HC Deb 09 May 2002 vol 385 cc275-92 12.30 pm
The Deputy Prime Minister and First Secretary of State (Mr. John Prescott)

With permission, Mr. Speaker, I should like to make a statement on the English regions.

Today, my right hon. Friend the Secretary of State for Transport, Local Government and the Regions and I are presenting our White Paper, "Your Region, Your Choice" for more democracy and less bureaucracy. Copies are available in the Vote Office.

Throughout the United Kingdom and Europe, there has been a growing recognition of the importance of regions as a focus for economic growth and social identity. The Government have challenged the notion that the only decisions worth making are those taken in Whitehall and Westminster.

We recognise that people in Birmingham or Bradford, Liverpool or Lowestoft, Falmouth or Faversham, Newcastle or Norwich deserve to have their voices heard, too. We believe that Britain as a whole cannot achieve its full potential unless all our regions share in success and, indeed, drive it.

When we offered devolution, we placed our trust in the people of Scotland and Wales. Today, I am announcing measures to bring decision making closer to the people of England by strengthening regional powers and giving them the choice of regional government.

We trust the people to make that choice and, if they wish, to choose to elect a regional assembly and give a new voice to their region. The White Paper gives effect to our manifesto commitment to provide for directly elected regional assemblies for those regions that want them.

My interest in regional policy goes back more than 30 years. In the early 1980s, Michael Foot asked me to draw up a new policy framework to secure agreement for devolution for Scotland, Wales and the English regions. Some hon. Members will remember that that caused some local difficulty as well as problems in the House. The result was the alternative regional strategy, published in 1982, which set out a framework for devolving power to Scotland and Wales, and decentralising power to the English regions.

In 1994, I appointed Bruce Millan, the former Secretary of State for Scotland and European Commissioner to chair the Labour party's regional policy commission. His report, "Renewing the Regions" said that, without strong regional policy rooted in the regions themselves, and without firm commitment to decentralisation we are unable to develop our national economy to its full potential". Many of the ideas in the White Paper find their origins in the earlier reports. I would like to express my appreciation to those who worked on them. Some are Members of the House today.

The Government have always recognised the regions' potential. In 1997, we inherited one of the most centralised systems of government in the western world. We have changed that. In our first term, we devolved power to Scotland, Wales and Northern Ireland. The Opposition opposed that. In England in our first term, we restored to London democratic citywide government, which the Opposition had abolished.

We have reformed local government; strengthened and broadened the Government offices for the regions; and set up nine regional development agencies, which, in their first two years, created or safeguarded more than 80,000 jobs. We also helped establish a network of regional chambers and assemblies, which have improved accountability and given the regions a new voice.

Today's White Paper takes that a step further. It sets out a range of options for people in the English regions. But, whatever they decide, the White Paper will strengthen regional policy across England. In all regions, we are giving extra resources and greater flexibility to the regional development agencies, and regional chambers will have greater responsibilities and a greater role in regional planning. In all regions, we will also give extra responsibilities to the Government offices to strengthen regional decision making and to ensure that government is joined-up in the regions. But for those regions that wish to proceed to directly elected regional assemblies, the White Paper sets out the process. Members are well aware of the different needs and aspirations of our English regions. There is a strong and growing demand in some regions to have a distinct democratic voice and a greater say over their own future. The people of the English regions should rightly have the same choice as we gave to the people of Scotland, Wales and London.

The White Paper is about striking the right balance, trusting the people, responding to the needs of a modern, diverse and more progressive society, and creating the conditions for greater prosperity and reducing disparity in and between our regions. The key, therefore, is flexibility. This will require a pragmatic approach and the consent of the people of the regions. Where there is a referendum in favour of them, we will establish elected regional assemblies, and I believe that where one or two regions lead, others will follow.

The White Paper sets out the powers, functions and financial arrangements for these new elected regional assemblies. They will have real power and funding to improve the quality of life of people in their region, particularly by improving regional economic performance. Indeed, raising growth by just 0.5 per cent. for the worst-performing regions would increase our national wealth by £20 billion in 10 years. As my right hon. Friend the Chancellor's pre-Budget report made clear, if all our regions raised their productivity to the national average, the average person in the United Kingdom would be £1,000 a year better off.

Regional assemblies will be responsible for developing joined-up regional strategies on issues such as sustainable development, economic development and regeneration, skills and employment, planning, transport, housing, health improvement, and culture. Assemblies will have a range of powers to help them to deliver those strategies. For example, they will allocate funding for economic development, housing, tourism, arts and sport. They will also be responsible for the regional development agencies, appointing the board and approving the regional economic strategy.

Regional assemblies will be funded primarily by central Government grant, and they will have complete freedom to spend that grant as they judge best. We will agree targets with them and provide a single pot for regional government. In addition, they will have the power to raise further funds through a precept on council tax and through borrowing. Naturally, budgets will vary depending on the population of each region. On current expenditure, the budget for the north-east would be about £350 million a year, and for the north-west about £730 million. On top of that, the assemblies will have a direct influence over large amounts of central Government public expenditure—some £500 million in the north-east and £1.3 billion in the north-west. That is over and above the £3 billion spent by local authorities in the north-east region at present.

Elected assemblies will need to be big enough properly to represent the interests of the different communities in the region, but not so big that they become unmanageable. We therefore propose that assemblies should have 25 to 35 members.

It is important that an assembly of that size should have broad political representation. In Scotland, Wales and London, we have used the additional member system of proportional representation to elect Members of the Parliament and the assemblies. On balance, we have decided to use the same system for English regional assemblies. The boundaries of each region will be the existing ones used by the Government offices for the regions and the regional development agencies.

In addition to elected regional assemblies, we would like to see greater involvement of groups such as the business community, trade unions, voluntary organisations and environmental groups. We want to encourage the regional assemblies to draw on the experience and skills of individuals in the region who may not be able to stand for election themselves. We want to build on the experience of the Scottish Civic Forum, the partnership arrangements in Wales, the London Civic Forum and the arrangements introduced in a number of English regional chambers. Different regions may want to use different models. We are asking for views on that. For example, there could be appointed assembly members who could play an active part in the role of the assemblies, but would not have the right to vote.

Regional assemblies represent a new tier of political accountability. They will work closely with their local authority partners. However, in areas that currently have county and district councils, an assembly would have a third tier of government. We believe that it would be simpler and more efficient if in those cases we moved to a fully unitary system of local government. So where it is decided to hold a referendum for an elected assembly—and only in those regions—there will first be an independent review of local government structures, conducted by the boundary commission for England. That review will examine the two-tier areas of the region, and make proposals for wholly unitary local government. Existing unitary authorities in the region will not be affected.

We believe that when a referendum is held voters should know the proposed structure of local government, and should be clear about who would do what in their area. I emphasise that the review takes place only in regions where a referendum will be held, and that any restructuring of local government will take place only if there is a "yes" vote in the referendum.

The White Paper sets out the process and timetable for establishing elected regional assemblies. Before we decide which region or regions should hold the first referendum, we will consult all the English regions on our proposals. The Secretary of State will decide whether a region should hold a referendum primarily by assessing the level of public interest in the region. In reaching his conclusion, he will seek the views of the regional chamber, local authorities and other key stakeholders.

We intend to introduce legislation to provide for referendums and local government reviews as soon as parliamentary time allows. We intend to allow a referendum to be held before the end of this Parliament. After a region has voted for an elected assembly, we intend to introduce further legislation enabling assemblies to be established. That would make it possible for the first regional assembly to be up and running early in the next Parliament—under a Labour Government, of course.

All English regions will benefit from our strong regional policy, and we will continue to develop the regional structures and agencies that we established in our first term. Furthermore, our White Paper offers the opportunity of a new constitutional settlement for the English regions, a choice that has been denied them for far too long.

The opponents of our proposals must answer this question: if devolution is good enough for the Scottish and the Welsh, why should they deny that choice to the people of England? Our proposals will give the regions of England new choices, new powers, and a new voice. By devolving power, we can elevate our democracy; by empowering our regions, we can engage people more effectively; by harnessing the energy of the regions, we can drive forward the nation's economic growth; by embracing diversity, we can strengthen the United Kingdom; and by liberating the potential of our regions, we will be helping Britain to prosper.

I commend the proposals to the House.

Mrs. Theresa May (Maidenhead)

I must say to the Deputy Prime Minister that it is the way he tells them; it really is.

I am grateful to the Deputy Prime Minister for his courtesy in giving me prior sight of the statement. His recognition of the courtesies of the House could well be a lesson to some of his colleagues. However, I also commiserate with the right hon. Gentleman. He said in his statement that he had long been an advocate of regional government, and we acknowledge his consistency in that regard. He has, we know, worked hard to battle for the White Paper. I am only sorry that, on the day of its introduction, he has been somewhat upstaged by the Secretary of State for Transport, Local Government and the Regions.

Mr. Eric Pickles (Brentwood and Ongar)


Mrs. May

Sabotage indeed.

We are opposed to regional government because we believe that regional assemblies will take power away from local government, lead to the abolition of county councils, and take decision making further away from local communities. The Deputy Prime Minister claims that today's measures will bring decision making closer to the people of England, but far from devolving power, they will centralise it, taking it further away from local people. The Government are simply going in the wrong direction, pulling power up to remote bodies; we want to push power down to local people and to local communities. We want community government, not regional government.

The Deputy Prime Minister also says that it is a matter of choice, but it is some choice for those who do not vote for a regional assembly. We learn from his statement that the regional chambers, government offices and regional development agencies of even those regions that do not vote for an assembly will be given greater responsibilities and powers, greater opportunity to take decisions affecting people's lives, and greater opportunity to take decisions away from elected local government representatives.

The Deputy Prime Minister claims to have changed one of the most centralised systems of local government in the western world. Tell that to the local councils that now have 15 per cent. of their funding ring-fenced by this Government, and who can spend it only on what this Government say they can spend it on.

The Deputy Prime Minister also tells us that, as a result of the introduction of regional assemblies, a complete review of local government will need to be undertaken in the areas concerned. That sends one clear message: it will lead to the abolition of county councils. Counties count. They are historic areas, with which people identify clearly. I wonder how many people in the north-east realise that regional government will mark the end of Durham and Northumberland county councils. How many people in the south-west realise that it will mark the end of Devon, Cornwall, Dorset and Gloucestershire county councils?

Regional government will mean that decision making is taken away from local people and given to the regions, but we must recognise that there are differing needs. In the south-east, for example, the needs of the Kent coastal towns are quite different from those of the Thames valley. Will people in Falmouth really want decisions affecting their lives to be taken in Bristol? Will people in Sunderland want Newcastle to rule their lives?

We also learn from today's statement—[Interruption.]

Mr. Speaker

Order. There is far too much noise in the Chamber. The hon. Lady must be heard.

Mrs. May

Thank you, Mr. Speaker.

We also learn from today's statement that the new regional assemblies will, after all, have tax-raising powers such as the power to raise a precept on council tax. The Deputy Prime Minister presents that as a great advantage, but I doubt whether the people of London, on whom the Mayor and the Greater London Assembly have imposed a 30 per cent. precept, would regard granting such powers to regional assemblies as a good thing. We are talking about budgets of about £350 million a year, but county councils such as Essex and Kent have budgets of some £1 billion a year. Exactly what will regional assemblies be able to do?

The Deputy Prime Minister said at the beginning of his statement that this is about more democracy and less bureaucracy, but we now learn that regional assemblies will be responsible for developing joined-up regional strategies on issues such as sustainable development, economic development, transport, housing, health improvement and culture. Does that constitute less bureaucracy? What will happen to the existing quangos when regional assemblies are in place? How many quangos will be abolished?

In its 1997 manifesto, the Labour party pledged that regional assemblies would require confirmation by independent auditors that no additional public expenditure overall would be involved". However, the reorganisation of local government is likely to cost up to £2 billion. Does the Deputy Prime Minister stand by Labour's manifesto pledge, and will he confirm that if additional public expenditure is involved, regional assemblies will not go ahead? Will the tax-raising powers for the regional assemblies be limited, as they are in Scotland, or will they be unlimited?

These regional assemblies will not provide greater opportunities for devolving power down to local people: they will raise power up from local government, destroy county councils and mean that local communities have less say in their lives and in decisions affecting them than they have today. These proposals for regional assemblies will mean less democracy, more talk and more tax. It is a centralising measure and we will oppose it.

The Deputy Prime Minister and First Secretary of State

I suppose that I could return the compliment and say that it is the way the hon. Lady tells them, but that would be flying in the face of history. I presume that the Tories are still responsible for what they did in government. Let me remind the House that they opposed Scottish devolution: they now accept it. They opposed Welsh devolution: they now accept it. They opposed the Greater London Authority: they now accept it. They opposed the Scottish regional development agency: they now accept it. They opposed the Welsh regional development agency: they now accept it. They also opposed the RDAs for the English regions, although God knows why they felt that England should not have economic agencies to deal with similar problems of jobs and investment. I shall have to treat the hon. Lady's comments with some contempt, because of the Tories' history. They oppose proposals and they shout a lot, but in the end they come to accept the new ideas. That is what will happen in this case.

The hon. Lady said that the proposals would mean more bureaucracy and less democracy, but decisions in the regions are made at present by Government offices. Who set up the Government offices? It was the previous Administration, but not all Departments were included. They are now, and that is an improvement. However, it is not sufficient for the regions to have civil servants making decisions—that is bureaucracy—when directly elected members could make the strategic decisions. If we are replacing civil servants, who are by definition the bureaucracy, with directly elected members, that will mean more democracy and less bureaucracy. Both civil servants and elected members have a part to play, but I cannot accept the hon. Lady's arguments on that point.

The hon. Lady mentioned precepts. When her party was in government, it abolished the Greater London council, but it did not consult the people of London on that. When the Conservatives came to finance its replacement, what did they use? They used a common form of precept, as the hon. Member for Brentwood and Ongar (Mr. Pickles) can tell the hon. Lady. Under all Governments, precepts have been seen as a proper mechanism for financing local

authorities. They are used even today in the metropolitan authorities. The precept has been a proper form of financing—alongside grants, which I also mentioned—for local authorities.

We heard some hypocrisy from the hon. Lady, whose concern for quangos is touching. Most of the quangos grew up under the previous Administration, because they did not trust the elected members of the regions to make decisions. We totally reject that approach and we will provide the people with an alternative of regional elections, as proposed in the White Paper.

The hon. Lady said that the regional assemblies will take powers away from local authorities. I understand that she has not had the chance to read the White Paper, but when she does she will see how the local authorities will retain the powers that they have. The proposals involve decentralising from the Government down to the regions.

The hon. Lady mentioned counties. There are county structure plans, as the hon. Lady has mentioned in the past, but that sort of regional body is not enough. Some areas are larger than individual county councils and there can be several county councils in an area. They will now have a regional body. There is no need for a county structure plan if there is a regional planning body. That is precisely what we are proposing.

The hon. Lady spoke about county councils. We are giving people the choice to retain or reject a county council. They will be able to decide whether they want to keep the existing local government structure or move to an elected assembly. We trust the people, and we give them the choice. That is called a referendum. We are not imposing the structure.

That is why the White Paper is about choice. If people in the south-east want to retain the current structure, that is fine: let us give them the chance to decide whether they want to advance through the referendum process towards regional government. However, it is their choice. It is not for people in Newcastle to choose for people in the south-east. Each region will make its own choice about its local authority. That is called consultation and democracy. The White Paper is dedicated to that purpose.

Mr. A. J. Beith (Berwick-upon-Tweed)

Will the Deputy Prime Minister accept that the Liberal Democrats have been campaigning on this issue for years? We welcome the fact that the right hon. Gentleman has brought forward proposals today. We will examine them closely to see whether they will achieve what needs to be achieved—bringing the regional government that already exists in this country under proper democratic control, and bringing down to regional level decisions that are now taken in London and which should be taken much closer to the people whom they affect.

Does the right hon. Gentleman understand that we have some anxieties about the slowness of the process, which involves two stages of legislation? When they vote, will people know precisely what powers will be available to their regional assembly, or will that depend on a subsequent piece of legislation?

Is the Deputy Prime Minister aware that we do not approve at all of his involvement of local government reorganisation in this process? The White Paper is not supposed to be about local government. If there is a job to do reorganising local government, would not it be far better, rather than trying to organise it from London, to let the regional assembly do it once it has been elected?

Does the Deputy Prime Minister accept that the council tax is not a particularly fair tax? It is not a very good instrument, as it will also confuse the role of local government with that of regional government, which is something quite different. Also, there is no mechanism to deal with those regions where—unlike the north-east, Yorkshire, and the north-west—there is no clear consensus about the regional boundaries. Such a mechanism ought to be established.

I hope that the Deputy Prime Minister realises that, in regions such as the north-east, there will be a continuing demand for the levels of funding that Scotland has achieved through the Barnett formula. People in the regions affected will regard that as very much part of the process. The argument about establishing a version of the Barnett formula for the north-east or north-west will not go away simply because the regional assembly argument is moving forward.

Will the Deputy Prime Minister recognise that the Liberal Democrats want to make the process work, so that it delivers to people in the regions something for which they will vote? When the legislation comes forward, we will seek to improve the package. We will also aim to help to present it more effectively than the Government have managed so far. In that way, people in regions where there is already a recognised demand for democratic control of regional government will be able to vote for it, and thus achieve it.

The Deputy Prime Minister and First Secretary of State

I thank the right hon. Gentleman very much for his words of support. The most recent Liberal Democrat document on regional policy was produced a few weeks ago, and there is a clear difference between our approaches to the matter. However, we agree on the essential objective—that people should be able to make a decision about regional government.

I look forward to the debate about the balance between the powers of regional government and local authorities. The right hon. Gentleman will be able to see how they are spelled out in the White Paper. Any confusion about the use of precepts or council tax stems largely from the Liberal Democrats' belief that the regional body should have tax-raising powers. That is a fair position, and no doubt we will hear the debate. The same proposal arose in the debates about devolution, and different solutions were found for the Welsh Assembly and the Scottish Parliament.

The right hon. Gentleman asked whether people will know about the powers available to the regions and the counties. I assure him that they will be spelled out, and it will be made clear to people where the resources will come from and what functions the bodies will carry out. We think that that is important, but we believe that a two-tier structure—a unitary and regional structure—is appropriate for regional government. However, there are strong arguments about the counties, and that means that the case will have to be made. People will listen to the arguments and will decide whether they want a two-tier structure. Our judgment is that a two-tier structure is the best.

Local authority members would not necessarily all be

happy if a new directly appointed regional assembly decided the local structure in their area. That is one of the reasons why the Tories imposed the unitary system in Scotland without asking the Scots about it—because it was highly controversial. The Banham inquiry did not complete the arguments for a unitary system because it ran into a lot of flak in different parts of the United Kingdom. We have now come to a political judgment that it would be better to have two tiers—a regional and a unitary system of government. We look forward to the debate and the contributions to be made by Opposition Members.

Andrew Bennett (Denton and Reddish)

Will my right hon. Friend resist being deflected by Conservative Members' crocodile tears about the counties, given that they got rid of the six metropolitan counties? Does he accept that there will be a major welcome for his statement on the Labour Benches, particularly in respect of transferring power from the centre to the regions? However, the balance must be that democratically elected regional assemblies are quickly put into place.

The Deputy Prime Minister and First Secretary of State

I very much agree with my hon. Friend on these matters. It is a question of balance, but at the end of the day it is about democratic accountability. The simple point is one that I have made before: decisions about the regions are currently made by local government officers and civil servants; we propose to change that so that people can choose to go for a directly elected assembly. That will provide the opportunity for directly elected members to make the decisions, rather than civil servants.

Mrs. Gillian Shephard (South-West Norfolk)

Does the Deputy Prime Minister agree that the principles of accountability and transparency are important for good government at local and, indeed, given what is to follow today, national level? If he does agree, will he explain how the proposals that he has outlined will enhance those principles, given that his explanation of the proposals indicates that they will result in a mish-mash of incomprehensible and remote local government arrangements across England?

The Deputy Prime Minister and First Secretary of State

I do not accept that. Of course, the right hon. Lady has not been able to read the White Paper. There is a fundamental difference between us, which is quite understandable, and I do not mean this as a criticism. We want to give the people the opportunity to decide what their local authority structure should be. To say that it must he a unitary structure within a directly elected region raises questions about the accountability of the present structure. However, the present democratic structures in the regions can remain as they are.

People in the regions have to demand change and go through a process and a justification; then there will be a referendum in which the people will decide. We have made it clear today that if we want directly elected assemblies, we must have the unitary local authority system. I should have thought that that would have a great deal of support from the Conservatives—after all, they imposed such a system on Scotland without consultation.

Mr. David Clelland (Tyne Bridge)

Some of us recognise what others will come to recognise in due course: that my right hon. Friend has done a great service to our nation and to democracy in the announcement that he has made today and the work that he has done on this issue over many years. His announcement will be widely welcomed in the north-east of England, although we would like to discuss certain aspects with him further. It gives the people of the region a choice that would apparently be denied to them by the Conservative party.

My right hon. Friend spoke of flexibility. Will the legislation that will introduce assemblies be flexible enough to allow for assemblies' powers and responsibilities to be widened, in consultation with the assemblies, without the need for further primary legislation?

The Deputy Prime Minister and First Secretary of State

First, I thank my hon. Friend for his kind remarks. It is generally recognised in the House that those in the north-east have been at the forefront of demanding an elected regional assembly. One can reasonably assume that they will be first at the gate.

My hon. Friend says that he will want to discuss some of the details with us. It is no secret that we will be meeting people in the north-east tonight and I shall hear their views. I am sure that it will not be total endorsement and that they will have criticisms to make. There are varying views in the north-east. Some want to see a complete parliament in the north-east, more or less, rather than an assembly. They want to keep all the powers. That is a school of thought in a number of regions, not least Cornwall. However, we must find a balance.

My hon. Friend asks whether we can go further even before we have drafted legislation or entered into consultation, and I have to say no to that at the moment. However, given what is happening in Scotland and Wales, where people are beginning to feel that they can express their views, I am not surprised that people ask for more rather than less.

Sir Patrick Cormack (South Staffordshire)

As one who is proud of the historical identity of the county of my birth—Lincolnshire—and of the county of Staffordshire, an important part of which I have the privilege to represent, may I ask the right hon. Gentleman to ponder for a moment? He is bent on rewriting, redrawing and destroying the map of this country as people have come to know and love it, and on putting in jeopardy the very identity of England. He is driving people forward by putting in place regional structures that will almost oblige many to think that they must vote in that direction. He is an iconoclast and he ought to be ashamed of himself.

The Deputy Prime Minister and First Secretary of State

I must confess that I am not ashamed. I see by the smile playing on the lips of the hon. Gentleman that his rhetoric was more for the benefit of those outside this place than it was a serious contribution. There is a clear difference between us: Conservatives in opposition and in government have always imposed their solutions. We are prepared to give choice—that is what the White Paper is about—to people in his area or to people in the north-east or other areas who are interested in the election of a regional assembly. If they take that route, they must accept that the first tier will be unitary. That is the point that the hon. Gentleman made and I understand it, but we made a decision and there is choice and balance in the White Paper.

Mr. Austin Mitchell (Great Grimsby)

I congratulate my right hon. Friend; this is a good day for Yorkshire and Humberside and a good day for him—the culmination of the long campaign that he has waged. He might like to know that, this morning, in a vox pop on Radio Humberside, he was named as a potential First Minister for the new Yorkshire and Humberside region. May I express the hope that, even if he is not prepared to enlarge the powers at present, he will consider the proposals as a basis on which to build? What Scotland has, Yorkshire and Humberside need. The regional assembly must have more powers if people are to be prepared to vote for it and support it. What part will the Government play in the referendum process for regional government? Will they support the principle as they did for Scotland?

The Deputy Prime Minister and First Secretary of State

I thank my hon. Friend for his comments and kind remarks. As to whether I would consider being the First Minister. I am already First Secretary of State in this House, and I am happy with that. I do not want to feed the idea that I might be facing retirement, because those guys up in the Press Gallery will be writing about it for weeks. They rarely write the truth, but given half a chance they will make that kind of comment.

On the point about powers and balance, there are many powers in the package and we have tried to achieve a proper balance. It is different from what we did in Scotland, Wales or London. We have considered the experiences in those areas so as to establish a proper balance. We are not establishing parliaments in the regions—that is a fundamentally different proposition—we are establishing directly elected assemblies. We think that the balance of resources and powers is right.

My hon. Friend asked about our support. Clearly, the matter is Government policy, but we want the decision to be that of the people.

Mr. David Curry (Skipton and Ripon)

The Deputy Prime Minister has not deployed what might be the most persuasive argument in favour of regional assemblies: they would be a system of governance of England compatible with devolution to Scotland and Wales. Instead, he has chosen to base his argument on economics. Does he accept that regional disparities in England have increased, despite the creation of regional development agencies? Why does he think that a new political structure will make that any better? Does he intend to ensure that the distribution of public finance to the regions is made on a fairer basis—for example, so that it relates to the per capita income of those regions compared with Scotland? If the benchmark is Scotland and Wales, how on earth does the right hon. Gentleman think that representative democracy, or real accountability, is served by a handful of neither nowt nor summat representatives, representing several hundred thousand electors in tiny assemblies that have no proper link with their electorate?

The Deputy Prime Minister and First Secretary of State

I accept the argument that this is part of a constitutional settlement that I believe people in England recognise as having been central to my arguments for an awfully long time. As I mentioned before, those arguments were made in the documents that we were writing in the 1980s. What people in Scotland and Wales were asking for was absolutely right, and I supported them in that campaign at the time. I also made it clear that the same demand should be made for the English regions. Indeed, I seek their support for giving people in the English regions the same kind of direct accountability, so there is that political consideration.

The economic matters are quite important of course, and many people will consider the proposals in that light. But if people consider what happened when Scotland and Wales were given their development agencies by Labour Governments, they will see that there has been a tremendous improvement in the economy of those areas. The improvement is never enough for people in those areas, but if the comparison in made, there is no doubt that the regional development agencies helped to improve their proportion of gross domestic product. That is why the difference was reduced between Scotland and Wales and the English regions.

It is right and proper that the English regions should have those bodies. People in the north-east feel very strongly about that. They want the same tools and resources to get on with the job and to improve the quality of life for our people. They define that in economic terms, but it is about more than that; it is about the environment, housing and all manner of things that make up quality of life, and the White Paper points that out. So it is right to ask me whether there is a proper balance between a constitutional settlement and the economic requirements to get greater prosperity in our regions. Yes, there is a proper balance, but both those issues come together.

Mrs. Louise Ellman (Liverpool, Riverside)

May I thank my right hon. Friend for his long-term commitment to the English regions? I congratulate him on being so determined to secure action. I was privileged to be a member of the Millan commission, and it gives me great pleasure to see so many of its recommendations now being put into practice. The regional development agencies already make a difference, but it is certainly high time that the already existing regional tier of government is made democratically accountable and more focused.

I should like to ask my right hon. Friend whether he is satisfied that the powers now being offered, which undoubtedly open major opportunities, are sufficient to make a real difference, particularly in economic development and transport. Will he reassure us that the Government are ready to listen to the voice of elected regional assemblies? Is he ready to listen to the voice of the north-west, which will welcome this proposal, in the same way as he welcomes comments from the north-east?

The Deputy Prime Minister and First Secretary of State

I thank my hon. Friend for her kind remarks and for the part that she played in the Millan commission, many of whose recommendations are included in the White Paper. She was also the leader of Lancashire county council, which did a very good job in developing new innovations and ideas on economic development in a county council structure. That was good—one to be welcomed—although I now prefer that to come under the regional development agencies and, indeed, elected regional assemblies. If people in the north-west welcome the proposals and wish to pursue the route of an elected regional assembly, that opportunity is provided for them in the White Paper.

The Government will have to take into account the fact that the assemblies will have their own pot of money and will make their own decisions, which are now made by central Government. The assemblies may say that they want more resources or more things, and the Government constantly get into debates with councils at present. I have no doubt that elected regional assemblies will make the same arguments. The one thing that I would say for directly elected regional assemblies is that they will have more influence over central Government to ensure a better and fairer distribution of resources.

Mrs. Angela Browning (Tiverton and Honiton)

May I remind the Deputy Prime Minister that the civil servants currently working in the Government offices for the regions are not unaccountable bureaucrats, as he described them? They are civil servants, answerable to Ministers; and Ministers, in turn, are answerable to Members of Parliament.

I attended the consultations on defining the south-west region, and I have to tell the Deputy Prime Minister from first-hand experience that the conclusion was that Swindon, the Scilly Isles, Bournemouth, Poole and the coalfields of Gloucestershire had nothing in common that would not apply to any other region of the country. I want to put this to the Deputy Prime Minister: if, in the course of the consultation, the south-west puts a proposal to him to break into two regions—or even three regions, as Cornwall wants to go its own way—would he consider that and give it his blessing if that was what the people wanted?

The Deputy Prime Minister and First Secretary of State

It is a question of choice, which is precisely what we have put in the White Paper. I hear what the hon. Lady says about Government offices, and I want to correct the impression that I might have given on that. I am the Minister to whom the Government offices are responsible, and I think that they do an excellent job—so much so that we have broadened their representation, and more Departments are actively involved in them. Furthermore, they were an idea of the previous Administration, which I thought was excellent. My only disagreement is this: if they make recommendations to Ministers, who debate with Members of Parliament here, why cannot they have a say about the priorities of their areas? That can be achieved effectively only by an elected regional assembly—[Interruption.] I hear hon. Members' objections, but, although it might be possible to get a question or a little bit of space in a debate at Westminster, that is no longer satisfactory to people in the English regions. Even if they are satisfied, we leave it with them to make that choice. Those who are not satisfied, however, will have a directly elected assembly, which will be more democratic and less bureaucratic.

Mr. Martin Salter (Reading, West)

Is the Deputy Prime Minister aware that the bleating of the hon. Member for Maidenhead (Mrs. May)—who is no longer in her place, so I presume she has gone to lick her wounds—about the continuation of county councils is nothing more than hypocrisy and cant. Why, in 1994, did Conservatives in Berkshire—the area now represented by the hon. Lady—propose the total abolition of Berkshire county council?

Mr. Speaker

Order. The hon. Gentleman should be putting questions to the Deputy Prime Minister not about the Conservative party but about the policies of the Government. I think that the Deputy Prime Minister has got the drift of the hon. Gentleman's case, and perhaps he can try to reply.

Hon. Members

He was not listening.

The Deputy Prime Minister and First Secretary of State

I heard my hon. Friend quite clearly. He was talking about more hypocrisy under the previous Administration. Indeed, he reminds us that they abolished Berkshire county council. Despite all the talk that I am hearing about keeping county councils, the Conservatives reduced the organisation in Scotland to unitary authorities and abolished the Greater London Council. All of that was without any consultation with the people in the areas concerned. The White Paper puts down a proposal and allows people to make a choice. That is the fundamental difference between the Government and the Opposition.

Andrew George (St. Ives)

The White Paper talks about trusting people, flexibility and embracing diversity. In the light of that, does the Deputy Prime Minister accept that, if the Government merely attempt to replace an over-centralised state with a centralised solution, the whole project will become unpicked? Given the chance, voters will simply stay home in their droves. Although chapter 6 of the White Paper refers to the possibility of flexibility about those regions, does the Deputy Prime Minister accept that the whole project will fail if the Government become obsessed with their own regional boundaries?

The Deputy Prime Minister and First Secretary of State

I do not believe that a centralised solution is being imposed on people. The Government have made a judgment, which is embodied in the White Paper. I hope that the House will have an occasion to debate the details and the flexibilities in the White Paper in the not-too-distant future. We have decided on the best form to offer as a choice. I agree that we are not keeping the local authority structure as it is—we are saying to people, "If you want elected regional representation, you must accept a unitary structure." We therefore have a boundary commission to give us recommendations on that. That is a political choice, but it is up to the people to decide whether they keep what they have or take the structure that we are offering.

Mr. Patrick Hall (Bedford)

Does my right hon. Friend agree that the good case that can be made for democratic regional government will be all the more persuasive if the long-term and deliberate decline in the powers of local government that was brought about by the Conservative party were firmly reversed? Does he agree that the opportunity to do that and to increase the powers of local government will arise through the creation of the unitary authorities to which he has just referred?

The Deputy Prime Minister and First Secretary of State

I believe that the unitary authority system is the best form of local government, and I think that the previous Administration felt the same. After all, they imposed a great deal of it throughout the country, and that was right. Such authorities have considerable powers and important decisions to make about the services that they provide in their area. However, I return to the point that we shall have a two-tier system if an area chooses to have an elected regional assembly. That option is right, and it would not undermine in any way the influence, controls and resources that the unitary authorities have. We are decentralising from the top down to the regions, and not from the local authorities.

Mr.Peter Viggers (Gosport)

Does the Deputy Prime Minister recognise that devolution in Scotland and Wales created for the Government a problem in the north-east and the north-west, which now feel disadvantaged? However, that is absolutely no reason to impose regional government on areas of this country that have no desire for it whatever. They will view the current plans with anger and disbelief. Is he aware that there is a strong feeling of county in Hampshire, which is based on the historic capital of England, Winchester? The county has shown itself to be sensitive to the different social and economic needs within Hampshire. Can the right hon. Gentleman try to give us an assurance that, if any area rejects the proposals, it will not be economically disadvantaged?

The Deputy Prime Minister and First Secretary of State

That is precisely what I have been trying to say. It is all about choice. If the people in an area do not want a directly elected regional assembly, they will presumably not ask for it. If some in an area think that there should be such an assembly, the Secretary of State will come to a judgment as to whether there is sufficient demand in that area. The White Paper spells out just what he has to take into account and, in those circumstances, there either will or will not be a referendum. At the end of the day, the judgment will be whether the people in a region want an assembly.

I have heard much from Conservative Members that such assemblies are not wanted in the regions and we can all quote stories about whether they are or are not wanted. However, a BBC poll says that two thirds of the population are in favour of regional government. [HON. MEMBERS: "Not in the south-east."] I shall come to the south-east—hang on. The big differences in support were clearly reflected geographically. In northern areas, support for regional government was more than 63 per cent.—73 per cent. on average—and, by the way, the west midlands is included in that. In the south-east, an average of between 50 and 60 per cent. were for regional government. Therefore, the figures suggest that a substantial number of people are prepared to consider proposals for regional government.

Joyce Quin (Gateshead, East and Washington, West)

In contrast to the carping from some Conservative Members, may I say that I think that my right hon. Friend's announcement is of huge significance for the English regions? For my region of the north-east, it represents a great opportunity for us to pioneer the process, and I hope that we will do that. I am still an owner of the alternative regional strategy that my right hon. Friend mentioned and I can recommend it as reading to the Conservatives, as they need common sense on the issue.

May I press my right hon. Friend on the consultation period that he has announced? Will he use it as an opportunity to say to the regions of England, including the north-east, that the proposed organisations will have real budgets and real powers? Will he also reaffirm his message about inclusivity, because everyone in the regions—business, organisations, voluntary groups and all our communities—can benefit from these proposals?

The Deputy Prime Minister and First Secretary of State

I thank my right hon. Friend for her remarks. I remind the House of the role that she played in bringing about the White Paper and greater powers for the regions. She rightly tells us that the north-east is a pioneer; clearly, it has been. I shall hear more about that in the north-east later today when I am accompanied by my right hon. Friend the Secretary of State for Transport, Local Government and the Regions.

I am grateful for the comments that my right hon. Friend the Member for Gateshead, East and Washington, West (Joyce Quin) made about the alternative regional strategy. I will make it available, and I can claim that, in contrast to the Opposition, the views I held 20 years ago are consistent with what I say today. The Opposition's views are hardly consistent from year to year or from election to election, but that is the nature of the current Opposition.

We are providing real budgetary powers, real finances, real powers to get on with the job and greater democratic accountability. That is shown in the White Paper. No doubt when we have the opportunity to study it, the House will debate its details and determine whether my points are justified.

Mr. John Maples (Stratford-on-Avon)

What the Secretary of State has not told us is what very had news elected regional assemblies would be for rural areas. Is it not inevitable that a regional assembly in the west midlands would be dominated by the interests, agenda and representatives of the Birmingham conurbation, and would suck in cash and powers from the rural areas? Whatever value county councils have, at least they provide some voice for rural areas in local government, which the right hon. Gentleman is proposing to abolish. Will this not inevitably be another advance in the interests of our great cities at the expense of our countryside and market towns?

The Deputy Prime Minister and First Secretary of State

It appears that this debate will continue as it started—by reflecting the hypocrisy of the Opposition. I will take no lectures from Tories on what happens in rural areas. The facts are clear to see from their 18 years in government. Since then, we have begun to make improvements. For the first time, we have produced a rural White Paper to consider precisely how we might improve the quality of services. At least we guarantee rural areas the advance in services that has occurred in urban areas.

All the issues, such as the economic provision of jobs, are important. The regional development agencies have been given a specific remit to get on with rural development, which rural areas have welcomed. Many of the things that we have done are starting to show improvements. Frankly, if areas decide to choose the path of an elected regional assembly, every rural and urban population in those areas will have a responsibility because that is how every region in the United Kingdom is made up.

Mr. Derek Foster (Bishop Auckland)

Is my right hon. Friend aware that for those of us who, like himself, campaigned for more than 25 years for regional government, the publication of the White Paper is a cause of huge celebration? It represents a great leap forward in establishing a vigorous authentic voice for the north-east. Is my right hon. Friend also aware that we know that the White Paper would not have been published without his tenacity over the past 20 years?

The Deputy Prime Minister and First Secretary of State

Of course I am grateful for my right hon. Friend's candid remarks. He has campaigned on this issue for a long time and, indeed, we have worked together on such campaigns. It is a special day for us because we belong to a Government who are introducing a White Paper on regional government. It is a great leap forward, as my right hon. Friend says. It will allow each region to develop a special voice, especially in the north-east. We have the opportunity to go out and sell the case and to show that there can be a more democratic way of working, which is what the White Paper does.

Mr. Andrew Turner (Isle of Wight)

The right hon. Gentleman and his right hon. Friends have been generous to my constituency in the words they have used in the House in recognising its unique status in England. Can he confirm that no powers would be taken from the Isle of Wight county council to the mainland under his proposals and that it would be represented in the regional assembly by a unique individual?

The Deputy Prime Minister and First Secretary of State

I assure the hon. Gentleman that if the people do not choose to take the route of an elected regional assembly, the present local government structure will remain as it is. However, if the region that includes the Isle of Wight wishes to go for a directly elected assembly, the local authority structure will be considered by the boundary commission and included in the proposals for a referendum. It is a choice for the people in the Isle of Wight and the south-east region.

Jeff Ennis (Barnsley, East and Mexborough)

I welcome today's announcement, particularly in view of the fact that I represent a constituency in the middle of an objective 1 area which has the lowest gross domestic product per capita in the United Kingdom. Does the Deputy Prime Minister agree that the future establishment of regional assemblies can only assist and enhance the future economic regeneration of neglected places such as Barnsley and Doncaster?

The Deputy Prime Minister and First Secretary of State

I have no doubt that that will help areas such as Barnsley, but we should also take into account Government measures before the White Paper, not least the £350 million coalfield community fund, which we introduced to help mining areas that had been destroyed, particularly by the vicious policy pursued by the previous Administration.