forward to continuing these enlightening discussions in Committee.

Photo of Lord Patel of Bradford Lord Patel of Bradford Shadow Spokesperson (Communities and Local Government) 4:48 pm, 7th June 2011

My Lords, in the short time available I will focus my comments on two areas of the Bill that will have a great impact on local communities and councils: community empowerment, covered in Part 4 of the Bill, and housing reforms, covered in Part 6.

I will start with community empowerment, which could be described as the "people power" element of the Bill. This part of the Bill gives a community the right to challenge a council over the provision of local services, and a new right to buy local assets such as libraries, swimming pools and community centres.

Make no mistake: I am in favour of giving people a greater say in the way their local communities and services are run. I have spent much of my career promoting this very issue and I have learnt that it is not enough to focus on removing suspected barriers, for example by increasing the powers of local authorities to commission services from the voluntary and community sectors. The issue is not lack of interest. We know that there is a great appetite in those sectors to do more, but they can do more only if they are given the right kind of support to make it happen.

We will see a transformation in the way that we provide public services in this country only if we provide investment to ensure that there is capacity building, including training, guidance and coaching, alongside support for infrastructure development, in place for the new commissioning arrangements to work. This is even more vital in these times of fiscal constraints and major cuts in core funding for local government. When this is considered in the context of a Bill that seeks to increase community involvement and service delivery, it leads me to question whether the proposals are a poor attempt to replace highly developed and expert services, which deal day by day with a variety of complex and challenging community needs, with an underdeveloped and poorly resourced alternative. This is not the way to empower communities.

And what of fairness? We have already seen the extreme differences in impact across authorities, especially between the north and south of the country, that the government cuts have produced-cuts that clearly are having a more profound effect in the most deprived and disadvantaged areas. The Government fail to recognise that not all communities have the same level of resources-either financial or professional. This Government have said that fairness is at the heart of their reforms. Would the Minister explain how the Government see fairness working in this Bill? What happens to minority groups that are excluded from the process? How will their voices be heard and how will the Government ensure that communities with fewer resources are not left disadvantaged?

The right to challenge, which is intended to put voluntary and community charities on the front foot when it comes to running public services, is meaningless without the investment to make it work. Words in a Bill will not empower local groups to challenge local authority bureaucracy and poor performance if they lack the support that will give them the time, the understanding and the skills to carry out this challenge.

This is not being condescending, but of course local people know more about what works and how things should be done in an area-they are the ones who experience services at first hand. In fact, there are many examples of this kind of community challenge and involvement taking place. We must ask, however, what would motivate people to want to do more, such as taking over services or assets rather than have the council deliver them. If community groups get involved in running these services, how will we ensure that they are properly accountable on service standards and use of public money? The right to challenge offers no redress to those communities. It simply does not empower them.

The Government seem to expect that the shifts in power from councils to local communities can occur without the right levels of investment. But without this investment, many of the essential processes will not be in place and this will place unintended new burdens on the community and voluntary sectors, which will have to navigate a way through this new system. Will the Minister tell me why the right cannot be used in reverse and why the direction of travel is only one way? Surely, what we need is a partnership between local government and communities rather than the one-sided and divisive approach in the Bill. If public services are not being delivered effectively, there is no right of challenge to redress that.

I want briefly to consider Part 6 of the Bill, which contains the housing provisions. I am deeply concerned by these provisions. The provision of social housing is one of the great and essential public goods of our society. For those on low incomes, social housing provides, through security of tenure, the means to continue working and to enjoy private and family life. It sustains cohesion in our communities.

The arguments put forward in defence of the housing provisions are that "flexible" tenancies should give more freedom to local authority landlords and allow them to manage their stock more effectively and should ensure that the occupation of social housing better reflects actual need. The provisions will allow local authorities to offer fixed tenancies for a minimum of two years, rather than secure lifetime tenancies, which are the norm at the moment. It is clear, however, that this provision has not taken into account the devastating impact that short-term tenancies can have on the most vulnerable in our communities. For example, having to move several times can have the most profound effect on the mental health of children-indeed, on the whole family.

What about the broader impact on the whole community? Short-term tenure reduces new tenants' commitment to their neighbourhood and homes. It undermines their willingness to invest time and energy in the fabric of the housing, the garden and the local environment. There is also the very unpleasant suggestion behind these housing clauses that social housing is to be viewed as some kind of failure to move on and make the most of life. This ignores the fact that, throughout their lives, individuals and families already have pathways through which they can move into different housing types and tenures and through different styles of accommodation in different neighbourhoods.

In fact, by reducing security of tenure, this Government will bring about a much greater restriction on social mobility. Furthermore, I can envisage a situation where these provisions result in more people complaining and seeking to redress what will clearly be a more unfair and discriminatory process.

This brings me to one further issue that I can only assume is an error in a Bill that seeks to empower people. I refer to the reform of social housing regulations in Clause 158. Currently, any person who feels that a complaint has not received satisfaction locally is entitled to take the complaint to the Housing Ombudsman. People may choose, if they wish, to involve their local MP or elected councillors in this process. Under the new provisions in the Bill, this right is to be replaced by an additional layer of bureaucracy that will require people first to involve MPs, councillors or tenants panels in resolving complaints locally before they are sent to the ombudsman. Will the Minister say why this additional layer of bureaucracy is regarded as necessary for housing regulation? Does this mean that the Government intend to restrict all ombudsman services in this manner in future?

I move on to what I think is one of the Bill's most potentially harmful provisions: the reform of the homelessness legislation. Under this provision, the local authority duty to homeless people and families will be changed so that its duty to house can be met by housing the homeless in the private rented sector. While to some this may seem reasonable given the numbers of people, especially in London, living in temporary accommodation while they are waiting for housing allocation, I believe that it will have a much more far-reaching and devastating impact.

Changes in the Bill to the homelessness duty raise serious questions about the rights of some of society's most vulnerable people. Homeless families will no longer be able to refuse unsuitable accommodation in the private rented sector. This could lead to vulnerable adults and children being housed in inappropriate and insecure settings where their mental health and well-being could be seriously threatened. As we are all aware, homelessness is an isolating and destructive experience, and homeless people are some of the most vulnerable and socially excluded in our society and include people with mental health problems, disabilities and alcohol and drug problems.

I understand that the Bill contains a safeguard whereby those made unintentionally homeless within two years of having their homelessness duty passed to the private rented sector are still entitled to housing assistance whether or not they are still in priority need. However, I do not think that this is sufficient protection. Although help will be offered to those who suffer repeat homelessness, a series of failed tenancies can be very damaging. For example, if vulnerable applicants are housed in the private rented sector with insufficient support, they may get into arrears, or their relationship with the landlord or other tenants may break down. In this case they may be considered intentionally homeless and thus not entitled to support. What protections does the Minister envisage will be in place to ensure that there is adequate support for those who are vulnerable and moved to 12-month private sector tenancies to prevent them descending into a spiral of repeat homelessness?

I have only briefly touched on two areas that I believe are essential for us to get right not just for the protection of the vulnerable and needy but for all our welfare in sustaining and strengthening communities. Alongside the funding cuts facing local authorities, this Bill runs a risk of deepening existing social inequalities, particularly in the north of the country.

Photo of Baroness Scott of Needham Market Baroness Scott of Needham Market Liberal Democrat 4:57 pm, 7th June 2011

In every speech on local government I have made in your Lordships' House in the 11 years that I have been here, I have called for government to introduce the power of general competence. I am going to have to think about something else now because I am really pleased to see that the Government have finally brought it forward. I am also very pleased to see the abolition of the Standards Board. It is a body which, while well intentioned, in practice led to a constant stream of vexatious and often trivial claims which were highly damaging to the individuals concerned and really bad for the reputation of councillors and local government as a whole. I am also pleased to see that the committee system is returning as an option for local councils, although I cannot for the life of me imagine why the Government think they should wait up to three years to be able to bring it in. It is important that local councils have an option on their governance models and can choose the model that suits them and their circumstances best. It is for that reason that I am utterly opposed to the imposition of the mayoral model in shadow form, as proposed in the Bill.

The idea of merging the mayor with the chief executive is quite frankly barmy. The whole rationale behind elected mayors is to have a high-visibility candidate, someone with quite different skills from the managerial qualifications that you would expect a good head of paid service to have. I have no doubt that it will go through, but if someone came to this House with a proposal that Ministers should become Permanent Secretaries, there would be an absolute uproar.

There is a sort of schizophrenia evident in the Bill. There are parts that are genuinely localist. For example, I was really pleased to see the dismantling of the provisions in the 2007 Act which told local councils how to receive a petition, but I saw with dismay an even more regimented system for bringing in referendums. Where I live in mid Suffolk, we are having a referendum right now on whether to merge with the local council. The councils got on and did it. They did not need primary legislation to do it, and this provision should not be in this Bill because, as it is envisaged, I fear it will be divisive and I think it will be very costly. There is still a tendency to reach for regulatory answers to every question. If the Government are serious about localism they have to go far beyond the boundaries of just this department and create a localism audit on all new legislation coming forward.

We have a real problem here. Too often, local councils are frozen like rabbits in the headlights of the legal profession and tend to take the safest option on offer. The sparse use of the Sustainable Communities Act and the general power of well-being is testament to that. My fear is that the general power of competence will go the same way. With so much other regulation, both from this department and imposed by others, councils and citizens will simply be unsure about what they can do, a point so well made by the right reverend Prelate.

I am struck by the fact that, despite the general power, I have been deluged with requests from councils and other organisations to request specific powers and duties to be put in the Bill. Clearly, they share the same concerns that the general power of competence simply will not do the job. I was particularly struck by an approach made to me by councillors in Cambridge who, like councillors across the country, are seeking to protect the special character of a shopping street, Mill Road. They are not confident that the general power will give them enough power to override the 2,500 pages of existing planning law, which they believe prevent them from taking the steps that they need to take in order to preserve the special character of the street. I am not at all sure that the changes to the planning system in this Bill will give councils the flexibility that they need to manage their streets in the way that their citizens want. I am sure that we will spend a lot of time on this issue in Committee but it seems to me that if the Localism Bill does not allow councils to protect cherished local neighbourhoods and facilities, it will have failed.

The actions of local government are too often bounded by what they have a statutory duty to do and also by what they are barred from doing by other regulations. We need to create more space in the middle, a discretionary space, where councils can do as they see fit. If one looks simply at the six clauses in this Bill relating to assets of community value, there are 54 things on which the Secretary of State will need to issue regulations. In my view, this is a massive job creation programme for CLG civil servants and for parliamentary draftsmen.

The elephant in the room of course is money. While three-quarters of local authority spend comes from central government, it is inevitable that central government will seek to impose control. The very complexity of local finance will mean that if there are referenda on council tax increases, they will become just a sort of shouting match between central and local government-a battle of percentages-which in the end will freeze and turn off local voters. Given the cost of a council-wide referendum, what we have here is capping by any other name.

Genuine local accountability is impossible while this system persists. It goes to the heart of a healthy local democracy. A lack of clarity about financial responsibility, the maze of statutory provisions and the demise of the local press in many areas combine together to work against a responsive local democratic system. To my mind, this is made far worse by the bundling together of elections on the same day. I fought, and won, two county council elections on general election day. I speak from experience when I say how hard it is to get any oxygen for local issues when elections are fought concurrently. Of course, turnout is higher but, if many of the people turning out are paying no regard to local issues, the cause of local accountability is not enhanced at all. The devolved Assemblies in Scotland and Wales have been given the option to choose whether to hold elections on a day other than that of the general election. Perhaps we should think about local councils being given the same option. There is nothing magical about the first Thursday in May.

This Bill has some good points but it is overly bureaucratic and remains overly centralised. Let us hope that the Government are prepared to listen to what noble Lords have to say today and in Committee and are prepared to make some changes.

Photo of Lord Adebowale Lord Adebowale Crossbench 5:04 pm, 7th June 2011

My Lords, I should declare an interest as chief executive of Turning Point, an organisation that provides community commissioning services in many local authorities; and as a member of the Audit Commission, which, as I have often said, is a struggle.

The Government's Bill initiates a power shift; a shift of power from central government to local communities, and in my view that is a good intention. The experience of my own organisation in working with many local communities is that communities in the greatest need understand to a far greater extent than they are given credit for by their local authorities what those needs are and how they can be met in more imaginative and, indeed, cost-effective ways. Moves to further empower communities through the right to challenge public services should be welcomed. I want to say a bit more about that and then refer to the issues raised by the provisions in the Bill on housing.

However, my concern is that many of the local communities that would benefit from being empowered are often in the most deprived areas and are the most deeply affected by unmet needs, with the related unemployment, low skill levels and health inequalities that are the inevitable result. Communities often know what they want, but are denied access to the resources necessary to become empowered. It is true that all communities should have the chance to assert the right to challenge, but my concern is that there will not be equality in resource and social investment in these communities. This point was also made by the noble Lord, Lord Patel of Bradford.

Turning Point's experience of supporting over 100,000 people in these communities to develop new services has led me to believe that, by empowering communities, a challenge to the local authority is often created. Generally, power is not given up without a fight. While I can see that the intention is to give communities the right to request, there is no duty to provide the resources necessary for communities in the poorest areas to gain the necessary skills, infrastructure and resources to fight the power. It should not be assumed that local communities, particularly in the poorest areas, are formed by some magical process, and it should not be assumed that such infrastructure and empowerment is free. Indeed, Turning Point has found that it is not a lack of money in many places, it is how the money is spent and who is making the decisions on behalf of communities. There is risk of the Bill unintentionally exacerbating the inverse care law as it applies to power and power differentials between the poorest and the richest communities.

I turn to housing issues, which again were also raised by the noble Lord, Lord Patel of Bradford. There is of course a crisis in the balance between supply and demand for housing in the UK, and no more starkly are the effects of this imbalance felt than in social housing. I am concerned about the intention to remove lifetime tenancies while reforming the homelessness duty accorded to local authorities. These reforms are intended to free up the availability of social housing, but they will have the opposite effect. These proposals may have unintended consequences that will oppose what this legislation is setting out to achieve.

It is acknowledged that there is a need for a significant period of stability when someone is given access to social housing. I question whether the time limits set out in the Bill are long enough for individuals with entrenched and complex needs to make the changes required to create stability in their lives. Limited tenure is likely to obstruct the social good of mixed and diverse communities. The social housing population is likely to become more transient, which could lead to further alienation as the social capital which maintains healthy, resilient communities is lost. While these reforms will affect only new applicants, eventually it is likely that the people who access social housing are those with the most entrenched and complex needs. This will act to further increase the stigma already attached to social housing and those who access it.

Similarly, limited tenure may act as a disincentive for people to improve their situation, which would go against the intention of the Bill. Those who excel in education and employment opportunities, or who work to challenge their substance misuse or seek support in addressing their mental health difficulties, could actually be penalised, and the security of their home may be taken away. This uncertainty is likely to increase if local authorities are given the right to discharge their homelessness duty through offering a private-sector tenancy of 12 months without the prior consent of the tenant.

We all know that the private rented market is more unstable than social housing. There is also the increased risk that those with complex need may become further alienated from the source of support that they should expect, which again is a point made by the noble Lord, Lord Patel of Bradford. The vagaries of some private landlords who put profit before tenants will be given free rein to take advantage of some of the most vulnerable in society. For instance, research by Shelter found that some landlords target those with substance misuse difficulties and other challenges in the belief that they will be more amenable to poor-quality, shared accommodation. The links between mental health and housing also show the wider effects of these reforms. Poor housing can contribute to mental health difficulties and, similarly, people who experience mental ill health can find it difficult to access quality accommodation. According to the mental health charity Mind, research suggests that people with mental health difficulties are twice as likely to be unhappy with their housing and four times as likely to say that their housing makes their health worse.

The impact of complex needs can mean that it is harder for some people to maintain private sector tenancies, especially without the increased support often available through social housing. Yet it is possible to have a situation in which the most vulnerable in society can be given private tenancies without their consent, which could exacerbate their problems and cost more in the long run. Housing is a crucial element of health and well-being-an agenda that is given increasing prominence. For the clients that Turning Point and other organisations support, stable, appropriate housing is well established as a key component in recovering from substance misuse, mental health and, indeed, managing issues such as learning disabilities. These reforms should not be allowed to endanger this hard-won progress and further obstruct government policy in other areas. I should like to hear specific remarks from the Minister on how those risks will be mitigated in the Bill.

To address that oversight, I should like assurances that those with complex needs who are given private sector tenancies will have the right to access social housing if they are again made homeless. It is important that any proposed reforms to social housing achieve a balance between accessible housing and ensuring that the most vulnerable people are not disadvantaged, and that their needs are met in resilient communities. There is no denying that this is a difficult balance to strike but it is crucial to the agenda of public service reform that the Government are pursuing.

Photo of Baroness Andrews Baroness Andrews Labour 5:13 pm, 7th June 2011

My Lords, I was quite tempted to address many different aspects of this Bill which have a curious familiarity, but I will concentrate on the planning sections. I am wearing two hats: first, as chair of English Heritage, I thank the Minister for what has already been done to improve the Bill in another place, and I shall come back to that at the end of my speech; secondly, I want to record my dismay both at the regressive nature of some of the proposed changes to planning and-in this rather curious combination of legislation-at the untested and confused nature of some of the more radical elements around neighbourhood planning. My fears are shared by many of the professionals and people outside this House who will have to make the Bill work.

Like many Members of this House, I can welcome some of the proposals, such as the specific proposals for a community right to buy and a community right to challenge, but the key question, which has been raised already by many noble Lords, is how we can guarantee that the Bill will work. The job of this House, in addition to guarding constitutional proprieties, relates to the workability test. At the moment, sadly, I am not convinced how the Bill, with its many good aspects, will achieve the ambitions for growth in planning and housing given the inherent contradictions in it.

The first contradiction is over what the Government want and expect from the planning system and these reforms. Planning is essentially about the best use of land and resources. It is about achieving a balance between all the things we need, whether that is about more jobs and affordable housing, energy security and green space or agriculture and high-speed trains. They all have to be accommodated, and the challenge for a modern planning system is to balance potentially infinite demands with finite resources. That is why the system must have the capacity to be strategic and it must be informed by a wider view of how things can fit together-a spatial view. That is precisely what we have lost in this Bill. With the loss of regional spatial strategies, we have lost the strategic content for planning and any means of mediating tensions between national, or even global, imperatives and local perspectives. Floods, minerals and housing have to be planned for across boundaries; they play out on wide spatial scales and they are contentious issues.

The Minister has already spoken about the duty to co-operate, but she will know from her extensive briefing that there is grave concern about the efficacy of a voluntary duty to consider co-operation which does not require local authorities to co-operate. We do not even know yet which areas of policy or which geographical areas will be covered. What is likely to happen when it comes to issues which divide local authorities and which have to be planned for beyond boundaries, such as waste incinerators or flood risk?

There are few more contentious issues than housing supply. Whatever the complaints about the regional spatial strategies, they had some merits: they were evidence based, independent and offered a coherent way of looking at where housing was needed and could be provided according to land resource. The regional spatial strategy also provided a mediating process for local authorities; now local authorities are on their own and face unforgiving housing pressures.

The Minister said that only 110,000 homes were built last year, but now that the national housing and planning advice unit has been abolished can she tell me how the housing needs for the nation as a whole will be assessed? How many houses does she think the country will need this year, next year or the year after? Perhaps she will refer me to the new homes bonus. I accept that that may act as a spur to housing in growth areas, but it will not help poorer communities where the need is for regeneration and renewal-take the case of Liverpool, for example. Indeed, the TCPA and the Joseph Rowntree Trust suggest that it will reinforce structural inequalities between regions. I am afraid that, on the analysis, the outcome is all too predictable. How would the Minister interpret that dichotomy?

My noble friend has already referred to Clause 124, on financial incentives. I and many others have grave concerns about the clause, because we have for the first time in planning legislation an explicit priority given to financial incentives in the planning system. This is a major distortion of what planning is there to do. It has set many alarm bells ringing, because it could lead to grave consequences. Where is the wider planning interest in this? Where is the interest which compensates for sustainability or affordability? Much wider issues should be taken into account.

I turn from the regressive to the untested elements of the Bill. We are told that the key planning document will now be the local development frameworks. Barely a third of them have been completed, but the neighbourhood development orders, these radical new powers, are required to conform with them. What will happen where there is no LDF in place? How many neighbourhood forums does the Minister anticipate? I have seen a figure of 25,000. Can she confirm what has already been put about, that some of them could cost as much as £200,000? But the crucial question is what exactly they will be free to plan for. If they do not cover housing allocations, waste or minerals, what are they left to do?

The lack of reference to sustainability opens up a second major contradiction. Whereas the Budget statement seemed to take a very simplistic view of planning in which growth and sustainability were at odds with each other, we now seem to have a default position in which economic growth is to be the principal determinant of planning.

The Minister in the other place was insistent that this and many other aspects of policy would be made clear in the national policy planning framework, which will be the key to getting the planning system right. Its purpose is to streamline all existing planning guidance, but we do not yet have the final version. We have only a draft version, apparently commissioned by CLG and produced by a group of "practitioners", which has been described by the TCPA, for example, as falling short of the kind of guidance necessary to create an effective planning framework for England. So we are in a rather strange position. Will the Minister say why the draft was commissioned when work is already under way in her department on the official CLG version? Who will own the final draft and when we will have it? Without the authorised version-and this is very important-we simply cannot tell whether the degree of detail available will be clear or sufficient to guide local authorities towards making the right local decisions. I would refer noble Lords to the issue of sustainability, which is interpreted in the draft text in a way that suggests that economic factors are given more weight than social ones.

I come back, finally, to heritage protections. What concerns us in the heritage community is that the protections around the historic environment in this draft document are in fact weaker than existing protections in the recent, modernised planning document on heritage protection-PPS5-which was praised as valued and successful, only two weeks ago, by the Minister for Tourism and Heritage. Indeed, he expressed his concern that it must not be thrown out with the bathwater in order to make the NPPF an all-new document, because it is such a useful and clear document. I am sure that the Minister will want to talk to him. The problem is that this document, for example, fails to recognise the spectrum of heritage assets, which extends from undesignated to nationally designated assets, or how to find new viable uses for useable heritage assets. If these elements were to find their way into the final draft, we would be left with a weaker set of protections around heritage. We do not want to do that.

I will let the Minister have a full list of areas of concern, which will also include the problems raised by undesignated archaeology, which again is in a rather unfortunate position in relation to the NDOs. I know that is something she will want to know about. I know the Minister is going to respond to me in the very positive way that she has already done when we raised issues with her at an earlier stage of the Bill. Indeed, without her interventions, we might now be faced with a clause that explicitly removed protections around conservation areas and listed building settings in relation to neighbourhood development orders. I am extremely grateful that the Government have now corrected this and I am very grateful to her personally.

In conclusion, I hope that the Minister is able to respond to some of my concerns this evening. I have raised them in the wider spectrum: the increased uncertainty, reduced confidence in the objectivity of planning and abolition of the necessary ability to plan strategically-not least because we are at a time when we have never needed greater foresight, intelligence and objectivity in the planning system. The Minister began by saying she was willing to listen. I would expect nothing less from her and I am sure that, across the House, we can improve this Bill in the way we need to.

Photo of The Bishop of Derby The Bishop of Derby Bishop 5:23 pm, 7th June 2011

My Lords, like many in the House, I warmly welcome this Localism Bill and the desire to empower communities and shift power to local communities. Many of us will be aware of the feeling of collapse of community and the undermining of democracy through apathy and non-engagement. This is a very timely measure to try to empower the local and I want to offer a very brief view from the ground; because if we are talking about empowering the local, we need to know who constitute the local and how people can be drawn into these processes and take part in the ordering of local society.

The clue comes in the language. The Bill uses the phrase "community empowerment". As the noble Lord, Lord Beecham, said, talking about Athens and Pericles, you might just about imagine a community in Athens, which was, I think, about 5,000 people. You might also have a sense of community in a medieval town, with its segments of people living in different crafts. However, since the rise of 19th-century industrial cities, modern cities and now the mobility of people in rural areas, the physicalness that created community has disappeared largely from people's lives. The Bill recognises this, in that although it talks about communities and community empowerment, it majors in its solution on the notion of neighbourhood, which is rather different. It talks about neighbourhood forums, neighbourhood plans and referendums-mechanisms for a neighbourhood to try to help community happen. But there are very important informal elements that create community and give people a sense of well-being and direction in life which need to be taken account of if these neighbourhood mechanisms are going to be inhabited as the Bill envisages.

I would like to share the results of research by the Church Urban Fund, which has looked at 232 faith-based projects working in the 10 per cent most needy areas of our country. It would seem to me that the test of any localism is how you include those normally excluded. This research looks at the 10 per cent of those in the most needy areas and the projects working with them. Sixty per cent of those projects report an alarming collapse in their capacity to engage with this local agenda-partly through the withdrawal of grants and partly through the collapse of the capacity of local government to be an agency in making communities. That is a very serious picture. If one test of localism is how we involve the most easily excluded, we have to think carefully about inhabiting this Localism Bill and how it can really work.

The danger in the way the Bill is couched is that neighbourhood mechanisms will most easily be inhabited by those who already have economic and social capital. There is a great danger that assets and services could be taken over and controlled by private finance and particular interest groups and not really draw on the local community. Research that the Church Urban Fund has done in my own diocese showed the struggles of a family centre trying to create families with stable lives and, in youth work, with trying to bring young people into society. We have to invest in these things. Besides trying to create the opportunity and structures that the Bill highlights, you will empower people's participation only if you give them the resources to do it. There is a tremendous resource deficit, particularly in the most needy communities. There must be some joined-up thinking in government if we are really going to make this Localism Bill operate. It is a thing of its time and a very wise proposal, but it must be substantiated by serious investment-not just in the mechanisms and opportunities but in the resources to local communities. I ask the Minister to consider very seriously the litmus test of localism, which is including those most easily excluded. Can that be somehow taken very seriously in working the proposals further, with neighbourhood mechanisms being developed so that they can reach out to community life and help community life happen more seriously?

Photo of Lord Wei Lord Wei Conservative 5:28 pm, 7th June 2011

My Lords, I start by declaring an interest as a voluntary adviser to the Community Foundation Network, a movement that seeks to improve society in the UK through philanthropy. I thank the Minister for sponsoring the Bill and for introducing it in such a listening manner-a Bill in which there is plenty to welcome as well as to discuss.

The Bill is an incredibly significant piece of legislation in that it sets out some of the key foundations for the big society, enabling a major shift by decentralising power and strengthening local initiative. In doing so, it creates a tangible empowerment of communities and neighbourhood groups. While community empowerment is only one ingredient in the big society recipe, alongside public service reform and encouragement of social action, it is a very important one. As those of us who have worked closely on local issues will be only too aware, for too long many communities have seen their hopes and ideas frustrated by an overly bureaucratic system or felt powerless against overbearing third parties, whether public, private or voluntary, which for whatever reason have, often unintentionally, overridden the wishes of local people.

This Bill and the big society itself are an attempt to redress that state of affairs, bring balance and help rebuild trust between those who have power and those who are subject to it. This Bill will bring together many provisions to eliminate some of the hurdles in local government planning and housing that make people feel powerless and apathetic. I want to highlight a few in particular and outline some areas that will need to be handled with care.

I eagerly greet the creation of a range of local community rights contained in this Bill: the right to challenge and propose alternative providers for local services; the right to buy or express an interest in assets of local importance to communities; the right to build much-needed housing or other small-scale community-owned infrastructure. Each of those has the power to transform communities, whether they are inner-city ones frustrated by the housing management provided to them as social tenants, suburban residents who want to save their pub, post office or library and turn it into a multi-use sustainable hub, owned and frequented by the community, or rural communities that I have visited that have wanted to create housing for their young people who are otherwise having to leave for the city because they could not afford to buy locally.

I also welcome the release of local authorities from Whitehall control by granting them the power of competence and the reforms of their governance, such as in the option of having city mayors or returning to the committee system, as well as a means to introduce direct democracy through various referenda. The key principle here is to provide flexibility, to move away from one-size-fits-all Whitehall control and, ultimately, to put more power into people's hands. These reforms will give local authorities real discretion to work innovatively and redesign their public services around their own local circumstances, in line with the wishes of those they serve. That is essential if we are to have a more responsive, efficient and accountable local service in future.

The provision for neighbourhoods, either as parishes or local forums, to create their own development plans will also produce a much-needed culture change in how communities interact with planning authorities. Rather than having an adversarial and expensive system where every little change needs to be argued over, the community is incentivised to come together to shape its own neighbourhood for the long term. In places such as Seattle, that has led to innovative solutions such as the community proposing creating much-needed housing over the local library and enhancing the character and community ties successfully within neighbourhoods.

As someone who has lived privately in social housing environments previously, I also welcome the measures designed to remove a number of unfair and bureaucratic barriers faced by existing and prospective social tenants. Waiting lists are too long and currently can force many people to live in a limbo-like state and in poor quality environments for years. It is unfair that so many will wait while others are given higher priority over them, sometimes for temporary economic or other reasons, in ways that can even destroy social ties between family members who rightly wish to live close to each other. Carefully thought through measures to make social housing tenancies more flexible and to widen the range of housing stock that people are provided with-subject to minimum standards, to include private rental options-are critical, in my view, to improving the lives of thousands of low-income citizens. Reforms to have more web-enabled swapping of homes and to strengthen housing association accountability are also welcome. We need more associations that are both responsive to tenants and can think out of the box when finances are tight.

However, like most good things, none of the new opportunities outlined in the Bill for communities and local authorities comes without some risk, which will need careful management at all levels. First, it is imperative that the new rights are designed to balance the need for due process without unnecessarily increasing bureaucracy. If the process is made too complex and given too many layers and tick boxes, there is a possibility that the new rights' full potential is never realised and that people will frankly not bother, especially in more deprived areas. To this end, I welcome measures being introduced by departments and various civil society groups to help communities have the capacity to take up their rights.

Secondly, just as central government releases powers now, local authorities must also be incentivised to devolve their own powers and not hoard them, to fulfil themselves the principle of subsidiarity. If localism is really to work, it is crucial that councils understand that same aspiration within their own communities and take steps to meet it. The popular pendulum may otherwise swing back over time to central control, as it did in the 1980s, after the failure of overweening municipalism. The referenda and other direct accountability measures are therefore key to holding local authority power in check, even as central oversight is partly reduced.

Thirdly, it must be acknowledged that neighbourhood plans are big documents and likely to take 18 to 24 months to produce. Due to the considerable consequences of the plans, it is also crucial that they are designed properly. While local authorities have a duty to provide support and advice it will be vital that, on top of that, community groups have access to specialists and toolkits-provided by the likes of the Prince's Foundation and others-to ensure that every community that wants to will be able to produce a worthwhile and workable plan.

The changes to social housing also need to be implemented with care. Others, I am sure, will pick up on that. When you have a country facing a chronic shortage of such a scarce resource as housing, there is always a risk of abuse. Poor decision-making can arise when those allocating housing are under pressure. Yes, we will need checks and balances and we will need to make changes in a phased manner, but the overriding issue here is a general lack of housing, which other measures in the Bill and the flexibility that it creates over social housing management should help to address. We must also understand that at times in this process, Whitehall may need still to play a role since healthy localism does not happen overnight. We will also need to watch carefully how different reforms take shape and gradually amend guidance and regulations as we go along. It will not be perfect straight away and control must be released carefully.

Finally, we must watch our temptation not to share power because we fear extreme groups taking over locally-that age-old tension between our desire for security versus our yearning for freedom. In my experience, such a blanket reaction is uncalled for. Instead of withdrawing, we should always push for the greater participation of those in the mainstream and those on the edge to drown out the extreme voices who would otherwise hold sway. The more we water them down out of fear, the more we will perpetuate the apathy engendered by bureaucracy and monopolistic abuse of local power, which have been so damaging to our country, democracy and public life. On the other hand, the more transparent, muscular and representative we make these reforms, the more likely that citizens of all kinds will participate as they realise that they have teeth. Let us therefore work together to make these reforms work on behalf of the millions of citizens who will benefit from them locally and enable them to help us to build the big society.

Photo of Baroness Bakewell Baroness Bakewell Labour 5:36 pm, 7th June 2011

My Lords, I declare a peculiar interest which is that I do not have any interests to declare; I am simply a citizen and a ratepayer of Camden. I will not detain your Lordships long but I am interested in the idea of localism. People have struggled to define it, which I find quite interesting because it just means what we have all been doing. I thought that I would add, anecdotally, some stories that might indicate how I will be judging this Bill as it goes through.

We have struggled in Camden for well nigh a decade to keep local libraries open. We planned our meetings together and the word got round on the street and in the shops. We had meetings, made plans, invaded the council meetings and took them over. We organised a scheme whereby all the pushchairs and wheelchairs in the borough invaded the council chamber. That was quite impressive, because those were the users-the people who wanted their libraries to be local and not to have to travel, as the council wanted us to do, to some glitzy, vanity-project library which nobody could reach. We have prevailed and we go on prevailing. In the face of the current cuts, we are once more on the warpath. This is localism as we experience it in Camden.

On another occasion, the rumour went round-it was a good street rumour from the parents of children at the schools and the people in the shops-that Starbucks was going to move in on one of the properties on our street, which prides itself on having highly idiosyncratic and individual shops. We knew that we did not want a chain. We met and made plans. Some of us put a bit of money in the kitty. We lobbied the local papers, we put up posters and we frightened Starbucks away. Starbucks let it be known in the local press that it certainly did not want to go where it was not wanted-incidentally, there are Starbucks branches not very far from our street. This is localism. It had no referendums and no structure. It had no top-down plans to organise us. We organised ourselves, which seems to me to be the essence of localism.

Just in case your Lordships think, "Yes, well, Camden; that's all very nimby", I have to tell you two things. The mums with the pushchairs and the old people in their wheelchairs were not nimby. In any community, it always takes certain vocal people to get things organised. Your Lordships will recognise that. However, once that is under way other people come on board, so we were broadly understood to be representative of the community. Also, once we had got rid of Starbucks we had a call from Richmond saying, "How did you pull it off? We want to do the same thing". There is already a broad, grass-roots willingness to pitch in. I am not sure whether the passing of Bills with systems, with forums or with structures being offered to us by them over there is what true localism is about, so I shall be monitoring this Bill for every clause which appears to be top-down and does not play along with the bottom-up, grass-roots sense of this country.

Photo of Lord Shipley Lord Shipley Liberal Democrat 5:40 pm, 7th June 2011

My Lords, I congratulate the noble Baroness, Lady Bakewell, on defining for us what localism means. In debates like this it is helpful to have clear definitions of what we mean by words: from "localism", through "community" and "neighbourhoods" to "nimbyism". In the end, localism is about neighbourhoods and neighbourhood provision; and it is about the social inclusion and cohesion that derive from that localism agenda. In that respect I agree entirely with what the noble Baroness had to say.

I declare my interest as the vice-president of the Local Government Association and I am still a member of Newcastle City Council.

The Bill's declared aim is to devolve and decentralise power to councils and communities locally; and where it does that, the Government should be commended. Not surprisingly, there is a concern that the Bill has not been drafted in the spirit of localism. That is because there are simply too many powers assigned to the Secretary of State and Whitehall to regulate and micromanage. The Government should not have powers to impose shadow mayors on local communities. The creation of an elected mayor should rest entirely in the hands of local people; and giving the Secretary of State the power to force a shadow mayor on to local people and then subject his decision to a confirmatory referendum is wholly against the spirit of localism.

Nor should central government legislate on what constitutes an excessive council tax rise. I find it interesting that the desire for localism in this Bill does not extend to allowing a referendum on putting council tax up. True localism would require not only an option to have the council tax rate below what the council says, but also one that is above what it says. As for referendums, councils already have powers to hold them, but the Bill will see Ministers in future regulating these more from Whitehall. In social housing, the Bill would lead to increased housebuilding and growth only if it frees councils to invest in social housing. So Whitehall should not be able to cap councils' ability to borrow to invest in social housing.

In principle, the Government have made firm commitments to devolution, so the desire to devolve is apparently there. This Bill's potential is for a legacy of empowered places, a more competitive and inclusive England, a rebalanced economy away from an overreliance on the south-east, and cities that have greater freedoms. This Bill provides further powers for London, transferred from the London Development Agency and the Homes and Communities Agency, with the power for Ministers to delegate further functions. The country needs London to do well and London-along with the devolved assemblies of Scotland and Wales and, through them, their cities-will have greater freedom to grow its economies than other cities in England.

Yet cities in England are also capable of delivering substantial growth and the country would benefit enormously from giving them the opportunities to drive prosperity. A recent report by Oxford Economics has shown that many billions of pounds in growth could be delivered by empowering English cities. For example, the urban areas of the eight English core cities -Birmingham, Bristol, Leeds, Liverpool, Manchester, Newcastle, Nottingham and Sheffield-already account for 27 per cent of the UK's economy. We need to seek ways to unleash that economic potential, create much needed investment, jobs and growth and enable those cities to compete on a level playing field internationally. I anticipate an opportunity to discuss this proposal further in Committee.

I have some further words on housing matters. Reforming the complexities of the housing finance system is very welcome, but it must lead to councils being empowered to do more-and being expected do more-for themselves, with greater interdependence and more financial certainty. We simply must build more homes, given that new household formation is now more than twice the level of new housebuilding. So many of our housing problems relate to undersupply, particularly of social housing, and addressing this is central to preventing homelessness rising and the average age of first-time buyers being driven upwards to over 40. The Localism Bill offers us an opportunity to improve the duty owed to single homeless people and, in my view, it would be right for local authorities to provide suitable accommodation for a period that would give them a reasonable chance of finding accommodation for themselves.

There is a concern that some councils, when seeking to bring their ALMOs back in-house, are effectively excluding tenants from the process. I hope a clause might be inserted into the Bill that would oblige local authorities seeking to disestablish an ALMO to inform and involve tenants fully and hold a ballot. I also hope for an assurance from the Minister that the community right to challenge will be applicable to social housing tenants and ALMO staff who want to manage social housing by setting up an appropriate co-ownership structure.

This Bill will remove security of tenure for new social tenants and introduce a new form of short-term tenancy. There is a danger that the Government could be introducing legislation which will cause anguish for some very vulnerable families, while not delivering a great deal. Short-term tenancies run the risk of creating a cycle of repeat homelessness; and rather than create yet more insecurity for people and communities, reform should focus on long-term solutions that deliver the security that vulnerable people need.

Securing social mobility is a key agenda for this Government, but this is achieved through security and confidence, both at individual and community level. Reviewing tenancies every 24 months is too short a timeframe to secure that ability to build confidence and act on opportunities for employment.

One final point relates to the ballot box and representative democracy. This is an understated, undervalued issue in the Bill because the primacy of decision-making at all levels must lie with those who are elected to take those decisions. To take neighbourhood planning as an example, there has to be a democratic legitimacy. Some 40 years ago I was involved in pushing the case for urban parish councils. For a decade or so it was central to a lot of my thinking and to that of a number of Members of Your Lordships' House. In the context of parish and town councils being available in many parts of the country, they are less so in concentrated urban areas. Securing democratic legitimacy may need part of this Bill to look at some form of elected urban parish councils to give force to neighbourhood planning.

Photo of Lord Wigley Lord Wigley Plaid Cymru 5:48 pm, 7th June 2011

My Lords, what a horrible title this is for a Bill, which is essentially about community-a much warmer concept. In the few minutes available, I will flag up some key issues, which I hope to return to at a later stage. The areas of main concern to me are how the Bill impacts on Wales and in general how it impacts on the well-being of disabled and disadvantaged people wherever they may live.

My party, Plaid Cymru, supports not only the devolution of power to the nations and regions of these islands, but also to local communities. For years, Plaid campaigned for the abolition of the ultra vires rule. Of course, enabling communities to do more for themselves does not guarantee that they have the capacity to do so. Some of the neediest communities also have the least capacity. JB Priestley once commented that decentralisation by central direction is a contradiction. That may be relevant to this Bill.

I am very aware that some of this Bill was rehashed substantially in its later stages in another place under a stringent timetable Motion, and that in March there was a yes vote in the referendum on the powers of the National Assembly in Wales, which significantly impacts on the application of parts of this Bill on Wales. Consequently, there is some lack of transparency which we will need to look at in Committee. An example is the lack of clarity regarding the Bill's application to Wales. This arises in Part 1, dealing with the general powers, Clauses 1 to 8. This has to do with local government, and the term "local government" is defined in Clause 8 in terms that apply to England. The Explanatory Notes to the Bill say on page 97 that Clauses 1 to 8 apply only to England, yet Clause 5(8) refers to orders that have,

"effect in relation to Wales", and provides for consultation with Welsh Ministers. Similar problems arise elsewhere in the Bill, for example in Clauses 126 and 127 in relation to homelessness, and in Clause 145 in relation to the abolition of the housing revenue account subsidy, which has a significant knock-on effect for Wales.

Two other areas are of particular concern to the Welsh Local Government Association. The first is in regard to the UK Government passing down European fines and penalties to local government. If councils are liable for EU fines, they rightly feel that they should be able to influence the laws that lead to those fines. It is not clear how the EU fines that relate to councils in Wales will be handled. Part 2 does not appear to apply to Wales, but the WLGA fears that it will. The Minister Greg Clark suggested in another place that this will happen, although it is apparently not currently in the Bill. As most local government functions in Wales are devolved to the National Assembly, this raises the question of the Assembly's right to interface directly with Brussels on these issues. There is also a danger of significant legal costs to the public purse from intergovernmental disputes over fines that may arise.

The second issue that the WLGA has flagged up is to do with planning. As the Minister will realise, Wales already has 25 local planning authorities, which enjoy substantial local engagement. Community councils have a key role as local sounding boards in Wales. Therefore, the question arises of whether localism as an approach in the Bill is as relevant to Wales. This leads to the question of whether the provisions of the Bill on nationally significant infrastructure projects are appropriate to Wales. The Bill does not reflect the reality of the devolution settlement in Wales. For example, Welsh Ministers and the Welsh Local Government Association have supported the aim that all energy developments of up to 100 megawatts should be devolved to the Assembly. The current dual approval process provides specific problems in Wales; so far Ministers appear to have been deaf to such pleas. I very much hope that we can return to this at a later stage.

Finally, I turn to issues of concern to disabled people. I declare an interest as joint patron of Mencap Wales. These issues include ensuring that security of housing tenure is maintained for carers and relatives of disabled people. This is an issue of considerable concern to many in the world of disability. There are also worries that people with learning difficulties will not be a priority group for social housing. This needs to be addressed. No doubt other such issues will arise in Committee; I very much look forward to participating in those debates.

Photo of Earl Cathcart Earl Cathcart Conservative 5:53 pm, 7th June 2011

My Lords, I am a landowner and a landlord, and have been a local councillor for several years. I certainly support the thrust of the Bill, in that shifting power away from central government to communities is most welcome. I have three points to make.

The first concerns how the Bill will affect small businesses. The business community has welcomed the measures in the Bill that could stimulate economic growth and ensure the protection of the country's high streets and town centres. I should like to look at how this might affect rural areas. It has long been argued that to save the village shop, pub and post office villages must have a critical mass of housing, so new housing must be built. I agree, provided that the new residents use the facilities in the village. Sadly, all too often the new residents will drive to the market towns or cities to work, where it is all too tempting for them to pop into the supermarket to shop. Villages then become dormitories.

Not only is new housing necessary but, just as importantly, jobs and small businesses need to be created in the villages so that the residents not only live but work in the parish. The residents would then spend their working week in the parish and be far more likely to use the village shop, pub, butcher and baker regularly, and would have to decide consciously to get into their cars to shop in the towns. Small and new businesses are vital to the economy and well-being of villages. As such, business, in particular small business, should be fully involved in the neighbourhood plans. It is therefore good to hear the Minister say today that neighbourhood forums will be strengthened by the business community.

My second point is about the requirement that a local authority must hold a referendum when it has received a petition that is signed by at least 5 per cent of local electors. Five per cent is too low and could give rise to a plethora of referenda. Five per cent of a market town with 20,000 electors might seem reasonable. However, in parishes with only 200 or 300 electors, 10 or 15 signatures would be all too easy to obtain. Just a handful of households could demand a referendum on any and every issue they choose, at no cost to themselves. That brings me to cost. Recently a referendum was held on a proposed incinerator near King's Lynn in Norfolk, which cost West Norfolk Council £80,000-£80,000 for just one referendum. If the bar is set too low, and 5 per cent is too low, referenda will be called on every contentious issue at a huge cost to councils, which they can ill afford in today's straitened times.

My third point concerns the requirement that local authorities maintain a list of assets of community value, which can be added to from nominations by members of the public. What is an asset of community value? Is it the farmer who allows the village to play cricket on his field or park cars next to the church? Those pieces of land are certainly of value to the community, but are they assets of community value? If they are, I can see many farmers withdrawing their facilities so as not to be caught by the Bill. This of course cuts across the ideals of the big society. Therefore, "community asset" needs a clear definition. The worry is that the Bill uses the words "disposal of"-not, as the Minister said, "sale of"-a community asset.

The Bill gives communities the right to bid for and take over the running of the community asset on disposal-that word again. Generally I support this idea, but I see problems. If a landlord wants to sell his pub to another publican, should the community have a right to bid? Undoubtedly, yes, but should that right be able to delay other commercial purchasers of the pub for up to six months, while the community gets its act together? I think perhaps not. The community's right to buy is intended to safeguard the pub from closure, not to disrupt commercial landlord-to-landlord sales. Strangely, there is no provision in the Bill to allow the community to bid for a pub if the landlord applies for a change of use from pub to residential, because there has been no disposal or sale of a community asset-just the loss of it. This rather defeats the object of these provisions. I support a great deal in the Bill, and I look forward to Committee.

Photo of Lord Filkin Lord Filkin Labour 5:59 pm, 7th June 2011

My Lords, I shall speak on just Part 5 of the Bill, which, although it was not referred to by the Minister, is one of the most substantial and concerning aspects of it. As the House may well know, the Bill abolishes the whole standards regime that has been developed for local government over the past 20 years. It does not simply abolish the Standards Board for England, it abolishes the national code of conduct for local government, which had to be picked by local authorities who could then add clauses to it. It abolishes the obligation to have standards committees in local authorities to investigate complaints. It also appears to remove independent members as chairmen of those standards committees, and independent members.

The House should be seriously concerned about these changes, for which the Government have made no clear or cogent argument, given the decisions that local authorities make. They have enormous power to create or destroy value through their planning decisions and award many large and small contracts. They are major buyers of goods and services in their areas and can award or withdraw grants affecting individuals and communities. They have extensive regulatory powers and are often the dominant employer in their community. This is a massive range of powers, which most of us welcome and support, but it is fundamental that the public have confidence that these powers are exercised with honesty, fairness and probity. For too many years, too many people in our society have not believed that that was the case, given the evidence that has emerged of occasional scandals. It is rash and foolhardy to behave in the way the Government are doing in demolishing this structure of standards, although that does not imply that there is no room for improvement and development.

Over the past few years we have seen a gradual improvement in public confidence that local authorities conduct their affairs by and large with decency and honesty, and that processes exist to investigate members who are alleged to have misbehaved. The Bill will, if unamended, destroy much of this good progress. It is opposed by the Committee on Standards in Public Life. That in itself ought to be sufficient reason for this House to take its recommendations very seriously indeed. It is also opposed by SOLACE and the Association of Council Secretaries and Solicitors. Classically, unfortunately, the Local Government Association has been split on the matter. The Conservative members feel that it is not polite to oppose their Government. However, other elements in the Local Government Association regard this as a foolhardy set of measures. We ought to be even more concerned, given the hamstrung nature of the Local Government Association's voice on this matter.

The Committee on Standards in Public Life has commented:

"The lack of a national code of conduct and an independent complaints mechanism in the proposed new regime for standards in local government risks lower standards and a decline in public confidence".

No one believes that the world will suddenly collapse, but clearly understood standards with clearly understandable processes provide a basis for investigating complaints and, more importantly, have a deterrent effect on misbehaviour. It is dangerous to allow a local authority to decide whether or not to have a code of conduct, as is proposed under the Bill, and if it does to choose what process to use to investigate complaints. It can no longer have an independent member chairing it. These measures will certainly reduce public confidence over time with the inevitable misbehaviour on the part of an authority or individual councillor, as human nature will not change as a result of localism.

Some councils will have codes of conduct, others will not. Some will have one code, others will have a different code, and most will have different processes. It is unclear from the Bill what sanctions are available to local authorities as it makes non-declaration of interest, or non-disclosure of a declared interest, a potential criminal offence but does not have clear sanctions or processes for addressing the vast majority of other forms of misbehaviour or alleged misconduct by members.

Most of us have had experience of local authorities in one form or another and most of that experience has been good, but some authorities are captured by one particular interest group. It can be a single party where a party is dominant for years, which can lead to the suppression of other voices or views, or it can be a cabal within a party. There certainly have been masonic influences in some London boroughs in the past. I hope that these things will never recur, but let us not destroy the processes, structures and standards that act as deterrents.

For all these reasons we have a national code of conduct that governs the behaviour of MPs, civil servants and others in public life. It is therefore self-evident that there should be a national code of conduct for local government as well. It is trivial of the Secretary of State to avoid this by using the localism argument. I hope that we will come back to these issues and consider them seriously. This is not, and should not be, a party political issue. The whole House, irrespective of party, should want to ensure that proper standards are put in place. To divide on party grounds in itself signals that there is something wrong with the Government's recommendations. The Government should pause on these issues and go back and consult properly on them. There has been no consultation or pre-legislative scrutiny on these fundamental issues.

Photo of Baroness Doocey Baroness Doocey Liberal Democrat 6:05 pm, 7th June 2011

My Lords, I must declare an interest as a member of the London Assembly. I have also previously served as chair of housing in the London borough of Richmond upon Thames. I wish to focus my remarks on Clauses 124 and 130, and how they will relate to housing in London.

The first of my remarks concerns the legal duty to the homeless. Clause 124 enables a local authority to discharge its main duty to the homeless with an offer of suitable accommodation from a private landlord without requiring the applicant's agreement. Such offers of a private letting would require only a minimum 12-month fixed term, offering no long-term security. The Government assume that this provision will lower the cost of accommodation to the taxpayer; indeed, the cost of temporary accommodation for the homeless is unnecessarily high. However, given the shortage of housing, lower rents are unlikely. The market trend is in the other direction. Average London rents are now nearly £1,000 a month. FindaProperty and Savills both estimate that during 2010 average rents for new private sector lettings in London rose by nearly 17 per cent.

I therefore find it highly improbable that private sector rents will fall as a result of this legislation. It is much more likely that the quality of private rented accommodation will decline as profit margins are squeezed. Rents will not fall but conditions might due to a lack of investment. Even if rental costs were reduced, any savings are likely to be offset by the knock-on costs of repeat homelessness due to the 12-month minimum term. The people who are becoming statutorily homeless are increasingly the most vulnerable families. Placing them in private sector accommodation is unlikely to give them secure and stable homes. Indeed, they are likely to be forced to live in substandard accommodation and, much worse, forced to move at regular intervals even if they have been model tenants who pay their rent on time.

In addition, benefit changes in the Welfare Reform Bill may make it more likely that tenants are evicted for falling into two months' rent arrears, so the Bill in effect undermines the legal duty of local authorities towards homeless people. We need proper safeguards. These could be established with a statutory accreditation system for the private rented sector rather than relying, as in London, on a voluntary one. Your Lordships may be aware that in London the mayor has established a voluntary accreditation system as part of his current housing strategy. He has set a target of 8,000 accredited landlords by the end of the year, and he is likely to meet that target, but let us put this into context; London has the highest number and proportion of privately rented housing in England. In 2009, there were nearly 700,000 private rented dwellings in London. That is 20 per cent of all London households, compared with an average for England of just under 13 per cent. Between 2001 and 2006, the number of private rented properties in London increased by a massive 25 per cent.

Currently, one in five households in London are privately rented. In some boroughs, the figure is much higher. In Newham, for instance, it is one in three households. In six London boroughs, private rented housing forms more than one-quarter of all housing stock. This is a sector that we need to be reputable, to be a genuine third pillar alongside owner occupation and social rented housing, but many landlords do not behave well towards their tenants in London's private rented sector. Four out of every 10 homes are non-decent or substandard. If more people are to be placed in private accommodation, it is essential that some form of kitemark is introduced to ensure standards.

My second concern is the proposal to remove security of tenure in social housing. Clause 130 proposes giving local authorities the power to offer flexible tenancies to new social tenants of not less than two years. The clause provides for the circumstances in which a new tenancy will be a flexible tenancy. The basic principle of flexible tenancies is sound, but if the minimum duration of a tenancy is only two years, that will almost certainly become the norm. That is what local authorities will offer, and the minimum will, in effect, become a target.

People living in social housing are entitled to reasonable security of tenure. They need to be able to settle into communities, to put down roots and to make friends. They also need to be able to find work within reasonable travel distance and to secure continuity in their children's education. If they are forced to move continuously, they will find it harder to stay in employment, their children's education will almost certainly be disrupted, and they will have less incentive to maintain their homes in good order. As a result, we are likely to see a greater concentration of deprivation and worklessness in social housing. Surely that is the last thing that anyone wants, but it will almost certainly be the direct consequence of providing such limited security of tenure.

Social housing is designed to help the most needy in our society. They must be given some form of continuity rather than a lifetime of transient housing. Transient housing serves no one well-certainly not the families, especially the children concerned, and not the local communities in the long term. I shall return to these issues when we reach Committee.

Photo of Lord Cameron of Dillington Lord Cameron of Dillington Crossbench 6:12 pm, 7th June 2011

My Lords, I must first declare an interest as a landowner and farmer and as chairman of the Charities' Property Association. This is a large and complicated Bill, and there are many sentiments behind it of which I approve, but today I shall restrict my remarks to the chapters on planning and communities. Here, there are opportunities but also, I believe, considerable dangers. The Bill is what Sir Humphrey might call "very brave". It is in its very breadth and complexity that the biggest bravery lies. I believe that the average businessman encounters the planning system once every eight years. After the Bill, he will find that he has to learn a completely new language. That will almost certainly lead to uncertainties and delays in development, and thus economic growth. Frankly, I cannot think of a worse time for delays in development and economic growth. In this context, I worry about our national housebuilding programme, especially affordable homes and, in particular, rural affordable homes.

As I said, it is a brave Bill. It is brave because not only will the system be different from top to bottom, but no one quite knows how the links between the different new bits will work, nor how the transitional phase will work. What happens to a contentious planning application during the 18-month phase it takes to get a neighbourhood plan in place? Surely the tendency must be to delay it, at a time when, as I said, we cannot afford to delay.

Starting at the top, I was dismayed but not surprised to see the abolition of the IPC, which is only 12 months old. We will now no longer have the democratic will of Parliament being implemented by a time-limited and precedent-conscious body, giving certainty and confidence to potential builders of and investors in our infrastructure. Here, again, such development will be controlled by the uncertain, personal whim of whatever Secretary of State is in power at the time. That is a retrograde step in my view and, in terms of getting long-term investment in to our infrastructure, a bad idea.

Coming down a layer to the abolition of the regional spatial strategies, I can quite see why that is being done. I was never a great admirer of the regional agenda, but it had a rationale in supra-local strategic planning. The proposed duty to co-operate seems to me to be a bit of a wing and a prayer. It is certainly brave. Would not a formal supra-local strategy, perhaps in line with the local economic partnership boundaries, be a better solution? In ideal circumstances, everyone knows that unpopular developments have to go somewhere and, in most instances, decisions will be taken amicably. It is possible to co-operate yet not accept your share of so-called bad neighbourhood developments, particularly if you know that, back in your patch, expectations have been raised by the new neighbourhood planning process and a whole series of well organised communities have vetoed such developments in the area.

On that last point, one of the answers could, unfortunately, be to place bad neighbourhood developments in communities which lack the capacity or the funds to develop the neighbourhood plan or to hold a referendum. That would be a disastrous result for the legislation. We must therefore ensure that capacity building and funding are available to help those neighbourhoods, particularly those who do not ask for it. It must involve far more money than the mere £3 million being transferred from the planning aid budget.

I fear that "brave" also applies to the whole concept of neighbourhood plans. It would be fantastic if they worked-if they do not become nimby charters-but, again and again, I have come across seemingly reasonable groups who point-blank refuse even to have affordable housing in their village to help their youngsters, let alone something that might be difficult to live alongside. What is to stop the process from getting into the hands of the articulate narrow-minded? The answer must be processes that instil responsibilities as well as choices. It would be helpful if we could see the new national planning policy framework before our deliberations are over.

Finally, I have a word about community assets and the right to buy. The idea that one can save cherished facilities such as a shop or pub sounds good and, from a rural community's perspective, highly commendable, but when all the representative organisations of those facilities are doubtful about those proposals, you know that things are not quite right. The point that they and others make is that those assets are part of a business. Businesses are often bought and sold, and often thrive and are rejuvenated because of it. Delays in that process could be disastrous not only for the business but also for the community-say, in the event of the death of the publican or the shopkeeper. To have a six-month delay at that stage would mean that customers might wander elsewhere.

To echo the sentiments of the noble Earl, Lord Cathcart, it is not the transfer of assets that deprives the community, especially when it is going harmlessly from one generation to the next; it is the change of use. Surely the moratorium to allow for community purchase would be much better implemented when a change of use is applied for through the planning process. At least then the two long-winded processes can run simultaneously and save everyone a lot of bother.

I have much more to say on the community assets as currently proposed, and many other aspects of the Bill, but I will save that for Committee.

Photo of Baroness Smith of Basildon Baroness Smith of Basildon Shadow Spokesperson (Energy and Climate Change) 6:18 pm, 7th June 2011

My Lords, I agree with the Minister when she introduced the debate by saying that this was an important, wide-ranging Bill with a great deal of consensus. Both those things are true but, as we have heard during the debate so far, there is also great concern about some of the principles and detail of the Bill. I welcome her comment that she is prepared to consider amendments in further debates. The number of speakers in the debate today reflects the experience and expertise in your Lordships' House on these issues. It is a shame that, with extraordinary discipline, so many noble Lords had to curtail their comments to just seven minutes. With the number of speeches, I am sure that we would have benefited from hearing more from those noble Lords. It is a shame to do so much in one day when perhaps a two-day debate would have been better for a Bill of this importance and interest.

On several issues, I share the concerns that have been raised, notably around the sale of community assets, the governance arrangements in local government and on social housing. It is worth reflecting that when we debate social housing and flexibility of tenure, we are talking about someone's home. People want security of tenure; they want to ensure that they can bring up their children, that they can go to work and that their children can be secure in their school in long term. We need to understand the concern that that has raised with so many people who are currently in social housing or who long for social housing and spend years on the waiting list.

I want to comment on issues, not yet discussed in your Lordships' House, in Chapter 2 of Part 1-Clauses 9 and 10-on the fire and rescue service. I wish to comment on three aspects and, as the Bill progresses, I shall seek clarification from the Minister. Two of those aspects are in the Bill: the powers being given to fire authorities and the limitations placed on those powers and the charging for services, other than core services, and the implications of that. The third issue is not in the Bill, but I hope we can look at it during our debates and deliberations. It is whether the existing scrutiny and oversight measures for fire authorities are adequate, in light of new powers and responsibilities.

I have a long-standing interest and commitment to the work of the fire service. In my eight years as a county councillor, I was a member of the fire committee and of the fire authority and I have also been the Fire Minister in England and Northern Ireland. I fully understand the reasons for the new provisions in Clauses 9 and 10, and the need for greater clarity for the fire and rescue service so that it can carry out the full range of duties expected of it and entirely appropriate for it. It is clearly not acceptable that the fire and rescue service should be unclear about whether it has the proper authority to carry out functions that it deems to be part of its responsibility to the community. I am broadly supportive but I am concerned that, although this is heralded by Ministers as an extension of powers, the Secretary of State will have new powers to prevent the service doing something that he does not want it to do.

The Bill states that the power allows the fire and rescue service to do anything that it has statutory power to undertake, or anything it considers appropriate for purposes incidental to its statutory responsibilities, however incidental that may be. The Bill makes clear that it cannot do anything that it is explicitly prohibited from undertaking. But certain subsections allow the Secretary of State or Welsh Ministers to restrict what a fire and rescue authority may do under the general power or make its use subject to conditions. Within the Bill there is no need for justification or explanation by the Secretary of State; there are no criteria on which the judgment will be made; there are no criteria on which the service or authority can rely to make an assessment about whether the Secretary of State is likely to use his or her powers to prevent them taking on a specific role; and there is no guidance for the Secretary of State about when it would be appropriate for him or her to use those powers.

Neither the Bill nor the Explanatory Notes is helpful in this regard, so how can an authority possibly have confidence that it really has the powers that the Bill initially outlines? The Bill both states that it is a matter of judgment for the fire and rescue authority, and then overrides that use of judgment with special powers for the Secretary of State. It would be helpful to have further detail from Ministers of what powers the Government envisage the fire and rescue service taking on, or at least some indication of when and why the Secretary of State will stop them using those powers. Would it be the same for all authorities, or would it depend on the Secretary of State's assessment of the level of competence of that authority?

The second issue is charging. The Government have helpfully been clear that in effect core services cannot be charged for. The Bill then outlines those areas that cannot be charged for, but anything not specified can be charged for. However, there are still some areas that could be deemed grey areas and, as the Bill progresses, clarification will be required.

The 2004 Act emphasised the provision of community safety and fire prevention work, but this does not appear to be in the Bill as an area that cannot be charged for. Many of your Lordships will have seen at first hand the work undertaken to educate the public about fire prevention and fire safety, including provision of smoke alarms, particularly in multiple-occupancy houses. Is it the intention of the Government that the fire and rescue services and authorities should have the power to charge for these services in future?

At present, flooding is not a core service, as I understand it. It is explicit that an emergency resulting from a direct result of severe weather or an event of widespread significance could not be charged for, but what about the five houses that are flooded by a burst water main, or a blockage in a sewerage system? Could the fire and rescue service charge those households for those services? I suspect, and I hope, that it is not the Government's intention that they should, but that is not clear in this Bill.

I can understand the Government wanting to allow charges for responding to a fire alarm where there is no fire, although I have concerns about that, and further clarification is required there as well. It must be clear what the Government consider to be a false call, as opposed to a malicious or hoax call, and what is considered to be malfunctioning equipment.

There is a serious issue here about additional burdens on business. Already business has responsibility for undertaking fire assessments, and the costs of installing and maintaining fire detection and alarm systems. Statistics show that 80 per cent of businesses fold within 18 months of a fire and we need to ensure that any action taken does not increase risk or overburden businesses.

My final point is on the issue of scrutiny. This Bill places heavier burdens and responsibilities on the members of fire and rescue authorities, both in terms of responsibilities and the issues relating to charges. The scrutiny and overview process must be able to match those responses. Unfortunately, my own recent experience of scrutiny and overview in the fire service has left me extremely concerned about the robustness of the current arrangements and whether they are fit for purpose for the new powers.

Following a number of local and national press reports, I recently received a number of complaints and allegations of mismanagement and financial mismanagement of the Essex fire and rescue service. It would not be appropriate to outline those allegations in this debate but I want to refer to the process. I was so concerned that I passed the documentation to the appropriate authority for examination, which was the clerk to the Essex combined fire and rescue authority. I am not in any position to make a judgment on the accuracy or otherwise of the allegations, but I need to be reassured that those matters will be investigated robustly, independently and transparently. If they are found to be inaccurate, misleading or just plain wrong, I thought that I would receive an explanation that would satisfy my concerns, or, if any of the allegations were accurate, that appropriate action would be taken.

I have been bitterly disappointed and my confidence in the process is being severely tested. I have been informed that much of the information has already been investigated, but I have not been told which issues or the result of any such investigations. I am told that there is a report going to an appropriate committee, but I have not been informed of which allegations are going to the committee, what information they have received, or how the judgment will be made. I know that the meeting will be in private and will not be open to public scrutiny at any stage. I am not convinced that the authority of elected councillors which is charged with the effective management of the fire and rescue service is aware of the detail and nature of the complaints, and the response that I have received from the county solicitor is far from satisfactory.

I am in the position of having received information that gives many people, including me, cause for real concern but there seems to be no way for these matters to be fully investigated in a robust and transparent way which gives confidence to the complainants. That is unacceptable. The public need to be reassured that the management, including financial management, of all public bodies is at all times above reproach and can withstand scrutiny. Being a long-time supporter of the fire service, particularly in Essex, I want to have full confidence in the service and the authority. That means having confidence that issues of concern will be robustly and transparently investigated.

With new powers and new charges being introduced, with certain constraints, the public will need to be satisfied that there is proper and effective scrutiny. I regret that my experience to date has not given me confidence in the current system. I do not ask the Minister to respond today, but I hope that this is an area that we can examine during the passage of the Bill. In brief, there is much in these clauses on the fire service to commend them to your Lordships' House, but the devil is in the detail and I hope that we can address these issues as the Bill progresses.

Photo of Lord Jenkin of Roding Lord Jenkin of Roding Conservative 6:28 pm, 7th June 2011

My Lords, I declare my interest as a joint president of London Councils and a vice-president of the Local Government Association. I say to my noble friend on the Front Bench that I welcome a great deal in this Bill. I particularly welcome the general power of competence. When I was Secretary of State in charge of local government, I remember addressing an audience of local authority chief executives and seeking to justify the Government's tight control over what local authorities did. They were totally unconvinced, not least, I suspect, because I did not convince myself. So I am delighted to see this change in the law.

I also support the wider use of elected mayors, which will be subject, of course, to the successful referendum by the authority concerned. What I am not convinced about, although my noble friend referred to this briefly in her opening speech, is why it should be necessary-why it should be the role of Ministers-to set up mayors in shadow form, by order, before the change has been approved by the electors of the authority concerned. My noble friend will have to do a great deal more to convince me that those proposed new clauses in the schedule are justified.

I also welcome, in general, the proposals for community empowerment in planning matters, but as other noble Lords have said, the devil will be in the detail, and we will need to examine it carefully in Committee. It has been suggested, and I have heard more than a number of assertions to this sense, that it will lead to "busybody, middle-class nimbys" looking after themselves-one noble Lord described them as "the articulate narrow-minded". However, the noble Lord, Lord Beecham, and I served together as trustees of the charitable arm of the British Urban Regeneration Association, and he will be as aware as I am of the hundreds of projects up and down the country, of local initiatives, by all kinds of communities, to regenerate their neighbourhoods. There is huge potential out there, and as we go through the Bill, I will want to be sure that it does make it easier for things to happen on the ground. There has been a huge amount of frustration-we have heard some of it during the course of the debate-and I want to be sure that this Bill removes some of the obstacles.

I also welcome the clauses on planning. For many of the changes, again, the devil will be in the detail, but I would like to take up something the noble Lord, Lord Cameron of Dillington, said when he spoke about the Infrastructure Planning Commission. I am in no doubt whatever-and when we debated the Planning Bill I made these points-that it is far better for the decision on major infrastructure projects to be taken by a Minister, who is accountable to Parliament, than by an appointed quango. That is the heart of these proposals. It has been extremely encouraging to see how the IPC chairman, Sir Michael Pitt, and his colleagues, have accepted that this will be their new role. They have stayed in office, and they are getting on with the job. I greatly admire the way that they are doing this.

I have, however, two significant worries. I am worried by the clauses giving Ministers power to distribute EU fines for breach of directives to local councils and other authorities. Yes, of course, if a council is failing to obey the directive on the treatment of waste and of recycling, it should bear the fine. But what are individual local councils supposed to do about atmospheric pollution in London that owes itself to Heathrow airport, or to the M25? To take one particular example, Westminster finds itself as the focus of traffic congestion from all over the country, and of course therefore has a high rate of atmospheric pollution. There must be some form of independent scrutiny of the proposed allocations, not least-and this is a point which really needs to be taken on board-because the Minister is directly interested in the result. Some of the blame may lie with Ministers. They should not be free simply to shovel it out to local authorities and other public authorities around the country. It is a complete conflict of interest, and therefore there must be an independent form of scrutiny.

My other worry relates to London, and a number of noble Lords have spoken about that. Most of the Bill is concerned with devolving powers down from government to local authorities and local communities. Much in London is going the other way, up from the boroughs to the mayor and the GLA, diminishing the influence of the London boroughs. I mention just one example: the Bill has powers for the mayor to establish what are called mayoral development corporations. There is an obligation in the Bill to consult the boroughs, and a lot of other people, but that does not give the boroughs appropriate protection against unwanted and damaging MDCs in their area. We must build in better safeguards to protect the boroughs. Of course, the Olympic Park Legacy Company is one of the central purposes of this, but there could well be others, and we need to make sure that that protection will happen.

One final point is that the Bill contains the right for the public and organisations and neighbourhoods to challenge local authorities, with the possibility of taking over some of their services. Why has the opportunity not been taken to allow the same people-indeed, local authorities-to challenge central government over services that they deliver in their areas, much of which could be much more effectively done locally, by local people, responding to local needs and circumstances? This is another thing which I shall want to see whether we can write into the Bill.

I congratulate Ministers on bringing this forward, and this House, with all its experience, must try to make this a still better Bill.

Photo of Lord Berkeley Lord Berkeley Labour 6:37 pm, 7th June 2011

My Lords, this is a very interesting Bill, as the noble Lord has said. I wonder how much it really has to do with localism. I sometimes think that it is more to do with moving the deckchairs of Treasury control, which wants to charge for anything that it can see that is chargeable or that can be moved, but we shall see. We will have some interesting debates on this in Committee stage. I will confine my remarks to two things: the issue about EU fines, which the noble Lord, Lord Jenkin, has just mentioned, and the issue of planning for major projects.

As the noble Lord has just said, the ability that the Bill will give Ministers to require local authorities to make a payment for an EU financial sanction imposed on the UK-if the Minister is satisfied that the authority caused it-is quite a serious issue. Interestingly, in the Starred Question which I raised on 23 May, I asked whether the Government were likely to be fined, or to have deducted from their money, £180 million by the International Olympic Committee if the air pollution did not achieve the EU limits. Of course, there is also the threat of the £300 million fine from the EU if the air pollution in London exceeds the PM10 level. In considering who should pay either of those fines, it is interesting that when I asked the noble Earl, Lord Atlee, who was responsible for this pollution, he answered:

"Everyone is responsible: the Government, the mayor, TfL, LOCOG, the ODA and, most importantly, individuals who make their own transport decisions".-[Hansard, 23/5/11; col. 1583.]

I can see some real fun occurring when the Government try to finger any of those people for £180 million or £300 million, especially when of course, as the noble Lord, Lord Jenkin, said, the Government are not a disinterested party. Perhaps they will put tolls on the roads-I do not know. There has to be some independent adjudication, whether it is the High Court or an independent arbitrator, to determine a fair apportionment of the fine. Government cannot be the one to make the decision. We will have to pursue this in Committee stage, but it really has to be tightened up dramatically to see who really was at fault and whether they could be fingered for any of the money at all.

My other concern, which the noble Lord, Lord Cameron, mentioned earlier, is about the ability of major projects to get permissions, and the uncertainty that this will cause for investors. I am talking about airports, ports, wind farms, freight terminals, nuclear power stations, railway lines and anything else that comes under the auspices of the national Infrastructure Planning Commission, which was set up under the Planning Act 2008. The purpose was to ensure that national policy statements would set national policy for these issues, which would avert the need for the promoter -whether in the private sector or the Government-to demonstrate a need for the project.

We have national policy statements for nuclear power stations, and we think that we know where they are going to be. We have national policy statements for waste water-one project is for an 8 metre diameter tunnel from Hammersmith to Beckton Alp, under the Thames and following its line. Those who wish to oppose it may find it difficult to oppose the principle if it is covered by an NPS. However, where are the other ones? If there is no NPS, how can promoters have any confidence that they will get planning permission, even after a big inquiry?

Further issues include how the national planning policy framework fits in to the jig-saw, and Ministers rather than NPS officials making final decisions. We may have a view on that-over the years some Ministers have been better than others at making such decisions-but my concern, apart from where all the documents are to encourage developers to go ahead with projects, is that anyone who lives near the locations of some of these planned projects can ask for a referendum. I worked for many years building the Channel Tunnel, and I worked with the Channel Tunnel rail link. It was difficult persuading local people that these were good things for the country and might even create a few local jobs. A local referendum in those places would have killed everything. Gatwick airport has a similar concern if it ever wants planning permission to make changes.

We can debate whether we like these things or not, and try to take a line through the middle, but my concern is: what company is going to invest in such projects, at a cost of £10 million, £20 million or £50 million-it is very expensive to get these projects through planning procedures-if there is a greater risk that it will be rejected by a referendum? I feel sorry for the Secretary of State for Transport, who is trying to push through the high-speed passenger line from London to Birmingham and beyond. How many referenda will he have in the middle of the Chiltern hills, and what will be the result? Will he ignore them, try to stop them happening or try to get the line through before the Bill becomes law? I trust that it will be the latter, but I do not know.

Finally, I believe that it will be possible for people in London to have a referendum on the level of tube or bus fares. Does anyone believe that people will vote for higher fares? It would be ridiculous for TfL to have to spend £2 million or £5 million for a referendum on a question that it already knows the answer to-that would not help its finances. Therefore, there must be exclusions, possibly for applications for planning permission for a much wider range of projects than I have talked about, and for fares. These are all things that I and others will raise in Committee, and I look forward to long and detailed discussions.

Photo of Baroness Parminter Baroness Parminter Liberal Democrat 6:45 pm, 7th June 2011

As a former West Sussex district councillor and a former chief executive of the Campaign to Protect Rural England, I think that it will come as no surprise to noble Lords that I will confine my remarks to the planning provisions in the Bill. It is fair to say that there is much that we can welcome, both in the provisions that help local communities to shape themselves and their environment and in the potential to deliver sustainable development. Having said that, I think that it is also very clear to me and other noble Lords that there is much left to discuss during the progress of the Bill in Committee, with concerns about matters that may limit those very good intentions. I will flag up three concernsthat I hope to raise as the Bill proceeds through Committee. The first is that planning permissions should not be unduly influenced by financial considerations; the second concerns the need for strong, strategic planning to respond to the environmental and climate change challenges that we face; and the third is the need to introduce a limited third-party right of appeal.

On Report in another place, the Government introduced an amendment to include local finance considerations in planning decisions. Like the noble Lord, Lord Beecham, and the noble Baroness, Lady Andrews, I am concerned that this could encourage local authorities to base decisions on short-term financial implications rather than on the land-use merits of the proposed developments. I cannot agree with the Minister that Clause 124 was an "incidental measure for clarification". The noble Baroness, in her opening remarks today, confirmed that financial considerations can be a material consideration in planning. The clause elevates finance above all other material considerations, including social and environmental well-being, because no other material consideration is specified in statute. The relative status of financial considerations in the planning system must be clarified by the Government in order to safeguard the fundamental principle that planning permission should not be unduly influenced by financial considerations.

Secondly, having abolished regional planning, and in order that we can deliver strategic planning, the Bill introduces the duty to co-operate-as a number of noble Lords mentioned-between local planning authorities and other prescribed bodies. It is to be welcomed that, on Report in another place, the Government strengthened considerably that duty. However, questions remain about how the duty will be enforced, as there are no sanctions if local authorities fail to co-operate, and there is insufficient clarity about whether such joint planning should cover anything beyond infrastructure planning for housing and economic development. The Bill creates no specific duty to plan jointly for a strategic, low-carbon energy infrastructure to ensure that this country can meet the challenge of climate change. If we are to meet the scale of the energy challenge confronting us, we require a step change in the UK, from having less than 7 per cent of electricity generated by renewables in 2009 to having more than 30 per cent from renewables within the next 10 years. Nor does the Bill make clear a duty to develop joint solutions to issues such as biodiversity protection, climate change adaptation measures or delivering landscape-scale conservation, which are important features of the Government's natural environment White Paper, launched just this morning. Greater clarity is needed about what strategic matters are part of the duty to co-operate, and about the sanctions for failing to co-operate, if we are to deliver on the need to meet the environmental challenges that face us.

Thirdly, the Government are right in the Bill to create greater opportunities for local neighbourhood planning. However, if they accept the importance of local people having a direct say in the planning of their communities and environment, how can it be right for local people to have no redress when a planning application is approved that drives a coach and horses through everything that has been agreed? A limited community right of appeal could be triggered where a decision to grant planning permission is not in line with the adopted local plan. Recent government figures make it clear that the number of such departure applications is extremely small. To introduce a limited third-party right of appeal, however, would build public faith in decision-making and encourage further participation in the planning process. As significantly, it would help to make a reality of what the Minister confirmed on Report in another place, when he said that the reforms were

"all geared towards making the plan prominent and, indeed, sovereign".-[Hansard, 17/5/11; col. 273]

There is much in this Bill that we can welcome and for which the Liberal Democrats have long campaigned-giving local people more of a say about their own environment and introducing measures to deliver sustainable development. That is, as I say, to be welcomed. Clearly, however, as this Bill progresses, as other noble Lords have indicated, there are many issues where greater clarity and, perhaps, revision are needed, if we are to deliver on the welcome intentions of this Bill.

Photo of Baroness Valentine Baroness Valentine Crossbench 6:51 pm, 7th June 2011

I declare an interest as chief executive of London First, a not for profit business membership organisation that includes property companies, energy providers, retailers and others who may have an interest in the practical implications of this Bill.

I support the Government's philosophy of empowering individuals and communities. I also support policy that brings growth and jobs. One of the biggest challenges is to marry these two things. I feel a responsibility, when considering this Bill, to endeavour to do that.

This Bill is just part of the localism picture. The Government are letting a thousand flowers bloom. A review of local government finance is expected, as is the reform of other governance structures such as local enterprise partnerships, enterprise zones and more besides. Like the right reverend Prelate the Bishop of Norwich, I too am reminded of the "Yes Minister" series and the cautionary response of Sir Humphrey Appleby to a new idea from the eager Minister: "That's very brave, Minister".

The carrot of local government funding reform is dangled elsewhere. However, new financial responsibilities on local authorities, such as the costs of local referenda and EU fines, will be all too tangible. Prospective local referenda are a serious concern in London. They are expensive-between £5 million and £12 million each-and too low a threshold might allow for abuse of the system. I share the concern of the noble Lord, Lord Berkeley, about whether a referendum calling for free Tube rides would gain popular support. Probably. Would the mayor be able to agree? Probably not. Given that referenda are advisory, they would seem a very expensive pressure valve if let off too frequently or too freely.

I also remain concerned about how much-needed local infrastructure is to be funded and built. The public purse is already stretched, but this Bill suggests that a slice of the community infrastructure levy be passed straight to neighbourhoods. This is a worrying fragmentation of a key source of investment, which should be targeted more effectively at broader strategic priorities, leveraging private sector investment.

I support other efforts to drive regeneration and growth. Devolving more focused planning governance-as the Bill proposes for the mayoral development corporation in the Olympic park, for example-is welcome, but good governance is no supplement for poor funding.

The concept of neighbourhood is an important part of this Bill. We should be clear that a neighbourhood is not automatically synonymous with residents. Bloomsbury, for example, has residents, educational institutions and businesses, all of which should have a say in formulating a neighbourhood plan. The Bill has already made some progress on this front. Government changes now allow for businesses to get involved in shaping the plan by sitting alongside residents on a neighbourhood forum. I welcome this.

As the saying goes, however, there should be no taxation without representation. Businesses pay their fair share through business rates, and should be given fair representation if the issue of a neighbourhood plan goes to a ballot. I welcome pilot schemes that inform how best this might work. Splitting communities into neighbourhoods or business neighbourhoods, however, misses the point. Communities are complex and not easily pigeon-holed. In some cases they are home to critical pieces of national infrastructure-airports, power stations or motorways, for example. While the Bill exempts this vital infrastructure, it does not clarify whether necessary associated development should be subject to neighbourhood planning. We need a process that accounts for the make-up of any given neighbourhood as well as allowing that community as a whole to approve or reject a plan.

I make one final plea to the Minister for a rigorous review process to be built into the Bill. There are so many "don't knows" across this policy area. Outside this Bill, local government funding is unresolved. Governance structures such as LEPs and enterprise zones are unformed and untested. Under this Bill, we genuinely do not know how neighbourhood plans will work in practice. For example, they have no time limit, but must be at least as permissive as local plans. If a local authority changes tack, must all neighbourhood plans be redrafted, with further referenda? Similarly, the community right-to-buy scheme is based on sound principles, but must be sensibly constrained to avoid vexatious attempts to stop or delay development.

Joining up government may be a thankless and endless task, but the formation of a national planning policy framework, including a presumption in favour of sustainable development, will give clarity to planning policy and is welcome. It should perhaps be mentioned in the Bill. On the other hand, the Government have embarked on yet another overhaul of the planning system before the property market has fully shed the overhang of the credit crisis. The coalition agreement put growth at the top of its priorities, and while I support the aspirations of the Localism Bill we must not allow well meant but poorly tested legislation to unhinge our fragile recovery. We should keep this Bill under review, pilot more difficult aspects of implementation and be willing to reverse measures that generate unintended economically damaging consequences.

To return to Sir Humphrey Appleby's words, being "very brave, Minister" is all well and good, but let us not be foolish.

Photo of Lord Marlesford Lord Marlesford Conservative 6:57 pm, 7th June 2011

My Lords, I congratulate the Government on bringing in a Bill to spread localism and must say how charmed we all were by the way in which the Minister introduced the Bill.

I, too, want to focus on the planning sections the Bill. In 1928, a remarkable book was published called England and the Octopus. It was written by Clough Williams-Ellis, the outstanding architect who, among other things, gave us Portmeirion, and who, along with Professor Patrick Abercrombie, was one of the earliest campaigners to prevent the urban sprawl and squalor and the ribbon development that threatened to extinguish forever the rural beauty of Britain. The book was republished in 1996 with a foreword by Jonathan Dimbleby, who at that time was the president of the CPRE. I at the time was the chairman. I recommend noble Lords who are interested in this subject to have a look at it.

I should at this point declare my own interests: as a Suffolk farmer with a number of let houses in Marlesford, some of which could be described as social housing, as president of the Suffolk Preservation Society and as chairman of the Marlesford parish council. In view of what the right reverend Prelate the Bishop of Norwich said, I should also say that I am a member of the Marlesford parochial church council,

Having served for 12 years as a countryside commissioner and eight years as a rural development commissioner, I am hugely aware of the dangers that there could still be to our countryside. It was 20 years after England and the Octopus that the Labour Government of Mr Attlee produced the 1948 planning Acts, together with the creation of national parks. The planning Acts, together with the National Health Service, were some of Labour's greatest legacies to this country-and they came just in time.

This is a very important Bill because it could have an impact on what England looks like, not just during our lives but right through the lives of our grandchildren, too. So we have to get it right, however much time it may take. Mistakes on paper can be corrected; mistakes on the ground seldom can be. The breadth and diversity of experience assembled for this debate to offer support and guidance to the House of Commons and the Government are perhaps an example of the value and function of the House of Lords as it is.

I suppose that the most dramatic example of what is at stake is illustrated by the National Trust which, through the spectacular success of Project Neptune, saved a huge part of our most beautiful coastline. If it had been lost, it would have gone for ever, and I do not believe that the planning system on its own could have saved it; nor, certainly, could ownership by local authorities, which have sometimes been among the great desecrators of our landscape. The Government are right to abolish the unelected Infrastructure Planning Commission and to sweep away the discredited regional strategies. Our counties are quite large enough to interact directly with Whitehall where national or regional policies are required.

The ownership of land, the stewardship of land and the use of land, whether for farming, recreation or development, are what the planning system is there to influence. Planning policy has been nourished by decades of casework and experience. It is neither possible nor desirable to seek to oversimplify the planning system. The core of the system has been the evolution of the series of policy planning guidance notes-PPGs, as they were known. Most of them have now been redrafted as planning policy statements. The PPG and PPS system is excellent and full of experience and expertise. I have the gravest doubts about the wisdom of replacing it with an overarching new planning policy framework that could, in its attempt at simplification, send a whole generation of babies down the plughole.

However, parliamentary scrutiny depends on having full details of the draft regulations that will implement the Bill. To move power downwards is always attractive, and certainly parish councils are the grassroots of our democracy, but there must be a balance between different local levels. Planning officers can, of course, be insensitive and bureaucratic, but they are needed to overrule arrogant or selfish developers who are not really interested in anything except the quick buck. Planning inspectors can get it wrong, although in my view they have been a most effective defence against unreasonable planning refusals and populist politicians who seek to impose inappropriately national policies at a local level.

Like my noble friend Lady Parminter, I am worried that the Bill as drafted will give fresh opportunities to big companies to get their way when they should not by using planning gain to bribe local communities. I recognise the difficulty of introducing a right of appeal against planning consents. None the less, I think that communities should have the right to challenge decisions that go against locally agreed plans or where local authorities have a conflict of interest. I fought a long battle using Parliamentary Questions and the media, eventually successfully, to stop Braintree District Council repeatedly giving itself planning consent, totally contrary to public policy, to erect advertising hoardings, from which it got some £30,000 a year, along the A12 trunk road. I think also that the proposals for a right to buy or right to bid for community assets said to be of community value could be fraught with dangers. This part of the Bill will need the most careful scrutiny and, I suspect, considerable clarification, if not amendment.

I would say that by any standards this Bill is much too long. I hope that if in Committee we find that some parts of it have not been properly thought through, the Government will be prepared if necessary to remove them for a future occasion. Finally I very much share the concerns already expressed over the European dimension. It is now 19 years since the introduction of subsidiarity under the Maastricht treaty as a guard against an overreaching Brussels, and it has had only limited success. May I suggest that localism could become the new shield against EU involvement?

Photo of Viscount Simon Viscount Simon Deputy Chairman of Committees, Deputy Speaker (Lords) 7:05 pm, 7th June 2011

My Lords, the noble Lord, Lord Marlesford, has spoken a lot about all kinds of things with which I totally agree, and I will expand slightly on some of them. This Bill covers a great deal of ground, but my comments, like those of many other noble Lords who have spoken, will focus mainly on Part 5, which makes changes to the planning system.

The post-war Labour Government are often remembered as the Government who created the National Health Service, yet another of their initiatives, the Town and Country Planning Act, has become one of the central cornerstones of our democracy. This Act established the principle that public bodies should have powers in deciding issues of land use in order to protect the wider public interest and not for any particular sector or short-term interest. Since that Act's passage, although Governments of different parties have reformed the planning system, none have departed from this key principle. It is this principle that needs to be upheld in our current debates over planning reform arising from the provisions of the Localism Bill. As with the NHS, the planning system currently faces an uncertain future as a result of significant reforms proposed by the Government.

The central theme of localism that runs through this Bill is to be welcomed. The Bill hails the end of the regionally imposed, unrealistic and arbitrary housing targets for local councils, which had few friends, and introduces a new system for neighbourhoods to create plans for their areas that will form part of local development plan if they are approved by referendum. However, I am concerned that, in a move signalled in the March Budget Statement, which described the planning system as a chronic obstacle to growth, the Bill has been amended to give short-term, economic interests undue weight in the planning process. This is instead of ensuring that the planning system makes decisions that are in the public interest and places equal importance on economic, social and environmental considerations, as it has since the 1947 Act. The Government have picked on the wrong target. The planning system might have its faults, it might sometimes be opaque and slow, but it is wrong to present it as an obstacle to growth. For instance, high house prices and low house building rates are not due to obstacles in the planning system but are largely a consequence of restricted credit availability.

Perhaps I can give some examples of the shift in the Government's approach and propose some remedies and safeguards in the hope that the Minister will respond at the end of this debate. Alongside the budget, the Government produced a plan for growth. This document, produced by the Department for Business, Innovation and Skills and the Treasury, states that the Government are,

"introducing a powerful new presumption in favour of sustainable development so that the default answer to development is 'yes'".

This presumption will be outlined in the national planning policy framework, a document we are yet to see.

The planning system should not act simply as a tool for economic growth, and we should all recognise that it should be perfectly acceptable for the planning system to say no to inappropriate, unnecessary or unsustainable development. The planning system is a means for gaining popular support and agreement for necessary development. As we have seen with regional housing targets, trying to force development on communities frequently results in antagonism and delays. It will not always be possible to achieve agreement, but it is crucial that the system is one that the public can trust to be fair. To do this effectively, it cannot have a presumption in favour of economic growth.

The purpose of the planning system is already to achieve sustainable development; that is set out in the Planning and Compulsory Purchase Act 2004. I support the addition of a definition of sustainable development in the Bill so that there is clarity about what is meant by sustainable development for councils making plans, whether they are county, district, parish or town councils. If Clause 124, which was added at a very late stage and with no fanfare, is to remain in the legislation, we must ensure that it will not enable non land use-related financial benefits provided by the state to be a material consideration in determining planning applications. An example of one such benefit is the new homes bonus, which the Government have created to provide incentives for new housebuilding.

The CPRE finds this new clause somewhat alarming. It states:

"We believe that as currently worded this clause could fundamentally distort the planning system by encouraging local authorities to base decisions on short term financial implications rather than the land use merits of the proposed development".

Leaving aside the merits of the new homes bonus scheme-the effectiveness of which in delivering the right sort of homes where they are needed remains to be seen-giving financial considerations this sort of weight in the planning system challenges more than 60 years of political agreement. I recognise that challenging long-held positions of agreement is not always a bad thing, but in this instance I suggest that the Government have got it wrong.

The Minister may say that existing payments, such as Section 106 agreements or the community infrastructure levy, already have a certain weight in the planning system, but these are both very different in that the money can be spent only in relation to the development for which planning permission is granted. The new homes bonus is not ring-fenced and the receipts for councils will be significant. I also understand that material considerations have never before been referred to in legislation, and that practitioners are concerned that by singling out financial considerations in the Bill they will become the "first among equals" among material considerations. This clause should be removed or substantially reworded to provide clarity and equity.

On neighbourhood plans, I have already said that the strengthening of the neighbourhood voice in planning is a welcome development. This process should be accessible and unnecessary complexity should be stripped from the proposals. However, again as a result of the Budget, the Government have amended the purposes for which neighbourhood forums can be set up so that they can be established to further purely economic goals and business interests. It may be the Government's intention that these powers are used only in business districts. Nevertheless, this move again departs from the long-held agreement on land use planning and sets a worrying precedent. Wherever neighbourhood forums are set up they should have to aim to promote economic, social and environmental well-being, and I hope that this section can be changed back to its original form.

Finally, I should like to make the case for a safeguard that should be in the Bill but is not. I believe that there is a strong case for a limited right of appeal for communities to be added to this legislation-not least because both government parties pledged to introduce one before the election. These circumstances should be limited. Communities should be able to ask the planning inspectorate to reconsider a development only where it has been approved by a local authority, even though it departs from a locally agreed plan or where a local authority has a vested interest. All of us will have come across situations where supermarkets or other large developers have in effect bullied councils into approving developments, which were not part of a local plan, by submitting appeal after appeal until the resistance or finances of a local council or community are worn down. Either by limiting the applicants right of appeal in some way or by giving communities a right to appeal in some circumstances, action should be taken to tackle the unfair planning appeals process and ensure that sufficient weight is placed on local and neighbourhood plans.

The Localism Bull appears to have the right intentions but it has been blown somewhat off course by the current economic storm. However, like all storms, no matter how fierce, this one will pass, and it is important that we are not left ruefully eyeing the wreckage when the bad weather abates.

Photo of Lord Palmer of Childs Hill Lord Palmer of Childs Hill Liberal Democrat 7:13 pm, 7th June 2011

My Lords, first, I declare an interest as a councillor in the London Borough of Barnet for 25 years and as chair of its audit committee. For many years, I was a director of an arm's-length management organisation managing Barnet Homes housing. Currently, I am a member of the standards committee-so I felt that I should speak at Second Reading of the Localism Bill. Clauses 129 and 130, which refer to the duties of homeless persons, take us back to the very dark days of limited offers to homeless people. My noble friend Lady Doocey mentioned this, and I should like to expand on what she said.

The idea that local authorities will be able to discharge their duties to the homeless by providing one offer-I repeat, one offer-from a private landlord, without the applicant having any say in being able to reject that offer, is horrifying. For those who have been in local government for many years, it takes us back to the days of two offers. Now we are talking about one offer from a private landlord.

What will be considered suitable accommodation may well fall short of what is considered to be decent accommodation. Many of us have seen people housed in private properties that are not decent. With the cap on rents, particularly in London, properties available to local authorities to house their homeless may well be of a lower standard than we would like. Allocating one property, without a choice, from a private landlord will take no account of children's schools, where people work or the wider family. That will put further onus and cost on the social services because those supports are not there. These clauses do not seem to say where the property will be. I am old enough to remember when London boroughs short of places to house people gave them the fare to seaside resorts where the rent would be paid to those landlords. These clauses are reminiscent of that time and need to be substantially amended.

Clause 142 is welcome in that it appears to give tenants of housing associations limited security. Tenants of less than two years must get at least six months' notice, but what happens in real life? Recently, I was made aware of tenants of a very reputable housing association. They were happy, as was the landlord, but the lease to that private landlord from the housing association had come to an end. The landlord was happy for the lease to continue under the same terms, but the social landlord said that it was its policy that tenants should move to new premises because it did not carry one lease over to another. Under the Bill, we must give stability to people housed by housing associations.

Clause 145 to 153 are welcome. They will enable councils that own properties, which are often managed by arm's-length management organisations, to keep their rental income. That will be a great benefit for many people, such as in my local authority where a lot of rental income does not stay with the local authority but goes back to the centre. However, I have a cynical suspicion. If local authorities are allowed to keep all their rental income, are we guaranteed that they will keep their current grants and standard spending assessments or will there be a formula? I understand that one man in Whitehall knows what it means.

Clauses 172 to 176 concern me. I am far from convinced that we want mayoral development areas. I am talking as a London borough councillor and that is the flavour of how I look at it. It appears to be the opposite of localism. The power in London in particular should be with the local authorities. Mayoral development areas, which perhaps are where the mayor is the mayor of that local authority, may be allowable.

If the aim is to get more empty land into use, such land should be taxed to encourage hoarders of land to bring it into use or there should be land auctions. There is a lot of private land for which people are waiting for the right price. In the mean time, many thousands of people are not housed, which is a disgrace. That can be linked to the announcement made only this week by the Government. They are to bring unused government-owned and local authority land into use by encouraging it to be sold off-but, sadly, not necessarily for social housing. A lot of land out there is privately owned, as well as that which is local authority owned.

Clause 158 deals with complaints to the housing ombudsman. I should like this to be a righting of the wrongs for the benefit of the tenant. I read this part of the Bill a few times. It gives me the feeling that like many complaints to an ombudsman the result will be the fining of the so-called offender. It talks about the determination of the ombudsman. The Bills needs to say how the tenant will benefit. After reading it, I cannot see any guarantee that that ombudsman's decision will not be purely a fine on the culprit rather than a benefit for the tenant.

Turning away from housing, paragraph 9L of Schedule 2 allows a local authority to change its system from an executive back to a committee system. I come from a local authority where I was part of the administration. I was a cabinet member for development and regeneration, and I would give little speeches saying that it is a dreadful system because I have unparalleled power to do almost anything I want, but it is not democratic. That is the case with the executive system where the member of the executive without portfolio has the power while the rest of the council has little of it. I serve on a council with 63 councillors, of which 10 members are on the executive. They are all from one party, not my party, but it has been mine. Those 10 members have interesting jobs managing and running the council, but jobs have to be found for the remaining 53 members as chairs or members of scrutiny committees that have little or no value.

I would like to see, as the Bill suggests, a move back to the committee system with a chair of committee for housing, social services, adult education and so on. The Bill would enable this, but states that it will happen in London after the next local elections, which are three years away. I would like the Bill to be amended so that local authorities are given the opportunity to bring about this change in the way councils are run sooner rather than later.

Finally, as a serving London borough councillor, I welcome localism and this Bill, but we must be careful to ensure that localism does not just mean devolving power from Whitehall to the city hall or the town hall. This Bill is a leap forward-I originally wrote that it is a huge leap forward, but I shall now say only that it is a leap-but there is room to improve it while it is in your Lordships' House on its way through Westminster.

Photo of Lord Ouseley Lord Ouseley Crossbench 7:22 pm, 7th June 2011

My Lords, I looked forward to the arrival of this Bill. It is clearly based on good intentions, some of which, as we have already heard in the debate, will be subjected to extensive scrutiny and challenge during its Committee stage. It is different from what I expected, and having read it through, it is complex and takes some navigation. It will have a huge impact on local government and people's aspirations for their communities, localities, neighbourhoods and quality of life. But this Bill was trailed rather differently, with exaggerated claims of what it would deliver, and that is why I am hugely disappointed with it.

This is a very important local government Bill, but let me give noble Lords a taster of what I had envisaged we were about to get. Back in December last year, the Secretary of State, Eric Pickles, said that the Bill signalled the start of "a new era of people power", and added that it would be the end of the era of big government. Andrew Stunell, at the Report stage in the House of Commons, stated that:

"The Government are committed to the radical decentralisation of power and control from Whitehall and Westminster to local government, local communities and individuals".-[Hansard, Commons, 17/5/11; col. 204.]

That sounds laudable and supportable, but it is difficult to envisage how the Bill as it stands will enable it to happen. Whatever happened to the promise of decentralisation, devolution, enhanced citizen empowerment and local control in a radical way when, in fact, we are getting substantial reserved powers for the Secretary of State to be interventionist and directional? From my own experience of working with communities in local areas, particularly in London, I have never known a situation where the central state or local authorities have ever handed meaningful power over to local people. Power, control, decision-making and resources have always been withheld, often for good reason and particularly to intervene when things go wrong, as they do from time to time. Someone in authority has to be held responsible and accountable.

An example of continuing centralist micro-management is the setting of an annual budget and council tax to be levied by the local authority. This is a local matter. The local elected members make those decisions and are answerable to their electorates. Why should the Secretary of State insist on having the power to determine what he considers to be excessive? Is that not a matter for local determination? Why should a Secretary of State be determining the circumstances for local referendums to be held, and who will be responsible for the additional costs? What of the additional bureaucracy and delays in processing and decision-making that will be created? We have to be certain, as we go through the Bill, that we are not staring at the prospect of reinforced centralist power and control, as well as increased bureaucracy, which the Government claim they want to reduce. There will be increased costs at a time of reduced resources.

Another example is the imposition of shadow mayors, which again is central government determining what is best for local people. Surely locally elected and accountable councillors, along with their local citizens, are the most appropriately placed to determine what is best for their locality. Why undermine local democracy when it works well most of the time and is more about localism than what this Bill purports to be? Clause 5(1) gives the Secretary of State far-reaching powers to,

"amend, repeal, revoke or disapply, other statutory provision if he considers that it,

"prevents or restricts local authorities from exercising the general power".

This is particularly distressing in the context of all local authorities having to conduct their business with due regard to their duties and responsibilities under the current equality legislation. Given that the Government have to date shown scant regard for the public sector equality duty, and indeed have recently canvassed public opinion on restricting the functions of the Equality and Human Rights Commission, there is much concern that some local authorities will slip back into institutional discriminatory policies and practices, with encouragement from a bullish Secretary of State. We must have assurances on this matter and ask the Minister for a clear statement of commitment and compliance with the legislation.

The Bill's approach to localism in London is perplexing-I agree with the noble Lord, Lord Palmer, on this point-because it extends regionalism through the Mayor of London while at the same time it reduces localism by marginalising local councils and their communities in the process. There must be oversight and scrutiny by locally elected councillors and their communities of the operations of the proposed mayoral development corporations for this to be genuine localism. The same concerns arise with the Greater London Authority taking over the housing and regeneration functions for London from the Homes and Communities Agency. It is not genuine localism to suggest, as the Government have done, that the London Assembly, a regional body with regional representatives, can offer the local involvement and participation that is required.

The retention of ministerial powers to delegate functions to the Mayor of London without local electorates and councillors having their say and some involvement, participation and engagement, is a further drift away from genuine localism. The so-called community right to challenge is limited to local authority services and facilities, but other authorities and agencies provide services locally. Those services should also be challengeable by local communities. Radical devolution cannot be administered in a piecemeal and half-hearted way. If this is to have any meaningful impact, local communities must be inspired and empowered to challenge all locally provided services. I believe that the community right to challenge should be open to all, regardless of a community's expertise or level of social infrastructure. Expanding the right to challenge is a welcome first step, but there must be co-ordination and leadership to challenge all the different agencies operating at the local level. It should not be restricted to locally provided services. Such a co-ordinating role is best led by the local authority. The Bill should therefore enable local authorities to challenge, with and on behalf of their communities and in partnership with other agencies, the provision of services delivered by national public bodies within their area.

Undoubtedly, town and country planning would benefit from the streamlining of administration and speeding up of decision making. However, close examination of the provision for neighbourhood planning suggests that there is likely to be greater complexity, more bureaucracy and risks to community cohesion if radical groups and nimbyism contribute to divisiveness, paralysis of decision-making and conflicts across communities.

Let me conclude by saying that there is much in the Bill to be commended in its attempt to increase community involvement in local decision-making and local service provision. Our fundamental aim should be to strengthen local government and to seek to enhance its localism credentials. Power is vested in those people we elect to represent us and to be responsive in serving and meeting the economic, social and cultural needs of the local inhabitants. We must improve the Bill to help local government, working with local providers, to improve its performance and effectiveness and to assist local government to enable communities to feel empowered about all local services being theirs even if they are not the direct beneficiaries therefrom. The noble Baroness, Lady Bakewell, described localism perfectly as it now happens in her local community through direct action. I believe that if we are to realise genuine localism we have to do much more than this Bill will achieve. Above all, for this Bill to become a successful stepping stone for localism, we would need to have less central control, less Whitehall direction and interference, less bureaucracy and reduced costs, less regulation, less prescription and guidance and no micromanagement from the centre.

Photo of Lord Reay Lord Reay Conservative 7:31 pm, 7th June 2011

My Lords, I am most concerned with the planning aspects of this Bill and I declare an interest as a landowner. Does the title of the Bill and the rhetoric used to support it conform to the reality of what the Bill will bring about? I have doubts. It does so in the case of the abolition of the regional tier, of which I heartily approve. It tries to do so in other aspects, including local referendums, but with adverse consequences, which other noble Lords have well described, in costs to local authorities and possible abuse, which mean that we need to look at it very carefully in Committee. In other instances the Government seem to have shied away.

Take the community right of appeal. Before the election, both coalition parties believed in it. They evidently recognised then that our planning system in one way is most unfairly balanced in favour of the developer. A developer will take the matter to public inquiry when a planning decision goes against him. When the decision goes against the local community or parish council, where true localism resides, they can make no appeal. Like the noble Baroness, Lady Parminter, and my noble friend Lord Marlesford, I would welcome a limited community right of appeal.

In addition, public inquiries are hugely expensive. The local community against the developer, when it comes to raising the funds to fight an appeal, is David against Goliath. Moreover, today's cash-strapped local authorities are very likely to be intimidated by the prospective costs of a public inquiry and, to avoid them, grant planning permission when they would prefer not to. At Report stage in the other place the Minister recognised this problem and said it was something that should be looked at. Can my noble friend the Minister say what the Government now intend to do about that?

The situation becomes completely outrageous in the case of wind farm planning applications where the developer is funded entirely by public subsidy, paid for by the electricity consumer. Yesterday I attended a meeting of the Lancaster district council planning committee when, for the second time, it turned down unanimously a planning application for a wind farm six kilometers within an area of outstanding natural beauty. I may say that that was a unanimous decision by the planning committee of a Labour- Green-controlled council. In fact, anticipating defeat because of the planning officer's strong recommendation to reject the application, and not waiting for the committee's decision, the developers had already applied to take the matter to public inquiry, betting their money-or rather betting the money they would receive from the poor electricity consumers-on the hope that the planning inspector allocated to them might decide to give priority to the Government's renewable energy targets, over a consideration for local feelings and the preservation of landscape.

I ask the Minister: is that localism ? Is that an example of matters being decided by the community and not by planning inspectors? Or is it an example of the Government trying to drive their own policy-in this case, their renewable energy policy, which I believe is misguided-through the planning system? In any case, daily practice is making a mockery of the Government's flagship localism policy. I think that there is a strong case for developers to be required to pay the appeal costs of the local authority, and also those of the local protest group, when such a group has notified the Secretary of State of its intention to appear at the inquiry as a so-called rule 6 party, and most certainly in cases when the developer is enjoying public subsidies.

Something else which concerns me is the new Clause 124, introduced at a late stage in the other place by the Government. Several noble Lords opposite have expressed concern about that. This puts into statute the ability of councils to take financial benefits into account as a material consideration when dealing with planning applications. Currently, Section 106 agreements, if I understand the position correctly, must relate to the nature of the application in some way-for example, provide necessary related infrastructure -and may be concluded only after planning consent has been granted. Clause 124 would bring financial payments far more to the fore and would make it much less convincing for the Government to claim, as they like to claim and should be able to claim, that planning permissions are not for sale. With government withdrawing funding from local authorities, the suspicion might even gain ground that developers were expected to take their place as a provider of finance to local authorities.

Lastly, I want to express my concern about the obligation placed on local authorities in Chapter 4 to maintain a list of assets of community value. That was dealt with very well by my noble friend Lord Cathcart and the noble Lord, Lord Cameron of Dillington. I thought also that this was meant to deal with the threatened loss of use of a pub, shop or other facility which has been communally enjoyed. That is how Ministers talk about it, but in fact it is framed so widely, as far as I can see, that any piece of private property, field, park, house or other building, which it could be imagined the community might ever like to have the use of, whether or not it ever has had the use of it, might be listed. Any sale of such listed assets must be held up while the community decides whether to bid or not. Whether I am right or not about that, this is a new interference with private property rights. It could reduce the value of listed property and disincentivise owners from making property available for public use in case that should stimulate an appetite for listing it as a community asset.

I look forward to the Committee stage and to combining with other noble Lords, I hope across party, to help try and amend the Bill.

Photo of Lord Boyd of Duncansby Lord Boyd of Duncansby Labour 7:38 pm, 7th June 2011

My Lords, I declare an interest as a Scottish solicitor but registered to practise in England and Wales. Part of my practice is in planning matters and I am also a legal associate of the Royal Planning Institute. My noble friend Lord Beecham drew our attention to the size of this Bill. In those circumstances it might seem perverse of me, and unwelcome to your Lordships, to address an issue that is not in the Bill, but it relates to the planning assumptions that underpin the assessment of compensation on compulsory purchase.

Let me tell the House why I am addressing this issue at this stage. In 2002 the London Borough of Wandsworth served a purchase notice on a company called Greenweb Ltd for a small piece of land to preserve its status as a public open space. Both the local authority and Greenweb were agreed that the market value of the land was £15,000. Greenweb had in fact paid £30,000 for this piece of ground. Greenweb contended that under the statutory rules it was entitled to considerably more. Indeed, it said that it was entitled to £1.6 million-over 100 times the value. The issue went to the Lands Tribunal and from there to the Court of Appeal, which, with great reluctance, upheld the landowner's claim and Greenweb Ltd found itself with a windfall of more than £1.5 million in profit for a £30,000 outlay. Though that case may be an extreme example of the perversity of some of the rules on compensation and the injustices that can be created, it is an example nevertheless.

The injustice is not just on the side of local government. Another case, decided by the House of Lords in 2009, Transport for London v Spirerose Ltd, arguably produced an injustice on the other side. In that case, the House of Lords said that the landowner was entitled to £400,000 for the land that was the subject of the compulsory purchase order. The Lands Tribunal and the Court of Appeal had valued the land at £608,000, the difference being in the assumptions that were made about the planning permission that was granted, the House of Lords saying that all that the landowner was entitled to was "hope value".

The law on compulsory purchase and compensation is a minefield of complexity, a mixture of statute overlaid with judge-made rules and again overlaid with statute. In 2002, the noble and learned Lord the then Lord Chancellor referred both the procedural and the compensation issues to the Law Commission. In 2003, it published its final report on the compensation issues. That report was well received. Regrettably, the previous Government did not find time to implement the report's recommendations. This is not the time or the place to try to implement all of them, but there is a need to address one aspect which underpinned both the cases that I have mentioned and produced the most difficult results: the planning assumptions that are made in assessing compensation.

In Committee in another place, Barbara Keeley moved amendments which would rewrite the planning assumptions in the Land Compensation Act. The amendment had the backing of the Compulsory Purchase Association and the Royal Institution of Chartered Surveyors and was in accordance with the recommendation on planning assumptions contained in the Law Commission's report. In response, the Minister, Greg Clark, very helpfully said that he would reflect seriously on what had been said and consider representations with an open mind. Since then, I am pleased to say that-as reported to me at least-good progress has been made. There was a meeting between the CPA, RICS and officials of the government department, and they have been encouraged by the positive nature of the exchanges. An impact assessment has been drafted, and there seems to be general agreement that no concomitant changes or amendments are required, an issue which concerned the Minister in Committee.

I hope that this matter can now be addressed. There is widespread agreement as to the nature of changes that are required and the need to effect them now. In the Court of Appeal judgment, all three judges expressed the hope that parliamentary time would be found to address these issues. Lord Justice Buxton said that if government were not prepared to act, local authorities, faced with uncertainty and deprivation of scarce funds, must exert political pressure to correct the anomaly.

We will return to this issue in Committee. Those who have promoted the change in the law have been greatly encouraged by the Government's response so far. I hope that that will continue. Certainly, if the Government decide to bring forward amendments to the Bill, they will have my full support in doing so.

Photo of Baroness Kramer Baroness Kramer Liberal Democrat 7:44 pm, 7th June 2011

My Lords, in this debate, if I may, I shall speak with something of a London perspective. It is London that I know; I hope that what I have to say about London will often have some broader application, but I do not pretend to that broader knowledge myself. As the 31st speaker in the debate, I shall inevitably repeat comments made by others, though I shall attempt to limit the extent to which I do so. I shall handle that perhaps by saying that I wish strongly to associate myself with many of the comments that have been made on housing. I have a great fear of there being created within social housing a sort of transitory, transient community, which does no good to families, especially to children, and very little good to the communities in which those people are resident.

The issue of EU fines is pertinent particularly to London, which faces potentially £300 million or so in fines for its failure to deal with air quality and the consequences of PM10, which takes between 4,000 to 8,000 premature lives a year. It is crucial that there is an independent body to allocate that fine and responsibility to central government, which has certainly played a role, to the GLA and to local government. Along with that point, there are many other comments that have been made with which I wish to associate myself.

I shall refer to two issues which perhaps have been less covered, following in a sense the strategy of the noble and learned Lord, Lord Boyd, of addressing issues which should have been in the Bill but are not. The first-again, I speak from a London perspective though not limited to it-is infrastructure financing. Many people will be aware that it cost some £3.5 billion to build the Jubilee line in London. But those who owned land fairly close to the stations saw a great increase in the value of property, the estimate being something of the order of £13 billion.

In other countries across the globe, that kind of increase in land value is captured to finance the project in the first place. It does not happen here. There were great hopes that it could be achieved for the Crossrail project, particularly given that those associated at that point with TfL were Americans who were used to this form of financing elsewhere. It fell apart, as I understand, because the Treasury did not want control of finances to slip away from central government towards a more local government, in this case London government. It saw the potential for financing off land value gain as a mechanism that would take control away from it. We ended up instead with London businesses paying a flat tax to fund London's share of Crossrail, which was a retrograde step.

The Bill presents us with a real opportunity to see that release of power from the Treasury towards local communities. It is certainly true in London's case; I suspect that it is true in the case of others. New infrastructure is fundamental to our being able to function and to grow. It is an issue that is not addressed in the Bill and, as near as I can tell, it never seems to be addressed in legislation that comes wandering between these two Houses. Here would be a great opportunity to try to capture it.

The second issue is government's trying still to keep inappropriate control of all kinds of bits of strategy-again, I am talking about transport. As your Lordships will be aware, Transport for London is the strategic planning authority for the Tube, the buses, the trams and the couple of overland rail lines that are contained entirely within the London area, but most of London's commuter services in south London are provided by overground rail, which comes under the national strategic planning authority-in other words, the department. One can see the argument: all these rail lines are part of a national network that ends in London. But the greatest usage and demand is for the commuter services that they provide in the last stretches once they hit the environs of London and the south-east and come on in.

Surely this Bill is an opportunity to say we are switching the balance between central and local power, and let us add strategic planning power to Transport for London to cover these rail lines that end within this city. Of course it will have to take very serious and fundamental note of national rail aims but let us recognise that the Bill is meant to be shifting that balance and recognising local importance and responsibility. That would seem to be a great example. If people think that you can do this kind of planning nationally, just remember it has taken nearly 10 years to get the Oyster card on national rail services-a very good illustration of how little notice national strategic rail planning has taken of the London issue.

Comments have been made about the Mayoral Development Corporation. I am not opposed to mayoral development corporations, as others might be, but I am very aware that when the GLA was first set up, there was a real focus on ensuring the transfer of power from central government to London and an absence of conflict between the boroughs and London government. On the whole, that has been the case, despite there being many different political colours and issues-there has, on the whole, been co-operation. It is really important that we do not suddenly start to build in conflict to this sort of mayoral development corporation. As you will know, London Councils has said-and I think the mayor is in agreement-that it would be comfortable making sure that something like 50 per cent of the board places for these corporations were allocated to local boroughs. Using those kinds of mechanisms, let us make sure that conflict is not built in.

I have an underlying frustration when I read this kind of legislation, which assumes that economic development is regeneration and regeneration is economic development. There is so much more involved in economic development. Culturally at least, I am not sure yet if there is a way to provide some sort of carrot within the legislation; but we need to look at these re-energised local communities as mechanisms to bring in and develop new businesses within their communities. An American mayor, if you want the honest truth, would be looking at unemployment within his city and touting to every major corporation that could put together a business facility to match that employment need, trying to drag it, tooth and nail, to his or her community. We do not use that kind of potential here. I am not quite sure how to build that into this legislation, but surely it is part of the dynamism that should be inherent in localism.

Photo of Baroness Young of Old Scone Baroness Young of Old Scone Non-affiliated 7:53 pm, 7th June 2011

My Lords, I declare an interest as a vice-president of the Royal Society for the Protection of Birds, president of a local wildlife trust and president of the British Trust for Ornithology. I want to talk, in common with others today, about the planning system. I believe that the planning system is a jewel in the crown of our democratic processes. It has been honed over the past 60 years to form a level playing field arena, in which rational decisions can be made between competing needs, demands and interests. It has sustainable development at its heart, is local enough but not too local, and is pretty accessible to all. This Bill, which sets out to revolutionise the planning system, must not throw the baby out with the bathwater. There are three elements of the current planning system that I stress need to be preserved and safeguarded.

First, there is the whole concept of what the planning system is there for, bringing in sustainable development to the heart of the system and making it the prime purpose. During the period of reform that we are going through, it is important to remember that the purpose of the planning system is not just about economic development. It is also about a whole variety of sometimes conflicting challenges, such as climate change, loss of biodiversity, the pressures of increased land take and urbanisation, and the need for greater social equity. The spatial planning system really is fundamental in providing that arena in which rational decisions can be made in a very transparent way to tackle these issues by trying to deliver and integrate economic, environmental and social issues at the same time-not by enabling choices to be made between them but by delivering all of them.

The Bill needs to reaffirm what the whole purpose of planning is: to achieve sustainable development. We should build into the Bill one of the many definitions of sustainable development that are current and indeed occur in other Bills and Acts-that sustainable development meets the social, environmental and economic needs of the present generation without compromising the needs of future generations.

The second element we ought not to lose sight of is almost at odds with the current title of the Bill, because it reminds me of the prayer that says, "Lord, make me good, but not yet". The prayer for the planning system is "Lord, make it local, but not too local". I sometimes think that there are areas of planning decision-making that are not best made at local level. Under this Bill, we are seeing the demise of regional planning and spatial strategies-but there needs to be an ability to plan at a scale above local. That is important for two reasons. There are some activities subject to the planning system where the decisions can only be made at the scale above the local scale, like waste management, flood risk management, the management of river basins and some of the biodiversity issues that are about international considerations. Many of these cannot simply be resolved on the spatial scale that is often offered at a local level. For example, if you make flood risk management decisions on too fine a scale-as I know to my cost as the former chief executive of the Environment Agency-you run the risk of simply flooding the folk downstream.

However, there are also some decisions that are simply too difficult to make at a local level. Waste management is a prime example. Our waste management infrastructure was stultified until we started to look at making decisions about the location of waste management facilities on a level higher than the local level. Decisions had to be made about these very important facilities, but no local community was going to accept them voluntarily. The same applies to difficult decisions between important wildlife sites and economic regeneration that will create jobs. For local people, it is very difficult to take wise decisions about longer-term interests and intangible values that increase our sustainability and quality of life, like biodiversity, when it may mean that you are actually voting against a job for local people.

We need to make sure that we do not see localism as the sine qua non of the whole planning system and recognise that some issues are best not dealt with on a local basis. The duty to collaborate between planning authorities and other bodies that is in the Bill is a bit woolly-it is only about strategic priorities and they have not yet been defined. We have to question whether that will deliver the clear strategic framework, on a scale greater than local, that businesses, developers and investors are crying out for. There are no sanctions if local authorities fail to collaborate and there needs to be a reserve power of intervention by the Secretary of State where they are, quite frankly, not getting on with the job.

The third issue I want to make a plea for is not in the Bill, but is integral to all the provisions that are-the whole question of planning guidance. I very much support the words of the noble Lord, Lord Marlesford, in this. We are waiting for the emerging national planning policy framework and I hope a draft will be available for us to look at soon. It will replace a wealth of wisdom and expertise that currently resides within the planning policy statements. If it removes that wealth of wisdom and expertise, which has been honed to be fit for purpose and useful over the past 20 years, and replaces it with something rather less adequate, that will be a backward step.

I am conscious of time, but there are two other issues that I will want to comment on during the Bill's proceedings. I very much support the noble Baroness, Lady Parminter, regarding limited community rights of appeal; and we must do something about this weasel clause on local financial considerations that came in late and I hope will leave early. I am deeply suspicious of something that needs to be spelt out as a prior consideration.

Let us not forget what we have learnt over the past 60 years of the planning system-it is a jewel in the UK's crown and is much admired in other countries. Let us not throw the baby out with the bathwater. We should keep the best.

Photo of Lord Gardiner of Kimble Lord Gardiner of Kimble Conservative 7:59 pm, 7th June 2011

My Lords, a Bill that seeks to provide new freedoms and flexibilities for local government and new rights and powers for communities or individuals, makes the planning system more democratic and effective and where decisions about housing are taken locally is to be warmly encouraged. The main premise of this legislation is soundly based, and one which I believe in its fulfilment-and, from what noble Lords have said today, with refinement-will be of great benefit to the people of this country. Trust, and trusting people, must resonate throughout what I have described as this great tome. All too often, legislators have decided that they know best. I do not seek to make a party point, because I believe that Governments of all colours have had the penchant for centralising power, but this Government have brought forward a very considerable proposal to reverse this tide and give people in their own communities a greater say in how best to run them.

I should declare my interest as a landowner, but also as executive director of the Countryside Alliance. A truly local agenda has long been a main thrust of the alliance's manifesto. Nowhere is this more true than in the areas of housing and planning in the countryside. The policy of imposing top-down housing targets on local government has failed. Last month, a report from the Institute for Public Policy Research suggested that England faces a shortfall of 750,000 homes by 2025. Not only would this mean that there would be insufficient housing, but it would also lead to a further 1.2 million people requiring social housing. There is already a shortfall, with nearly 1.8 million households on social housing waiting lists. This is a particular concern for rural communities where young families represent their future sustainability. Some 11,000 new affordable homes per year are needed over the next five years in settlements of fewer than 10,000 inhabitants. As there are some 16,000 small towns, villages and hamlets across England, this should be an eminently achievable target.

There are numerous examples of communities working together to develop housing schemes. I was extremely fortunate to open one last month at Whitchurch in Buckinghamshire for Hastoe Housing Association. The parish council was closely involved and an attractive development was built next to the village school. There are now at least a further five children from the development on the school roll.

I very much hope that the Government will find a way forward in this Bill to deal with vexatious village green applications, which have been used as a means of stopping or delaying much needed rural housing. These applications have been made despite planning permission being granted and the parish council enthusiastically backing the housing scheme, and sometimes the houses have even been built and occupied. My experience has been that communities are opposed to new housing if they feel it is being imposed from outside, is not meeting the needs of local families and all too often has been unsympathetic in its design. This Bill provides many opportunities for progress.

We should enhance the role of the parish council, which should be trusted more to take local decisions. These councils already produce parish plans, which in turn form part of supplementary planning guidance. The proposed neighbourhood development plans could build on and use these existing parish plans rather than carrying out further expensive consultations. Communities will be given the ability to save local assets threatened with closure, by allowing them to bid for ownership and management of community assets. This is to be welcomed; there are already many positive examples. Indeed, in 2006 one of the Countryside Alliance awards winners was Sulgrave village shop and post office. When the village shop closed, it was purchased by the village, through the parish council, and is now run by 60 part-time volunteers, aged between 16 and 80.

I express some considerable reservations, which have already been aired by a number of other noble Lords, about the consequences-and I emphasise the consequences-of the right to buy initiative as currently in the Bill. This by my reading suggests that local authorities will acquire the right to put anyone's land or buildings that can be called community assets, on a list, with no right of independent appeal. The owner of anything on this list cannot then sell, give away, or transfer to his or her family that land or building until the local community has had a chance to raise the funds to bid for them, which could take up to nearly a year. We must find a way through so that this strong disincentive for owners to make their land available is avoided. I use just one example to highlight this: if an owner wishes to transfer his farm to the next generation and in the middle of the farm is a field which he has permitted the local cricket club to use, this Bill's provisions as currently drafted could come into operation. I cannot believe that this is the intention of the Bill, but I fear this may be the consequence. I ask the Minister to reflect on this as to how best this unintended consequence can be resolved.

Overwhelmingly, this is a Bill is intended to strengthen local decision-making, placing trust in local communities to take responsibility for themselves and to take decisions which affect them and their future. For these reasons, I support the principles which underpin it.

Photo of Lord Stevenson of Balmacara Lord Stevenson of Balmacara Shadow Spokesperson (Culture, Media and Sport) 8:06 pm, 7th June 2011

My Lords, I want to focus on the concerns raised earlier by my noble friend Lady Andrews and other noble Lords about the proposed changes to the planning system, particularly as it affects our historic and cultural environment. To quote from the DCMS website:

"The historic environment is the physical legacy of thousands of years of human activity in this country, in the form of buildings, monuments, sites and landscapes. It reflects our history as a maritime nation, of trade, population movement, architectural endeavour, economic, political and social development and the use of natural resources from prehistory to the present".

I have managed to correct in my speech-and I hope that it is picked up by Hansard-the spelling mistake that unfortunately adorns the website.

Following the noble Baroness, Lady Young, I believe that a robust presumption in favour of sustainable development should be at the heart of the Bill to ensure that the new planning system truly allows the present generation to meet its development needs without compromising the ability of future generations to meet their needs.

I would like to make three specific points. First, safeguards for the historic environment, currently contained in PPS5, should not be undermined. PPS5 should be incorporated within the proposed national planning policy framework and a draft of that document should be available, alongside the Bill, before the Bill is considered on Report. The composition of neighbourhood forums needs to be clarified, and the neighbourhood plans should not supersede the powers of local, democratically elected bodies. Protection for the settings of historic houses and for those in conservation areas should not be reduced, and the remit of the independent examiner should be strengthened, particularly in respect of the national planning policy framework

Secondly, following the noble Lord, Lord Gardiner of Kimble, who is my neighbour, the proposals around the community asset register have some unintended consequences. As any private or public building may be nominated for the register, this provision may well have the effect of reducing rather than encouraging the provision of private land for community use, because of the fear of nomination. Also, problems are likely to arise from the inevitable delays in making sales of registered property. There is, in the original Bill, no provision of a right of independent appeal against listing in the community asset register, and I would like to suggest to the Minister that this might be a sensible provision.

Finally, supporting infrastructure costs and local finance considerations are an important part of the Bill. A fair share of the community infrastructure levy needs to be secured for projects involving heritage by permitting local authorities to spend the levy on supporting our heritage and cultural environment. Clause 100 permits local authorities to pass CIL funds to other parties, which gives the flexibility for the funds to be spent by a neighbourhood forum. However, it would be helpful if the specific case for supporting our heritage environment could be included in the Bill.

As other noble Lords have said, the late amendment to the Bill which makes local finance considerations a material consideration in planning applications is of considerable concern. Financial considerations arising from a proposed development should not be considered alongside planning applications and this aspect of the Bill should be withdrawn.

Photo of Lord Redesdale Lord Redesdale Liberal Democrat 8:11 pm, 7th June 2011

My Lords, that was a very brief and extremely erudite speech. I will be equally brief, which will move the debate on quite considerably. I first must declare an interest as chairman of the Anaerobic Digestion and Biogas Association, which has been put in place to promote the development of an AD industry. I have one issue that I wish to raise: the subject within the Bill that I ask the Minister to look into is clarity on the issue of sustainable development. I believe that issue is a central tenet of what this Bill should be about. Looking at other legislation, including the Climate Change Act 2008, I think that most legislation should be looking at the carbon implications of development in a low-carbon economy.

In a debate at Report on the Bill in the Commons, the Decentralisation Minister, Greg Clark, agreed to produce a definition of sustainable development and planning policy through the national planning policy framework. It is quite possible that that planning policy framework will not be in existence during the whole course of this Bill. In developing much of the low-carbon economy which we are trying to build, therefore, we are being asked to accept that a central issue which will guide the thought processes will be up to scratch. We will be left in the situation of this House not being able to debate the nature of what sustainable development should be about.

Sustainable development is of course a difficult term. "Sustainable" now often means carbon-based; in the past, it came from the international development area. It was almost impossible to get officials to agree on being sustainable because there was no indication of the cost of what "sustainable" meant. That has now moved into the carbon aspect. However, we are being asked to look at this Bill without understanding the implications. The starting point of sustainable development in carbon terms should be looked at. That has major implications because planning should not just be looked at in terms of individual properties; we now have to look at planning in the future, in a low-carbon scenario, as a holistic issue.

The waste review is about to come out and the issue of waste is of primary importance. In talking to many local communities, there is an absolute fear of waste processing plants being developed next to individual properties in areas of outstanding natural beauty or in historic areas. However, there is the problem that we have to start understanding the carbon implications of not having a well thought-out waste policy. Transportation is one of the highest forms of carbon intensity, which means making sure that we understand that waste parameters are important. If we do not therefore understand sustainable development in carbon terms and what priority it is to take, we will have a problem in that we will not be able justifiably to say that we are coming up with an efficient carbon technology.

I hope to put down an amendment at a later stage of the Bill. However, if the Minister could indicate at what stage the Government could give some information on the development of that planning policy framework and what sustainable development might mean in that, that amendment would obviously not be necessary.

Photo of The Earl of Lytton The Earl of Lytton Crossbench 8:15 pm, 7th June 2011

My Lords, in addressing the House for the first time in nearly a dozen years, I first express my appreciation and gratitude to the Cross-Bench electorate for having readmitted me and for the warm welcome that I have received from many noble Lords since I arrived back. As recycled material, I hope that my utility and usefulness will not be too limited. Like many other noble Lords, I have many interests to declare: I am the president of the National Association of Local Councils, which represents parish and town councils, and of its Sussex county associations; I am a landowner and a practising chartered surveyor-I am afraid that planning and development, valuation and all those other things form part of my general remit; and I have recently been involved with the Royal Institution of Chartered Surveyors land and society commission, which has just reported its findings on community issues and property.

My comments will necessarily be general but, first, I thoroughly welcome the Bill and the localism agenda. It is high time for them. The realignment of the way that society manages its affairs, possibly for future generations, is very important. We need to trust communities more and to connect the citizen with government at all levels. However, this sort of cultural change in attitudes will need a long timescale to bed in. We have had decades of social, economic and political underinvestment, which have to be reversed. I consider that the parish and town councils, with community and voluntary organisations, are more than up for this and I pay tribute to the superb examples of collaboration already taking place-the noble Lord, Lord Gardiner, referred to one of those. The Bill is full of good ideas but little detail. I have to share the concerns about something claiming to empower communities but having the immediate effect of handing substantial powers to Ministers.

On the power of general competence, the recognition in the Bill that parish and town councils are particularly well placed to take on much of the localism challenge is enormously welcome. Those councils are essentially creatures of place and locality-homogeneous they are not-and they range from very small parish meetings to huge town councils. Numerically, there are about 8,500 of them across the country but their statutory status, neighbourhood roots, principles of independence and democratic and financial accountability have been much underrated. Their precepting power puts them firmly in the category of local government. The general power of competence will up their game and provide a catalyst for renewed vigour. Yet they work on relatively tiny budgets and, however one organises non-parished areas in future, the neighbourhood equivalents are going to need to be based on some of these principles and have some of the resource implications to contend with. Assuming, of course, responsibility for taxpayers' money, objective service delivery and public confidence are the aims, then those sorts of benchmark are important.

As for standards, while agreeing with a light touch, I would certainly support the suggestions of the Committee on Standards in Public Life that its seven principles be embedded overly, and perhaps more enforceably, in this Bill than appears at the moment.

The plans for local referendums, by contrast, look top-heavy and bureaucratic at parish level and they risk undermining the very purpose that they set out to achieve. This part of the Bill needs to be reconfigured on a more local scale.

Many noble Lords have mentioned assets of community value. All I would say-I do not wish to repeat what others have said-is that I do not believe that this was asked for by the parish and town council sector. Local people want the ability to secure those things, especially services, that make their community vibrant, cohesive and viable; they do not need much anything more than that. There will be an impediment to market processes and that is greatly to be regretted. However, the right for these communities to bid for functions where principal authorities do not or cannot economically provide them is welcome, and I think that the Bill needs reinforcing in this area.

I will skate over the spatial strategies issue, except to follow the noble Lord, Lord Reay, in saying there is already a vacuum, with developers taking pot-shots at the system through the planning appeal process. That needs to be dealt with quickly if communities and the whole principle of planning are not to be subverted.

There is a huge issue of resources. We need to build social capital and a results-based process that will drive greater individual and collective engagement in local affairs. We also need things to be local in scale in terms of their complexity and bureaucracy and, of course, we also need accountability.

Photo of The Earl of Caithness The Earl of Caithness Conservative 8:21 pm, 7th June 2011

My Lords, it is a pleasure to welcome the noble Earl, Lord Lytton, back into the Chamber. He is a fellow chartered surveyor and we missed him when the plague of 1999 took him out temporarily, but he has proved that there is still life after death. He will be a great asset once again to our debates on local government.

Listening to our debate today, I was reminded of when I was a Minister in the Department of the Environment and I was about to start on a housing Bill. My noble friend the late Lord Whitelaw said to me, "Legislate on local government at your peril". I wonder whether my noble friend Lady Hanham would agree that those were wise words. I certainly thought they were after trying to take a Bill through this place.

There is a lot to welcome in this Bill. Clause 161 will get rid of Part 5 of the Housing Act 2004 and the dreaded home information packs-what a waste of time they were. It is so good that they have gone. However, having got rid of home information packs, why have we not got rid of the community infrastructure levy? That was another thing that we argued against and was one of the sillier bits of socialism. Hopefully that might be looked at again.

Localism is not a cheap and easy option. It is nice in theory and it is often very good in practice, but it is expensive and it is not going to be easy to put back what has been centralised. For example, referendums involve costs, which a number of noble Lords have commented on, and neighbourhood planning requires local neighbourhood plans, which are dynamic and change rapidly. That does not fit into the administratively convenient plan-making structures that we tend to put into Bills-the two do not coincide. The whole system has got to be made much more flexible and easy to update. At the same time, such plans have to blend in with the plans of the big national infrastructure programmes, such as airports or ports, which need certainty. Once decisions have been made on what to do within the national structure, people must not be messed about because these are important businesses.

I shall focus, as have several of my noble friends, on Part 4 of Chapter 4, which is concerned with community assets. My noble friend Lord Cathcart asked, "What is a community asset?". We need to define it. The principle of this is good but it needs to be looked at in much more detail. There is confusion over whether there is a right to buy or a right to bid. The consultation paper said that there is a right to buy, but the Bill says that it is a right to bid. The two are very different. That needs to be clarified.

There are two aspects to this. There is the community-owned land and the local authority-owned land. Will my noble friend confirm that all public bodies should be required to publish details of their non-operational land, alongside a strategy for its disposal that actively identifies the land with potential community use or benefit? That would be helpful. Then there is the other aspect, which is privately owned land. I agree with much of what has been said about shops, pubs and post offices, but it is their use that is important, not necessarily the buildings themselves.

It is a fundamental mistake for the Bill to include land. When you include land, you bring a whole new ambit to this, as my noble friend Lord Gardiner of Kimble mentioned in the examples that he gave. If there was a wood next door to a village where people were allowed by the landlord to exercise their dogs, would that be classed as a community asset? If the landowner then wanted to dispose of that estate, he would find that bits of the land were subject to a community asset designation order, which would delay the sale of the estate. There is much here that is intentionally quite good but, in practice, will not work well. Will my noble friend also confirm that if a community asset is purchased, it must be by a community organisation and not one of the national voluntary bodies, such as the RSPB, which can use a local designation for its land-grabbing purposes?

It is interesting to look at what is happening in rural and urban areas. Rural areas are much better at community projects. There are almost 10,000 rural community-owned buildings, with an asset value of £3.1 billion. Most of those are run with no paid management at all. The average turnover of a rural community building is less than £9,000 as a result of volunteer input. However, the real problem is the cost of refurbishing or enlarging the building. If, under the Bill, public funds will now be given to a community organisation, why are they not given to the landlord in the first place? It seems totally ridiculous to take an asset away from a landlord, who would like to maintain it but cannot spend the money, to give it to a community group only for it to get the grant to do so.

We shall have lots of fun and spend a lot of time in Committee. I look forward to it as much as the rest of your Lordships.

Photo of Baroness Warwick of Undercliffe Baroness Warwick of Undercliffe Labour 8:27 pm, 7th June 2011

My Lords, I share many of the concerns about the Bill that have been expressed across the House during this debate. Many of these reflect noble Lords' particular interests and I do not propose to repeat these, except to say that they have given the House real cause for anxiety about many of the Bill's provisions. I shall restrict my remarks to some general points that strike me as particularly worrying.

First, however, I make it clear that I support the concept of localism. I agree with the principle that those elected in a local area should be able to do what is in the interests of the communities they serve, rather than do only the things that Parliament specifically authorises them to do. I certainly believe that local groups, so often supported by dedicated volunteers, are perfectly placed to take decisions that will make a difference to their communities. Long before we became familiar with the phrase "big society", these groups were working to care for older people, run nurseries and playgroups, manage co-operatives and give families and parents much valued support and advice. Devolving power to local communities and giving people a real say in how their local area is run makes sense. Indeed, my party has long believed this. As has been highlighted already in this debate, when in government it took important steps in that direction.

I am concerned that the potential benefits of the new powers that the Bill proposes giving to councils will be at risk because of the massive cuts in local authority budgets. The Government's rather bombastic barrier-busting rhetoric means little when councils are facing a total funding shortfall of £6.5 billion in the next two years, putting many council services under threat. Coming at a time when the Government are reviewing all duties of local authorities and talking in terms of demands, burdens and restrictions, it is vital that we have a list of protected council duties. I am particularly concerned about the need to protect services such as libraries and duties towards children in care and the homeless. Will the Minister give us an assurance that this issue of protected services will be addressed?

Although the Bill in its current form gives local community groups and council employees the right to bid to run local services, the cuts which the Government are simultaneously imposing on local councils will hit community and voluntary groups particularly hard. As others have already observed, far from doing more, as the Government assert, they may be able to do rather less. As I and others in this House have said on previous occasions, vital services cannot simply be shifted to voluntary groups as a way of cutting spending.

Although I would have liked to see Amendments 36 and 37 that were proposed in the other place go through, as it would have set out the statutory provisions to be protected under the Bill, I realise that we have to deal with the Bill as it is. But therein lies my deeper concern. It is difficult to be persuaded that this Bill can deliver genuine localism when it confers so many powers on the Secretary of State to curtail it. Although these powers have received some amendment in the Bill's passage through the other place, notably to ensure proportionality and to achieve a fair balance between the public interest and the interests of any person adversely affected, I am nevertheless still deeply worried by the wide-ranging nature of the Secretary of State's proposed new powers.

I particularly share with many others a view that it is not desirable for the Secretary of State to be able to,

"amend, repeal, revoke or disapply", any duty on local authorities. In this regard the Bill has worrying echoes of the Public Bodies Bill, which so exercised this House in recent months. I spoke to amendments on that Bill, declaring my interest as chair of the Human Tissue Authority, and we made some reassuring progress. As was pointed out by noble Lords during that debate, amending primary legislation by simple affirmative order is a device which Governments must use with care. This House was urged from all sides to reflect on the strictures of the Constitution Committee, which clearly stated: "Departures from constitutional principle", such as these Henry VIII clauses,

"should be contemplated only where a full and clear explanation and justification is provided".

That explanation and justification are needed equally in our discussion of the Bill before us today.

We have had much discussion this afternoon on what real localism may look like. Real localism will allow local communities to decide for themselves whether or not they want a mayor, and who their shadow mayor should be, and will require local authority pay policy statements to include the lowest paid as well as the highest paid so that local communities can see for themselves that there is fairness in local government pay. But most importantly, a Localism Bill that delivers will be one that clearly protects the vital duties of local councils-those duties which were created by legislation and which provide services on which people rely. Those duties must be protected from the powers being proposed for the Secretary of State by this Bill.

Photo of Lord Teverson Lord Teverson Chair, EU Sub-Committee C - Foreign Affairs, Defence and Development Policy 8:33 pm, 7th June 2011

My Lords, I decided to take part in this debate as I wanted to congratulate the Government on the clause in the Bill headed "Predetermination". That measure would be unacceptable to me as a parliamentarian in the European Parliament and in this House. However, when I am involved in local government I am restricted in the way that I speak about issues. I am absolutely delighted that the Bill addresses that issue head on and abolishes the problem, or that is certainly the way that I read it. When I became involved in local government two years ago, it seemed strange to me that as a local representative I was unable to talk about what I believed ought to happen regarding, for instance, an important planning issue in my electoral division.

Last week when we were in recess, I caught up on some of my council work and attended a meeting held by a local pressure group on the Cornish eco-town in the St Austell area. I was not the local councillor for that area, but one of my colleagues, who was, was present. Because he was on the planning committee that would consider the application in two or three weeks' time, all through that meeting he had to say to his local electors and residents, "I can't say to you what I want to happen, because of a thing called predetermination". Of course, to his local electors, that was barmy. The person who represents them, who they want to give strong leadership, one way or the other, cannot say what he believes. I am delighted that, under the Bill, that will change.

It would be amazing if, say, under Lords reform, which was debated before this debate, we could not go on to the radio and say what we felt or the way that we would vote on that issue. That would be unacceptable to us as parliamentarians. I am glad that the Government say that that will be unacceptable for councillors as well.

I also congratulate the Government on another small area, which is how, when people are about to have planning enforcement placed on them, they suddenly apply for retrospective planning permission. I have experience of that in my electoral division. After the whole process, all the time that has been put in by enforcement officers and the legal work, it all goes back again. Local residents have found that those who have been seen to cheat local planning decisions have yet again put off the day-perhaps for ever-when justice will be done.

I would be interested in hearing a comment from the Minister on one area of the Bill which has been mentioned by one or two noble Lords. It concerns European Union fines. I do not understand how it would work. It relates to the European Court of Justice. I find it strange that there does not seem to be any proper way in which the Secretary of State would decide whether a local authority was guilty or how the fine would be imposed. It seems to be a classic case of judge, jury, prosecutor and executioner. That worries me. I can see how it might apply in certain areas, but can the Government assure me that it would not apply, say, to commission, which could become subject to an ECJ fine if it was not met on regional policy where some genuine mistakes had been made in allocation of EU regional funds? Some fines, penalties and repayments from that can be substantial and could disincentivise local authorities from getting involved in European regional funding.

The usual topics that I speak on in this House are energy and climate change. On that, I mention local referenda. What concerns me about the 5 per cent threshold is that that may include the nimbys but not a lot more. Will we have a real problem here with social housing, which has been mentioned, renewable energy schemes and other things which are part of government and national policy-usually, all sides of the political debate in this country? The implementation of those policies, which are important to local people generally, could be restricted by that provision. I have great concern there and I wonder whether the Minister can reassure me that, in matters such as renewable energy schemes and social housing, it will not be possible to freeze developments in those areas because of a fear of local referenda or because turnout is so low that only those who really do not want those schemes vote. That is a concern.

Reading the papers produced by the Library, I noted that the Secretary of State, Eric Pickles, described centralisation creep over the past few decades. To me, it seems more than creep. The thing that delights me most is that, throughout my political life, when I have been mostly fighting against Conservatives, I have always accused them of being the centralisers. They have started the creep back towards localism. I congratulate them and the Government on that. I look forward to the Committee stage of the Bill, and I hope that the principle of localism will apply also to fines in relation to rubbish collection, impositions as regards pay structures and local tax referenda.

Photo of Baroness Greengross Baroness Greengross Crossbench 8:40 pm, 7th June 2011

My Lords, I declare an interest as a vice-president of the Local Government Association. Any Bill which devolves more powers to councils and neighbourhoods and gives local communities greater control over local decisions must be a good thing. I cannot praise the Government too strongly for going down this path. For far too long there has been a relentless move towards centralisation and I am delighted that, at long last, we have a Government who are not merely talking about it, but are setting out to do something about it.

Unfortunately, as currently drafted, the Bill would leave us with a local government system that is too complex, too prescriptive and in some ways even more centralist than the system that it replaces. For example, there is the power of the Secretary of State to direct, to control or to take over various powers himself or herself. Having some 30 pages of the schedules governing neighbourhood development and planning alone seems to undermine the entire principle of passing real power to the people. I can see the need for some parameters. Clearly, where there is a need for national standards or a national framework, such safeguards are essential but, as it stands, the Bill seems to go far beyond that. Maybe the Minister would be prepared to give an undertaking that powers will be invoked only where local decisions can affect such regional or national matters. Even with such an undertaking, I realise that there might still be much discussion about what is rightly national or regional and what is not, but at least the underlying principle would be clear. Unfortunately, even with all this length-or more likely because of it-much is still far from clear.

The Government have decided-I congratulate them again-to rip away years of creeping centralisation. It would be a shame if it was a missed opportunity to sweep away at least some of the complexities and confusions that have grown within the system. Unfortunately, in some areas, new and seemingly unnecessary complexities have actually been added. Is it, for example, really necessary to have five different referenda processes, with different rules and differences as to their binding power?

Again, if 5 per cent of the local electorate express the wish to have an elected mayor, the local authority must hold a referendum. That seems to be quite clear. Why on earth then does the Secretary of State, in some instances, want the power to tell an authority that it must have a referendum whether or not the wish has been expressed? Surely, the idea is that, in local matters, local people choose. Even more worrying is the Secretary of State's power to install a shadow mayor. That has been mentioned several times, but seemingly the Secretary of State will have the power to force the authority to put a shadow mayor, and the whole mayoral mechanism, in place even though not even 5 per cent of the voters have asked for a referendum. That does not exactly sound like the acme of devolution.

In the case of fines imposed on the UK by the EU, I can see no problem with a principle that says that, if the actions, or lack of actions, of a local authority can be shown to be the direct cause of an EU fine for the breach of an EU regulation which is binding on this country, the authority that caused it should carry the responsibility for that breach. Why not? If they rightly want to be treated as grown ups they must-and I am sure would-accept their responsibilities. However, they are rightly worried about the fear that central government will see this as a possibility to transfer what are clearly their obligations on to others. A clear statement from the Minister that authorities will bear the burden of actions only to the extent that they have caused the problem, would be a clear and welcome statement that the Government understand the worries of many local authorities.

However, as I started by saying, the Government are to be congratulated on addressing what has been a growing problem: that of centralisation. This is an opportunity that must not be wasted. I and, I am sure, many others will be pleading throughout the passage of the Bill for something that really delivers what it promises: to devolve everything reasonably possible. I hope that the Minister will give us a clear assurance on that, and that it is her desire to see that enacted in the simplest way. It would underline a principle which most of us-including the Minister, with her distinguished career in local government-hold close to our hearts.

Photo of Lord Lucas Lord Lucas Conservative 8:46 pm, 7th June 2011

My Lords, I do not doubt for a moment that my noble friend will do exactly that. I look forward to a stream of accepted amendments over the course of the next month or two.

I welcome this Bill. I share some of the reservations that noble Lords have expressed this evening, but I will not dwell on them, as I want to concentrate on my own points. The principle of the Bill-reconnecting people with place, and giving free rein to local choice in the context of a wider strategic vision-seems to be absolutely the right way to go. The Bill also contains a substantial shift in power and value from landowners to local communities, which is going to be an engine for change. Let me give the example of my local town in Hampshire, where maybe a dozen sites around it might be developed in a substantial way. When they come to make their local plan, they will talk to those landowners to see who will give them the best deal. With proper advice, they should be able to make some pretty cute bargains. The idea that the landowner takes 90 per cent and the community takes 10 per cent is history. We are going to see something much closer to equality.

In rural communities, there is real opportunity for development. We are going to find that landowners get used to receiving much less of the planning gain than they do now. It will be seen much more as a collaboration between them and the community that they are part of, with a lot of the gain flowing to the community. To my mind, this is as it should be, because the adoption of the burden which will be caused by the development falls on the community, and they deserve recompense for it. They should be in a position to absorb that recompense. It is also the way in which planning permissions for telephone masts, windmills, and other things which place a burden on the local community will be settled. It will not just be the landlord battling to keep everything for themselves; it will be very much a negotiation with the community, to say, "We want a better telephone service here; who is going to have the mast? We are going to share in the revenue from that". I see a fundamental shift in the balance of power between landowners and communities, and I welcome that. I think that that is absolutely the right way to go.

I hope to make some substantial proposals on the back of that. I think we need an intermediate stage, between where we are now and a full neighbourhood plan. Neighbourhood plans are going to be difficult and controversial things to get to. They have got to be crowned by a referendum which can overturn all the work that has been put into them. Even in a relatively rural community it will be a chancy and difficult business. In the context of a city or a large town it will pose great difficulties, with very diverse communities, as both right reverend Prelates have said this evening. The whole question of how this works within a city will take a lot of careful working out. Therefore, I would like to see an intermediate stage in which the plans begin to become understood and are widely canvassed in the community, and in which it would be possible for the local authority to accept an informal plan as a material consideration in coming to its planning decision. That would be a much easier thing to put in place in cities. Getting to a point where a community is united behind a plan is years away. It would be great to create those communities in cities, but it will not be simple or quick. I would like to see something that will give the community a voice in its own affairs short of having to go through the whole rigmarole set out in the Bill.

Secondly, I would like to see a real emphasis on openness. Communities will have a great deal to gain from the Bill, and wherever there is gain on that scale there is the possibility of corruption. I would like to see it made absolutely clear that any transactions to do with a neighbourhood plan will be open and will remain open; it must always be clear exactly what has gone on. In that context I very much share the concerns of the noble Lord, Lord Filkin, about the abolition of the standards committees and the associated arrangements. Why should a citizen now have no redress against a bullying councillor? That is a very retrograde step and I look forward to addressing it in Committee.

We must be careful that neighbourhood plans are free from attack by all the influences and rules that we have allowed to grow up in the context of local authorities that are big and strong and capable of dealing with them. I refer to things such as strategic environmental assessments. No neighbourhood will ever be able to deal with that; the burden must remain at local authority level, and we must make sure that a neighbourhood plan cannot be attacked on that basis by anybody. There are very powerful collective interests, whether historical or environmental, which are well funded and capable of taking a neighbourhood plan to pieces if they are allowed access. They must be confined to local authority level. Their influence must be strategic and must observe the rules that apply to neighbourhood plans. We must not have a system in which a neighbourhood defending its plan can find itself suddenly faced with a lawsuit from an outside pressure group.

I will pick up many other things in Committee; I suspect that my noble friend will grow tired of seeing my name on amendments. Many points have been made all round this House that deserve to be listened to. We have eight days in Committee; it will not be enough.

Photo of Baroness Whitaker Baroness Whitaker Labour 8:53 pm, 7th June 2011

My Lords, I hope that the Minister will not think me churlish if, in the interests of time, I focus only on points not yet covered about parts of the Bill that would benefit from amendment. I say in passing that I very much welcome the potential for elected mayors. I have spent time in mayor-led cities in France and their achievements in design, amenity and economic success are a revelation. It seems to work best if the mayor is a former senior Minister, such as Monsieur Chaban-Delmas in stunning Bordeaux, which has been beautified by the work of the noble Lord, Lord Rogers of Riverside, or someone on the way up. This might apply to the Mayor of London.

I hope that noble Lords will turn their revising mind to two areas. Both stem largely from the abolition of the regional tier of government. The first is design. The regional development agencies that are about to be abolished were crucial in championing good design and in providing invaluable advice and expertise, both for buildings and for the whole environment-the community space. The RDA-funded network of regional design review panels has been particularly important in advising local authorities on important design considerations in planning applications. I hope that the noble Baroness will reassure me that this important resource will be maintained in some form, and that she will take the opportunity provided by the current round of planning reforms to strengthen the design review process for the future.

To the uncertainty over design review must be added the cessation of funding for planning aid, which stepped in to help small organisations with little capacity. Although some of this funding has been reallocated and is to be used to support communities in the development of neighbourhood plans, it is not clear how such an ambitious policy can work, given the cost and complexity of developing such plans. Meanwhile, we welcome the presumption in favour of sustainable development, which is, of course, allied to good design. We need to acknowledge the profound impact of design on the way we live our lives, from the local transport system to the provision of wholesome amenities, from our economic role to the all-important sense of well-being.

There is plenty of evidence that people will accept, or even welcome, new development when they are involved in its planning and design-but this needs an expert steer. How are neighbourhoods going to cope with this? Ministers' acknowledgment that the design requirements in the housing and planning Acts will be honoured is encouraging, but I ask the Minister why these provisions do not, as the Bill stands, apply to neighbourhoods and how the Government intend to ensure that good design will be promoted and upheld under the new system.

My second area needing a close look relates to the Secretary of State's statement of compliance with human rights. The basis of the problem lies in the abolition of the regional targets for Gypsy and Traveller sites and the drastic reduction of the capital funding. This means, in reality, that local authorities will have much less incentive to grant planning permission for private sites or find land for their own. There is already a shortage of authorised sites and that is the cause of illegal occupation and traumatic evictions. A very high proportion of local authority officials have said that they expect the community-based planning system in the Bill to make accommodation for Gypsies and Travellers more difficult.

What has happened to the provision for local authorities to set up panels which must include under-represented groups to promote the sustainability of their local communities in the Sustainable Communities Act 2007? What monitoring arrangements will there be, in fact, to check the number of sites relative to need? What will be the role of the unelected neighbourhood forums in dealing with site applications-and parish councils?

The Government's summary impact statement refers to the,

"potential for a negative impact on supply",

And to delay in "processing of planning applications", which is alarming, but the equalities impact statement that I read does not refer to Gypsies and Travellers at all. Is the department not aware that Gypsies and Irish Travellers are an ethnic minority? It is surely discriminatory to have a practice of allocating, say, one-third of the homes in a new estate for affordable homes, but ignore the need, equal in worth, for transit and permanent sites for caravans. We have not decided, and could not decide, that the small number of nomadic members of our population have fewer rights than the settled majority; so we must arrange that they have a fair settlement. The enforcement impact statement omits the likely increase in eviction costs, each one of which can run into millions, which will arise from the dearth of legal sites and consequent stopping on unauthorised sites. Can the noble Baroness provide an estimate?

In sum, there are a number of clauses in the Bill, principally those dealing with the abolition of regional strategies, local referenda, the withdrawal of reporting on local development schemes, development plan documents, monitoring reports, neighbourhood development orders, community right to build orders, and retrospective planning permission, which could impact very adversely on Gypsies and Travellers. I cannot find any mention of this in the impact statements, but perhaps the Minister can tell me where it is. So may I ask her what account was taken of the likely effect on Gypsies' and Travellers' rights under the Human Rights Act in drafting the Bill? In conjunction with these concerns, I agree with my noble friend Lady Warwick about Clause 5. The power to repeal could include the public sector equality duty with barely any parliamentary scrutiny or consultation and could adversely affect minority communities already suffering prejudice. How can fairness be safeguarded with such sweeping powers?

There is one further part of the Bill which I mention as needing a hard look, and that is an aspect of the community right to challenge in Part 4. This provision opens up public services to bids from community groups. If such a group is a religious organisation, it is exempt from the Equality Act requirement not to discriminate in employment or in the provision of services, and there is nothing to prevent it including proselytisation as part of its service delivery. I think this is inappropriate. We would not want-indeed, we do not allow-the public services themselves to discriminate or to include a plea for a particular religion as part of their package, so we should not allow an organisation performing a public service to do so either. I look forward to the Minister's response.

Photo of Lord Greaves Lord Greaves Liberal Democrat 9:02 pm, 7th June 2011

My Lords, I declare an interest as a member of Pendle Borough Council. In view of the contents of the Bill and the likely debates as it goes through, I also declare an interest as vice-president of the Open Spaces Society, and I remind the House of my relationship with the British Mountaineering Council. We have had an astonishing number of erudite speeches, many of them about planning. I was going to talk about planning, and I promise the ministerial team that I shall be heavily involved in the planning section of the Bill when we get to Committee, but most of what I would say now has already been said, so I shall just make a few discursive remarks about how I see the Bill in general.

For a start, I shall tell the House what I was doing last night. I went to a meeting in the ward I represent on Pendle Borough Council, Waterside ward, of a body called the NAG-the neighbourhood action group. It consists of residents, ward councillors and local agencies and groups who are doing very valuable work within the ward, including an organisation called Open Door, which has just won The Queen's Award for Voluntary Service and does brilliant work. People come together with a couple of officers from the council who are part of the new locality working team, which I shall mention in a minute. It is an area of very considerable deprivation. Under the census categories-the super output areas, as they are called-depending on which indices you take, it variously comes within the top 10 per cent to the top 1 per cent of deprived areas in the country. The top is the most deprived. It is not a posh, middle-class area at all. It is an area which has had active residents' groups of various sorts for all the 40 years that I have been associated with it.

If you go back 10 years, a series of residents' groups in different parts of the ward came together in a group called the Waterside Community Network, which put a lot of pressure on the council, the county council and other public bodies, campaigned against problems in the area and for better facilities and ran local events. Six or seven years ago, the then Labour Government set up the housing market renewal scheme, and Waterside was part of it. As part of that, they put a lot of resources in to set up a neighbourhood management scheme and, as part of what in those days was known as double devolution, attempted to move decision-making and involvement below the level of the local authority. There were lots of pilot neighbourhood management schemes around the country, including in the HMR areas. The resources were council staff and council community development workers who have done a great deal of really good work. It is interesting that, as a result of putting in council staff and resources, the original voluntary residents groups, which relied entirely on voluntary involvement, atrophied and it all became part and parcel of the council-run scheme.

All that money has been stopped now. It was always going to be stopped. It was not just because of the Government's cuts, although perhaps it has stopped a bit more quickly than it might otherwise have done. As a result, we now have the NAG meeting where these people come together, but there are far fewer resources than there used to be. We have all got to start again. That is a lesson of governments spending a lot of money perhaps in very good ways and then suddenly pulling it out again. Most of the areas of neighbourhood management in Lancashire have closed down. Throughout Pendle, including in my ward, we are keeping it going because, despite the present budget difficulties, the council has been able to put some mainstream resources into what it now calls its locality working team.

On Thursday evening, I am going to a meeting of the Colne and District Area Committee, an area committee of Pendle Council, which takes a lot of decisions about what happens in our town and in our part of the borough. It consists of all the councillors in our part of the borough. It does all the planning applications in that area but takes lots of other decisions as well, has resources to spend and makes decisions quite independently of the central council setup. The important thing about these meetings is that people can turn up and take part in the meeting. They can speak on any item on the agenda, tell us what they think and very often change for the better the decisions that are made.

All that was done without any national legislation. There are no local government Acts, localism Acts or whatever telling our council how to run area committees or how to involve residents in the working of the council in various ways. We have done it because it was thought to be the best way to do it. At the time, there was a lot of opposition. Now, you could not tear the councillors and the council away because it works very well.

There is a lesson to be learnt here: under the previous Government, the Local Democracy, Economic Development and Construction Act came into being. I think that there are six pages of detailed primary legislation about how councillors should deal with petitions. During the passage of that Bill, I detained the Committee for quite a long time, as the noble Baroness, Lady Andrews, will remember, when I tried to point out that it was all nonsense. Councillors are perfectly able to make up their own minds about how to deal with petitions. If they cannot, and do not, they can be turfed out and councillors with more sense can be found.

One of the good things about this Bill is that it scraps all that petition nonsense. Instead, we have all this new referendum nonsense, which is far worse. It is far more complicated and time-consuming, and will be far more costly. I hope that the House of Lords will kick it out. It is exactly the same kind of nonsense; that is, the only way to get councils to behave reasonably when residents in an area want to put forward their views is to produce detailed, national legislation, along with reams of guidance and regulations. That is not localism. It is top-down legislation.

The noble Baroness, Lady Bakewell, said something really interesting when she explained what happens in her area when residents are "on the warpath". That is the other side of localism. It is people campaigning, agitating and deciding something for themselves, not the council saying that it has got to be done this way or whatever. It is about going out and occupying a council chamber with wheelchairs, which takes me back to my youth. It is a political rather than a bureaucratic and administrative process-not party political, but politics with a small "p". People decide to do something about a problem, they get organised and put the pressure on.

This is the sort of thing that the kind of people who have written this legislation do not understand at all, but I think that some Ministers understand it only too well. I hope that we can bend the legislation a bit so that people who want to agitate in this way will find it easier to do so. We can provide structures for people to gain access more easily, just as we have provided structures to allow people access to our area committee. What we cannot do, of course, is force people to act. However, the way to really get them involved is to make them angry by closing something down or doing things they do not agree with, but that is the way of the world.

Photo of Lord Mawson Lord Mawson Crossbench 9:10 pm, 7th June 2011

My Lords, I would like to take this opportunity to congratulate the Government on bringing this Bill before the House. It holds important opportunities for local communities to take hold of their assets and use them to mould their own futures. In my view, particularly in the inner cities, too many people's lives have been controlled by the state, with disastrous results for some of the poorest communities in the country. The state has often been responsible for creating dependency cultures which breed poverty, apathy and a lack of ownership. The human spirit, which always seeks to create and take responsibility for life, has been dulled, and the taxpayer has paid the price. It is time to begin to pass the ownership of and responsibility for local assets to local people. This Bill represents a small first step forward by boldly handing over public sector assets directly to those individuals and organisations who wish to help build their local communities' future. I believe that the Bill will be welcomed by many communities and forward-thinking local authorities. For example, the mayor of Newham, Sir Robin Wales, is currently leading a debate on how his council can help residents take control of their lives and improve their situation and stop delivering services in ways that sustain and encourage dependence.

I would like to focus my comments on Part 4 which is concerned with community empowerment, and particularly Chapter 3 which enables voluntary and community bodies such as churches and charities, as well as public sector employees delivering services, to express an interest in running a local authority service. This is an important step forward. If we truly want to empower communities, they need to take responsibility for their own future by building enterprises and taking ownership of local assets. This very practical activity can, in my experience, not only develop entrepreneurial skills but also, in diverse communities, create community cohesion and build new relationships. One of the ways to ease racial tensions is by investing money in practical projects where people from different communities have to come together to take hold of their futures as individuals. We would see greater unity in the divided communities of Bolton and Bradford if the Government began to hand over physical assets to those local communities, apply funding streams in a way that brings people together, and demand the input of community practitioners and activists. Practical projects, if managed well, can be game changers in local communities if the public sector gets out of the way and gives local people the space to be entrepreneurial.

Innovation in health and education will not come through speeches, policy papers and strategy documents. Change will come through local leaders, be they doctors, teachers, social entrepreneurs or residents, taking ownership of land, buildings and services and running them. As I have repeatedly pointed out in your Lordships' House, there are nearly 50,000 churches in Britain which, along with other faith communities, would be interested in playing a key role in the big society by stimulating an enterprise environment. There can be real social and economic benefits if local social enterprises are encouraged to run integrated services. This works in practice because social enterprises, like churches, can look at the totality of the local context, the experience of the individual and the family, and not just one bit of it. I and my colleagues have done this for many years now in all of our projects, especially in East London, with some success. It is essential for us to create across this country a culture of learning by doing. Part 4 of the Bill begins to give local communities the tools to do just that. Let none of us be under the illusion that this is easy and that a few lines in the Bill will make change happen. There are real challenges here.

The Bill in its present form asks for two extremely unequal parties-the local authority and the local partner-to work through complex community issues. This disproportionate relationship will result in the local authority holding all the cards and, if it is opposed to the novel ideas presented in this Bill, it will use its full hand to prevent change despite any paper reassurances that the Bill can offer to the contrary. I had direct experience of this problem some years ago. Let me describe what happened in practice.

In the late 1980s and early 1990s, Tower Hamlets had a new Liberal Democrat council. In a bid to bring decision-making closer to the community, the Lib Dems divided the borough into seven neighbourhoods which would have some semblance of devolved control over the decisions that affected them. Although this sounded innovative at the time, we soon came to realise that the fundamental concerns behind the thinking was wrong. This approach, in common with the ideas of other parties which would follow, cared more about implementing structures than about working with local leaders and the agents of change. The frequently shifting political landscape was tough on the people of Bow. Every political change seemed to be followed by at least three years of chaos while new structures were implemented and old ones taken down. During these chaotic years, my team and I decided to forge ahead and encourage people from the voluntary sector to work with people from the public sector on a joint project which could, we hoped, offer an intelligent response to some of the so-called intractable social problems.

The chief executive, Bill Tomlinson-a good man-wanted to take the localism agenda further and explored the transfer of local authority services to community organisations, a somewhat radical idea at the time. The Bromley-by-Bow Centre decided to look at each area of council activity in our local area and see which services could be contracted out to us. We were proposing a long-term contractual relationship instead of one based on short-term grants. Every Friday afternoon my colleagues would sit down with Bill and one of his heads of services and attempt to come to an agreement that would move the project forward. Some of the conversations were positive and some were straightforwardly hostile, but eventually we agreed a contract comprising three elements of responsibility that we-at that time a small voluntary sector project-would take charge of. The services to be transferred to us were agreed as: running community education classes; providing care services for local elderly and disabled people; and running the local park. We believed that we had the capacity and experience to now take ownership of these services and run them well; the council thought so, too.

Unfortunately, one week after the ink was dry, the Liberal Democrats lost control of the borough to Labour even though our ward remained Lib Dem. As usual, structures had to change. The infrastructure of seven neighbourhoods was swiftly removed and, in its place, Labour invented seven committees to run the borough instead. It took another five years until we were able to start having a coherent conversation again with the local authority. In 2000, a more dynamic relationship began to develop between the centre, the council and the health service. New, more business-minded leadership teams were thankfully appearing in these public sector bodies. For 10 years we worked well together.

How will the Government address the imbalance in this relationship so that two unequal partners, operating with different scales of resources and responsibilities, can achieve a desired outcome? Will this Bill actually be practicable for a local social enterprise to successfully challenge its local authority and seek to run a service? The key, I believe, lies with who decides the specifications of the service and the cost. Will that person be independent and local so that the devil in the detail is understood? There needs, of course, to be provision for the possibility that a community organisation, like any part of the public and business sectors, can fail and that a service contract or community asset will need to be recovered by a local authority. Again, getting the detail of this right will be important.

My question to the Minister is: does anybody currently drafting this legislation have personal experience of challenging a local authority when trying to deliver a service? If the Minister would find it helpful, I would be willing to share our considerable experience in this area and explore together how we might make this piece of the legislation workable in practice.

Photo of Lord Black of Brentwood Lord Black of Brentwood Conservative 9:20 pm, 7th June 2011

My Lords, I warmly welcome the Bill. I have some specific points to raise on certain aspects of it, but, before doing so, I shall make a brief observation about what I believe will be the highly beneficial impact of the legislation on local authority members.

I was a district councillor in Brentwood in the late 1980s. Although I have played no subsequent role in local government, I know that public service and the burdens that go with it have changed considerably since then and not always for the better. I may be a little dewy-eyed about it, but, back then, it seemed that councillors were relatively free to campaign on issues, to talk openly about planning issues and to work with their local communities free from burdensome regulation. In recent years, that freedom has been seriously eroded. Councillors are far too often warned off pursuing particular policies because of a possible clash with other laws and regulations or the threat of judicial review, as my noble friend Lady Eaton outlined earlier. This has been compounded by the real danger from no-win no-fee arrangements and the menace of the compensation culture. This is particularly true in the area of planning where overly burdensome rules on predetermination make it impossibly difficult for citizens to engage with their local representatives or to seek to get them to campaign on important local issues. I agree wholeheartedly with the remarks of the noble Lord, Lord Teverson, on this.

Along with the welcome abolition of the Standards Board regime-I know that we have heard different views about that today-which encourages trivial complaints about local councillors and has become something of a busybodies' charter, the clarification in the Bill of the rules on predetermination and the introduction of the general power of competence will return much needed freedoms to local councillors to act in the best interests of their communities.

When I was a councillor, I learnt from the pages of the Brentwood Gazette about the vital importance to local communities and to active citizenship of a vibrant and informed local media. By that, I mean not just the local newspaper-which is highly significant in any community-but also local radio and the local advertising community, an equally important part of the civic tapestry. In a few small respects, there are issues in the Bill which impact on this local media landscape and I want briefly to highlight them. In doing so, I declare an interest as executive director of the Telegraph Media Group and as a director of the Advertising Standards Board of Finance, which funds the work of the Advertising Standards Authority.

The vast majority of the objectives contained within the Localism Bill pertaining to advertising, including restrictions on the placement of advertising trailers in fields as well as on fly-posting and graffiti, are to be warmly welcomed, but there is one minor exception relating to outdoor advertising and to Clause 111. Outdoor advertising sites play an important role in the life of a community. Around 30,000 large roadside billboards nationwide advertise local services, liven up derelict areas and often act as important points of public information. The vast majority of these advertisements comply fully with the law and with the codes of advertising practice policed by the Advertising Standards Authority. Very occasionally, however, a local planning authority finds it necessary to take enforcement action against a site where the media owner has not apparently complied with relevant legislation in obtaining planning permission.

At the moment, outside London, an advertiser has the right of appeal against that decision to a local magistrates' court, which can weigh up the issues and reach a swift decision without too much cost to the local authority or the advertiser. Disputes can be resolved without fuss where they should be: in the community involved. That is localism in action. It is a different matter within London, where, under Section 11 of the London Local Authorities Act 1995, there is no right of appeal and an advertiser can challenge a decision, at great expense, only by judicial review. This is a power which in two judgments of the High Court, most recently by Mr Justice Irwin in Clear Channel v London Borough of Hammersmith & Fulham in 2009, has been described as "draconian" because of the lack of an appeal process and because media owners are often deterred from challenging a possibly erroneous use of a power by a local planning authority because of the costs involved.

It therefore seems quite wrong that a Bill dealing with localism should seek-as it does in Clause 111-to remove the common-sense, local right of appeal within local authorities outside of London and replace it with this draconian, anti-local and unfair regime that exists in the capital, clogging up the valuable time of the High Court in the process. That is completely the wrong way round. Surely we should be respecting the rights of local communities to deal with such matters within those communities rather than in a far off court by importing into London the system that works so well outside rather than the other way around. That would be real localism.

Dealing with this point would also cover off an important point of principle. As far as I can tell, Clause 111 appears to be extremely unusual in the context of this legislation in that it is the only provision within Part 5 relating to planning that lacks any right of appeal. That cannot be just and I hope we can deal with this constructively in Committee, as it is at heart a technical not an ideological issue and one that I believe has cross-party support.

I will make one very quick point about local newspapers and their scrutiny role in the local community, a point touched on by the right reverend Prelate the Bishop of Norwich earlier. As this House has discussed many times, local newspapers have a vital role in scrutinising local authorities and the way in which local taxpayers' money is spent. If localism is to mean anything, and this legislation is to work in practice, it must mean that local people have access to information about how decisions are taken. How else can they take advantage of the exciting new powers this Bill offers them, which my noble friend Lord Wei outlined earlier?

In recent years this has become more difficult with the move to cabinet-run councils taking secret decisions behind closed doors. The provisions in the Bill on the establishment of oversight and scrutiny committees to hold the local authority executive to account can help roll back that tide and allow such committees to become a valuable addition to public access rights. However, this is not a substitute for a free and vigorous local press, which must be allowed rights to attend the actual local government meetings at which decisions are discussed.

That is why I am concerned that the Bill does not more clearly limit the fairly widespread ability of local authorities to exclude the local media from access to meetings. This can be remedied if the Secretary of State is prepared to issue robust regulations under paragraph 11 of Schedule 2 to the Bill and the new Part 1A of the Local Government Act 2000, which are predicated upon openness. I am sure that this is the instinct of the Secretary of State-it certainly fits in with the spirit of this Bill-and I hope that at some point during the passage of the legislation the Minister will be able to reassure us on those points.

I hope these small points I have raised can be tidied up in Committee because this is an excellent Bill, which I believe has the potential to be as significant in handing real powers to local people and energising them in their local communities as the right to buy was in the 1980s in creating a property-owning democracy. In doing so it will have my wholehearted support.

Photo of Baroness Thornton Baroness Thornton Shadow Spokesperson (Health) 9:28 pm, 7th June 2011

My Lords, since the Government have completely failed to provide me with a health Bill this summer, I thought I might keep in legislative shape by taking a look at the Localism Bill; and indeed the person responsible for it. Eric Pickles was in my younger years-and indeed his, because we are the same age-infamous as the leader of my home town, as well as that of the noble Lord, Lord Patel: Bradford. We bear the scars, I have to say. He managed to wreak significant damage on the fabric of the city before he lost an election.

If noble Lords will bear with me, I would like to take a small trip down memory lane with Mr Pickles and then I will address my remarks to the community right to challenge and right to buy. I expect the Prime Minister believed that Eric Pickles's time as a councillor and leader in Bradford qualified him for this job. However, I wondered if the Prime Minister had read a book called The Pickles Papers by Tony Grogan. I recommend it to your Lordships' House; I recommend it to David Cameron, to the coalition partners and particularly to the civil servants at the DCLG and perhaps the Bill team. It tells the story of what Eric Pickles likes to call the Bradford revolution. As my noble friend Lord Beecham has suggested, there are parts of the Bill that reflect the obsessions of Mr Pickles, and, if I might add, it feels to some Bradfordians that there are parts of the Bill that are about settling some old scores.

I remember the so-called Bradford revolution well, as I am sure the noble Baroness, Lady Eaton, would too, were she in her place. This period had all the ingredients of a soap opera rather than a council chamber: intrigue, double-dealing, ambition, power, sex, money, conspiracy, corruption, betrayal and blackmail. They are all in the book. I have to say, my Lords, do not get too excited about the sex or blackmail.

What we actually saw was a city leader in Bradford who was mostly financially supported by Conservative Central Office and using Bradford as a Thatcherite experiment, with the slimmest of majorities. Indeed, with the casting vote of our lord mayor, whom Mr Pickles confirmed in his position for two years instead of the usual one, he then revealed a plan to wipe out what he called the municipal socialism of Bradford for ever and to transform Bradford Metropolitan Council into Bradford plc, with himself as chairman of the board of directors. He did significant damage to the city-and I am very much aware of some of this, because members of my family worked in the voluntary sector. He tried to kill off the voluntary sector, including organisations which promoted racial harmony. His cuts created huge hardship in the poorest communities. He closed down the youth services, and he raised the prices of meals on wheels not once but twice in a year, and so on.

This may seem familiar to noble Lords. Just think about the cuts that Mr Pickles volunteered local government for with great alacrity. Just think about the 142 extra powers in the Bill and the toxic Henry VIII powers in Part 5. As if to add insult to injury in Bradford, we are in line for a shadow mayor. I say to the noble Lord, Lord Wei, that he should beware-this is not a politician to whom the words "big society" come easily, I suspect.

I turn to the right to buy and the right to challenge, because I am an optimist. In a nutshell, the right to buy is intended to facilitate the takeover of public buildings and other assets by community groups and local charities. The right to challenge would allow local groups to express an interest in running a local service which they felt they could provide better. The noble Lord, Lord Mawson, spoke about the poetry in the value of these proposals, but I intend to be slightly more prosaic.

Could the Minister confirm that, although we are merely starting to consider this Bill-and this House may have serious and substantial amendments to make to this part of the Bill, on the issue of asset locks or whatever-the DCLG has launched consultations on the detail of supplementary regulations that will govern how these new rights are supposed to work? In terms of policy-making and parliamentary scrutiny, this seems not so much to be putting the cart before the horse as trying to bake the cake with only half the ingredients.

With regard to assets of potential community value, currently it is not clear whether the asset listing can include assets which are of potential community value, as well as those that have had community value in the past, or currently. The Bill indicates this would be possible, but the consultation paper actually indicates otherwise. This seems to be of obvious and a lot of importance. Often community organisations can find new and transformative uses for assets which otherwise are underused or even liabilities. Will the new powers encourage creative and innovative community action? For instance, derelict land is a good case in point, and there are very good examples of this.

One consequence of not allowing the right to apply to assets of potential community value would be to create a disincentive for landowners to allow informal use of property by the community, as the Countryside Landowners Association complained about, which has already been raised today. If, however, the right also applies to assets of potential community value, then the fact that a landowner had previously allowed community use would become of less consideration for local authorities in determining which assets should be listed, so the disincentive would be diminished.

The Government need to address the issue of the moratorium period, as they need to strike the right balance between the interests of property owners and the challenges facing community groups. A period of three to six months may not be enough, and Locality-previously the Development Trust Association-which has been working with community groups on community asset transfer from both public and private property for nearly 20 years, tells me that three months would be wholly inadequate for this purpose, and even six months might be too short. This is one issue that we will need to discuss.

There are a lot of issues about the community right to buy. For instance, there is the right of first refusal, wanting to avoid the bureaucracy that has made the Scottish model cumbersome, and the right of first refusal being workable without additional bureaucracy. I suggest to the Minister, given that this issue has been raised several times, that we should have a meeting to discuss the issues of first refusal and asset locks. This is such an important issue, around which I think there will be a great deal of consensus.

There are several issues with the community right to challenge. Briefly, can the Minister confirm whether in determining who makes an expression of interest to run a service the priority should be given only to local community groups? It seems important that the local authority should have the option of procuring the service directly from the organisation submitting the expression of interest, if it considers that desirable, yet that would obviously need to take place within the regulatory framework of commissioning. I recognise that in some cases the EU rules or other requirements will necessitate an open tender approach but that is not always the case.

It would be helpful if the Government could encourage commissioners to procure services from community groups who submit an expression of interest and, in some cases, use a grant rather than a contract approach as a suitable way forward. However, is that one-way traffic? In other words, what happens if there is an electoral mandate to continue to provide a service in-house, perhaps based on the unsatisfactory experience of an out-of-house provider? It seems that the Bill looks at it as one-way only. Perhaps the Minister could clarify that issue for me.

I am concerned about how the right to challenge will manifest itself and I will be seeking reassurance that there is a proper test of community and accountability. I fear that we may have a case here of the old-school Conservative "councils should meet once a year to hand out contracts" faction engaging in an awkward dance with the new-wave "radically devolve powers to local communities" faction. The result could be that the right to challenge would look less like a tool for community empowerment and more like a lever to accelerate access to the private sector. I am sure that is not the intention, but we need to make sure that the safeguards in the Bill mean that it cannot happen.

Photo of Lord True Lord True Conservative 9:37 pm, 7th June 2011

My Lords, I declare an interest as leader of a London borough that, under successive management, has practised localism and is vigorously practising it now without Parts 4 and 5 of this Bill. I strongly support the Bill's principles. It is a sea change, as others have said, from the old top-down ways in its inspiration. Good local government is certainly, in the old cliché, close to the people. I also believe that it should be ready to yield power to communities and the people and I agree with a lot of what the noble Lord, Lord Mawson, said.

If people genuinely believe that becoming involved will make a difference, they will turn out at elections, come to meetings, go on demonstrations, yes, and express intelligent views and run things. The Bill rightly wants to encourage that but the mechanisms for people to do so must be accessible, comprehensible and transparent and I cannot say that about everything in the Bill. In fact, probably only Whitehall could think localism and write a 430-page government Bill to deliver it, as the noble Lord said at the outset. The essence of localism is infinite variety. We must not chew up creativity and variety in an overheated word processor and I know that Ministers do not want that to happen.

Your Lordships will not be surprised that I, like others, regret that the elixir of localism evaporates in London-the noble Lord, Lord Jenkin, made this point. London boroughs cannot initiate development corporations under the Bill; the mayor must decide. Our regional planning strategy is not being abolished and we are still under City Hall. When our local authority agrees that a three-bedroom house may have up to two parking places, London regional government instantly intervenes to say that it can be only 1.5 spaces. Try explaining half a car space to a local resident. The point is that there is not much localism there, and where London is concerned there is not enough change in the Bill. In fact, regional government gains authority and, by Clause 199, it could get even more. I would like to explore that in Committee.

One answer might well be that there is a general power of competence. Like others, I welcome that and thank Ministers for it. But how far will the system let this good idea go? I hope a very long way, because local government and local communities need change and experiment in an age of technological change and limitations on resources.

Already I hear some calling for more restrictions on the general power of competence. The problem is that even now the general power will not trump some other legislation. We are trying to set up social enterprises from within our local authority, but European procurement rules obstruct the creation of viable large-scale social enterprises freed from council control. We are spending quite a lot of money on lawyers for this at the moment. Perhaps I could have better advice from the noble Lord, Lord Mawson. So I appeal to Ministers to resist attempts to confine this general power of competence.

On the core aim of promoting public involvement, I appeal for simplicity. Give local authorities the incentive to involve people and I believe many more will do so. Some parts of this Bill still assume that local authorities will not listen. As a result, they offer challenge procedures that risk being complex and costly, as other noble Lords have pointed out, and potentially far more open to use by political parties or lobbies than the average citizen. I applaud the intentions, but some effects could be perverse, and I think we can improve them in Committee. I support referendums on excessive council tax rises, but, as other noble Lords have said, the plan to unleash referendums where just 5 per cent of local people in an electoral area ask for one-it might be 300 people or so or even a couple of perhaps disgruntled councillors-may be highly time-consuming and vexatious. It could be a licence for politically-organised single-issue campaigning, which will not encourage mature and open decision-making or help local communities. If we go down this road-I agree that referendums have value-the triggers should be higher.

Like others, I am sceptical about the complex machinery for neighbourhood plans and neighbourhood forums. There are good ideas there, but they need more exploration. If neighbourhood planning is already happening at local authority level, why duplicate it? In our borough we are trying to do neighbourhood planning already, and I believe that to be effective it needs to be dynamic, open, almost anarchic, as the noble Baroness, Lady Bakewell, said, and not on a rigid model. People come in the doors and put their points of view for different reasons and in different ways. It needs a changing cast of people involved as the questions in different areas evolve. To work, it has to involve far more than 21 people who cannot be moved on for five years in some cases.

We must not create a disincentive for local authorities to take a lead. What would happen if-as in our case-having invested years working informally to design neighbourhood plans in concert with thousands of people across the borough-up pop groups of campaigners or, worse, civil servants, waving this Act and demanding it be done again. Like others who have spoken, I believe it would be simpler to allow some limited public third-party appeal where a local authority did not follow its own plan. I am sorry that promise was dropped by the coalition Government. In essence, while strongly supporting the Bill in principle, and I believe it can be made an outstanding and historic Bill, a good Localism Act might well be permissive, not prescriptive. It must treat local authorities as part of the solution, not part of the problem. It should let local authorities whose adopted local development framework does not reflect local views and neighbourhood plans tear up that framework. It is not clear to me that Clause 97 allows that. It should.

In conclusion I would say that I also worry about procedures on the lists of assets of community value. Here is a really excellent idea to protect local pubs, post offices and resources, but it has been expanded too far and it is potentially invasive of rights. We will have to adjust that in Committee. As a local authority leader, I also welcome the community right to challenge, which is very important. As my noble friend Lord Jenkin said, why can local authorities not challenge to do things? For example, a local authority could replace a lazy RSL or, in London, perhaps run our high streets, instead of a remote body such as TfL.

The Bill will improve local communities in many ways. In essence, we need to be more experimental and supportive, and less prescriptive. Parts of the Bill will need to be pared down and it must not be made more complex. I hope it emerges from this House thinner but no less focused on the vital objective of involving local people in decisions that affect their lives.

Photo of Lord Boateng Lord Boateng Labour 9:46 pm, 7th June 2011

My Lords, localism has many friends on all sides of this House. I suspect that, as we consider the Bill and seek to improve it, we will approach that task in a friendly way. We all believe in localism because of our own experience, with so many of us having grown up, as it were, in local government.

There is, however, a problem. For localism to be delivered effectively on the ground requires two things in particular: trust and risk taking. In my experience of government, Ministers do not much trust anyone with their pet projects-those policies that they have been striving to bring to fruition for so many years, particularly those bitter wilderness years in opposition. Now that they have the opportunity to do it, they are being asked to cede power. The Treasury trusts no one. I say that with hand on heart. Civil servants are not prone to risk taking. I say that having been one. Therefore, in those circumstances we have a problem-something that has contributed to the schizophrenia that lies at the heart of the Bill, as has been exposed and shared with us by several colleagues, again on all sides of the House. They point on the one hand to the Secretary of State giving and on the other to the Secretary of State taking away, or holding close to his own chest. That is something that we will have to deal with in Committee. We must engender a little more trust and create space for risk taking, recognising that, from time to time, localism will go wrong. We have to be prepared for that.

Reflecting on the comments of the noble Lord, Lord True, one person's variety is another person's postcode lottery. The challenge, therefore, is to create a context in which it is possible to unleash and unlock the potential that comes from local communities; and to give people an opportunity to have a go, feel engaged and have a sense that their activism counts for something and can go beyond mere protest to the tough, rough business of delivery, which many of us who have been local councillors know something about. How can we achieve that when, at the same time, there are huge restraints on public spending and resources are a real issue out there in the field? That will require all the ingenuity and good will that can be mustered across central government.

We are also faced with the challenge that the Bill is being introduced alongside the restraints on spending at the same time as the Government are rolling out their big idea. However, I argue that it ought not to be seen as the big idea of any one Government as it is something that we all ought to be able to recognise as having real value-that is, the concept of the big society. If the big society is to be made a reality, it has to be about empowering individuals and communities. If that is to happen, we are going to need more than strong, active local government; we shall need strong, active communities because localism is not just about getting the balance right between central and local government but about enabling individuals to come together at grass-roots level to take responsibility for their own lives and communities, and to do so within a legislative context that is truly enabling and empowering. That is the trick that we have to pull off in Committee and as the Bill goes through Parliament. We should welcome the opportunity to do so.

In some ways it is a pity that we did not have this opportunity at a more auspicious time in terms of the public finances because the reality for so many groups on the ground-we are grateful to ACEVO, the Association of Chief Executives of Voluntary Organisations, and to many other organisations representing the voluntary sector for giving us the relevant statistics-is that some councils are responding to spending cuts by looking after their own and are passing on disproportionate cuts to the voluntary sector and to community groups, thereby reducing the very community capacity to build the big society that we need.

The Minister will recognise the importance of small community groups in promoting good practice. For example, the Pepper Pot Day Centre-an organisation that she will know well because she was a strong supporter of it when she was a distinguished leader of a local authority-has pioneered innovative ways of caring for the ethnic minority elderly. The fact of the matter is that such small voluntary groups up and down the country are threatened by the cuts. I am afraid that we do not always find sympathy in local government for such groups or a willingness to cede power. We do not always find a willingness to protect such groups, some of which are rather difficult and challenging-they are all the better for it-from the impact of cuts. The prime example of the big society to which the Prime Minister referred when he was asked what he understood the big society to mean was the citizens advice bureaux. Those bureaux are bearing the brunt of local authority spending cuts.

I hope that during our deliberations on the Bill, the Minister will have her civil servants brief her on the report of the Commission on Big Society. I declare an interest as I was a member of that commission. It was chaired by the noble Lord, Lord Rennard, and included among its number the right reverend Prelate the Bishop of London and a Conservative member of the other place, but perhaps even more significantly, members and leaders of voluntary sector organisations from all over the country. The commission made three recommendations which I should like to share with the House, and which I hope the Minister will consider as we move onto the next stage.

The commission's first recommendation states:

"That the Government amend the Public Services (Social Enterprise and Social Value) Bill so that it requires commissioners to consider not just the full social, environmental and economic impact of their decisions in awarding contracts to different potential providers, as it does currently, but also explicitly to consider the impact of their decisions on individual and community empowerment, and to do so when decommissioning or cutting a service as well as when commissioning one".

That would make a real difference and concentrate the mind in a way that would enhance, rather than detract from, the big society and localism.

The second recommendation states that, given the threat to so many smaller voluntary organisations up and down the country, the Government should,

"shorten its consultation period, and make its proposed guidance on local government funding avoiding disproportionate cuts to the voluntary sector"- that is, through the impact of the statutory sector's decisions on the voluntary sector-

"with immediate effect".

That would provide some immediate relief for some of the organisations who are currently bearing the brunt of so many of the cuts.

Finally, the Government should,

"require local councils to publish their spending on the voluntary sector, as the Minister for Decentralisation has previously called for, and ... the Treasury collate, quality-assure and publish the information, so that councils can be held to account by civil society groups" and can be subject to proper public scrutiny.

All of that is doable in the context of the Bill. None of it requires additional public expenditure, but it would make a reality of the localism that we all seek, the localism that truly enables and empowers.

Photo of Baroness Hamwee Baroness Hamwee Liberal Democrat 9:56 pm, 7th June 2011

I should declare an interest as joint president of London Councils, vice-president and past president of the Town and Country Planning Association, and, as I remain a member of what my noble friend Lord Tope calls the local government party, as an ex-member and chair of the London Assembly and a past member of a London borough council.

I find myself torn over the Bill. The Government acknowledge and seek to address ingrained centralism. I acknowledge that I have talked tediously over the years about seeing power not as granted from the centre but as coming up from citizens. I say citizens, because citizenship is an important concept and community, which is also important, begs almost as many questions as it answers. Community empowerment, as others have said, reflects a rather top-down attitude.

I am sad to say that I read the Bill as rather anti-democratic. Representative democracy, to which other noble Lords have referred, is about the vesting of trust in representatives at a local level: representatives who are in a position to raise their sights, to make connections between issues and assess priorities. That is to be bolstered. I would like the Government to exercise a self-denying ordinance and get away from the mindset that they need to protect people against their local authority.

The Secretary of State at CLG could play a big advocacy role within Whitehall on behalf of local government-I suggest education and taxation for starters. I share the view that the provision for referenda on council tax increases above a centrally set ceiling is capping under another name.

There is also an obligation on local authorities to rise to the challenge. I hope that the power of general competence will not be so constrained that local authorities and members will be tentative about its use. We are told that the Secretary of State does not intend to use the wide-ranging powers to limit the power of general competence and that he will use it lightly, but being told that may not be enough. I am with the noble Lord, Lord True, here.

The Bill does not go back to first principles. In grafting this power on to existing provisions, is the Minister satisfied that there has been a thorough trial of pre-existing legislation which will constrain local authorities?

One of my first principles is that power is best shared. I have always had a problem with the model of the elected mayor and I have an even greater problem with the concept of shadow mayors. I am very puzzled about how that can be described as anything but: "We at the centre know best; we know you have mechanisms now for a directly elected mayor, if you wish, but let us show you the error of your ways". I think the Minister will have got that message from the House this evening.

A lot is going on in the local scene. Over the past few days, we have had long debates in this Chamber on the Police Reform and Social Responsibility Bill. Reference has been made during those proceedings to this Bill and, among other things, to possible confusion between mayors-the post-holders-and police and crime commissioners. If we have coincidental elections, we shall make the problem even worse.

I am also concerned about the costs to local authorities inherent in this Bill. I am not concerned about the costs of democracy, but do we need legislation for the referendum on the council tax and the other referendums? The need to manage local expectations worries me considerably. On the community right to challenge, anyone who has been in the private sector knows the costs for everyone when there is a beauty parade of who can pitch the most persuasively. On the provisions about community assets, is it just the lawyer in me that stumbles over restrictions on the disposal of one's own property? Will there be an unintended consequence that property will not be developed in the widest sense for the good of the community because of a fear by the owner of losing out in the longer term?

The neighbourhood fora are self-selecting, unaccountable, without proprietary rules, and so on. The noble Lord, Lord Lucas, alluded to that. The local authority will have a lot of shepherding and support in this area for neighbourhood development orders which will, in effect, give planning consent. They seem to me to contain the seeds of real difficulties beyond resources.

The right reverend Prelate the Bishop of Derby referred to the advantaged position of those with social capital and, if I were a resident of a village which wanted to keep it just as it was, I would recruit like-minded neighbours and make sure that we had no additional housing in the neighbourhood and I would shift the issue on to other villages that were not so quick off the starting block. I think that was the point made by the noble Lord, Lord Cameron. If a local authority does not have up-to-date, adequate housing assessments, how will an examiner, who looks at a local plan, consider it in terms of housing numbers?

I would like to put in a word for the strategic, following the noble Baroness, Lady Andrews. Should planning not be a strategic activity? The regional tier has gone, essentially, I think, because of the politics. What failed? Was it the concept or the practice? We need meaningful, effective strategic planning. The duty to co-operate does not deal with, for instance, the spatial boundaries of a catchment area. It seems to me to be quite circular. If everyone has to co-operate with everyone else, but there are no shared objectives and no shared priorities, how do you start or how do you get off the merry-go-round? Like my noble friend Lady Parminter and others, I am very unclear about how local finance becoming a material consideration will work. I am struggling to understand whether this runs counter to Clause 106, which deals with the impact and the consequences of a decision-not the catalyst for it.

The NPPF has been mentioned and the concerns are recognising the links between the built environment, health, well-being, climate change, adaptation and so on. Echoing the noble Baroness, Lady Valentine, the notion of sustainable communities is really important and it is important that we see the framework very soon so that we can be reassured that it is not in danger of going down the plughole mentioned by the noble Lord, Lord Marlesford.

There is a purpose to planning and it needs to be stated. I do not see that sustainable development and planning for prosperity need to be in conflict because I do not think sustainable development is necessarily anti-growth.

It has not been possible to touch on all parts of the Bill. I congratulate the Minister and other noble Lords who covered so much ground with so much expertise and wisdom. Finally, I will pick up the comments of the noble Lord, Lord Filkin, about standards. My noble friend muttered to me, rightly, that we must not overreact to problems with the Standards Board and let those distract us from the issue. There is a lot to address in Committee, and our duty will be to ensure that the legislative basis is there for the cultural shift to which the noble Baroness, Lady Eaton, referred, not just job creation for the regulation drafters.

I said I was torn over the Bill; maybe the grand old man, Mr Gladstone-not particularly a loyalist, I think -was right when he talked about,

"trust of the people, tempered by prudence".

Photo of Lord Walpole Lord Walpole Crossbench 10:06 pm, 7th June 2011

My Lords, I declare my interest as a rural landowner, with various houses and workshops and things. I am a Cross-Bencher, and the important thing about Cross-Benchers is that we are not whipped. We listen to the facts. I have been here all day, listening to facts, and they have been quite fascinating. Like many Members of this House, I spent several years in local government before I came into the House, first of all on the Erpingham rural district council, and then on the old Norfolk County Council. I continued after that particular local government reorganisation, as a member of Norfolk County Council, and was involved with taking the structure plan to public examination. In fact, I think I knew more about Norfolk for 10 days than anyone ever has apart from the chief planning officer. I was also on the East Anglian Economic Planning Council, until the noble Baroness, Lady Thatcher, decided to get rid of us.

I looked at this Bill, when I first got it, in absolute amazement-the sheer size of it is daunting. However, I do agree with some of its objects. I hope that it will enable co-operatives to be able to run local shops, such as we do in our village at Itteringham. It is a very good shop and responds to local needs. On the other hand, there are some objects which this Bill includes about which I am more doubtful, such as the Norfolk Museum Service discussion about using a trust to run museums. Possibly this may help spend more money, but I am not sure they will spend it on the right things. The whole thing is sad, and we have got to watch it.

I would like to thank all those people who have contacted me by phone, letter and e-mail about the Bill; that gives me some idea of what people outside this House think about it, which is very useful. I will make two or three remarks about what has happened today. As my bishop is still here-and I did warn him that I would say this first-he pointed out that there is a difference between a parish that is urban and a parish that is rural. I hope that the Minister will remember that; it is very true. Also, the noble Baroness, Lady Scott of Needham Market-I should not choose all my local friends, should I?-was getting this mayor and chief officer to be sorted out properly. With regard to having elections, but not on the same day, one of my friends from Northern Ireland asked me if I realised that the last time they had elections there, some of them were first past the post and some were under the other system. How can you get people to vote two different ways on one day? To get them to vote for two people on one day is quite an achievement.

The noble Baroness, Lady Valentine, was right to ask for a review as soon as possible, perhaps a year after whatever happens, starts. I also enjoyed the remark of the noble Lord, Lord Beecham, about the difference between Pickles and Pericles. They are not quite the same person, but I enjoyed it. The last thing I noted, and I hope that the Minister noted it as well, were the remarks of the noble Baroness, Lady Whittaker, about regional things, such as regional design. That is more important than people realise: otherwise, there will be bits of London all over Norfolk and I do not want that.

There will have to be many changes to the Bill. I look forward to the Committee stage, and I thank the Minister-all in four minutes.

Photo of Lord McKenzie of Luton Lord McKenzie of Luton Shadow Spokesperson (Work and Pensions), Shadow Spokesperson (Communities and Local Government) 10:10 pm, 7th June 2011

My Lords, I thank the noble Baroness, Lady Hanham, for the manner in which she introduced the Bill and for her expressed willingness to engage in discussion on amendments in areas of difficulty. This has been an extensive and knowledgeable debate on an important but still flawed Bill. It was late in arriving at the other place and it was significantly rewritten in its final stages there, which puts a particular onus on this House to hold the Government to account.

Amendments notwithstanding, there remains a massive inconsistency at the core of the Bill, which the Government heralded as having the intent to transfer power to local authorities and local communities, but which is everywhere fettered by constraints and regulation-making powers held at the centre. The powers that will be wielded by the Secretary of State under Clause 5 were referred to by my noble friend Lord Beecham and by many other noble Lords, and are simply not acceptable. The Bill was described by the noble Lord, Lord Shipley, as not written in the spirit of localism, and referred to by the noble Baroness, Lady Hamwee, as antidemocratic. It also caused the noble Lord, Lord Tope, to question his understanding of "localism".

We support localism, which gives communities greater opportunities to shape their future and the nature of their local environment, and how services are to be delivered. Where the Bill facilitates this, we will support it. However, such opportunities must not be simply nominal. As my noble friend Lord Patel of Bradford and others asserted, they must be real for all members of our communities, not just for the well resourced and articulate. This is especially relevant for neighbourhood planning. As my noble friend Lord Beecham explained in his brilliant opening speech, I will concentrate my remarks on the Opposition's position on planning proposals and comment on some of the finance and tax provisions of the Bill.

As we have heard, the Bill gives to local communities the power to veto, through a referendum, excessive council tax increases; it is a one-way option only. The Secretary of State will determine the benchmark for what is excessive; how the referendum will be conducted; the question to be put; the publicity to be permitted; expenditure levels that will be allowed; and how the votes are to be counted. They can direct that the referendum provisions do not apply and decree the council tax requirement that must operate. Effectively, the Secretary of State will set the maximum level of council tax increases each year, but will also set the terms on which it can be debated with local communities-so much for localism. We will seek to get on the record how it is proposed that these powers will be used. We do not oppose the provisions for changes to the business rate supplement, but it seems that apart from that introduced by the GLA for Crossrail, which is unaffected by the changes, none is currently in contemplation. The noble Baroness, Lady Kramer, made interesting comments about infrastructure funding; perhaps we will have an opportunity to debate that in Committee.

As to the broadening of powers for local authorities to grant discretionary non-domestic rate relief, we note and concur with the impact assessment that, though welcome, there will be little appetite for funding such discounts when there is no new government money, and where the local source of funding will have to come from council tax payers at a time when threatened referendums will constrain what can be raised. Obviously, different considerations would apply if the Government were to deliver on their commitment to the localisation of business rates, and we must scrutinise these proposals against that prospect. Perhaps the Minister will take the opportunity to update us on progress in this matter, and explain how the Bill will ensure that the commitment can be accomplished, together with ensuring that all authorities have adequate resources to meet the needs of their communities. Have the terms of the resource review finally been set, and can we still expect the report in July, before we finish our Committee deliberations?

As my noble friend outlined, notwithstanding amendments, we remain implacably opposed to the proposals to levy EU fines on local councils, and will work with other noble Lords to have them removed from the Bill. As the noble Baroness, Lady Eaton, and others rightly said, the LGA has designated these clauses as unfair, unworkable, dangerous and unconstitutional-again placing too much power in the hands of the Minister.

We support the thrust of the changes to housing finance, building as they do on the work of the previous Government. However, true to form, the Secretary of State cannot resist holding powers to reopen a settlement payment and to determine the overall indebtedness of a local authority, thereby undermining the new self-financing freedoms for local authorities.

The noble Lord, Lord Best, pressed the point-and we agree with the LGA-that in the prudential code the sector already has an effective approach to managing borrowing, and that the ongoing risk of changes to the settlement creates an uncertainty which is unhelpful to the planning of new investment. Many noble Lords referred to the planning system and the changes that the Bill encompasses. They are a major untested upheaval, made worse by the blundering approach of the Secretary of State, who had to be restrained by the courts but not before creating confusion and chaos for the local planning authorities, developers and communities alike.

We heard some powerful input from my noble friend Lady Andrews, the noble Lords, Lord Cameron, Lord Marlesford and Lord Redesdale, and the noble Baroness, Lady Parminter, among others. The demise of regional spatial strategies and pronouncements to ignore housing allocations have, according to the National Housing Federation, already caused dramatic reductions of some 200,000 housing units being planned for in local development plans.

The regional spatial strategy regime is to be replaced by a duty to co-operate. There are to be changes to the process of local development frameworks and a new neighbourhood planning regime. Of course, alongside this sits-although not part of the Bill-the incentive of the new homes bonus. The abolition of regional spatial strategies will leave England as the only country in Europe without a regional planning framework, with, in our view, the duty to co-operate as an inadequate substitute.

In scrutinising these provisions we might start by borrowing from the Town and Country Planning Association, which says:

"At its best, the planning system can create the certainty to secure long-term investment and growth, address housing need, secure sustainable development and help local people to have a real voice in the future of their community".

It is a good yardstick by which to evaluate the Bill.

Do the Government still adhere to the five principles of sustainable development set out in 2005? We await the promised draft national planning policy framework, where apparently all will be revealed including the promise that sustainable development will remain at the heart of the planning framework. But the omens are not good. We have had budget pronouncements-change of use and promised land auctions, for example-which suggest other considerations might prevail. We have Clause 124, which elevates financial receipts in the hierarchy of material considerations. This clause was introduced with no consultation, dialogue or debate and should surely not survive our deliberations. We have the recently published draft NPPF of the advisory group, which has a weak and inadequate definition of sustainable development. Perhaps we can be told the status of this document. The Minister will understand that in the absence of an acceptable draft of the official NPPF, the level of concern will continue to feed attempts to get definitions of sustainable development and the presumption in favour of sustainable development on the face of the Bill-a move which we will support.

Given its significance, I do not see how we can reasonably complete our Committee stage deliberations without a chance to scrutinise a draft NPPF. We will also continue to pursue amendments proposed by our colleagues in another place, focusing on putting the heart back into our high streets by requiring local planning authorities to include a retail diversity scheme within its local development framework.

The duty to co-operate is the Government's attempt to recognise the need for co-ordination at a spatial level higher than individual local planning authorities. Despite amendment, it falls short of an effective strategic approach to planning. Assessment of whether co-operation has taken place will be made retrospectively at the local development plan soundness test, there are no effective boundaries to shape the extent of co-operation and there is no clarity on what is to be covered. Our concern is that the duty is essentially voluntary. As in the other place, we will seek to amend the Bill to ensure that sustainable development is a core objective of the co-operation, with obligations specifically to cover climate, housing, biodiversity and transport and to base the co-operation on a spatial area rather than just on neighbouring authorities.

I believe we would all support the concept of community-based planning and the opportunity for communities to shape their neighbourhood and local environment, but this will have to be accessible to all. It seems to us that the Government are still struggling with democratic legitimacy in cases where the neighbourhood is not defined by a parish council. The processes involved are incredibly bureaucratic and raise issues of capacity both for local authorities, which have a duty to support neighbourhood planning, and among the communities themselves. Neighbourhood forums, even with the need for an increased membership, need transparency and accountability and should have the involvement of elected councillors. The prospects for disputes seem high with potentially competing bids for recognition, disputes over whether someone works in an area and the status of a neighbourhood plan when the local development framework has not been completed.

We welcome the provisions for pre-application consultation. We also welcome the Government's change of heart in continuing with the community infrastructure levy but will use the opportunity in Committee to explore further the issues raised with us and, doubtless, other noble Lords concerning the interaction with Section 106 money, its implications for affordable housing and the consequences of widening its use to the maintenance of infrastructure. Central diktat about how local authorities are to apply the levy is certainly outwith the spirit of localism.

The new planning system also has to be considered in the context of the new homes bonus, which, it is asserted, will be a powerful incentive for local authorities to pursue housing development. However, we do not consider this to be fully fit for purpose. We know it is going to be funded in large measure by top-slicing revenue support money. It is payable in retrospect and on the basis of net additions to the housing stock, so rather than being a plan for addressing national need, it will disadvantage regeneration projects and cause resources to be redistributed in favour of areas where demand for housing, particularly high-value housing, is strong. It can be no substitute for the necessity for local authorities to undertake a robust assessment of housing need. However, such assessments of themselves will only by chance aggregate to what at national or sub-national level amounts to overall need, including the social housing needs of those on low incomes.

There is plenty in this Bill to keep us busy in the coming weeks. We will scrutinise it rigorously but responsibly. I doubt whether eight days will be enough, given the debate we have had today. We will work with others and in particular will seek to: roll back and constrain the raft of powers to be held at the centre which imperil vital services, particularly those in Clause 5; to delete the abomination of imposed shadow mayors and the merger of roles; to remove provisions which allow EU fines to be visited arbitrarily on local authorities; to amend its housing provisions to protect those becoming homeless and in need of secure affordable housing; to support the LGA in seeking to improve the changes to housing finance; to put the presumption of sustainable development and a robust definition in the Bill; to strengthen the duty to co-operate; and to challenge some of the bureaucracy and lack of democratic legitimacy around neighbourhood planning. There is much else: the Welsh dimension, the issues around nationally significant infrastructure projects, London governance, the role of the MDC and the Standards Board, not to mention compulsory purchase and the compensation provisions.

In short, we want this Bill to be truly about localism where individuals and local communities are empowered, supported and resourced to shape and influence their neighbourhoods. To achieve this, we will need to change the Bill. We look forward to working with the noble Baroness to that effect.

Photo of Baroness Hanham Baroness Hanham The Parliamentary Under-Secretary of State for Communities and Local Government 10:25 pm, 7th June 2011

My Lords, when I woke up this morning, I thought to myself, "I am going to have seven hours or so of this Bill today. How on earth are we going to get through it?". I have to say that I got through it with enormous enjoyment. There have been immensely good contributions. On just listening to what has been said and the way in which it has been said, people should take heart that legislation gets properly scrutinised and is taken really seriously in this House. Across the piece, I should like to thank everyone.

I am going to recommend to the Chief Whip that we stick to seven minutes for every Second Reading speech. The amount that noble Lords have packed in to their seven minutes is probably just as good as when someone goes on for 15 minutes. I thank all noble Lords for the effort that they have put into their speeches and for the strength and depth of knowledge that have come through. I genuinely say again that we are willing to talk and to listen. We were asked for meetings on a number of subjects, which we will have if people want them. I ask noble Lords to get in touch and we will see where minds meet. Where they do not meet, I am afraid that they do not. We will be looking forward to that in Committee.

We have about 15 minutes-the noble Lord opposite had 15 minutes-which is not a lot of time to deal with the major issues that have been raised. Nor is it long enough to mention every Peer who has spoken. Therefore, I am going to use a sort of self-denial and not mention anyone other than the two Front Benchers opposite, whom I thank for their kind opening remarks and for their closing remarks, my noble friend Lord Tope who opened for the Liberals and the noble Lord, Lord Ouseley, if he is in his place, who opened for the Cross-Benchers. That is it, and now I am not going to make any more comments about people. I am going to go, I hope, straight to what we have been talking about.

I sense that, while there is not complete agreement on the measures in the Bill, there is enough recognition of the need for localism and for a lot of the measures that we will be able to discuss sensibly at subsequent stages. I realise that there are issues to which people will want to come back. I know that many amendments will be moved in Committee but we now have a sense of where the thoughts of noble Lords are going on this.

Perhaps I may try to deal with some of the major areas which have been raised. The general power of competence is meant to be just that. It goes wider than the well-being power that was there previously. It is there to try to ensure that local authorities can, without feeling too fettered and without having a statutory framework around them, do some of the things that they want to do in terms of services and how they provide them, as well as do what they need to do in other areas.

In my opening remarks, I tried to deal with the powers of the Secretary of State. By and large, under the safeguards being built in, the Secretary of State is really going to deal just with taking away barriers to the power of competence. If things are standing in the way, he will be able to remove those legislatively without us having to come back to Parliament all the time. I hope that we will be able to move on on that.

On the governance issues, I understand that there are still concerns over the shadow mayors and those concerns were widely expressed. I know that we will come back to that, as we will to the combination of mayor and chief executive. I will wait with bated breath for that. While we want to look at the detail, it is important that we put mayors into the context of the overall package that we feel will be good both for cities and local democracy, and how decisions will ultimately be put into the hands of local people, which of course is the basis of the Bill. The purpose of the Bill is to pass power down. This is not a Bill that is going to constrain or be constrained by and large by the centre. It aims to pass as much as possible down to local authorities to deal with.

I hear the concerns about EU fines, but I think they may be a little bit over the top. The intention is only to deal with areas where this country is in danger of being infracted-I think that is the word-but I am bound to say that that does not happen very often. In fact, I do not think it has ever happened. However, there is a possibility, albeit remote, that a local authority just might be the cause of an infraction or of infraction proceedings being taken. It is for that reason that this provision has been inserted into the Bill. Clearly there would be discussions and decisions to be made about where the responsibility lay and how much could be taken by the centre. It is a power to get local authorities to watch EU legislation carefully so that they do not trip over it and end up with us all facing huge fines. I know that we shall come back to that one because I can see it in the faces of noble Lords opposite.

Let us look at the right to buy assets of community value, which has clearly caused a lot of concern-indeed, I have had discussions about it today. The list of assets will be constructed by the local authority, and people can ask for something which they consider to be an asset to be put on the list. The only time that that asset will come into public view is if the owner wants to sell it. If they wish to sell it, time will have to be given to a community group to put in an initial bid. It will have to be something that the community needs. We have talked about pubs and shops, and we heard about shops that have been taken over and run by communities. This gives a statutory back-up to what people have been doing in a voluntary way. It will provide a break between the sale being put forward and it taking place because a community group will be given the right to take some time for a bid. The time periods are under consultation at the moment to work out how long groups will be able to have to see whether they can put in a bid. Having done that, if a group achieves the right price, which they might not necessarily do, they will then have the right to buy. I do not think this is quite as heavy a burden as some have made it out to be. However, some of these aspects are still out for consultation, and we shall come back with more detail for the House by Committee stage or perhaps just after.

On rural communities, I understand and accept that there may be difficulties, particularly over vexatious village green applications. We shall want to look at that more closely to see whether there is a real impact. There are also other aspects to do with rural assets, and we shall be having further discussions about those.

We are now introducing neighbourhood plans. They are going to have to fit in with local development plans and national policy frameworks and to conform to those. There are anxieties that things will go awry because local councils will have no control over them, but they will have that control because the local development plan will already have laid out the parameters into which neighbourhood plans can fit. Again, this brings in the community, perhaps more strongly, into saying what it would like within its local area. Someone asked about housing, but it will not be able to frustrate housing development if the local authority has already put in a plan that it wants something in that neighbourhood.

With regard to sustainable development, the five principles are still accepted. A definition of sustainable development is being produced as we speak. I hope that we will have that for the next stage. Someone asked what a neighbourhood would be made up of. By and large, we expect them to be parish councils and/or wards in boroughs. The NPPF is being drafted and again I expect and hope that we will have that before we finish deliberations in Committee.

There was a lot of discussion on housing tenure and reform. The proposals for flexible housing tenure are just that. Concern was expressed that the flexibility will start at a minimum of two years, but that is a minimum. As I said in my opening remarks, the expectation is that, by and large, it will be much longer than that. Social landlords need to understand that if someone does not need social housing for longer than a certain length of time-or for a short time-they do not have to give them a long tenancy. If they think and it is accepted that they need a lifetime tenancy, that is available. If a social landlord decides to put all his properties on to lifetime tenancies, that is acceptable. They have the option of flexibility on what they can do.

On the issue of homelessness and whether it can be discharged by having an offer of private accommodation, homeless people are not always homeless for life. Some of them have short-term crises and some of them do not desire or need accommodation for a lifetime. They need short-term help along the way. One way in which they can have short-term help is to give them accommodation in the private sector. They may have to go into the private sector if no other accommodation is available, which is often the situation. It is a way of ensuring that they are housed somewhere. Whether the standard of the accommodation is decent and whether they can afford it will all be taken into account at the time. The provisions are not dismantling the homelessness safety net. We want to be really clear on that. Local authorities will still have a duty to secure suitable accommodation for those who are eligible and in priority need. As I said, critically the accommodation must be suitable, which covers a wide gamut of issues, including affordability, size, condition, accessibility and location.

I have covered almost all aspects raised-I hope noble Lords will forgive me if I have not-but the only other one that I want to touch on quickly is the concerns that were expressed about the standards regime. As was pointed out, many of the complaints made to standards boards are extremely frivolous. They put councillors under the most enormous pressure. I know that because I have sat on a standards committee, and you know and see what comes before you. It will not be a disaster for this power to be taken away. Most local authorities will and can have their own system and code of conduct. We would expect them to have such a code of conduct; indeed, we have said that if they make any changes, they will have to publish them widely so that local people understand what they are doing. The great panoply of bureaucracy associated with standards can now be wound up.

I think that it is 10.41. I can probably wind up very shortly-I apologise if I have stretched a little bit beyond what I should have done. I thank all noble Lords for taking part. My noble friends Lord Attlee, Lord Taylor and I will look forward to the next stages of the Bill and to taking it forward.

Bill read a second time and committed to a Committee of the Whole House.

House adjourned at 10.42 pm.