Clause 4

Sustainable Communities Bill – in a Public Bill Committee at 10:00 am on 2 May 2007.

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Local communities allocation

Question proposed, That the clause stand part of the Bill.

Photo of John Bercow John Bercow Conservative, Buckingham

With this it will be convenient to take Government new clause 1.

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

Thank you, Mr. Bercow, for your explanation. It was helpful both in making it clear to us whatis happening and in facilitating a sensible debate. Members of the Committee may have been as confused as I was about such matters. Procedurally, this is new territory.

New clause 1 will replace clause 4. It is the first new clause, rather than a new clause 1. It is, in fact, a new clause 4, and we all know what happens when that issue is raised. For the record, I propose on behalf of the Government to provide a process under a new clause 4, which I hope the Committee will welcome. I say at the outset that the Government are not doing that reluctantly; they want local spending reports.

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

I am absolutely sure because Iam speaking for the Government with collective agreement. We see such a proposal as facilitating the local area agreement process outlined in the Local Government and Public Involvement in Health Bill, which is currently before the House. It is a useful addition to those powers.

I want to outline how we see the local spending reports working and their purpose. The new clause goes further than the Bill’s original wording and is more satisfactory to all concerned. I shall explain why. The local spending report would cover all public expenditure in each local authority area in so far as it is possible to define it. It could cover both current and future spending. The decision about how regularly the report should be produced—whether yearly or three-yearly in line with current spending review periods, or less often—is not defined, but its purpose is to inform decisions. I imagine that producing a report yearly may be the most convenient way forward, even if the decisions about the allocation of the spending are made over a longer period.

A central part of the Government’s policy towards local government financing, for which there is strong support across the councils, as represented by theLocal Government Association, is that multi-year settlements—three-year settlements—are very desirable, bringing predictability of finances and therefore better decision making, and scope for efficiencies. I envisage local spending reports being produced to inform those three-year spending periods. Local area agreements cover three-year periods, with the next round running from 2008 to 2011, but that does not necessarily tie the local spending reports to three years, and it may be that one would want to produce figures annually for each of the agencies and authorities mentioned.

Photo of Julia Goldsworthy Julia Goldsworthy Shadow Chief Secretary To the Treasury, Treasury

The Minister is explaining clearly how the process will tie in with and support the local area agreements process. Does he agree that it is important that every authority involved in the process is included also in producing the spending allocation aspect of the report?

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

Yes, because it would help to support the process. The new clause has a greater scope than the original Bill. Rightly, I think, it includes a duty to consult interested parties and authorities, so that the process is not one that is imposed from Whitehall. I shall define the authorities that are covered in due course.

The new clause specifies also that the costs of producing the report must be limited. Hon. Members may recall from the Second Reading debate the Government saying that we were fearful of setting up too bureaucratic a process, and we think that the proposed process would avoid that by limiting costs.

There must be flexibility in the scope, approachand timing of the reports. Three members of the Committee represent two-tier areas, I believe, and in the case of such areas a report might focus, for  example, on proposed expenditure within a county area, within a county and district area, or just within a district area.

The fundamental point of the reports would obviously be to aid transparency and accountability, but I believe that they would also have the beneficial effect of prompting serious debate in local areas, as I believe the hon. Member for Ruislip-Northwood accepts. As people and parties argued about the allocation of taxpayers’ money in their areas, two fundamental questions would arise. The first is, “Why is our area not getting more than others?”, and the second is, “Why can we not decide locally that more money should be spent in different ways at local level?” It is entirely desirable that the expenditure of taxpayer’s money should be held to account in that way.

Photo of Jeremy Corbyn Jeremy Corbyn Labour, Islington North

From his departmental experience, the Minister must be aware of the processes and financing that underlie regeneration, including the single regeneration budget. Most such schemes involved some analysis of public expenditure in the relevant districts, and in certain cases the result was that there was less expenditure by local and regional government, because the SRB, or whatever it happened to be called at the time, took over. Are there lessons to be learned from that to the effect that there should be better analysis of total expenditure in communities?

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

I think that two lessons can be learned from that experience. Cambridge university produced an evaluation of the single regeneration budget and concluded, quite rightly, that if regeneration moneyis spent within a silo divorced from other public expenditure in the area, there will be unintended and undesirable consequences and that public expenditure will not achieve maximum effectiveness. A single regeneration budget, for example, that replaces a row of derelict shops with flats and houses but does not take into account the availability of school places in the area does not help to bring about a sustainable community. However, if the different public agencies in the area pool money and share objectives, there is a greater chance of achieving sustainability.

My hon. Friend gave the example of the SRB. One may also use the example of the housing market renewal fund or a new deal for communities. The organisations that deliver those budgets must in future share targets with local government and central Government agencies in that locality so that they work towards the same desirable goals. There are any number of examples. Under the performance regime that is being put in place, there will be 35 mandatory targets. If one of those was reducing deaths by fire, all the agencies, including those spending the single regeneration budget, would be required to have that target in mind. They would be under a statutory obligation to show in the regeneration plans howthey were helping to meet that target. That would include—in this particular example—improving fire safety, sprinklers and other safety devices, and looking at the impact of the regeneration plan on the fire authorities’ risk assessment plan. That again would make the community more sustainable. I am wary of introducing a Stalinist five-year plan that involves producing a certain number of tractor tyres.

Photo of Clive Efford Clive Efford Labour, Eltham

We can do it in three.

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

Yes, we are more ambitious. We have three-year plans, not five-year plans. Ultimately the five-year plans were not sustainable. They lasted 60-something years. I am going to stop the analogy here.

As we put down the building blocks of the Bill, we are drawing up a process by which we can define expenditure as local.

Photo of Jeremy Corbyn Jeremy Corbyn Labour, Islington North

The Minister must be aware of the problems as well as the benefits of the regeneration schemes. As one who has observed such schemes locally, I think that one of the negatives is that local authorities can, if they are in a bad mood, use regeneration as an excuse to reduce expenditure in a particular area. They can essentially siphon off central Government money into local services when they should be maintaining expenditure and using central Government money as an add-on to improve the community. I realise that the subject is complex, but the Minister must be aware of the problem.

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

I thank my hon. Friend for that point. That is one of the other lessons of the evaluation of single regeneration budgets. It is always the case that ring-fenced budgets have a knock-on effect on non-ring-fenced current expenditure on other areas by local authorities. The benefits or otherwise of ring-fencing is one of the key arguments in local government finance. Ministers often believe that by ring-fencing a budget, they are ensuring that their objectives will be met. Of course, an unintended consequence is that non-ring-fenced budgets get diverted away from the area that the ring-fenced budget is aimed at. A ring-fenced budget for child care, for example, could cause departments for children and education in local authorities to divert money away from child care and into primary or secondary education. There are those unintended consequences. The Bill, supplemented by the local government Bill and the new regime, will square those circles at the only level at which they can be squared—the local level. I believe fundamentally that we cannot join up government just at the national level; we can do so better locally. The local spending report is a key information tool to allow local authorities, other local agencies and the public to do so, as are the mandatory targets in local area agreements.

Photo of Julia Goldsworthy Julia Goldsworthy Shadow Chief Secretary To the Treasury, Treasury 10:15, 2 May 2007

The Minister is right to say that access to information will be key to decision making and transparency. Will he comment on a couple of authorities or funding streams of public money that I believe might not be covered? Clause 80 of the local government Bill sets out the bodies that will co-operate in the setting of local area agreements. The list is fairly comprehensive, but I would appreciate clarification on the position of two sets of bodies.

Strategic health authorities do not appear to be on the list, but they will obviously have some influence on local spending. I raise the second issue because of a constituency perspective. Cornwall has benefitedfrom objective 1, which is European funding. Although  it is matched by Government money through the Government office for the south-west—in future, after the next programme convergence, it will be matched through the regional development agency—there is no scope for transparency about European money. Is there any way that it can be included so that there is such transparency?

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

I thank the hon. Lady for that intervention, and the answers are yes and yes. Her point is important, and indeed it was partly lobbying by Cornwall county council about the level at which decisions on the allocation of objective 1 are taken that led me to conclude that the process set out was desirable. There is one other Member from the region here, but for the benefit of others I shall say that objective 1 money was allocated by the European Union because of the deprivation indices in Cornwall, which is the poorest part of our country. The ratio of house prices to wages is the highest there, but people often misunderstand it to be a rich, leafy area. It is very leafy, but it is rich only in parts.

Photo of John Bercow John Bercow Conservative, Buckingham

Order. I hope that the Minister of State will resist the temptation to dilate on the minutiae of the formula, because although it might be titillating to the Committee it is not immediately relevant to whether clause 4 should stand part of the Bill.

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

I am grateful to you, Mr. Bercow.

It is central to the regional economic strategy that areas’ economies should be sustainable. At the moment the level at which the decision is taken to allocate money is regional and, although that makes sense in helping the regional strategy to hang together, it does not necessarily follow that decisions taken at county level necessarily supplement the regional decisions. We must find a better way to do it.

The local spending reports will identify moneys spent by all agencies in the hon. Lady’s area. New clause 1(4) states that the area concerned may be

“one or more local authority areas”,

and proposed subsection (3) states that the authorities may be a principal council, a Government Department or

“any other person exercising public functions.”

The word “may” is used not in the permissive but inthe legalistic sense; in practice those bodies will be included.

The bodies mentioned by the hon. Lady which will have a statutory duty to co-operate include strategic health authorities, but the local spending reports will include all public agencies as defined in proposed subsection (3), not just those covered by that statutory duty. In that sense, the local spending report is much wider than the measures in the local government Bill, and the sums included in the local spending report are much larger than those that are pooled or aligned through the local area agreement. I believe that that is what the hon. Member for Ruislip-Northwood wants to see, and I support him in that regard.

Photo of Clive Efford Clive Efford Labour, Eltham

Will the Minister clarify something?I am not a lawyer, and I find that an advantage sometimes. [ Interruption. ] A barrack-room boy, perhaps, but only when I was in my cab.

The Minister may recall that, during the first sitting of the Committee, my right hon. Friend the Member for Holborn and St. Pancras talked about the importance of plain English in drafting our Bills. If “may” means “shall”, why do we not use “shall”? I wonder if the Minister could explain that.

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

I remember that intervention by my right hon. Friend, when he called for plain English. If members of the Committee recall, I said then that one reason why I was looking forward to the change of Prime Minister and the leader of our party is that it will enable us to tell jokes at lawyers’ expense without fear of punishment from the Whips Office. [ Laughter. ] Before hon. Members laugh too much, the same is also true of public school attendance, but that is a different conversation.

I am quite prepared to accept that, in proposed subsection (1), the word “shall” should appear, rather than the word “may”, because the intention is that the Secretary of State “shall” produce the report, not that the Secretary of State “may” produce the report. If she—or, at some future point, he—turns up to work and decides, on a whim, not to produce the report, that would not be acceptable. The intention is that the reports will be published.

Regarding proposed subsection (4), I would caution that we should not go too far in rejecting legal advice, because, of course, the measure has to be tested in the courts. As it is the lawyers and judges who control the courts, we do not want to push our luck too far. The intention is that the area concerned—the list gives some of the different types of area, or authority—“may” make the request, and that provides some flexibility. As I said before, one may want to do that at district level, even in some cases at town council level, and not at principal local authority level.

The purpose is to achieve a report that identifieshow much money will be spent in each area by the authorities—local authorities and the other agencies that I have mentioned—and, if they do not spend the money themselves, to identify who does. The clause originally distinguished between funding for primarily national or for local authorities. The proposed amendment would put in a different and more useful distinction. Much expenditure could be legitimately said to be neither primarily national nor local, and we consider it to be more powerful to identify the totality of funding that may be spent in an area, so that there is a common base from which to work. That exercise would be based largely on existing information, even information that may be currently available. Although I have nothing against either profession, I do not wish to set up a new process that enriches accountants, let alone lawyers.

Photo of Frank Dobson Frank Dobson Labour, Holborn and St Pancras

Accountants are more trouble than lawyers these days.

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

We do not propose to create a new power to require additional information to be provided by partner authorities beyond the information that is currently being produced. One of the complaints that councils make about the alleged—sometimes real—over-centralisation and bureaucracy comes about not as a result of the requirement to meet targets, but as a result of the requirement to provide information. Information is necessary to draw comparisons, but requesting information for the sake of it, or for a new process, can be overly burdensome. I am not seekinga power to require councils to provide any other information beyond the information they already provide.

The aim of the task would be to quantify expenditure that can be easily identified as relating toa particular area and to understand the amount of money for which local partners and communities are responsible. As well as providing information for transparency and accountability, the purpose will be to help local authorities, their partner agencies and their residents better to plan expenditure by enabling them to identify what money they have to help them to meet their local objectives. The proposal will give local authorities and their partners substantially more power than would the Bill. I hope that it is seen in that helpful context.

The Bill distinguishes between national and local money, which would give local authorities alone the right to reallocate to local matters funding that had already been allocated by Departments or agencies. As I said, that would have been unworkable and would have created conflicts, whereas the statutory duty to co-operate in the local government Bill is designed to improve partnership working. Under that Bill, the scope of the new local area agreement is vastly enlarged. We will introduce a duty on named partners to co-operate in setting the local area agreement targets. That process will be debated during consideration of clause 5 of this Bill. We will also introduce a duty to involve local people in the preparation of community strategies, or sustainable community strategies as they will be renamed and reshaped when this Bill reaches the statute book.

We have made it clear that the amount of the available funding that should be used to support delivery of local and national priorities will be determined locally. We would like to ensure that the financial information that is available to partners is as good as possible. That is what the new clause is intended to achieve.

I should like to make a final point in speaking to the new clause in this stand part debate, as you have helpfully allowed me to do, Mr. Bercow. We must ensure that we do not set up a bureaucratic process that undermines the purpose of the Bill, which is to achieve sustainable communities. Any potential new costs need to be kept to an absolute minimum. I am conscious that the Committee will want the Government to adhere to the new burdens principle, which was introduced by my predecessor as the Minister for Local Government, my right hon. Friend the Member for Greenwich and Woolwich (Mr. Raynsford). The principle requires the Government to provide extra recurrent funding if they place a new burden onthe local authority. That policy is taken seriously in  the Government, and I do not want to create new burdens, because of the possible bureaucratic and cost implications.

Any new powers should be broad enough not to bind the Secretary of State into a prescriptive process; they should help in the development of the sustainable community strategy in each local authority area which we are all trying to achieve. The powers must be limited by ensuring that any proposed mechanism to apportion public expenditure to local authority areas is not onerous.

I shall give an example that came out of the consultation across Government, as the Committee may be interested to learn about it. I apologise for the time that I took to produce the amendments to the Bill. One of the reasons why it takes time—I hope thatmy right hon. Friend the Member for Holborn andSt. Pancras will back me up on this—is that one has to consult across Government. One of the issues that that threw up was that figures for legal aid expenditure incurred by the Department for Constitutional Affairs, and spending on provision of court services, are not currently provided at local authority level, as there is no business case for doing so. The same is true for expenditure of other agencies. Part of the expenditure of the Highways Agency is not allocated locally, although part is.

Photo of Julia Goldsworthy Julia Goldsworthy Shadow Chief Secretary To the Treasury, Treasury 10:30, 2 May 2007

Concerns have been expressed to me by lawyers in Cornwall that the changes to legal aid will significantly affect the ability to provide legal aid in the county. On that basis, if there are concerns thatit results in patchy provision, might it be importantto have that kind of information at a regional or sub-regional level to ensure that there is fair access to those services for all?

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

That is a reasonable point. I believe that the figures are available at county level, but not always at principal authority level. That raises an important point. A case comes to mind of an individual who was receiving up to £2,000 of legal aid to fight an order to evict him from his house. The eviction was being pursued by a local authority on the basis that £2,000 was owed in back-rent. The case was made that it would be easier to use the £2,000 from legal services and give it to the council to pay off the rent, and the objective of all, apart from the lawyers, who, of course, profited from the process, would have been met. That is a good example of why it is desirable for agencies to co-operate, and to have a duty to co-operate, and find solutions to problems that are not overly bureaucratic. I am simply pointing out that I do not want to createa process that requires agencies to engage in an accounting exercise that is not useful for their business.

I mentioned the Highways Agency. The cost of a motorway running through a local authority area would not be a matter that a local authority would want to concern itself with, but the amount of expenditure on maintenance of trunk roads would be a key bit of information that could be useful in a local spending report.

I hope that I have convinced the Committee that the Government are not simply proposing this new clause   to deflect something that they do not like. On the contrary, we believe that this is a helpful process for developing local area agreement. The new clause is drawn up quite flexibly, and gives scope to the Secretary of State and her successors to produce information that is most helpful to local areas. I reassure the Committee that, if it desires when we get to the relevant point, I am more than happy to accept the proposal to amend proposed subsection (1), line 2, to replace the word “may” with the word “shall”.

Photo of David Drew David Drew Labour, Stroud

I thank my hon. Friend for giving way just as he gets to his peroration. May I clarify how he intends to accept that? Will the amendment be re-tabled on Report, or is there some other mechanism by which this could take place by osmosis?

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

I am grateful to my hon. Friend for raising that, for two reasons. One is that I had forgotten to mention it, and the second is that my officials were glaring at me to mention it. The caveat, which is only sensible, is that when the Committee has finished its deliberations, I wish parliamentary counsel to consider the Bill and advise on any unintended mistakes or contradictory consequences. The hon. Member for Falmouth and Camborne is looking suspicious. I am simply saying that it is desirable, and it is always the case, that Governments do that with a Bill that has been considered by Parliament and changed. I am being open and, I hope, helpful to the Committeein improving the Bill. It is desirable to give theend product of the Committee’s deliberations to parliamentary counsel. I am sure that the Bill’s backers would want to do so, too.

Julia Goldsworthy rose—

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

May I just answer the question before taking an intervention?

With that caveat, and with the guidance of the Chair, the opportunity may be given to take the amendment so we can change the new clause in Committee.

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

No, it is a deliberate, conscious decision. I am giving a commitment that the change is up to the Committee, not me, and I am happy to accept it. You indicated in your opening remarks, Mr. Bercow, that there will be such a possibility for us.

Photo of Julia Goldsworthy Julia Goldsworthy Shadow Chief Secretary To the Treasury, Treasury

I just want to be clear that I understand how the process will work and that, if the amendment is agreed to, the Bill as a whole will be considered to see whether there are any internal contradictions. Will it be that way around, rather than the Committee rejecting the amendment and seeing if it can be incorporated later?

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

Yes, that is correct. I think that that would give the Committee the reassurance that it seeks. It would be wrong of me not to do so. I hope that I have explained the purposes of the new clause.

Photo of Jeremy Corbyn Jeremy Corbyn Labour, Islington North

Does this mean that the Minister is accepting “shall”?

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

Yes, it does. It is not accepted reluctantly, but accepted as something that is desirable.

Photo of Jeremy Corbyn Jeremy Corbyn Labour, Islington North

I thank the Minister for that plain and clear assurance and for his pleasure in endorsing this proposal.

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

For the benefit of clarity, the hon. Lady wanted to make another intervention. I will give way to her, then I really will shut up.

Photo of Julia Goldsworthy Julia Goldsworthy Shadow Chief Secretary To the Treasury, Treasury

The Minister has made it clear that he is prepared to accept changing “may” to “shall” in proposed subsection (1) of the new clause. He has also made it clear that it is important that “may” remains in proposed subsection (4), and we agree on that. However, I still do not understand whether he is prepared to accept changing “may” to “shall” in proposed subsection (3). Would not that be appropriate in the merry month of May?

Photo of Phil Woolas Phil Woolas Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government

It is not desirable for any Bill defining an authority to use such language. We do not want to restrict which agencies are included. We want the definition to be as broad as possible, so that new agencies, for example, would be covered by the existing definitions. I should like the local spending report to identify all public expenditure within the area. I hope that that explanation is accepted in the spirit in which it is intended. It is not unusual to use “may”. Seeingyou in the Chair, Mr. Bercow, I am reminded of a 45-minute debate in a Committee about whether “may” was the appropriate word to use and, if my memory serves me, you accepted that it was.

Photo of Julia Goldsworthy Julia Goldsworthy Shadow Chief Secretary To the Treasury, Treasury

There are many areas wherenew clause 1 is an improvement on clause 4. There is agreement that a bottom-up approach is needed, and the new clause helps to re-enforce it.

Flexibility in the timing of the production of the reports is also important. Fundamentally, we need transparency, which would benefit not only local authorities but the public, who are ultimately the consumers of services on which the money is spent. However, the proposal needs amending, and key words such as “may” are important. Although I am pleased that the Minister has accepted the first amendment—(a)—which changes “may” to “shall” in proposed subsection (1) of the new clause, it is also important to change proposed subsection (3), because if there is to be a spending plan that covers all public spendingin the area, it must include every agency with responsibility for public spending.

Proposed subsection (3) states—

“The authorities may be—

(a) a principal council;

(b) a government department;

(c) any other person exercising public functions.”

It has to be all of them; it cannot be just one or two. I am concerned that if the new clause remains as drafted, there will be the option of looking at it on a limited  basis and not producing a spending plan of all public spending. That was the tenor of the discussions between the main supporters of the Bill and the Minister, and I therefore hope that he will reconsider the proposal. We are very grateful to him; we do not question his good faith, but unless proposed subsection (3) is changed, the meaning of the Bill will be significantly undermined.

The amendment tabled by the hon. Member for Ruislip-Northwood makes it clear that there should be a requirement for transparency—that it should not just be a possibility. It is useful, too, because it sets out all the agencies that engage in local area agreements asset out in clause 80 of the local government Bill. I appreciate that the Minister said that his new clause was drawn even more widely than that to encompass all public spending and I am reassured that it will include the things that I raised with him in an intervention—not only other authorities, such as strategic health authorities, but public money that is being spent via the European Union. I give one cheer because I am pleased that there is some movement on the language in the proposal, but we feel very strongly that it must include all public spending, and unless the wording of proposed subsection (3) is changed, that will not be achieved.

On the spending issue, the Minister said that it should be clear that this must not just be an accounting exercise. As I said, an understanding of levels of spending not only informs priorities but helps to inform the effectiveness of the delivery of services. Something that immediately springs to mind, as I have done some work on it, is the delivery of the warm front initiative, which is aimed at helping people out of fuel poverty. We know what fuel poverty is on a locallevel, but it is not possible to get information onhow assistance through the warm front scheme isbeing delivered by local authorities. There are no subcontractors able to deliver the warm front scheme in Cornwall, and that has a significant impact on the number of people who can be assisted.

In that case, knowing what public money is being spent on the warm front scheme would be a massive help in understanding whether that Government policy was being effectively delivered locally. It is not justan accounting exercise and a matter of identifying priorities; it is critical to understanding the effectiveness of the local delivery of Government policies. I hope that the Minister will take note of those points.

We are pleased that there will be movement on proposed subsection (1), which is our key concern, but movement on proposed subsection (3) will be crucial, too. The new clause and the Bill will be significantly diluted if that is not taken on board.

Photo of David Drew David Drew Labour, Stroud 10:45, 2 May 2007

I shall be brief because we have other things to do.

Photo of David Drew David Drew Labour, Stroud

That was one of my better speeches.

I commend the Minister. We are making real progress. I simply want to ask two questions. First, because of my tardiness, I want to get the order of the  clauses clear in my mind. Will he state clearly where he understands new clause 1 will go, notwithstanding that in the wash-up period before Report there is always the chance to look at reordering the clauses to ensure that their sequence and language are as clear as possible?

Secondly, on the issue of “shall” or “may”, parliamentary lexicography is very interesting, but this really means something. At the end of the day we have to make it clear to principal local authorities what they should discuss local spending plans with other bodies. I hope that the Minister will tell us how we inform those different bodies that they need to ensure that their spending is part of the plan. I presume that some secondary legislation will spell out exactly what the framework of the local spending plans will be, or that we will have at the very least a code of practice so that there is consistency across this great nation, and every area knows how everything that is being put in the pot is provided and we do not get the inconsistency that the hon. Lady described.

The warm front initiative is a good example. I do a lot of work with home improvement agencies, and even within Gloucestershire it is interesting how different the spending patterns can be. That can be to do with localism, but it also can be down to the fact that nobody has sat down and tried to co-ordinate those spending activities, which could ultimately lead to greater efficiency. I hope that the Minister will say something about that.

Photo of John Bercow John Bercow Conservative, Buckingham

Before any other hon. Member rises to speak, and certainly long before the Minister seeks to respond to the hon. Gentleman’s observations,it might help if I explain that if members of the Committee wish to support new clause 1 they would first be obliged to reject clause 4 and the proposition that it should stand part of the Bill. Furthermore, in terms of the order in which new clauses are taken, of which new clause 1 clearly is an example, it is perhaps as well to remind the Committee that that order is a matter for the Member in charge of the Bill, but it is not a matter with which Members need to preoccupy themselves in the course of today’s proceedings.

Photo of Clive Efford Clive Efford Labour, Eltham

I, too, shall be brief. I commend the Minister for his approach, for engaging in the debate and picking up the spirit of the Committee.

On the issue of “may” and “shall”, the thing that concerns me is that the legislation is drafted by lawyers, who have always operated like a cartel. If we wrote legislation in plain language we would put ourselves out of a job because no one would have to come to us to interpret it. The concern about “may” is about what is not included, and that is the little bit that comes after it, which is “delete as applicable, may or may not.” By implication, the word “may” must also mean “may not”, which is what troubles me. If we mean “shall”, we should use that word. I cannot see that there will be a legal interpretation that says that “shall” does not do what it says on the tin, so it should be included.

My other point is about transparency—local people understanding how things happen and what people are doing in their local communities. If people think that things are not happening, perhaps making information available to them could explain why. Alternatively,  people could be armed with questions to ask the people who are responsible so that they can explain what is going on. Providers of health, transport and other services in a local community all affect the vibrancy and life of that community, and people need to be well informed about them and to have some understanding.

In a former manifestation, I was responsible for issues relating to health and social services in my local authority area. All the public services annually provided a report to the local community: the police provided crime and expenditure statistics, and the health service provided a health report or review including statistics on things such as incidents of heart disease, strokes and so on in different sections of the community. The services spent a great deal of money to produce glossy documents, and I suggested that we should all get together and produce just the one document and to make it a civic event—it could happen over either a week or a day—at which all the public services come together.

I thought that we should produce not only a report, but a directory with contact details that told people to whom or to where they should go for information. That way, people would have information not only on how services had been provided and performance, but on contact details to keep next to their telephone. If people wanted to contact someone about their bins not being emptied, or the local health service or police—we now have safer neighbourhoods teams in every community—they would have a document that told them about their first point of contact and other information.

The idea was to make the services’ reporting to the local community into a major public event. The Bill offers a way towards that: it will bring together the service providers in a community by saying that they must be part of an area agreement. Where there is an area agreement, there will be a report on how people have performed against it, and that information will be well publicised in the local community.

We have made a lot of progress this morning and on that basis the Minister should be commended. I look forward to being able to support the steps that we have taken towards achieving a Bill that will bring about sustainable communities.

Photo of Nick Hurd Nick Hurd Conservative, Ruislip - Northwood

I add my voice to those who congratulated the Minister on setting a constructive tone in the debate. The Minister will be aware that there was some disappointment with Government new clause 1 when it was tabled, but he has prevented a lot of criticism with his tone.

The Minister is well aware of the importance of clause 4. The Bill is about giving people real influence over how their communities are developed. As we discussed in the debate on the Floor of the House, in this day and age, power equals money—the Bill is about giving people real influence over how money is spent in their area. The vision is that a great spotlight will be thrown on to all the nooks, crannies and corners of public expenditure so that the communities that we represent can for the first time get a clear picture of how much taxpayers’ money is being spent in their area, and what it is being spent on.

In this day and age, it is extraordinary how difficult it is to access that money—we do not know the scale of it, but it feels enormous. We used the example of Kent because it is one of a very few counties that has been able to access meaningful data. In round numbers, there is approximately £8 billion of taxpayers’ money swilling around Kent, of which £2.5 billion is visible and accountable under direct local government control. We do not know about the rest. However, the county council has done some analysis that provides a powerful picture of how money is directed in a local way. The vision of this Bill is that every community should have access to such information. It is potentially an enormously powerful tool.

As the Minister knows, with transparency comes greater accountability, and with accountability, as has been touched on by various contributors to the debate, we can reasonably expect greater efficiency. There will be great pressure on the system to be more efficient and to account for every penny that is spent. One aspect of the decline in the sustainability of communities is that people withdraw from the process because they feel that they have no influence. They think, “If we have no say, what is the point of getting involved?” The hope of the Bill’s sponsors is that once we can show them the money and give them the sense that they can influence how it is spent, we will trigger a new sense of civic participation and engagement.

That is the virtuous circle that we are trying to create. First, however, we need to define what the money is. That is what the clause is about. The virtuous circle that I described was under threat because of one word, the word “may”. On the whole, I like May—it is the best month of the year. It is the month in which I was born; it is, as we can see outside, associated with beautiful weather; it is a month of great potential. In fact, I like the word so much that I named one of my daughters Katie Mae. However, history has taught me that Katie may and she may not. Just as that applies to my daughter, so it may apply to any Minister or Secretary of State.

I add my voice to those who have expressed the view that here “may” is not good enough. That has nothing to do with this Minister, who was unkindly compared to a slippery bar of soap. I try not to think too hard about the Minister in the bathroom, but when I do I see him as an absorbent sponge, picking up the wit and wisdom of this Committee. This point, however, is nothing to do with the Minister.

Photo of Nick Hurd Nick Hurd Conservative, Ruislip - Northwood

Or even new clause 4, Mr. Bercow, but it is to do with the word “may”. An interesting piece of research that has been prepared for me reinforces those concerns about the word “may”. It is called “Lostin Translation—The Abandonment of Ministerial Assurances.” The claims of abandoned assurancesthat it happens to list date back to 1997, but I am sure that a more objective exercise could be undertakenthat covers a longer period, spanning several Administrations.

The point is that people—certainly this Committee—will not take ministerial statements on trust. We need something more robust in the framework of the Bill. We cannot  allow good intentions to be lost in translation. I do not know whether the Minister is familiar with the movie of that name. It is one of my favourites, and contains long sections in which Bill Murray is wandering around a hotel in Tokyo with a baffled look on his face. I hope that when, as seems inevitable, the movie of the Sustainable Communities Bill is made, the director will not choose to dedicate large sections of that film to images of the Minister wandering the corridors of his Department, asking, “Why is it that whenever I say something, it gets lost in translation when it comes to the clauses put before the Committee?” That is what appears to have happened in the case of this new clause.

I congratulate the Minister on his flexibility in relation to subsection (1) of the new clause, but I would also reinforce the message of the hon. Member for Falmouth and Camborne on subsection (3). You kindly, Mr. Bercow, gave me some leeway to refer to my amendment. I do so only in order to draw to the Minister’s attention what we are trying to achieve, which is to make it extremely clear who should be party to the new agreement.

I recognise that the Government’s new clause contains a seed of something that may actually be more ambitious than even the Bill’s sponsors contemplated, and I congratulate the Government on their ambition. However, that ambition is qualified by the word “may”. As currently drafted, the new clause incorporates too much flexibility for my taste, and I sense for the Committee’s taste as well, in that a potentially less enlightened Secretary of State than the current one, who might even be of a different political colour and might not like the Bill, could remove from the process key Departments or agencies that should not escape the spotlight.

The amendment that I tabled sets out a list of institutions that are parties to local area agreements which is drawn from pages 54 and 55 of the local Government Bill. That is a logical source given that the Government have said that they see the Bill as an extension of local government legislation and as a mechanism for strengthening local area agreements. I put it to the Minister that to seek to be more explicit in this Bill in defining the agencies and Departments that it covers is consistent with everything that he has said. I understand that the Government want to take broad powers and retain as much flexibility as possible, not least because they need to consult the people likely to be affected, and the Committee is sensitive to that, but subsection (4) of the new clause is too loose and we need a stronger commitment, which we can achieve by reinserting the word “shall”.

Jeremy Corbyn rose—

Photo of John Bercow John Bercow Conservative, Buckingham 11:00, 2 May 2007

Order. Further to my earlier remarks, I should like to clarify fully the order in which new clauses will be dealt with. In accordance with the order of consideration motion moved by the hon. Member for Ruislip-Northwood, new clauses will be dealt with after all the clauses and the schedule have been disposed of. The place where any additional new clauses will actually appear is a matter for the hon.  Member in charge of the Bill. I hope that that adequately answers the point made by the hon. Member for Stroud.

Photo of Jeremy Corbyn Jeremy Corbyn Labour, Islington North

I want to take the opportunity to thank the Minister for helping us this morning. He need not look so puzzled; I am thanking him because without a requirement on expenditure levels the whole concept of local sustainability and local involvement in decision making becomes impossible. I speak as one whose first involvement in the issue began in the mid-1970s, when I was the chair of an area renewal programme in Haringey which was funded at that time by the Home Office. Our intention was to try to ensure that local services focused more on the needs ofwhat was essentially a poor, diverse, working-class community. With a lot of pressure, it was possible to make the local authority define its levels of expenditure, but it was extremely difficult to make any other public service do anything of the kind or indeed participate in any meaningful way.

We have moved on a lot now that there is urban renewal and regeneration and so on—whatever the programmes happen to be called at different times. However, my observation from a number of regeneration schemes in my constituency is that, without the necessary diversity of information, there is a tendency among local authority officials to use them as a subsidy for other services. The Minister rightly points out that the Government intend always to ring-fence expenditure, because they would want the money to be spent specifically in, to take examples from my area, Finsbury Park, Archway or Mildmay. That is fine, and I agree with it. However, the local authority might then move in, and officials with their beady eyes might spot the expenditure, quietly and subtly reducing spending in various departments on the basis that the single regeneration budget or whatever will pick it up.

I am sure that other hon. Members have seen that process happen in their own communities, so the progress that we have made today is important.

Photo of Julia Goldsworthy Julia Goldsworthy Shadow Chief Secretary To the Treasury, Treasury

Does the hon. Gentleman agree that it is not just an issue of local councils reducing funding using ring-fenced funding from central Government? As with European funding, it is critical to ensure that that funding is additional. The key issue of additionality must be identified clearly in the process.

Photo of Jeremy Corbyn Jeremy Corbyn Labour, Islington North

Absolutely. It is always difficult for central Government and the European Commission to allocate expenditure and hope that it is spent efficiently, not just used as a subsidy by the relevant local authorities. The process is never easy. Efficiency can be achieved only by having a high degree of local accountability, which is where the Bill comes in. My experience of the good side is that a lot of local accountability comes about. Local authorities want to get involved as do other local services, and it can be a therapeutic and good process. Indeed, it can break down many community barriers because people have to come together to debate this and major local planning issues.

On the negative side, the language and process used can be so arcane, obtuse and obscure that the local community, having started with high hopes of a regeneration scheme and watched it develop, then see it gradually melt away. All who are left are the anoraks, the nerds and the business interests who get together and carve the whole thing up. The local population then feels completely excluded from the whole process. We cannot prescribe everything from here, but if the Committee agrees that wording essentially requiring publication of all levels of expenditure in a community is carried, it will at least mean that the raw information is there. Those of us who represent diverse communities—I suppose that everyone does in some ways—often find that the less able a community in lobbying for its interests, the less money it receives.

I shall cite one more example of my Haringey experience. Those who are familiar with the boroughof Haringey will know that it extends from Highgateto Tottenham. When I was chair of the planning committee, it rapidly became apparent that the  planning committee spent most of its time discussing conservation issues with a small number of people in Highgate. Those people spoke really well; they were brilliant advocates for Highgate village, whereas the people at Tottenham did not have such tribunes and the ability to access the power structures. The only way to succeed is to take the power of decision making, particularly on planning issues, to a much more local area and allow the information to be provided. The voices can then be heard. Anything less than that leads to the articulate and the powerful gaining control, and the less articulate and the less powerful losing out. If the Bill achieves what I hope it is intended to do, which is to empower local communities that often feel completely remote from decision making, particularly about major planning issues, we will have done a good job. We have made some excellent progress this morning, and I thank the Minister for that.

Question put and negatived.

Clause 4 disagreed to.

Further consideration adjourned.—[Mr. Hurd.]

Adjourned accordingly at nine minutes past Eleven o’clock till Wednesday 9 May at Ten o’clock.