§ Lords amendment: No. 14, after clause 4, after the words last inserted, insert the following new Clause F—
§ "F.—(1) Schedule (Block grant: Receiver for the Metropolitan Police District) to this Act shall have effect for enabling block grant to be paid to the Receiver for the Metropolitan Police District.
§ (2) This section has effect for any year beginning on or after 1st April 1983."
§ Mr. Speaker
With this amendment it will be convenient to take Lords amendments Nos. 25, 27 and 29.
§ Mr. King
The amendments and the schedule which accompanies them deal with a point that was raised originally by my hon. Friend the Member for Hornchurch (Mr. Squire) and to which we responded as positively as we could. We said at that time that we would see whether 934 it was possible to work along these lines. Subsequently, we had the unanimous approach of the London Boroughs Association. Indeed, an amendment was tabled in the other place on behalf of the London Boroughs Association and was also supported by representatives of the Association of District Councils. It is a sensible provision to ensure that rating authorities in the Metropolitan Police district do not suffer unexpected losses or gains as a result of the changes in the Metropolitan Police's expenditure over which they might have no control. The London Boroughs Association has pressed the provision strongly. My hon. Friend the Member for Hornchurch left us in no doubt about where he stood on the matter and urged this course on us. After due consideration we thought it was the right course to take. I apologise to the House if the amendments are somewhat lengthy but the principle is simple. It enables block grant to be paid direct to the receiver.
§ Mr. Cartwright
I should like to welcome the amendments because, as the Minister said, they tidy up an anomaly. They are sensible amendments. I am one of the few hon. Members taking part in our discussions today who was not on the Standing Committee of the Local Government, Planning and Land (No. 2) Bill. Therefore, I do not know why section 64 and schedule 11 of that Bill proposed to pay Metropolitan Police block grant to the rating authorities. It was not a good idea. It breaches the basic principle that block grant should be paid to the authorities providing the service. It undermines the accountability of the local authorities concerned because they are receiving funds for services that they are not providing. More importantly, it undermines the accountability of the Metropolitan Police. I am always arguing that we should be increasing the financial accountability of the Metropolitan Police. I have always been unhappy that the receiver of the Metropolitan Police can precept on the authorities in the Metropolitan Police district who must pay over the money that he requires. That has always seemed to me to be taxation without representation.
Apart from the problem of accountability, there are serious accounting problems to which the Minister referred. Local authorities in the Metropolitan Police district have to make some estimate in their budgets of the amount of block grant that the Metropolitan Police will receive. It is a difficult operation given the current ways in which block grant is calculated. It depends now to some extent on the decisions of the Secretary of State. It depends to some extent on the authority's own spending and on the spending of other authorities. Therefore, the calculation will be changing throughout the period of the grant year. It cannot be definite until the grant year is completed.
If a local authority takes a pessimistic view about the level of block grant it will levy a higher rate than it should in order to protect itself against unexpected demands. That would harm the ratepayers and would be against the policy of rating as tightly as possible, for which the Government argue. If an authority takes an optimistic view it runs the risk of having to cover an underestimate from its reserves. If those reserves are not sufficient, the authority will now have to go to the Secretary of State and ask for borrowing powers. In other words, it will be placing itself in jeopardy as a result of factors that are outside its control.
As the Minister said, the London Boroughs Association has pressed amendment No. 14 for some time. I am glad to hear that the Government are accepting the amendments 935 because they tidy up sensibly an anomaly which should never have existed, and remove practical problems. I welcome the amendments.
§ Mr. Robin Squire (Hornchurch)
I introduced the amendment in Committee and I should like to congratulate my right hon. Friend the Minister and the Government on the action they have taken. I do not intend to make a long contribution. The reasoning behind the amendment was given in Committee and has been reiterated today by the hon. Member for Woolwich, East (Mr. Cartwright). I should like to use a football vernacular which I have used in the context of more than one amendment on this subject in the past two or three years. I feel like the man who thinks he has scored a goal, has been ruled offside and then had the decision changed by a friendly Russian referee who has allowed the goal to stand after due discussion and the odd protest. I welcome that goal warmly.
All the local authorities in the greater Metropolitan area will appreciate the amendment. It will simplify what is still a complicated procedure, but to the extent that it makes it marginally less complicated we should welcome it and I am sure that they will.
§ Mr. Christopher Price
I do not pretend to understand the depths of complication that the hon. Member for Hornchurch (Mr. Squire) explained so carefully in Committee, but, like everyone else, I welcome the amendment.
The problem of the accountability of the Metropolitan Police has been raised in a small way in our debates on the Bill. Earlier speeches have referred to the complications and to the guessing game that individual local authorities now have to play to try to find out what the eventual grant will be. But the guessing game has coincided with much wider arguments about how one achieves accountability for a large amount of money from an organisation that is provided with money through the rates, and that so far has been wholly unaccountable except in the sense that from time to time we can ask the Home Secretary questions about it in the House.
The London borough of Lewisham, part of which I represent, did a great service to the public 18 months ago by threatening—it did not carry out the threat—that it would not pay its precept to the Metropolitan Police under certain circumstances unless it, Lewisham, achieved a great deal more accountability than it had until then. For Lewisham, that was a perfectly reasonable thing to do.
In 1978, because of the sheer obstinacy of the Commissioner, Sir David McNee, we were subjected to a great deal of physical damage and harassment as a result of a National Front march. The march could have been avoided if the Metropolitan Police had been more accountable and had advised the Home Secretary that the march should be called off, as the Home Secretary has been advised in similar circumstances ever since. The people of London saw what happened in Lewisham in 1978, and finally the Metropolitan Police came to their senses and realised that on balance National Front marches had to be banned. The amendments have come to us because the Government have been introducing more and more centralised and complicated ways of paying rate support grant.
Every time they make a change they find that they have made a mistake and so they have to introduce an amendment in Committee. Every time they do that they 936 find that they have made another mistake and so they have to introduce an amendment on Report, and so the process continues until we are called upon to consider Lords amendments. We should not imagine that we are at the end of the road and that the Government now have it right. Our experience since the 1980 Act is that the Department of the Environment's legislation throws up more anomalies than it solves, and so it will be with the Metropolitan Police.
The Government have acceded to a reasonable request from the London Boroughs Association, which was supported moderately and eloquently by the hon. Member for Hornchurch (Mr. Squire). The Government have responded by producing this "solution". If the Government are to pay the block grant direct to the Metropolitan Police, that is even more reason for saying that that has not satisfied financial accountability. I suppose that the audit commission might be able to investigate whether the Metropolitan Police needs all the riot shields that it has and then to make a judgment on whether it is getting value for money from the riot shields, fire hoses and water cannon that it buys. The audit commission might have a right to do that but it must go beyond that.
The House must establish a system under which the Commissioner of Police of the Metropolis and the receiver of the Metropolitan Police must come before democratic representatives, whether that is under the aegis of the GLC, as some of my colleagues on that body want, through the London Boroughs Association, or through the procedures of the Public Accounts Committee in the House. Under such a system they should be called on to provide far more answers than they are willing now to give. I am talking about the money that has been spent, and especially the policies that underpin their demands for money to be made available.
Financial accountability on its own is meaningless. There is no point in asking "How have you spent the money?" The tone of the Bill is that it is silly to put in auditors merely to ascertain whether there is a receipt for a cheque that has been paid out. The thrust of the Government's policies within the Bill is what the Government call value for money. We are talking about value for money audits.
We have seen how local authorities are to be subjected to value for money audits. How does the Minister propose that the Metropolitan Police is to be subjected to a value-for-money audit under the new block grant direct payment arrangement which is laid in the amendment? If the Minister proposes to change the system, he should not present the amendment to the House by saying "This is a small amendment that was agreed to in another place to help this body". He should explain what impact the new audit commission will have, with its private auditors—Mr. Ian Hay-Davidson, Mr. Arthur Anderson and other great and wonderful individuals who will be brought from the Conservative Party and other parties, but substantially from the Conservative Party—in providing value for money for the great public services of Britain. How does the Minister propose that the Metropolitan Police will be subject to value-for-money auditing?
When a service such as the Metropolitan Police is comparatively well funded compared with education or housing, and when the money is flowing fairly easily because the Government have decided to make a priority 937 of the police, there is a great danger that the money will start to be wasted. For example, there may be a desperate attempt to spend everything by 1 April to ensure that funding will continue at the same level. The police are comparatively well funded and they should be under stronger rather than weaker scrutiny exactly for that reason.
The Minister has explained the effect of the Lords amendments and we all welcome them, but I want to know rather more. For example, I want to know whether the Minister is willing to apply to the Metropolitan Police the stringent value-for-money audit that he says he wants to apply to so-called overspending local authorities such as the Greater London Council and the London borough of Lewisham. Will it be one law for the Metropolitan Police and another for Labour local authorities? That is the question that I want the right hon. Gentleman to answer. The Metropolitan Police is just as capable of overspending as local authorities.
§ Mr. Graham
The amendment is good sense and long overdue. There may have been some unease about the manner in which the Metropolitan Police received its money partly by direct grant and partly by means of a precept. The amendment comes before us because of the unhappy experience of local government over the past two years, which has been the direct result of the Government's financial policies and methods aggravating a difficult situation. No more money will find its way to the Metropolitan Police than that which it already receives. However, the money will be funded to it more directly. It should be possible to be much more precise about who is responsible for the various elements within the total bill. Nothing is more irritating to a local council than to be responsible for what it has spent and to be answerable for what it has not spent.
Every hon. Member who has participated in the debate has had only good things to say about the police generally but, as my hon. Friend the Member for Lewisham, West (Mr. Price) said, the raison d'etre of the Bill is not merely value for money but accountability. The Minister must explain to the House the system that he will operate to ensure that every penny that is provided from the public purse, centrally or locally, is accountable. The amendment is necessary because of the uncertainty and instability that have faced local government over the past two years.
The amendment will mean additional work for the Government and additional bureaucracy, but it would be churlish not to acknowledge that the Government have responded to the pressures from the LBA and all the metropolitan authorities. I understand that there has been some opposition from one or two authorities that are covered only indirectly by the London boroughs. I hope that the Minister will say something about that. Those people have been trying to act on behalf of their ratepayers and they must feel aggrieved, or perhaps they misunderstand what is happening. However, the Opposition appreciate and welcome the Lords amendment.
§ Mr. King
I shall pick up the final point that the hon. Member for Edmonton (Mr. Graham) made about one or two authorities that were concerned about the changes. One example has been drawn to my attention recently, which involved presentation. The previous presentation 938 was not the most helpful. The Metropolitan Police grant was debited against the borough rate and the gross amount of Metropolitan Police expenditure was shown separately. The effect is that the same net result is produced, but it is misleading. That is not the best way to act. The authority was concerned about the changes involved, but, with that one exception, the change has universal support.
I now turn to the remarks made by the hon. Member for Woolwich, East (Mr. Cartwright). The background to the system that we are changing is that previously things were done in the way in which they had always been done. As we are a Government who never make a change for the sake of making a change and who are always anxious to move with the grain in society, we left the arrangement as it was. It is now clear, on a logical analysis, that that was not the most sensible way to act. Therefore, after we had listened carefully to the arguments we were persuaded that the changes should be made.
The hon. Member for Lewisham, West (Mr. Price) took me a little wider than the issue of the payment of block grant direct to the Metropolitan Police. I noted his words carefully when he said "We cannot leave it there." I thought that he never did. The hon. Gentleman then gave a short dissertation on the subject of the accountability of the Metropolitan Police. He asked whether there was to be one law for the Metropolitan Police in terms of value-for-money auditing and another for local authorities. The answer is "No."
The Metropolitan Police will be the subject of proper value-for-money examination auditing, not under the audit commission. The list of bodies that will be covered by the audit commission includes combined police authorities but the Metropolitan Police, with the police authority being the Home Secretary, must come under the Comptroller and Auditor General, and are subject to his rigorous value-for-money studies. There are certainly no tighter regimes.
§ Question put and agreed to.
§ Lords amendments Nos. 25, 27 and 29 agreed to.