Local Government

HL Deb 18 November 1981 vol 425 cc507-49

2.52 p.m.

Lord Evans of Claughton rose to call attention to the urgent need to reform local government, in particular by the introduction of a fairer and more representative method of election; and to move for Papers.

The noble Lord said: My Lords, local government, local democracy and local autonomy in this country are in grave danger, and indeed I believe will be in a state of terminal decline if the Local Government Finance Bill at present before another place becomes law. The danger is not brought about by the folly of local government but by a continuous process of emasculation and erosion by central Government which began with the Local Government Act 1972. It continued with four changes in the rate support grant system which made it extremely difficult for local authorities to come to any assessment about their financial arrangements with the continual changes in the calculation of the method of grant they would receive, and thirdly with many parts of the Local Government Act 1980, which I and several other noble Lords opposed strongly in your Lordships' House.

The Layfield Report of 1976 argued that unless positive efforts were made to enhance local government the partnership between central and local government which had operated so successfully for so many years in this country would inevitably break down. How painfully true that prediction has proved to be since that time. Now, local government's limited financial independence is under further threat.

Its own tax-raising capacity, the rates, is an unpopular, regressive and inefficient system. It is truly said that the public pays taxes in sorrow and rates in anger, and, if recent events are any guide, supplementary rates in great anger. Yet, in spite of all the unpopularity, rates succeed in raising only about one-third of local government expenditure at this time. The paradox is that, in spite of these problems and these difficulties, and in spite of the apparent public concern, when it comes to elections the public proves to be generally apathetic. Local elections rarely attract more than a 50 per cent. turnout of voters, and an average is about 35 per cent., with many wards falling as low as 15 per cent.

Local authorities are continually berated for inefficiency, extravagance and pettifogging bureaucracy. Except in a tiny minority of extremely well publicised cases these criticisms are totally and entirely unjustified. Councils, councillors and council officials do a humane, sensitive and caring job of work in conditions of increasing frustration. Between April 1974 and April 1980 in cash terms central Government current expenditure increased by 133 per cent. while local government current expenditure increased by—I should like to say "only"—104 per cent. In the same period, total Government expenditure has fallen by 1.8 per cent., and, within that figure, local government expenditure has fallen by 21 per cent. while central Government expenditure has increased by 8 per cent. Therefore, the housekeeping record of local government, its financial propriety and financial concern, would stand comparison with any central Government department. In addition, over the same period the rates have continuously risen more slowly than inflation.

I believe that a healthy and responsive system of local government is the cornerstone of democracy in this country. The belief that centralisation is an evil to be opposed whenever possible, that there is an innate virtue in creating and maintaining a local democracy in towns, villages and communities, has been a deeply-held Liberal conviction for many generations, reaching perhaps its finest flowering in the Local Government Act 1894. This was the parish councils Act, which realised in legislative form the philosophy expressed by Alexis de Tocqueville much quoted at that time and still true today: Local assemblies of citizens constitute the strength of free nations … A nation may establish a system of free government but without the spirit of municipal institutions it cannot have the spirit of liberty".

Those values are still relevant today not merely in a national but certainly in a European context.

The Conference of Local and Regional Authorities of Europe adopted a draft charter for local self-government in 1981 which states unequivocally: Powers given to local government shall normally be full and exclusive. They may not be undermined or limited by administrative action on the part of a central or regional authority".

And then another quotation: Local authorities shall have a general residual right to act on their own initiative with regard to any matter not expressly assigned to any other authority nor specifically excluded from the competence of local government".

Then the final quotation from the same draft report reads: Public responsibilities shall be exercised by preference by those authorities which are closest to the citizen".

This statement might well be read, learned and inwardly digested with great benefit by members of Her Majesty's Government. It restates the historic commitment of my party and, I thought, most, or all, of the parties in this country to the concept of local democracy, local independence, and the idea that decisions should be made at the lowest possible level of government.

I welcome the fact that the Secretary of State for the Environment is said to be re-examining the clauses in the Local Government Finance Bill relating to local referendums in the light of a recent debate in another place. I hope that none of your Lordships is so naive as to believe that removal of that part of the Bill will make the rest of it acceptable; that is certainly not the case on these Benches. I welcome, also, the promised Green Paper on local government finance. It is a great tragedy that legislation was not introduced very soon after the Layfield Report in 1976 to enable local authorities to raise their own revenue, making them less dependent on central Government handouts in the shape of the rate support grant. It is my view, which I have stated frequently in your Lordships' House, that the putting right of the financing of local government is more important than amending the boundaries and structure of local government.

I recognise, however, the desire among many local authorities for structural change. In shire counties there is the wish for more responsibility, understandably sought by such proud and historic cities as Bristol and Nottingham, and the desire of metropolitan boroughs in metropolitan counties to opt out of relationship with the metropolitan county. My own Metropolitan Borough of Wirral, the Metropolitan Borough of Sefton (where I understand elections will take place soon) and many other metropolitan boroughs are anxious to opt out of relationship with metropolitan counties and to become all-purpose authorities once again, possibly with joint boards dealing with matters on a county-wide basis. We hear strong rumours that the Secretary of State may actually be taking up the policy that my party has put forward since reorganisation, of dismantling the metro-counties. I hear much concern expressed, too—I was at a meeting this morning with the Welsh authorities—about the remoteness and excessive size of the Welsh counties.

All those are matters of great importance to the health, efficiency and good running of local government, though I think none of us could contemplate with equanimity a further fundamental upheaval in local government boundaries until the question of local government finance has been put on a fairer and more efficient basis and, in my belief, until the method of election to local authorities has been fundamentally altered. I shall concentrate my remaining remarks on what I believe to be this essential first step to local government reform, namely, the reform of the method of election to local councils.

The present first past the post system of election to local government is a direct cause, in my submission, of many of the evils of local authority representation and certainly encourages an artificial polarisation between central and local government. I do not suggest that the introduction of the single transferable vote system would be a universal panacea for every local government ill, but the case for its introduction at local government level is even stronger, if that were possible, than in parliamentary elections, and the reasons are many, the principal ones of which I will set out.

First, local government elections cause far greater anomalies and many more of them than do Westminster elections. For instance, in 1978, no fewer than 10 of the winners in the 36 metropolitan districts won with fewer votes than their rivals. Secondly, a narrow majority of votes is very often translated into an overwhelming majority on the council; for example, in the London Borough of Lambeth, about which we hear a great deal, at the last elections Labour got 48.5 per cent. of the votes and obtained 42 seats, while Conservatives were only just behind in terms of votes received, namely 46.8 per cent., but received only 22 seats for their pains. Perhaps much of the extremism that we have seen in Lambeth—many of the matters about which the Secretary of State has found so much to complain—would not have happened if the first-past-the-post system had not existed in that particular, and many similar, boroughs, because a similar result came out in the Greater London Council elections last May.

My next point is the problem caused by the first-past-the-post system in creating a clean sweep in local authorities. A party can win almost all the seats in a local authority with less than half of the votes. For instance, at the last elections in Islington, Labour obtained 49 per cent. of the votes and got 50 seats, and the Conservatives got 38.2 per cent., a respectable score, but got only two seats. There is something grotesquely wrong with an arrangement that produces that kind of result, and I could quote many other examples.

The result of the imbalance is that there is on those authorities no effective opposition. However good the one or two people elected in opposition, compared with perhaps 50 in control, they cannot be an effective opposition; they cannot man the committee benches and they cannot create an efficient and competent opposition to the party in control. And it is an established rule, which I think all your Lordships accept, that Governments benefit from strong and healthy opposition, and in my submission local government is no exception.

My next point is the question of corruption. Some years ago we could hardly pick up our newspapers without seeing that some member of some local authority was being tried for some form of corruption, and the Royal Commission on Standards of Conduct in Public Life in 1974 found: The local authorities most vulnerable to corruption have tended to be those in which one political party has unchallenged domination".

That is a very important point, and that danger must remain so long as this system of elections subsists.

My next point for criticising the present system is that it exacerbates the national division between parties. Because the anomalies of the present system benefit the strongest party in any area, this country looks far more divided than it is, exaggerating rather than mitigating the social and geographical divisions that exist. The present system, coupled with the abolition of the aldermanic benches, with which my party agreed, exaggerates swings under the present system of first past the post elections against Governments in mid-term local elections. I apologise for again referring to Islington but it provides the best example. In 1964, Islington Council was 100 per cent. Labour. In 1968 the Conservatives took control. In 1971 every single Conservative seat was lost and Labour took over 100 per cent. control again. Is that, can that, be healthy for local government, for continuity of policies and ideas and a useful discussion of the needs of the people in a particular area?

That kind of clean sweep or swing against the Government often results in severe conflicts between local authorities and the central Government, whoever they happen to be. A Labour-controlled local authority perhaps elected more recently than the Government, with its grossly inflated majorities produced by the first-past-the-post system, may well claim that it has a mandate to refuse to implement Government policies. Similarly, with a Labour Government in office, Tory councils might well defy the Government's rules. We can all remember—it is still occurring—the endless conflict about comprehensive education and the 11-plus, which does not benefit the quality of education in the particular areas, but merely causes terrible uncertainty for children and their parents. This is a very serious criticism not only of local government, but of the method of election. It creates cynicism, dissatisfaction, contempt, and indeed derision among the electors more often than is good for government in this country.

You see, my Lords, of the 14 authorities named by the Secretary of State for the Environment for flouting requests to contain expenditure, 10 were grossly unrepresentative, and that again underlines my contention that the present system stimulates conflict and encourages the defiance of Government by local authorities as well as the internal difficulties and the continuing battle between local government and central Government. In the interests of efficiency in local government there should be a partnership, and local government and central Government should not be in constant conflict.

Lord Jenkins of Putney

My Lords, will the noble Lord give way? I am trying to follow his argument, but he began by suggesting that the measures that he proposed would have the effect of increasing the independence of local authorities in relation to the central authority, whereas he now seems to be telling us that when local authorities display their independence there is something wrong about it.

Lord Evans of Claughton

No, my Lords, I am not saying that. I am saying that the degree of change that takes place, reflecting the degree of change in the views of the electors, would not be as enormous if we had a system of STV rather than a first-past-the-post system, and therefore the clash between the local authority and the central authority would not be as dramatic as it is at present. There is a very large area in which most councillors and most Governments have broad agreement. Where in a local authority an extremely large majority is created by the present system, there is not merely disagreement, but deliberate —I was going to say "bloody-minded", but I must not use that expression—defiance of reasonable requests from a Government, of whatever political hue. When the local authority behaves in the way that I have outlined, the result is that the Government have to resort, or choose to resort, to powers and administrative procedures and devices in order to control and emasculate local government—which is what we are seeing today. That leads inevitably to a slow, creeping, but continuous, centralisation of local government. The grotesque swings that I have mentioned could not, by definition, occur under a system of the single transferable vote.

I have heard in your Lordships' House and elsewhere debates about the relative merits and demerits of the system of the single transferable vote, and while, understandably, I am an unqualified supporter of the system, I am aware of arguments against it. However, these arguments apply much less to local government than they do to Westminster elections. One of the arguments is that the first-past-the-post system has led to stable government based on one-party rule. Of course that does not apply to local government. Local authorities do not form Governments, but work within statutory guidelines in a committee system. Councillors are elected for fixed terms, and therefore internal rearrangements, or the overthrow of the party in power, cannot precipitate a general election, as can occur in another place.

Finally, most local authorities have their elections in existing multi-member wards, with perhaps three or six councillors. So the argument that one hears about the special and historic relationship between the member and his constituents would not apply in local authorities as it is alleged to apply in Westminster elections, because in most areas there are already three or six councillors. So the problem would be entirely resolved. There would already be the multi-member wards, and there would be no difference at all in the relationship between the elected councillor and those who elected him.

I should like briefly to summarise what I have said. I believe that whatever one's political views, there is a crisis in local government at the moment. Financial and structural reforms are needed. My submission is that in carrying out those reforms any Government would be irresponsible if it were not to give very serious consideration to introducing a system of the single transferable vote in local elections. I believe that the first experiment in the system was carried out in a local authority in Sligo, and it succeeded so well there that the Republic of Ireland has the system. I would suggest that if the system were introduced in this country, even if only on an experimental basis, it would be found to have such benefits that no Government could resist it being used entirely throughout local government elections. My Lords, I beg to move for Papers.

3.16 p.m.

Lord Underhill

My Lords, I am certain that all noble Lords will be grateful to the noble Lord, Lord Evans of Claughton, not only for placing this subject on the Order Paper but for the very constructive way in which he has introduced it. I have very little difference with the noble Lord in regard to the first part of his speech. My party, for which I speak, has always stressed the vital necessity of partnership between central and local government. I am sure that all noble Lords will agree that a lively and independent local government is absolutely vital to our system of democratic government. Together with the parliamentary system, local government forms the twin pillars which sustain our political democracy. Therefore, I agree with what the noble Lord, Lord Evans, has said about the dangerous trend towards centralism, which must be halted if we really want to see even further development of lively local government. There is a tendency for decisions to be taken in Whitehall over and above the desires and needs of the local people, exercised through their representatives.

The noble Lord, Lord Evans, has stressed some of the features of the Local Government, Planning and Land Act 1980, with which many of us thoroughly disagreed, and I shall not go over those again. Similarly, we share the noble Lord's concern over the provisions in the new Local Government Finance Bill, and we shall have ample opportunity to discuss them when the Bill comes before the House. Many noble Lords criticised some of these proposals during the debate on the gracious Speech, and I share all the concern that the noble Lord, Lord Evans, has expressed.

Many noble Lords will agree that there is need for some type of reform of our local government structure. The Labour Party did not like the 1974 reorganisation of local government, and nothing that has happened since then has removed our dislike of the present structure, which has brought about a certain remoteness in many areas, as well as destruction of local loyalties and division of the administration of some of the personal services. Having said that, we recognise that any change would undoubtedly bring dislocation and upheaval. Therefore, the matter must be considered very carefully. The utmost thought must be given to any proposal to alter the present local government structure.

As far as the Labour Party is concerned, our general trend is towards a change to most-purpose authorities. If I may say so in passing, when I was our regional secretary in 1958—that is going back a long time—all the Labour-controlled authorities and Labour groups in my area agreed then with the principle of most-purpose authorities. That is 23 years ago. This will bring local government closer to the people, and it will remove some of the remoteness. It will involve a consideration of the position of the counties.

We accept the general principle of most-purpose authorities but this has to be considered with the greatest care, and I want to admit on behalf of my party that we are considering very carefully what should be the ultimate change we should put forward by way of a further reform in the structure of local government, because it goes beyond the present local authorities. There are the ad hoc bodies, the non-elected bodies, which have grown up and which, somehow, ought to be brought within our democratic structure. Certain powers are given to the regional offices of quite a number of ministries, and these powers are exercised. Somehow these offices ought to be brought within our democratic structure.

As far as we can possibly do it, there should be the utmost development of responsibilities falling upon elected people. At one time the Labour Party put forward the principle of elected regional authorities, and, if I may digress, I am one of those who believe that if we had put forward devolution for Scotland and Wales and, at the same time, regional devolution for England, we might have secured a far different position from that which we have now. That is a purely personal view. The general principle of elected regional authorities was not accepted throughout the country, and therefore this is a matter to which we are giving the most serious attention, as to what should be the final form of local government structure that we should propose. It is not a matter which one can easily toss around by sloganising.

I was pleased to hear the noble Lord, Lord Evans, refer to the question of corruption. I was in the fortunate position of being the secretary of a Labour Party committee which dealt with the conduct of the Labour Party in local government, and which issued a very wide-ranging report back in 1975. It was widely publicised, and it dealt with all aspects of the conduct of Labour groups and the conduct of councillors in local government. Paragraph 51 of the report of the Royal Commission on Standards in Public Life, produced in 1976 and to which the noble Lord has referred, stated: We agree with the emphasis that the special committee of the Labour Party placed on the responsibility of local party leaders to ensure proper standards of conduct in their groups. The main parties also have a duty at national level". It went on to say that they appreciated that there were different levels of administration in local parties. But the Royal Commission studied our report and thought we were on the right lines.

The part of the noble Lord's speech with which I cannot find myself in agreement is his proposal for electoral reform. I can understand that there is some concern with certain aspects of our electoral system, but what we must not do is jump at easy solutions. I am not suggesting that the noble Lord is doing this, because he has put forward a constructive case, but there are people who jump at easy, almost popular, solutions of this problem. I must emphasise, despite what the noble Lord has said, that any changes in the local government electoral system must inevitably affect any system that we have for our national elections. I know only too well that if the Labour Party had pushed for a system of electoral reform on a regional basis for the elections to the European Assembly we would have done far better in those elections. But we did not, because once the foot is in the door we open the way to a change in our electoral system for our national elections. We just cannot separate the two.

There are principles involved in the suggested electoral reform which we cannot just toss on one side, because we are concerned not only with any possible change in the electoral system, in electoral democracy, but also with any possible change in our democratic political system, because you cannot divide the two. There has been a considerable amount of talk about a democratic proportional system, but if one looks at this very carefully one sees that the only really democratic proportional system is that which says that if you take 53 per cent. of the votes you have 53 per cent. of the seats. That is an electoral system which is totally democratic. Many continental countries have it, where the political parties are written into their constitution. But we have not got that system.

I was the national agent of the Labour Party, and I know what power such a system would have given those of us who ran the party bureaucracy, because you could administer this system only on a list basis. People would not vote for individuals, people would vote for a party list; and the party bureaucracy would have a great deal of influence as to whether you were first on the list or twentieth on the list. Therefore that system, which could possibly be described as the soundest democratic electoral system on a proportional basis, has very grave dangers. It removes completely any possible influence that personalities and the calibre of individuals would have in local government, and, surely, that is where one would wish to have it as much as in parliamentary elections.

Another way is the exhaustive vote system, which applies particularly in the French elections. This can be justified on the basis that you change your position of voting according to the circumstances in relation to who is dropping out. That is a system one can understand, but I am certain that noble Lords would not feel that that is a system which could be applicable to the United Kingdom.

It is argued that it is unfair for a candidate to be elected on a minority of the votes cast, but some of the electoral reforms which are proposed are not proportional representation systems at all. Some could lead to a candidate with most first-preference votes not being elected because somebody picks up a greater number of second-preference votes. We must ask: Is that fair? Is it democratic that someone who has less first-preferences can finish up being the person elected? That is what could easily happen under the system which has been advanced.

The most favoured system, as the noble Lord, Lord Evans, has said, is the single transferable vote, STV, which provides that preferences after the first achieve equal power to the first preferences. I cannot accept, and my party cannot accept, that, at the end of the day, second, third or even fourth preferences will have as much influence as first preferences. I am certain that cannot be justified as a democratic argument whatever other ground it may be justified upon. Furthermore, it will require larger electoral areas. The noble Lord, Lord Evans, says that we already have them. Of course, in many of the metropolitan districts we vote in yearly elections with only single persons to be elected. in many of the non-metropolitan districts which vote year by year—and, frankly, that is the system I prefer because it avoids the swings—there are single candidates only standing in each year's election where the local authority has opted for yearly elections and not for elections every four years. Therefore, it would require a change to multi-member areas, with the lack of personal attachment to the electoral area.

May I emphasise that, as with national politics, surely the conduct of elections on clear policies is important. We believe in political democracy. Political democracy means that there need to be efficient, healthily functioning political parties. That is part of our political democracy. Even if all the existing political parties went out of existence there would soon be other political parties taking their place, because people would group together to put forward their like views.

With some of the electoral systems that are being proposed as alternatives to our present one there could be concentration on attracting second-preference votes. That seems to me to be obvious: that one will modify one's views in order to try to pick up second- preference votes. Is that healthy? Is that the good political democracy in which we all believe? That could lead to blurring of the issues and programmes. I believe that it is essential for the electors to have a clear opportunity at local elections to vote for a programme and not merely for the whim of a particular individual. There may be disagreement from some noble Lords, particularly from those opposite, but I do not believe that you can have a healthy functioning local government when you have a council of, say, 60 all of whom are independent individuals, all fighting in different ways. Eventually, the electors need to have clear programmes put before them.

Under some of the proposals there could be a system where power eventually was in the hands of a party whose candidates in total had less first-preference votes than another party. How that could be justified on grounds of fairness or democracy I fail to see. We could have a situation also with fringe candidates; and under the SDP system or any other system of that kind extremist candidates could go forward with second-, third- or fourth-preference votes; and they would be the first to be dropped out because they would not poll many votes and therefore the second and third preferences of extremist parties could have a considerable influence in the resulting elections.

Despite how simple it may sound to do away with the present system, we on these Benches believe that we ought to adhere to the present system of first past the post. It has served us well nationally. It allows the elector to have a clear issue. If one attempts to introduce a new system into local government one not only brings in the factors to which I have referred but it would be the thin end of the wedge for bringing them into national elections, with all the resultant consequences of change in the political system which we wish to preserve.

3.32 p.m.

Lord Boyd-Carpenter

My Lords, when I read the Motion in the name of the noble Lord, Lord Evans of Claughton, I speculated as to what general reforms of local government the noble Lord and his political colleagues had in mind. I am bound to say that I suspected that the only point of substance that he would want to put forward would be to bring forward again what I hope he will not mind my describing as the Liberal Party's obsession with fancy forms of franchise. I put that thought from me, as being uncharitable; but I find to my regret, because I am a charitable man, that I was right. Those who listened to the noble Lord's speech, delightfully delivered as it was, will, I think, agree with me that apart from some generalities—and I will not call them platitudes—about the desirability of preserving the independence of local government and a glancing blow at a measure which is at the moment in another place, basically the only practical recommendation which the noble Lord put forward to the House was the introduction into local government elections of the single transferable vote. So far as the mover of this Motion was concerned, that is his idea of what this debate should be about.

If that is so, this debate will not take long. I think that the majority of your Lordships on both sides of the House will agree with me that the noble Lord, Lord Underhill, did a superb demolition job on the single transferable vote. Certainly, he left me with no more to say on that than that I agree wholly with him. As your Lordships know, he speaks with particular authority on these matters, being the former chief agent of one of the major parties in this country with enormously more practical experience of the mechanism of elections than any of the rest of us. I would only add this to what he said: I thought there was a certain contradiction in the argument of the noble Lord, Lord Evans of Claughton, that the introduction of this method of election would reduce the chance of clashes between central and local government. Surely, if you have the two layers of government elected on a different basis, then, if the difference in the systems has any effect at all, there will be greater likelihood of a clash. With one set of people elected under one system and another set of people elected under another, the likelihood of a clash, so far from being diminished, is surely increased.

I agree with what the noble Lord, Lord Underhill, said about the effect upon the independence of candidates of the adoption of this system quite apart from the inevitable introduction of the party list; and I was delighted to see that the noble Lord, Lord Underhill, dislikes that idea as much as I do. Surely the system must mean that the candidate most likely to be elected is not the man whose appeal is clear-cut, the man whose policies are clearly stated, the man whom the electorate know will do particular things; but the man who is so inoffensive, so colourless, that he does not offend anybody and who therefore gets the later preferences. What we need in local government —and, maybe, in central government—is more people with clear-cut views in which they believe and who are prepared to carry them through rather than more compromisers, more people so afraid of offending sections of opinion that they have no proposals to put forward in the national interest.

I agreed so much with that part of Lord Underhill's speech that I hope he will not mind my saying that in another part he suffered from a slight lapse of memory. In his robust affirmation of the view that local government should not be overridden by central government, he perhaps overlooked the fact that during the previous Labour Government, of which he was so effective a supporter, Mrs. Shirley Williams, who was at that time a Member of the Labour Party, put forward, as Minister of Education, legislation designed to override by force of law the wishes of those local education authorities who desired to retain selective entry grammar schools. She succeeded in compelling some of those authorities to dismantle schools which they wished to preserve and for which they had the highest admiration. Only the decision of the electorate in 1979 prevented her succeeding in destroying the lot. I know that quotation from the past of parties and Governments is an occupation in which we can all indulge, but I could not help reminding the noble Lord, Lord Underhill, of that particular example when he was so clearly affirming the wrongness of overriding local authorities.

Lord Underhill

My Lords, I think the noble Lord will recall that this was a clear point in the Labour Party manifesto which led to that decision. It was clearly put to the electors as a vital principle of education.

Lord Boyd-Carpenter

My Lords, it was certainly part of the Labour Party policy and I think, insofar as it was confirmed in 1979, it helped to contribute to their defeat. For that reason I hope that they will continue to put it in their manifesto. But that does not get away from the point that under our system of the local administration of education, some local authorities had been elected on the basis of retaining their selective grammar schools—as was the case of the local authority in my own late constituency of Kingston-upon-Thames—and there was here a clear legislative attempt to override local government on a matter within its own administrative sphere. I hope that the noble Lord will bear that in mind when he makes these general statements about overriding local government and when, as perhaps may be the case later this Session, we have to discuss this matter in another context.

As regards the reform of local government generally —to which really the noble Lord, Lord Evans, made no reference, although his Motion does so—I very much agree with the noble Lord, Lord Underhill, that we should proceed very slowly and cautiously about this issue. Changes in local government structure almost always seem to involve greater expenditure. Also, if they are to be of any substantial nature, they should be carried through on the basis of all-party agreement. We are going to get nowhere if a Government of one party make far-reaching changes and the Government of another party seek to alter them. I hope that in this respect—as in respect of other possible changes in our constitution nationally—if there are to be changes of a major character they will be put forward on the basis of a large measure of consensus between the major parties. I would caution that at the moment the important point in respect of local government is not the exact form of the structure but the cost.

The noble Lord, Lord Evans of Claughton, made a gallant attempt to support the concept that local government was economically administered by quoting perfectly properly the fact that the percentage increase in the cost of local government over recent years has been a good deal lower than that of central Government. There are many reasons for that; but what I think the noble Lord omitted to give weight to was that the original take-off point on which those percentages are based is too high. I am sure that our concern in the sphere of local government, while preserving as much of its independence as possible, is to try to secure that those in local government contribute to the general effort which is required in the economic interests of this country to restrain the growth in public expenditure. It is not, in the colloquial sense, a question of cuts. It is restraint in growth. Where we are dealing, as we are dealing with local government expenditure, with approximately 25 per cent. of public expenditure, we are dealing with a very substantial element in this equation.

Here I come to where I have a considerable criticism of the electoral system of local government to which the noble Lord, Lord Evans of Claughton, referred. It is the strange fact that in many local authority areas those who contribute the largest proportion of rate payments have no vote. I am referring to industry, commerce and business premises generally. There are many areas in this country where the overwhelming proportion of the rate burden falls on those disfranchised people—disfranchised since very foolishly a good many years ago another Government abolished the business vote.

On top of that it is of course the fact that even among private citizens in most boroughs, in most counties, the majority of the electors are not themselves ratepayers, anyhow. A system such as that is inevitably weighted, however resolute and economy-minded local councillors may be, in favour of increased expenditure. It is a system under which agreeable things can be produced to an electorate, the great majority of whom do not have to pay anything towards them, and indeed a great deal of which is paid by those who are completely disfranchised.

This seems to me to be one of the explanations of the extravagances—and I agree with the noble Lord that they are not universal—for which local government is responsible. The temptation on elected councillors to go for expenditure is very strong indeed and I very much respect those in many boroughs and in all parties who have the courage to resist that temptation. However, we simply cannot get away from the fact that some local authorities' expenditure is really out of hand.

In order that I may not seem to be making a party point, I will quote a Conservative controlled borough, the Borough of Kensington and Chelsea, in which the rate poundage was increased this year by 52 per cent. over and above that of the previous year. There are Labour-controlled boroughs that can match that unhappy record. That surely indicates that there is something the matter with our system of local government, and I suspect a good deal of that which is the matter is so because the electoral system is so weighted in favour of expenditure.

This is not the occasion—though I understand that there may be one later in this Session—to go into the details of excesses in local government expenditure. I was fascinated to see that the Association of Metropolitan Authorities were apparently spending their ratepayers' money in large advertisements in the newspapers propagating their own particular views on what they believe to be impending legislation. I hope that the district auditor will have a look at the expenditure of the individual authorities within that area to see whether it is not perhaps a matter for an appropriate surcharge on the individuals concerned.

However, we come back to the Motion with which the House has to deal. I wish to leave as my contribution the thought that if we are to continue with the system of rates—and there are strong arguments against so doing—we must review the franchise so that there is no taxation without representation. Those were the words of those who set up the United States 200 years ago and they remain true of any democratic system. You must not be able to tax people unless they have a say in the political process from which that taxation springs.

It may well be that other financial methods may be more suitable. I have always thought that a local sales tax had considerable attractions and much less built-in incentive to expenditure because through a local sales tax almost everybody pays and therefore everybody has some motive for seeking to restrain expenditures from which they may also be benefiting. That is too big an issue with which to detain your Lordships this afternoon. I am sure that it is good that we in this House should be discussing a matter which is of grave concern to a great many of our fellow citizens.

I know that later this session we shall probably be discussing it perhaps in a less restrained and less genial mood than we are this afternoon. I hope that I am wrong about that but it seems to me at least a possibility. I feel that, in a much longer term, we are on to a real point as to the relationship between the financial base of local authorities, the way in which they raise their revenue, and the electoral system under which decisions to raise that revenue are taken.

Lord Aylestone

My Lords, I, too, should like to congratulate the noble Lord, Lord Evans of Claughton, for choosing this subject this afternoon. He has a considerable experience in local authority work. Mine is considerably less—only a matter of a couple of years before the war. That experience left me with one or two firm views. One—I think it is quite in order for me to mention it in a debate on local authority reform—was the inequality of the system of paying rates or, from the point of view of the local authority, raising rates.

To give an example: two identical houses next door to each other in the same road or street. One occupied by an aged couple, perhaps retired, living on pension; and the other occupied by a middle aged couple with maybe three sons or a daughter or two working. Both pay the same rates. This cannot be right; it cannot be equitable.

The noble Lord, Lord Boyd-Carpenter, mentioned the fact that businesses are completely disfranchised in relation to paying rates; but so are very many other people. This is, I suppose, an argument for a local authority rates tax. I have not studied that sufficiently to comment on it but I think something needs to be done and maybe there will be an opportunity later in the year when we discuss the impending Local Government Finance Bill. We know very little at the moment of its absolute detail, but as far as we can see at the moment I should think the local authorities' view of the present Government is at an all-time low, judging from the letters received from various local authorities.

I have an interest to declare in this debate in that I am a member of the National Committee for Electoral Reform, and have been for some time. I think one sometimes makes the mistake of thinking of local authorities as miniature parliaments. Perhaps in one sense it is not a mistake because they are a local parliament of some sort but they do not have to function entirely in line with any particular Government and anything that takes away from the local authority the powers it has had over finance or anything else does in fact damage local democracy.

I think one of the ways of putting that right is to ensure that some of the people who serve a local authority well under a different electoral system have a reasonable chance of being re-elected even if the political swings of the day are against them. How often have we seen good local authorities disappear— or a third of them—at an election simply because there is a swing in national politics? That cannot be right and I favour a form of proportional representation, though not necessarily of the kind which was mentioned by the noble Lord, Lord Evans, or yet AMS. There are many countries in the world who have adopted proportional representation systems which are special for their own country. I know the noble Lord, Lord Boyd-Carpenter, refers to them as "fancy forms of franchise". But those countries do not think so. They work them and they understand them. I do not think any less of our own people than I do of the people in those countries who understand them and have applied a great deal of thought to them and after perhaps a trial at one or two elections find them quite easy to work.

Our local authorities are composed of well-meaning people, many of them hard-working political individuals and many of them not; although I must admit I am always a little suspicious of those candidates who call themselves "ratepayers" or who canvass under another name. I think that a form of proportional representation, not necessarily the STV, would be rather better than the first-past-the-post system which we now adopt nationally and for local authorities. I would go further and say it would probably work out equally well in national politics, given the chance; but we certainly ought to experiment and we ought to try at local authority level if that is the view of the country.

One can give many examples, as the noble Lord, Lord Evans, has done. I will give one example from my own county of Surrey. Last year in the county council election just over half the votes were polled by the Conservative Party—in fact, 51.5 per cent. of the votes—but that gave them 82.4 per cent. of the seats: 61 seats. Labour have never had a Member of Parliament for Surrey. They do not poll badly and in last year's county council election they got 20.5 per cent. of the votes, which gave them 9.5 per cent. of the seats, or seven seats, as against the Conservatives' 61.

Here again is another anomaly, because the Liberals, having polled more votes than the Labour Party, got three seats less. No one can argue that this electoral system is in any way fair and I see no reason why we should not try PR in areas like that. If one looks at the national position, of course, one can go on and on and it becomes much worse. Glasgow has 13 constituencies, only one of which is held by the Conservative Party; but they got 26 per cent. of the votes in Glasgow and therefore should have been entitled to something like three Parliamentary seats. I know the noble Lord, Lord Underhill, will oppose this. The Labour Party always has and the Conservative Party always has, at official level; but there are very many members of both parties who are prepared to give PR a trial.

Again in Surrey, the position, as I have already said, is that the Labour Party have never had a single seat but they always get reasonably good votes. If one looks overall at the country as to what the view of the country is on PR on an opinion poll—and I will be the first to admit that the answers in opinion polls depend on the questions put—in a 1978 opinion poll, 72 per cent. of Labour voters were in favour of some form of PR for local authorities, 69 per cent. of Conservative voters favoured it and, as was to be expected, 88 per cent. of the Liberals. Everyone who studies election results will know that we have had Governments in this country which have become Governments on the basis of fewer votes overall than those of the main opposition. If one looks at the other side of the coin, you have the position where the opposition have had more votes and remained in opposition and so it goes on.

If one wants to look for examples, there is the Republic of Ireland. People there may be politically conscious, but I think we are too. PR works there extremely well and although the noble Lord, Lord Evans, has mentioned the single transferable vote, I would repeat what I said earlier; there are other systems which could be tried out which would be a matter for the Government of the day. One hears the criticism that proportional representation is too difficult to operate for our electorate. Why? Why are our electors different from those of Italy, France, Switzerland and many other countries? They are not. I should have thought they were equally intelligent; in fact if they can fill out a football coupon many of them can vote for PR.

Again, the noble Lord, Lord Boyd-Carpenter, made a veiled reference—I hope I am not unfair—to the fact that changes in electoral law are not always welcome. It is true. Of course we did get rid of the business vote and the university vote, but we got nearer, as a result of doing that, to one man, one vote, which to me at any rate is an extremely good principle.

The noble Lord, Lord Underhill, mentioned the privilege which would be in the hands of a national agent who, if the system worked, could in fact so manipulate things that he could put into constituencies the people he wanted there. As an old Chief Whip, I should like to have had that choice myself on some occasions; I am not sure that the Labour Party would not like it at the present moment. I was reminded while the noble Lord, Lord Underhill, spoke of a happening—I hope it is true—concerning a former colleague of his (a national agent no longer with us) being telephoned one morning, and the message went something like this: Our good colleague, the Member of Parliament for so and so, has died. May I take his place? The national agent's reply was: Yes, if you can fix it up with the undertaker". There is privilege in the hands of national agents. There is privilege in the hands of Chief Whips. We know that. But we do not think that any of them operate the system so badly, and we do not think that they will operate it any differently if we have a new system. I am sure that if, as a trial, we adopted a system of proportional representation for local elections, it could prove to be one of the best moves we have made in this field, and it would give local government an opportunity of having, sitting on their councils, a more numerically accurate view and representation of the people whom they seek to represent.

4.1 p.m.

Lord Thorneycroft

My Lords, I also wish to thank the noble Lord, Lord Evans, for introducing this debate in a speech of a great deal of quiet common sense. Indeed, I had the embarrassment of finding myself, at too frequent intervals, somewhat in agreement with what he was saying—not, let me hasten to add, on the electoral system. We are not debating a Bill, we are not debating a Green Paper and we are not making a decision, We are having a debate about a very important topic. I should like to put a proposition, with which I think the noble Lord would agree. The proposition is that a powerful and effective local government is a crucial part of the constitution of this country. If we could start from that position, we should perhaps get a little nearer to agreement.

Power in this country rests upon a directly elected House of Commons, and I share the view of the noble Lord, Lord Underhill, and my noble friend Lord Boyd-Carpenter that it should continue to rest in the hands of a directly elected House of Commons. It is no part of my wish to see that weakened or blurred in any way. I would not wish to see proportional representation introduced there. I would say this to my noble friend Lord Boyd-Carpenter. I quite agree that he and the noble Lord, Lord Underhill, have smashed the case for PR. But I have pondered what would happen to the Social Democratic alliance if it were introduced. They are not even agreed about the form that it would take. But if it were introduced immediately after they were put into power, the alliance would split from top to bottom. They are already divided into a kind of upstairs-downstairs compartment, and do not tell me that, if they all had the opportunity to stand against each other, the Liberals of the West of England would sit down with Social Democratic candidates, after introducing a system especially designed to enable them to play their part. So there are aspects of the matter which should not be lightly dismissed by my noble friend.

A powerful House of Commons must be buttressed, on the one hand, by a strong local government and, on the other hand, by an effective and strong second Chamber. At this moment, these aspects of the constitution are not, to my mind, in a very happy condition. I would not say a word against Her Majesty's Government—my noble friend Lord Bellwin knows me too well for that—but I am bound to tell him that, if you canvass opinion at all widely in this country at the moment, you will find there are very few of those with any knowledge at all of local government, who do not take the view that it is the purpose of Her Majesty's Government greatly to erode their powers. I do not think my noble friend would quarrel much with that expression of opinion, and I think the Government must work extremely hard to counter that general view in the country.

There are others, who do not include either the noble Lord, Lord Evans, or the noble Lord, Lord Underhill, who want to make fundamental structural changes. Their views are widely canvassed in the Social Democratic Party; it is called decentralisation, regional government and the rest. That would be a very major change indeed, and we ought to be extremely careful —and I agree with the noble Lord, Lord Underhill, on this matter—before we embark on any course of that kind. Then there is the Labour Party which wishes, quite simply, to abolish the House of Lords.

I regard this situation in the country as a dangerous one, because, from one quarter or another, I see threats to all the built-in safeguards to the exercise of power in this country. I would say to my leaders in the Government here, that if the Conservative Government in the second half of this Parliament could concentrate upon strengthening local government and, so far as possible, putting in some built-in safeguards, as well as strengthening the House of Lords, they would be taking two forms of action which could pay very substantial dividends for all parties, and for this country, in the years to come.

I accept that there are many faults in local government. I am bound to say I do not think it is true that local government's handling of its affairs, from a financial point of view, is any worse than that of central Government. I accept that one can debate the actual figures, but it is certain that all over this country at the present time, with all the difficulties that are going on, there are thousands of men and women, some officials in local government and some elected members of local government, who are playing an enormously important part in the way our affairs are conducted.

Of course this system is abused and, like all systems, is is wide open to abuse. I must tell the noble Lord, Lord Underhill, that I am afraid it is abused fairly widely in certain—though not, by any means, in all— Labour-controlled areas, such as the West Midlands, Manchester and London. I do not think anybody who is a democrat, looking at those areas, would say that the system is being run rightly. The method of abuse is quite simple. What you do is you raise the rates, you absolve as many of your own supporters as you can from paying the rates, you bleed white the industries that are there, even though you may destroy the city centre in the process, and you employ as many men, tied voters, as you can in the service of the local authority.

That in broad terms is the technique. It is now brilliantly exploited in many parts of the country, particularly in Manchester and, deplorably, in Sheffield. Many of these proud corporations, such as Sheffield, for year after year were governed by the old Labour Party, and governed very well. Some of the Labour members there are as depressed as I am at the prospect and sight of what is happening at the present time in those areas. Men are ashamed of what they see. But it would be wrong to judge the whole of local government on those examples.

To come nearer home to London, I played a part with Horace Cutler in fighting very hard on the slogan, "Keep London Out of the Red", which the noble Lord, Lord Underhill, will remember. Noble Lords will recall that we argued, as best we could, that if the election was won by Labour it would not be the old Labour Party, which I knew and respected, with men like Herbert Morrison with whom I was brought up. We said that the Labour Party would be taken over very quickly by the extreme Left. The only thing was that they were taken over more quickly than I had expected. The senior and respectable figures running ILEA were dismissed. People who were utterly unfit, I should have thought, to conduct the education of anybody were put in charge of the education of the children of London. Ken Livingstone—it is not necessary to comment on him, but I myself would not regard him as a person particularly suitable for governing the capital—was very rapidly put in charge.

I deplore these events. I cannot look at what took place with any joy, but I do not look to an Act of Parliament to put it right. That is the last thing I wish to see—even by the judgments of Lord Denning. (I treat this with great respect as it is subject to appeal.) Within the narrow context of what is within or outwith the statute, well and good, but it touches only the fringe of the fundamentals of what is really going on in London. Nor do I look to electoral reform. I would say to the noble Lord, Lord Evans of Claughton, that there is still a perfectly practical and very vigorous opposition. The answer is that we lost the election, but in a democracy it is possible to lose elections. If you lose at one time, the answer is to do better the next time. We lost—true, with a minority of people voting. The answer is to persuade more of them to vote.

Already democracy is working. Already one Labour councillor has resigned, fought an election as a member of the Social Democratic Party and thrashed the official Labour nominee in his own constituency. That is what democracy in this country is about—not fiddling the thing round or trying to correct events by Acts of Parliament which are specially aimed at situations of that kind.

It may be said that all this is well enough but that local government spending is too much and that the system of financing is unfair. This is probably to some extent true. I would say to the Government that before one acts in these difficult areas one really has to think most deeply about where one is going. Talk goes on about freezing the business rates. It sounds wonderful, but who then pays? The domestic ratepayers then pay and you end up in a worse position than the one you started in. Or people talk about abolishing the rates. My noble friend Lord Bellwin knows that I have always thought that this is a most incredible thing to say until one has thought out what one is going to put in their place. If you abolish the rates and put taxation in their place, it results in .8 billion on top of the tax bill. This is difficult if a Government are trying to reduce taxation, and it is the end of local government as we know it in this country.

These are the realities. These are the fundamentals of local government. Therefore it is necessary to consider very carefully what can be put in place of the existing rating system—though not, I think, another inquiry. Layfield went into the matter with tremendous thoroughness. There is great knowledge in Government, in all parties, on this subject.

What, then, are the objectives—short-term and longterm—which we should go for? The short-term objective of the Government, I understand, is the control of Government spending. Obviously we control the grant which we pay. I am not talking about punitive control. I am talking about the ordinary control of the grant which we pay. This we have always been able to do. So far as I understand it, we control capital expenditure. Certainly the Secretary of State for the Environment was demonstrating this very clearly the other day. It is the control of current expenditure above that level and raised by rates which is in question.

It may be very bad that people spend too much money. I certainly dislike high rates. I need a bit of persuading that current expenditure matched by rates has any effect upon the public sector borrowing requirement (I am bound to say I find it frightfully difficult to see how it could) or upon M3, or upon any other of the local gods who run around at the present time. At least let us be clear what it is that we are trying to correct. If this is something fundamental to the British economy let us say so and let us be made to understand it. If it is merely the overspending by authorities—the raising of rates, which I am as keen to oppose as anybody else—let us say that, because the measures one adopts in these two different circumstances can be very different indeed.

In the longer term I assume that our objective is that we should seek to see that all voters pay something towards the cost of what they are voting for. We want to see that this is as fairly balanced throughout the voting population as can be contrived. It is to that that I think we should give our mind—not at this moment, at any rate, by changes in the electoral system which, though interesting, divert us from these fundamentals, not by uprooting the whole system and starting once again, attractive though these ideas may be. All of us, of whatever party we belong to, have got enough on our plates at present in local government without taking on any more. I am, as the House may know, a conservative. I believe in conserving local government. I believe in conserving what we have got and making the best of it. Above all, I believe in conserving the interests, the energies, of the thousands of men and women who are working today on that side of our affairs.

4.17 p.m.

Lord Hill of Luton

My Lords, it will, I know, sound pedestrian after so powerful a speech as the one to which we have just listened and in a debate so admirably opened by the noble Lord, Lord Evans of Claughton, which led inevitably and properly to an emphasis on the electoral system aspect of the subject which he raised, but I want to follow one point (which I shall do briefly) that he raised in the first half of his speech in relation to needed local government reform. Let me say at once that I hope that whenever a useful reform is under consideration we shall not for years ahead be confronted by the argument that we cannot afford it. However, there is one aspect of the changes which came into operation in 1974 that I think demands early attention: the decision to destroy county boroughs in the medium sized towns—in other words, to depart from a unitary system to a divided system. I believe that over the years the evidence has accumulated that that system is not working well, is not serving the community well— indeed, is proving confusing and difficult and is tending to be destructive of the confidence of ordinary people in the local government machine.

I know that changes in the system may from time to time be made, but I want to concentrate on the division that was established by that Act. The ordinary citizen goes to his town hall, perhaps because he is concerned over a housing problem, or a home help problem, or a host of other problems such as danger to his property from a proposed traffic development. Before 1974 he might not have been satisfied with the answer he was given but almost always he got that answer at the town hall. Now what is he told? "Go to the county hall"—often miles away. Or, "Go to the local sub-office of the county". He is so often put off and sent to so many places that it is not surprising that he tends to regard local government officers as bureaucrats who do nothing but push him along the machine rather than meet his request for help.

I intend to be very brief but I hope that nothing that is said about the difficulties and dangers of reform, the need to think out everything with great care, will prevent a re-examination of the decision to destroy those county boroughs. I know it is a long time ago, but I once worked in a county borough; I was deputy medical officer of health for Oxford and I saw it at work—a town of 75,000 with a complete range of services, including an infectious disease hospital, tuberculosis hospitals, a general hospital, housing, the whole lot; and it worked exceedingly well. I do not pretend that it should have continued unchanged. I do not think that county boroughs were appropriate as hospital authorities and I believe that the solution that was produced, with great credit, by Nye Bevan—the solution of the hospital service removed from local government —was the right one. But I have no doubt from my experience, long ago as it was, that that system works exceedingly well, particularly from the point of view of the members of the community. So I would ask that this is not lost sight of and that an examination is made, bearing in mind not only whether it suits the authority but whether it suits the members of the public it is supposed to serve.

One last thought came to me while the noble Lord, Lord Thorneycroft, was speaking. I think that since the war—and I speak of all inside politics and outside politics—we have all been a bit bemused by and a bit reverent to certain words—"co-ordination", "correlation", "economies of size" the merits of the big organisation over the small. Many of the arguments have been rumbled, even though we may ourselves have listened to them with sympathy, or even used them, in the past. Bigness is now seen as the source of more troubles than it solves. There is a desire to look afresh at local government as well as to every other development in our social life. We have been deluded by ourselves too long to believe all these ideas about collaboration, co-ordination, and so on.

Let us look at the situation afresh and at this particular part of local government structure, which is only seven years or so old; at the destruction of the unitary authority for medium towns, which was the county borough, and the development that we now have in its place. It is something that is far less satisfactory to the people it seeks to serve. When the people are dissatisfied with an organisation they tend to blame individuals, and I believe local government suffers from a criticism that rightly belongs to those who created the administrative structure in which local authority works.

4.24 p.m.

Lord Holderness

My Lords, I want briefly to support that part of the case of the noble Lord, Lord Evans of Claughton, which related to electoral reform in local government. In doing so I am sorry, but not wholly surprised, to find myself in conflict with my noble friends Lord Thorneycroft and Lord Boyd-Carpenter, with whom on almost every other subject I am virtually in complete agreement. For several years before I left another place, and particularly after my membership of the commission chaired by my noble friend Lord Blake, I became convinced that the case for changing the method of electing Members of Parliament was strong; the case for electing Members of the European Parliament by some kind of proportional representation was stronger, and the case for electoral reform in the field of local government was the strongest of all.

The noble Lord, Lord Aylestone, has already pointed out the situation in parliamentary elections—and there have been two fairly recent experiences: in 1951 and then the first election of 1974 when the party that won in terms of seats had received the fewer popular votes. Those are two examples in 30 years. Examples of this kind of anomaly in the field of local government are, as the noble Lord, Lord Evans, pointed out at the beginning of our debate, far more frequent and he also drew attention, as did another noble Lord, to other anomalies which have occurred where the proportions of votes and seats are wholly unmatched; and they both pointed out that there are parts of the country where the winner takes all, or nearly all, and the loser is barely represented.

I find it difficult to understand, particularly after listening to the speeches of such lovers of democracy—and I am not in the least being insincere—as the noble Lord, Lord Underhill, and my noble friends, that they can take the view that these whimsical results of our present electoral system do not make a nonsense of the concept of democracy as we understand it and which most of us very sincerely support. Indeed, I hope most of us in your Lordships' House do so. Most of us also dislike the idea of one-party government and I hope that, even without a reform of the electoral system which elects another place, we shall succeed in avoiding an elective dictatorship by one party in another place. But in many areas of local government the virtual rule by one party is distressingly common.

In spite of what the noble Lord, Lord Evans, said at the beginning of our debate, I never cease to be amazed by the determination of thousands of voters at local government elections—and indeed millions of voters at parliamentary elections—who are well aware as they go about their business of voting that their activity on polling day will not make any difference whatsoever to the eventual result; I admire even the 15 per cent., the 30 per cent. or the 50 per cent., which he mentioned who vote in local government elections, a large proportion of whom realise that their vote will make no difference at all.

Among many others, no doubt, I deeply regretted the almost universal introduction of party politics into local government. I think we all realise that there are a number of local issues that properly reflect the national divisions between political parties, but there are a great many issues which do not reflect those divisions at all and to my mind the development of voting under strict party discipline and of elections on rigid party lines are unhealthy changes since the end of the last war.

Nevertheless, I believe it wise to try to be realistic, and it is certainly realistic to accept that party politics in local government is here to stay and it is probably more constructive to look for ways to try to remove the rougher edges of the local party battle in order to encourage—and indeed to compel—the greater degree of co-operation between the parties on which good local government is bound to depend. I believe this will happen only when elected councillors have a greater responsibility towards all the electors who vote in local government elections and not merely to that section of the electorate whose votes lead to their victory. I do not believe we shall see such a healthy growth in responsibility without some reform of the electoral method.

The noble Lord, Lord Underhill, and my noble friend Lord Boyd-Carpenter made what seemed to be criticisms of a list system. The system suggested for this part of our electoral activity by the noble Lord, Lord Evans, was not a list system; it was the single transferable vote, and this is the system which I believe would make sense in local government elections. It is often criticised, as the noble Lord, Lord Aylestone, said, for its complications and its alleged incomprehensibility, but I believe that its difficulties, if such there be, are for the experienced and trained counters of votes rather than for the voters themselves. As the noble Lord, Lord Aylestone, said, anyone who can fill in an approved form would surely not find it very difficult to express a preference for Mr. A over Mr. C or Mr. C over Mrs. B and so on. This does not seem to be a very great difficulty for an intelligent electorate.

I believe that a more serious objection against the single transferable vote, certainly in the case of parliamentary elections, is the large size of constituencies that would be involved, and the constituencies would naturally be far larger in the case of elections to the European Parliament. But, as the noble Lord pointed out, multi-member wards, as we all know, are already an accepted feature of local government, and it is surely there that the single transferable vote will much more easily replace the present system with its, in my opinion, wholly undemocratic results. Therefore, I hope that my honourable friends and Her Majesty's Government will recognise that the arguments for a change in the method of local government elections are stronger than in any other area, because it is here that the need is greatest and it is here that the present anomalies are far the most disquieting. I hope that we shall at least be given the assurance that the arguments will be seriously considered. As many noble Lords have already pointed out, local government has had and is having to bear at present a great many burdens, and I believe that electoral reform is one method by which those burdens can be perceptibly lightened.

4.33 p.m.

Lord Houghton of Sowerby

My Lords, as the noble Lord, Lord Thorneycroft, said a few moments ago, we are not yet discussing a Bill on local government finance, nor are we discussing a Green Paper on the options we may have on local taxation. Nevertheless, it is very difficult to avoid anticipating them in at least some respects.

I am rather surprised that, with all the experience of local government on these Benches here, only the noble Lord, Lord Underhill, and myself have volunteered to come forward to speak in this debate. Probably my noble friend Lord Underhill is less of a volunteer than I am, because he is our Front Bench spokesman.

Lord Boyd-Carpenter

He is a conscript.

Lord Houghton of Sowerby

My Lords, I have never disagreed more with our Front Bench spokesman than I have disagreed with him this afternoon. Indeed, we have some curious alliances going on here today. When my noble friend is taken to the bosom of the noble Lord, Lord Boyd-Carpenter, and embraced by the noble Lord, Lord Thorneycroft, I begin to think there is something wrong somewhere. I do not propose to be embraced by anybody except the noble Lord, Lord Holderness, with whom I find myself in such warm agreement.

Perhaps I may say how intrigued I am to be followed in this debate by the noble Duke, the Duke of Portland, because when I first became a junior tax officer in the Mansfield tax office one of the first jobs I was given to do was to examine the property maintenance claim for taxation purposes of the Welbeck Estates. This was an enormous job, because it was an enormous estate, with a gigantic rent roll which, in the astronomical figures of the day, was beyond my wildest dreams. I remember the noble Duke's agent, T. Warner Turner; I remember that man; I remember his authoritative signature and I remember the standing he had in the locality. In fact, I was dealing with the property maintenance claims of quite a number of noble Lords who then occupied luxurious accommodation in what was called The Dukeries. Well, that is a personal reminiscence which I hope the House will permit me. After all, these things do come back, and from then until now I never ever thought that I should be followed in a debate in your Lordships' House by the Duke of Portland.

To return to the serious business, I think there are two issues affecting local government which come to the fore; one is the franchise and the other is finance. I do agree with the noble Lord, Lord Holderness, and the noble Lord, Lord Aylestone, that some change in the electoral system is really imperative, for a large number of reasons which I think it would take too long to dwell upon this afternoon. Let me mention one of them. I served on the Salmon Commission on Standards of Conduct in Public Life. The noble and learned Lord, Lord Salmon, was in his place a little earlier this afternoon. One thing we found was the danger of corruption in the 100 per cent. controlled local authorities. There were numerous examples of that following upon the Poulson scandals, which really led to the appointment of the Royal Commission in the first place.

There should be an electoral system which breaks up the monopoly control by one party in the local authority when there is a substantial vote against that party at the polling stations. We had councils where minorities of quite substantial numbers had no representation on the local authority at all. We heard evidence of the aggressive behaviour of monopoly power on councils which had had one-party rule year after year, almost decade after decade. That was not democracy. They were not people of clear-cut independent views. If you had a clear-cut independent view, you were not part of the majority power and you failed at the next election, even if you were not ejected before that. What chance has the clear-cut independent member got in local government elections today? In many areas, very little indeed. We hear talk about lists; there are lists now. That is one of the dangers of the present system—that if you are on the list you may get elected, and others do not come in at all. So I think that the franchise is a serious matter and cannot be brushed aside.

I know what the Labour Party feel about this. They were against proportional representation for European elections, not because they were against it for those elections, because all the other countries in the European Economic Community were adopting the same system: their fear was that it was the thin end of the wedge, and my noble friend said as much this afternoon. When the noble Lord, Lord Holderness, pleads for some change in the electoral system for local government, probably apart from the need for a change in the electoral system for central government, he is overlooking the fact that my noble friend Lord Underhill, representing the authentic voice of the Labour Party, will in fact be more afraid of introducing any change in the first-past-the-post system for local government, on the ground that it would be the thinner or thicker end of the wedge. That is what they are anxious to prevent.

I agree with the noble Lord, Lord Holderness, that in local government the citizen is closer to the elected representative over a wider area of important matters of concern to him—his environment and what he sees as he goes about the town. Indeed, local matters occupy a great deal of space in newspapers and excite a great deal of controversy and emotion. Therefore, I am strongly in favour of a change in the electoral system. There are methods which can be adopted which will be better than having an electoral system—which we have at present—which can sweep one party wholly out of office and another party wholly in on a marginal change in the attitude of the local electors as a body. That, think, is very important.

In passing, I ask why is it necessary to talk of a referendum to decide on a matter of local government policy? I shall tell your Lordships: it is because there is not sufficient confidence in the representativeness of the local authority under the existing electoral system. They want to go beyond the elected representatives to the voters directly because they will not accept the judgment of the voters or the will of the voters expressed through the existing electoral system. If we had an electoral system which produced a more representative form of government for local authorities there would not be any need to have a referendum, certainly not on a narrow issue affecting the level of rates.

I shall leave the matter of the franchise because I do not want to take up too much time and I shall move on to deal with finance. I think that rates as a form of taxation are now too high to rest upon the principle which was good enough when they were introduced; namely, a tax on the occupation of land and premises. That is too narrow a base now for taxation in view of the level which rates have now reached. As the noble Lord, Lord Boyd-Carpenter, pointed out, many who have votes do not pay; others who have enterprises pay, but have no votes. The noble Lord, Lord Thorneycroft, emphasised that point too. It is one of the fundamental rules of taxation that those who can vote for it should pay their share towards it or be exempted on grounds which are approved for exemption and are not the technical grounds of whether they occupy a particular premises or not: it must be based on something more relative and more fair, applying the principle of ability to pay.

Therefore, I certainly think that rates must be looked at, although I confess again that I served on the Royal Commission on the Constitution and we looked long and hard at alternatives to the rating system and were not impressed with what we looked at, certainly not as regards local taxation or, for example, local income tax. However, much water has flowed under the bridge since than and I think that we must wait and see what the Government can produce in the Green Paper.

I should like to mention one other matter. I think that something should be done to assist the candidature of those who wish to offer themselves for election at local government level. Those councillors are unpaid; they cannot save money out of their stipends or expenses; in many cases they do not have the type of wholehearted backing of adequately financed local parties to give them the resources they need to put their case before the public. I thought that the Committee on Aids to Political Parties, of which I was chairman, did put in a pretty good recommendation on assisting both parliamentary and local government candidates with their expenses up to one half of the permitted maximum if they gained enough votes to save their deposit—that would be one-eighth of the votes cast. Such a proposal would be some incentive to candidates to stand for election if they felt that they had enough local support to justify their candidature.

As regards the general framework of local government, I do not think that we can begin to pull that to pieces yet. Indeed, 1974, in terms of experience of a drastically changed structure of local government, was not so long ago. I think that we must wait for the terrible year of 1984—when disaster is likely to befall all and sundry including Her Majesty's Government—and give 10 years to our existing local government structure before we can begin to examine it with any hope of getting a better judgment for the future.

In my old constituency of Sowerby I had six local authorities and at local elections they nearly all had a higher poll—a much higher poll—than county boroughs in the neighbourhood like Halifax and elsewhere. I put that down to the fact that there is a good deal of local loyalty; politics obtruded far less on the elections in local authorities in my constituency than in many others; and there was a feeling that they were electing people with a point of view not too hidebound by their known or unknown political bias. I think that the new local government arrangements have deprived the area of something of that quality of local government.

In general, I am in favour of more democracy even at the expense of efficiency. That is probably a wild statement to make, because inefficiency can really be a bad thing in local government as elsewhere. But to have local government which becomes a bureaucracy, however efficient, will be to lose a great deal of its response to the will, the enthusiasm and loyalty of the local electors.

This has been a wide-ranging debate and as the noble Lord, Lord Thorneycroft, has said, we are neither debating things that have come before us nor have we a Motion that will register a decision. All I can suggest to the noble Lord, Lord Evans of Claughton, is that he should ask for those Papers—what a big bundle they would be!

4.48 p.m.

The Duke of Portland

My Lords, the noble Lord, Lord Houghton of Sowerby, began his speech, which was listened to with great interest, by mentioning his task as an inspector of taxes when he had to deal with the taxation of the Welbeck Estates. I wish to take the opportunity to mention that not one penny has come to me from the Welbeck Estates. I should like to mention that, otherwise I fear that this forthcoming week my postbag will be heavier than usual with requests for donations which I shall, with reget, be unable to fulfil.

I venture to remind your Lordships that at the last election of the Greater London Council the Conservative Party received 39§8 per cent. of the votes, but only 41 seats. The Labour Party received 41§8 per cent. of the votes and 50 seats. The Liberals obtained one seat. If the election had taken place with proportional representation, the Conservatives would have had 43 seats; Labour, 45 seats; and the Liberals, plus, perhaps, the Social Democrats, four seats. Thus, with proportional representation, Mr. Kenneth Livingstone and his caucus would not have enjoyed complete freedom for their pernicious activities.

4.49 p.m.

Lord Sefton of Garston

My Lords, I apologise for not having put my name down on the list of speakers in this debate, but I abstained for a specific purpose. I thought that, with all the varied experience of the speakers this afternoon, the points which I wished to make would be made and I was reluctant to delay the rising of the House beyond a reasonable time, particularly in view of the event that will take place on television at 7.30, which I am sure will interest your Lordships.

I am stunned into making a contribution to the debate—as I suppose I could be termed a volunteer—and to follow the noble Lord, Lord Houghton, because of his reference to the question of corruption in local government. Anyone sitting in our Galleries or listening to the debate—and I very much think that tomorrow the papers will pick up the question of corruption in local government and highlight that as part of the debate—would have come to the conclusion that, perhaps in local government more than in any other activity in this country, did corruption reign, and in particular in those authorities with a monopoly of power. I consider that to be a defamation of a band of well-intentioned, hard-working and sincere members of local authorities.

Was there no corruption in the Civil Service? Was there no corruption in the police force in the Metropolitan area? Was there no corruption on the Benches of the House of Commons? Was there no widespread corruption throughout the private sector, which ultimately led to the downfall of a political leader in a certain part of this country, at which I have no doubt that some Members of this House were hinting? Is it not a fact that of all the corruption that has existed and been exposed in the corporate life of this nation, that which can be attributed to local government is very insignificant indeed? And it is: it is a very insignificant proportion of some of the evil forces that are wandering through our nation. I utterly and completely resent and reject the concept that corruption has become so widespread because of the monopoly of power of one political party in a local authority. The whole of those local authorities were not corrupt, but just one or two men—one bad apple in a full barrel—and the rest were perfectly upstanding men and women, who had probably given their lives to the service of local government.

I think that we should stop this defamation of councillors. I am a volunteer now because I received—as no doubt other vice-presidents of the AMA received—a briefing by the AMA. My noble friend Lord Evans referred to the question of erosion of power. According to the AMA, it seemed to start in about 1974. The AMA specifically says that it started in 1974 and in this last decade there has been an erosion of power "beginning in 1974". I quote from their brief. Nothing could be further from the truth. The erosion of power began long before that—and mark this—partly due to the fault of local government. It began when the services that were being carried out by local authorities were no longer applicable to the kind of areas that they governed.

Before the war it was becoming quite apparent—and did become apparent—that the manufacture and generation of electricity and the distribution of gas and these networks, some of which were carried out by local authorities, were not suitable to be carried out by the local authorities whose area covered only a small part of the operational area. So they were taken away. That situation also applied to hospitals, the training of nurses and the training of doctors. It became necessary to take that function away from local authorities and to put it in the hands of someone else.

That is where the erosion started. It started simply because local government at that time would not face the practicalities of life, would not change and adapt to meet the new challenges. Perhaps I could take a much closer example and one that is more current. Why were the watch committees abolished? Why did there occur the erosion of power from local authorities in the conduct of our police force activities in such a splendid and glorious way for such a long time? It took place because some local authorities did not have the ability or willingness to see that no longer in a modern age could police forces be utilised in a sensible fashion on the basis of the old boroughs, for which we have had such a wonderful appeal. The Police Act 1964 came 10 years before the date for the erosion of power as laid down by the AMA. But in specific terms it certainly began the erosion of power that has now led to all the discontent that exists on Merseyside, in Brixton and elsewhere. The reason—and I repeat it—was because of the desire of certain local authorities to retain their organisation, which had become an end in itself.

I completely and utterly support my noble friend Lord Underhill when he says that if we talk about government of a country and of our community, the major question to look at is that of all the ad hoc bodies which are controlling our affairs, the affairs that matter. We must examine them to see how we can introduce a democratic element into the administration of those affairs. Let me give an example. During the winter on Merseyside we have a tremendous problem of people suffering from hypothermia. Only thousands of pounds could save many, many lives. Of course, on Merseyside we are subject to the dictates, for example, of the North-West Water Authority. The water authority may well decide that out of public funds they would take £2 million towards the cleaning up of the Mersey, and within their terms of reference they are perfectly entitled to do so. But, in the language of Merseyside, it is a cockeyed way of deciding priorities if one public authority decides to spend £2 million on cleaning up the Mersey, from which no one would die, and the health authority is starved of a few thousand pounds to alleviate the problem of hypothermia.

Yet if one looks at the structure that has been built up to govern these facilities one finds no democratic input. The final priority decision is probably taken by the Treasury on the basis of sheer hard cash. Is there not a case for saying that in determining priorities within a national budget, within the locality there should be means by which the democratic structure should feed into these bodies the wishes of the people in the locality? I say no more than that. It is obvious that there is such a need, because that is the real reason why local government is in disrepute; that is the real reason why sometimes only 25 per cent. of the population bother to go out and put a cross on a ballot paper. It is because they no longer believe that local government is relevant to how they earn their living. Somehow some measures must be adopted to bring back that relevance. It is perhaps the most important point to be debated.

When we talk about the question of devolution—real devolution, devolution of power that will control priorities between spending authorities—it is a nonsense to talk about it on the basis of arbitrary boundaries which were probably laid down hundreds of years ago merely because a boundary of a local authority ran alongside a hedge or a stream. It becomes more ludicrous when you talk about devolution to a place like Wales, and you think that the area around Cardiff is more socially and economically inclined to the south of England, and the area around Flint, Mold and North-East Wales has an identity of interest with Merseyside. To talk about the economic planning of North Wales and still leave the boundary of Wales across it is a nonsense, and the sooner we face that the better and reject completely and utterly the idea that because a boundary was laid down by some warring factions a few hundred years back, we should still retain that boundary for the operation of local government. If we do not throw it away, we shall never get a proper redistribution of powers.

The question of PR. I will not say that this is a hoary old subject, but it is a subject that the Liberals have adopted for a few years. Somebody said somewhere that patriotism is the refuge of the scoundrel. Perhaps PR is the refuge of those who cannot get power any way other than through PR. But it will not work. I saw the noble Lord, Lord Evans, nodding in agreement with my noble friend Lord Underhill when he said that the idea of PR was that if you got 53 per cent. of the votes of the electorate you could have 53 per cent. of the power in the council or an area of government. If one looks at the biggest district council on Merseyside one can see that that is pretty well reflected. The membership on the benches of the Liverpool City Council has a closer relationship to the number of votes cast for each individual than perhaps any other district council. I am glad to see that the noble Lord, Lord Evans, agrees with me.

So we have achieved what we would have achieved through PR. My goodness, what have we achieved? There was a period in Liverpool when it was ungovernable. There was a period in Liverpool of several months with the Liberal Party the majority party, where in fact the conduct of the city was in the hands of the local government officers. Now is that a good argument for PR? The truth is that if the Liberals and the Social Democrats by some miracle achieve power at the next election they will not want to listen about PR; they will be content with the present method of electing people to the seats of power. Of course they will. I say reject the concept of PR.

Let me come to my final point. The Motion that we are debating talks about "fairer". Fairer than what? Fairer to whom? The only argument in respect of fairness I have heard this afternoon is fairness to political parties. I always, perhaps wrongly attributed to the Liberal Party an emphasis on the importance of the individual. I have heard Liberal leaders in Liverpool City Council stand and proclaim, almost from the rooftops, that they believe in the power of the individual over party. All I have heard today from the Liberals is of fairness to a party: Why should not they have the same amount of power as they have in votes? What about fairness to people? Ordinary people are not bothered about the niceties of election. They are not bothered really about fairness to political parties. They are bothered about a fair deal for them.

One thing is crying out for a solution, particularly in the area of the country from which both the noble Lord, Lord Evans, and I come; that is, a fairness in distribution of resources. We do not get it. We do not get it in Scotland, in Wales, in Northern Ireland or in the North West of England, simply because we are too far away from the seat of power, and the seat of power is here. If you want fairness in our life, if you want fairness in the distribution of the services and the resources of this nation, then, to quote, I think, the words of the noble Lord Lord, Underhill, we hive to bring power closer to the people. That means that central Government have to surrender the power they have now. We have to establish the right areas and the right institutions to take some of that power. When we begin that road we shall begin to reaffirm our faith in democracy that served us so well for such a long time.

5.4 p.m.

Lord Beaumont of Whitley

My Lords, we are approaching the end of an interesting debate on a fascinating subject. To a certain extent what I hope to do is to comment on a number of things that have been said in this debate, particularly in the field of electoral systems, in the hope that some of the statements that have been made will not necessarily remain as gospel truths in your Lordships' minds or on the pages of Hansard. If I do not take up and comment on all the extremely good speeches that have been made, I hope noble Lords will forgive me.

The noble Lord, Lord Underhill, said that we should not go for the easy solution and the quick answer. There is sometimes too great a prejudice against easy solutions and quick answers. It is considered extremely smart to say that to every complicated question there is a quick and easy solution—which is always wrong! But this in fact is not necessarily true. If I may use a metaphor which I may have cause to resort to again, it seems to me that the noble Lord, Lord Underhill, in looking at the electoral system in local government is rather like a man looking at a generating machine which has broken down and which is producing less and less electricity and more and more faults. You point out to him that in fact there are obviously dangling two loose wires which should be connected, and that that would be the right way to solve the problem. But, no, he says, that would be an easy solution and a quick answer, and it must be something more complicated than that because this is a complicated machine, and it is a complicated world, and we are not going to get around to doing it in that way.

The noble Lord made a number of detailed criticisms of the system of election by the single transferable vote. Some of his arguments were convincing. He said that we would not get true proportionality unless we had the list system; that it was essential for PR; and he pointed out that the list system was an extremely bad system because it results in great dominance by party machines. My Lords, the list system is an extremely bad system. There are few defenders of the list system among those who support proportional representation in this country. There are not very many elsewhere. A few countries have it. Most countries that have it, regret it. No one, so far as I know, considers that a list system is suitable at all for local government. The fact that you do not get absolutely truly proportional representation with another system is a red herring. You get a very much fairer system than you get with our present system, and that would be the point of reform.

The noble Lord also said that in the single transferable vote system the second, third, and fourth preferences have equal priority with first preferences. I regret to say that that is not entirely accurate. Second, third and fourth preferences in the single transferable vote system are weighted so that they do not have equal priority, or greater priority, with first preference votes. It is true, as the noble Lord said, that ruling parties in local government could be elected on less preference votes than the next party. It is very rare, it is very unusual, but I will grant that it could happen. But the reason why it happens when it does happen is because people do not vote straight down the party line, and because they give their second preferences sometimes to a person of a different party from their first preference. Surely that is a thoroughly good and admirable thing in our electoral system.

Finally, the noble Lord produced, as I think did one other noble Lord afterwards, the thin end of the wedge argument. The thin end of the wedge argument has always been an extremely bad one. It has often been exposed, and never better than in the words of Francis Cornford, which some of your Lordships will remember. The argument about the thin end of the wedge is to argue that we should not do what is admittedly right—and it is admittedly right, because we would not use that argument if there was an argument that it was wrong—lest we should be tempted to do something wrong in the future. That has never been, and is not now, a logical argument, and the argument of the thin end of the wedge is one which, when it raises itself in politics, as it so often does, should in my view always be rejected.

The noble Lord, Lord Boyd-Carpenter, attributed certain platitudes about the necessity for the independence of local government to my noble friend Lord Evans. I do not think they were platitudes. I wish they were. If he was saying things about the independence of local government which did not need to be said—if the independence of local government did not need to be defended these days—no one would be happier than myself unless it was possibly himself. But in fact we know that the independence of local government is under attack in various ways—for example, by the various ways in which Mr. Heseltine is trying to cope with his admittedly extremely difficult problems. There was another report on Sunday about the attitude of Sir Keith Joseph to schools in Manchester and his refusal to accept the scheme put forward by Manchester for dealing with the sixth forms in that city, a plan which has been worked on for two and a half years but which is apparently being turned down just like that by central Government.

The noble Lord, Lord Boyd-Carpenter, said that if we had separate systems of election for local government and national government, we should have a greater clash between national and local government. That sounds extremely persuasive but I suggest that it is not so. One thing we should avoid is the classic swing against the sitting national Government in the middle of that Government's reign, which changes the whole face of local government all over the country and has absolutely nothing to do with local preferences, local people and local policies. Throughout the country there would be more and more coalitions in power in local government, and that is a recipe for not having clashes between national and local government.

Lord Boyd-Carpenter

My Lords, the noble Lord has taken me to task for referring to the speech of his noble friend as containing platitudes about the independence of local government, and he went on to quote the action of the present Secretary of State for Education in rejecting Manchester City Council's proposals on sixth forms. Would the noble Lord agree that, whether Sir Keith was right or wrong in that, as an interference in the rights of local government, that pales into insignificance as compared with the action of Mrs. Shirley Williams in seeking to dictate to all local authorities that they should abolish their selective grammar schools? And, as Mrs. Williams is now apparently a friend of his, perhaps that is a rather helpful example.

Lord Beaumont of Whitley

I entirely agree that we all have our problems, my Lords. I venture to suggest that the noble Lord has rather more problems, if he is really interested in the independence of local government, than any we are likely to find on the Social Democratic Benches in this place, in another place or among those who are shortly to get into another place. But it is a valid point which the noble Lord makes and I would be the last to claim purity in this matter. Liberals in this House are regularly saying—every week and month we are saying it—that we believe in devolution and believe we should give powers to local authorities and leave them there. Having said that, we are used to having other Liberals lobbying us and saying, "But you must make the Government do this", or "You must stop the Government doing that". We reply, "But we are in favour of devolution, remember", to which they reply, "But not in this particular matter". It is true that this is a disease which affects us all. I hope it affects my party and I hope it affects the Social Democrats rather less than it does other parties, but it is a disease and I am not fighting against something which rears its head only in one particular party.

To return to the main argument, what we are fighting for to a certain extent is a resumption of an older pattern of local government where party did not have so strong a sway. That is why it is so disappointing to see so many Tories supporting the new set-up. Noble Lords will remember that in the 'Forties, 'Fifties and early 'Sixties the Tory Party were the first to deplore the greater introduction of party politics into local government. I thought the speech of the noble Lord, Lord Holderness, was particularly pertinent on this point, showing that he belongs to that older tradition which has to a certain extent been abandoned. One of the most interesting bits of the debate was the comments of the noble Lord, Lord Boyd-Carpenter, about the electorate and the problems that are stimulated in that field, one which we have not had time to deal with today but one to which we shall all have to turn our attention rather more.

The noble Lord, Lord Thorneycroft, made a slightly jocular point of the fact that the Liberals and Social Democrats would split after electoral reform. Of course they will. But they will not split between Liberals and Social Democrats. When I look at our two parties, formed as they are to a certain extent by the present electoral system, I detect in each of them old-fashioned Liberals, what one could call Social Democrats on the European model, and radicals. We have all three lots in our parties; we are a coalition, too, and they have them in their party. The Labour Party is also a coalition, as is the Tory Party, a mixture of "wets" and "drys". When there is proportional representation, by STV or any other method, there will be realignment of politics and it will affect us all, and I suggest that will be a good thing.

The noble Lord, Lord Thorneycroft, also said, "Change the face of politics. Change what is happening using the present system", and he took the St. Pancras by-election as an example of what could be done under the present system. Changes can be effected with the present system—at the right moment if things are going right. The last two by-elections in which I worked full-time were Lambeth Central and Croydon, North-West. In each of them we had a good candidate, a good organisation and more or less the same policies. In one we lost our deposit and came below the National Front and in the other we won with an overwhelming majority. It was not, as far as I could see, anything to do with the specific virtues of the people and parties concerned; it was purely a matter of that particular moment. I think we would get away very much from that system if we had a reformed system.

To take the example of my electricity generating machine again, I suggest that the noble Lord, Lord Thorneycroft, is behaving rather like a man who has inherited a very old electricity generating machine, one which has been breaking down on and off, like the previous one I mentioned. Things are not working, there is not much water in the house, the lights keep on breaking down and you say to him, "Would it not be better to have a new machine and get the whole thing working? Then we could run this house properly, do our work and cook our meals". To that he replies, "No, there is no time to do that. We have so many problems on our plate, because we are having to cook our meals without electricity and do our work without lights, that we cannot afford to take the time in order just to change the machine". It is the machine that needs to be changed. It is out-of-date, it is rickety, it never worked particularly well.

I draw my speech to a close by saying that I believe fervently in the need to keep powers in local authorities, and indeed to increase them. I believe that we should shove decisions as far down the line as we can, as was said by the noble Lord, Lord Evans, when quoting the European document. We must resist the temptation to try to solve the problem in all kinds of ways in which the cure is often worse than the disease. Referenda are not intended—I should say, not suited; they can be intended for anything. Referenda are not suited to making decisions about expenditure in local government, and when they are used in that way, as they frequently are in America, for instance, they very often go wrong. As your Lordships will know, recently in America a state has had to close down a large number of its public schools following a referendum on fund raising. That is exactly the kind of system which it appears that Mr. Heseltine is seeking, or is at least playing about with the idea of introducing.

Proportional representation deals with great disadvantages. It corrects low turnout and apathy. Whatever the noble Lord, Lord Sefton of Garston, says, it defends against corruption. It also defends against the lack of opposition, the lack of open democratic debate, and the secrecy which is endemic in local government where there are large majorities. Reform would break down the party spirit, and I as a party hack of long-standing, though not perhaps of quite as long a standing as the noble Lord, Lord Underhill, want to break down that party spirit. Proportional representation assists genuine independence, it fosters continuity of policy. Under it there is no need for referenda. It is seen to be fair. If I may adapt slightly the words of the noble Lord, Lord Sefton, I would say that proportional representation is the refuge of those who cannot get power any other way—the people.

5.23 p.m.

The Parliamentary Under-Secretary of State, Department of the Environment (Lord Bellwin)

My Lords, I wonder whether I may respond to the debate by answering what I considered were three major points that have been made. First, there was a reference to proportional representation, and secondly to the restructuring of local government. Thirdly, there was reference to the interim measure, the finance Bill, that is being proposed. I shall then try to comment as best I can on some of the many observations that have been made during what has been a very interesting debate, and I, too, should like to compliment the noble Lord, Lord Evans of Claughton, on introducing it.

With regard to the issue of proportional representation, after listening to the noble Lord, Lord Underhill, I speak with some temerity, since I found his in-depth knowledge of the subject extremely impressive. Whether or not we agree with his point of view, it behoves us all in future to be very careful when we know that the noble Lord is to participate in a debate in which this particular question is to be discussed. As I say, I found his contribution very impressive.

I have listened with great interest to the whole of the debate because, as your Lordships know, local government is very much my own home ground, and its good health is something about which I care very deeply. I should be the last to maintain that there are no imperfections in its current state of health. The noble Lords, Lord Evans, Lord Beaumont of Whitley and Lord Aylestone, my noble friend Lord Holderness, and one or two other noble Lords, have urged a change in the system of local government elections. We have been told that introduction of the single transferable vote system would help to solve the problems of local government by enabling minorities to gain representation, thus acting as a brake on the headlong progress of political dogmatism. I am sceptical of those high claims for proportional representation, as well as their corollary: that the problems of local government stem from the system of election. Frankly, that seems to me a superficial view. It is not the system of elections that needs to be changed. On the contrary; the difficulties sometimes associated with local government might be far worse if elections were conducted under proportional representation.

Proportional representation supporters tend to fall into the error of assuming that the sole, the only purpose of an electoral system is to ensure that the composition of an elected body reflects as closely as possible the support accorded by the electorate to each political party. If that were all it was about, there might indeed be something to be said for proportional representation. But I respectfully suggest that it is about much more, as the noble Lord, Lord Underhill, so graphically reminded us. I submit that it is about something else. One of the primary purposes of an electoral system is to produce an authority which is responsible; that is, one in which there is an identifiable governing group that has clear policies and which, within the constraints within which authorities must operate, is answerable to the electorate for the decisions that it takes.

However, one of the characteristics of proportional representation is that only rarely does one political party have an overall majority. Where no party has a majority any decision needs the support of members of at least two parties. Coalitions might be formed after an election, based on a programme which the electorate has not had the opportunity to approve or disapprove. Alternatively, there might be a series of shifting, ad hoc coalitions. In either of those situations there is a risk of weak, unstable and perhaps even capricious administration. In neither case would one party be answerable for the local authority's record; each party could pass the buck to others. If the electorate did not like the policies of a local authority, there would be little that it could do about it at the next election because of the slight chance of one party being returned with an overall majority. That is not the way to produce a healthy local democracy.

Another feature of proportional representation is the tendency for minor parties to have an influence quite disproportionate to their size and to the level of their support. It does not take much imagination to foresee the possibility, if proportional representation were introduced to local government elections, of certain parties with views which are deeply abhorrent to the great majority of the electorate gaining a foothold in some local authorities, and perhaps even holding the balance of power. Of course that can happen, and occasionally it happens now. In my experience, and in the kind of position to which the noble Lord, Lord Sefton, referred—and I shall allude a little later to some of his other observations—in certain circumstances, the consequence that I have mentioned leads to a most unworkable and unsatisfactory situation.

I really do not see how it could enhance democracy to change our electoral system to one under which small parties were more likely to hold the balance of power than they are under the present system. The simple majority system is well known, well understood, and simple to operate, and it is more likely than the alternative systems to elect local authorities which are fully accountable to the electorate and responsible for the policies that they pursue. For reasons that I have given I believe that we should be very wary of abandoning the present system.

The noble Lord, Lord Evans, and one or two other noble Lords, spoke about corruption. I had intended to refer to this point later, but I feel as deeply about it as does the noble Lord, Lord Sefton, and so I shall mention it now. I am sure that the noble Lord, Lord Sefton, put the point much better than I could put it, but I felt every bit as deeply as he did. In all the years I was in local government it was heartbreaking to see the prominence and the publicity that was given to what, in the context of the totality of those serving and working in local government, was the tiniest minority; and yet it became so that the whole of local government was looked upon as being corrupt. With great respect to those noble Lords who have mentioned it today—and I know that they did so in another context, but even so—I think that by again bringing this up in this way there is a danger of, in fact, pinning upon local government a reputation which truly it does not deserve and should not have.

Perhaps I may move to the second major subject which has been dealt with; namely, the restructuring of local government. To most people local government reform raises the whole subject of the reform that took place in 1974. Of course, there were reforms long before then, but the one which is in most people's minds and which has made arguably the greatest change was the one in 1974. I know that the those changes came as a shock to many, and in some places even now, after eight years, they have not been fully accepted—and there are those who would say "not unreasonably".

However, in passing the Local Government Act 1972 Parliament provided that after 10 years had elapsed from the date of reorganisation the Local Government Boundary Commission should undertake a review of county boundaries, and also those of London and the metropolitan areas. So from 1984, as the noble Lord, Lord Houghton, reminded us, the commission will be holding its review, hearing representations and considering proposals for change. Their proposals will go to the Secretary of State, who has power to make orders, subject to Parliament, to implement them. That review will be the time for those who are unconvinced of the present arrangements to press the logic of their case for reversion. However, the boundary commission's review will take place within the confines of the structure created by the Local Government Act 1972; there are real limits on the sort of changes possible in that context.

I do not for one moment wish to imply that the Government are in any way complacent about the existing structure. While I must make it clear that the Government have no plans for restructuring, that does not mean that we are entirely satisfied. Whether in relation to London, the metropolitan areas or the shire counties, there are arguments for saying that two-tier government is inherently expensive because of overlap or duplication, and that elimination of one tier or other could reduce these. On that account some have argued—indeed, some did today; for example, the noble Lord, Lord Hill, who always does it so elequently—for "unitary" local authorities, thus eliminating any possibility certainly of duplication between tiers, quite apart from the other attractions that they would have in the sense of their being more local than some of the existing arrangements.

Outside the metropolitan areas, however, that would not support abolition of the counties; it is towards abolition of the districts (with all the objections to making democracy more remote) that this argument leads. Many county services need to be managed over a larger area or a larger population than most non-metropolitan districts as at present constituted could provide. The Redcliffe-Maud Royal Commission concluded that the size of unitary authorities would need to be much nearer to that of counties than districts.

The position is rather different in the metropolitan areas, and in London. In these areas the population of metropolitan districts and London boroughs is large enough to sustain major services. But even in these areas there are arguments both ways. There is the need to plan and manage some services for the area as a whole. Nor is it certain that fragmenting responsibility for services now run by a single authority among a number of districts or boroughs, even where the districts or boroughs joined together to run them, would of itself produce economies. But it is difficult to argue that there is no case for, if you like, abolition of the GLC and the metropolitan counties. I say again, and I say it carefully, that the Government have no present plans to do so, but it is an option which must deserve examination.

I think I would also say on this point, as I finish with it, that the Government feel at the present time that it is far better to tackle local government spending directly, and that this will bring more immediate savings. That is why we have made local government expenditure, not structure, our present priority. Hence the Local Government Finance Bill recently introduced in another place, to which I would now, albeit briefly, make reference.

My right honourable friend the Secretary of State has made plain that we fully understand the concern that certain proposals in the Bill cause to many people. Because of that he has said that we would happily listen to alternatives that might be brought forward. Indeed, he himself listed some of the alternative ways—and let me stress it here because this is really what it is about. It is about the fact that the central Government have their parameters of expenditure within which, in the past, local government always proudly and fairly boasted it kept; and, as your Lordships know, I was one of those who was making the boast at that time and, I hope, was keeping within those parameters. Yet here, for the very first time, we have a situation where we have a £1,000 million—a billion pounds—of over-spend which local government has been unable to contain within the parameters set down by the centre.

The very sad part about it to me is that, having been requested to make adjustments, to revise budgets, the great majority of local government not only tried to do, but in fact did, just that. They showed, first of all, that it could be done, if the will is there, without the catastrophic destruction of services that many had forecast—some diminution here and there, but nothing catastrophic. Yet all the authorities which have done this—and the number, I think, is some 275 or thereabouts—found that all their efforts, they having reduced spending by some £200 million, in round figures, were wiped out by the determination of a number of other authorities. Three alone did not just hold their expenditure but added £189 million more, and others brought it up to around about the same £200 million figure, because they were simply not concerned—and, indeed, some would say they were quite happy to flout what the Government were wanting.

So this was the scenario; this is what the Government were faced with trying to do. How were they to protect, first of all, those who pay the bills, the ratepayers, and, secondly, those who pay the bills and have no votes, the business and the commercial world? Thirdly, and not least, how were they to look after those who in fact tried to conform and tried to fit within the pattern laid down?—because they, no less than anyone else, are entitled to have their interests looked after. So it was faced with that that the Government embarked upon interim measures, of which prior warning had been given as long ago as June that if it was to be so the Government would have no alternative because the sanctity of Parliament must be paramount. No one in any party has ever quarrelled with that, and nor do they now; and I have here quotations from all parties that would confirm that.

So this is the scenario with which the Government were faced, and that is why we have come out with our proposals. We have said that as long as it is quick we will listen to other ways of achieving the same objective. But I must stress this: let it not be said that our willingness to be flexible over the method should be mistaken for flexibility of purpose. We must be quite firm, because in the end we canot escape—in fact, local government cannot escape—the plight of the people to whom I referred a few moments ago.

So I come to the various observations that have been made by noble Lords who have spoken today. While I know that your Lordships will understand that I cannot pick them all up, I will try to make brief observations on some of those parts which I felt were perhaps the more telling, or even the more important. The noble Lord, Lord Evans, referred to the apathy at local elections—and who would doubt that? But, with respect, there is nothing new in that, and certainly nothing done by this Government has made that apathy either greater or less. The record of it goes back quite a time.

He also spoke about the comparison between reduction in local government and central Government expenditures. I think that I can easily dispatch that, but I would prefer, as on many other observations, to keep my powder dry for the many opportunities that I shall have on the Finance Bill. I think that in any case there are enough points that I have to cover tonight without dealing with that one. Likewise, when he said that the rates have risen more slowly than inflation. That may be true of average rates, but all the things that we are talking about in the proposed legislation are not to do with the average authority at all; they are to do with a handful of authorities who are not interested in what happens to their rates or their ratepayers. They are the only ones who would be affected by what we propose in the Bill. Then the noble Lord talked about the desire for restructuring, with which I have already dealt.

The noble Lord, Lord Underhill, in an exceptional speech, as I have said already, said "Restructure? Yes, but be careful". That sums up in one line what I was saying. One must be very careful. There are costs involved and who knows what other problems. Some might say that perhaps a lack of being careful about such major changes have led often to some of the problems that we face today. Yes, the options are there and open; but be careful. I assure you that we will.

I would not dream of trying to pick up the points that the noble Lord, Lord Underhill, made on proportional representations and all that surrounded it. He left me far behind. I shall look forward with interest to reading what he said when I come to that. He warned us of some of the ways in which such a system could be abused. I want to say on the party system that, when I went into local government as an idealist, I thought that the ideal person to go into local government was not the one who belonged to a party. I wanted what I thought the best man for the job to hold the seat. But I learned a great lesson—that the greatest safeguard for the public is the party system. The way we watched what the Labour Party did when they were in power and the way they watched us and what we did when we were in power was a classic example of what can and should happen; and of what is a great safeguard for people who live in areas where power changes. Where it does not change because set parties always win, it is less effective. But there is much scope in the party system which, I think, is excellent in terms of what it does for local government.

My noble friend Lord Boyd-Carpenter approved, as I do, Lord Underhill's analysis. He said that we need more people with clear-cut views who are willing and able to carry them through and that we are less likely to get this and more likely to get anodyne candidates with the system which was commended to us. I agree with that in every way. He said that he would like to see all-party agreement on major structural changes. That would be the ideal. Would that there were other things on which we could get similar agreement. I and others could think of many things where the country as a whole would have benefited by this. This was the case in so many situations in Leeds, my own city, in the days when the parties sat down and agreed on common approaches for the city's benefit. This is why today it is one of the most progressive cities in the country. That is an ideal and is perhaps too much to hope for. On restructuring, of course, if we can get all-party agreement, then my noble friend is so right.

I should like to comment on one thing that he said when referring to the rates of Kensington and Chelsea. In fairness to them—and heaven forbid that I discuss the rates of individual authority—like all the Inner London authorities they have to add what is presented to them by way of precept from ILEA and the Greater London Council over which they have no control.

The noble Lord, Lord Aylestone, referred to how often national swings eliminated well-run local authorities. I say, "Thank you" to the noble Lord. I was on the receiving end on more than one occasion and I heartily agree. My noble friend Lord Thornycroft made a powerful speech. He said—and who would quarrel with it?—that powerful and effective local government is a crucial part of government in this country. I agree as much as anyone in the House, as I hope you would expect me to agree. He said that Government should strengthen local government. Yes, I say. But is not what we are doing not diminishing their role but trying to do just the opposite.

The fact is that we are trying to protect those who have done so much—and they are the vast majority of authorities—to work within the central Government's parameters. If central Government does not protect them, then in what way are we strengthening local government? I think that this is something we should bear in mind all the time. I will bring your Lordships back to this point again and again when we come to discuss the Bill. I am grateful to my noble friend for his basic support. I recognise his concern. I think that we must listen to it and take note. I assure him that we do so, did so before and will all the more so in that he made it again today.

I have covered the point made by the noble Lord, Lord Hill. My noble friend Lord Holderness sup ported the general philosophy behind the proposals of the noble Lord, Lord Evans of Claughton. I understand that; it is not a right or wrong situation; it is a view. One respects it even if one does not necessarily agree with it. I agreed when the noble Lord, Lord Houghton of Sowerby, pointed out how close councillors are to their local scene; but I thought he painted a sad picture for elected members who have independent minds. I do not think that I should be so pessimistic about their role at the present time. In my experience, the elected members with whom I worked within the party system were never afraid to express their views forcefully to influence decisions taken on a party basis. The Lord, Lord Houghton of Sowerby, made a fair point when he said that the rate base today is too narrow and that it must be widened. There must be an alternative—and there will be. The present Government are committed to it. I hope that the Green Paper will take us forward and will lead to action. We have had Green Papers and Royal Commissions. I think I can assure you that there will be action. This is one issue on which all parties will agree. Whether they will agree on the final form that that action should take remains to be seen.

The noble Lord, Lord Sefton, is very knowledgeable about local government. He and I have sat on opposite sides of the table on many occasions. I thought he made an excellent speech. He talked about the erosion of power. It was the first thing that I heard in local government all those years ago. The phrase on the tip of everyone's tongue was "the erosion of local autonomy". It was the in-phrase then and it is even more so today. It has gone on for so long. The noble Lord may be right in pin-pointing that.

To revert to what my noble friend Lord Thorneycroft has said, it is at our peril that we are not willing to see that there is a strong and healthy local government. Despite what was said today or what will be said when we come to the Bill, it is the intention of this Government that there should be strong and healthy local government. If we quarrel and differ as to the way of getting there, that is the reality of what politics is.

The noble Lord, Lord Sefton, referred to ad hoc bodies. He struck home very much indeed and there are many who would agree with him. But, as in most things, it is a question of getting a balance. There must be situations where that does not apply. As a general philosophy, he knows that I agree with him on that and hope to see some move in that direction as we go along.

The noble Lord, Lord Beaumont, said that coalitions are a recipe for not having clashes. I have worked in local government in minority situations. I can tell your Lordships that little is more frustrating; the party in power are constantly looking over their shoulders. They cannot do the things that they want to do. The authority does not benefit. Frankly, it is a disadvantage to what happens to the city. I do not think that is a good thing: I think that is a bad thing. He suggested to my noble friend Lord Thorneycroft that he should get a new machine. I used to know something about machines and I would only tell him that a new machine is not always necessarily better than the old one. It depends what it is.

In the longer term, there can be no lasting solution to the problems facing local government without a thorough overhaul—and I agree with noble Lords who have said that—of local government finance. The noble Lord, Lord Evans, opened up with that very theme and I agree with that.

Our financial proposals are an interim measure because in the end it has to be a reform of the system—and I repeat that for the record: it is an interim measure and will be. I have referred to the Green Paper and it will be coming out and hopefully there will be discussion across the board. I hope that what I have said will demonstrate that the Government are in no way complacent about the long-term health of local government. Now I suggest respectfully is not the time for major surgery. We must get the system working as efficiently as possible. Only when we have done so will it be sensible to consider some of the other interesting issues that have been raised today.

5.52 p.m.

Lord Evans of Claughton

My Lords, first of all may I thank your Lordships for the interest that has been taken in this debate that I initiated and the contributions that have been made. I probably ought to apologise for not spending more time on the general reforms of local government that one wants to see, particularly regarding finance and structural reform. I thought that I had made it fairly clear that we were inevitably going to debate these kinds of matters in this House at enormous length in the coming months.

I indicated that the main thrust of my arguments would be in particular, as I say in the Motion, by the introduction of a fairer and more representative method of election. I do not feel that I need to apologise for speaking at some length about proportional representation. I did not say that I thought it was a complete panacea and answer to all the problems of local government. Of course it is not. But a matter of fundamental importance to me—and it has always been—is that there should be a fair system in local government, and as the noble Lord, Lord Holderness, said, if proportional representation is good for Parliament and good for Europe, it is best of all for local government. That is an absolutely fundamental point.

When I was first in the Young Liberals in the 1940s and the 1950s I sometimes wonder how I survived because about 98 per cent. of the people who voted, voted either Conservative or Labour and it was all jolly comfortable and, as the noble Lord the Minister said, one party would have their period in office and then the other party would have theirs. However, now the whole thing has changed. The majority of people in this country no longer want that kind of polarisation. The people of this country do not want majorities any more. They are trying to tell us that they want politics of co-operation not politics of confrontation.

The noble Lord, Lord Sefton, mentioned the problems in Liverpool where as near as can be all three of the main parties are represented in fairly large numbers. As the noble Lord said, there has been a terrible problem in Liverpool. That is not the fault of there not being a party in control; that is the fault of the politicians not recognising that instead of adversarial politics, which they have been born into and brought up on, they now have to face the concept in local government of the politics of co-operation. As the noble Lord the Minister said, very often there is co-operation on a very broad front.

We have to accept multi-party involvement in the government of this country whether it be local or national in the future. When my party held the balance of power in the Wirral, when I was leader, many members of the other parties said, "Why can we not work together?" The leaders of the Labour and Conservative parties said: "No, we will never work with the Liberals. We will let this simmer endlessly with nothing being done rather than co-operating with the Liberals because we know that in a year or two they will have melted away like the snow in the spring". Of course the electoral system that we have at present tends to do that from time to time.

If there was a system of PR, there would be no melting away. People would have to change their attitude to local government, quite apart from national government, and say, "We must co-operate". There would not be the absurd situation that we have at present of a government, either locally or nationally, being elected on a minority of votes trying to push through extremist measures which are unacceptable to the overwhelming majority of the whole electorate. We would not have that.

I would have thought that this would be very attractive to many of your Lordships, particularly those of your Lordships on the other side of the House who probably have terrible fears and nightmares about the activities of the "Bennites"; and I would have thought it would have been attractive to noble Lords on this side who have a terrible fear of the Prime Minister's "dries".

In conclusion, I feel that unless the major parties of the country realise that there is a sea-change taking place in politics, as recognised by our noble colleagues, the Social Democrats, ourselves and by the country, unless the Conservative and Labour parties recognise this fairly soon, they are going to be in for a very long period of sad disillusion.

This has been a very useful, pleasant and interesting debate. There have been interesting disagreements within parties, there have been interesting ideas about how local government reform, financial, structural and otherwise, should take place. I look forward not entirely with enthusiasm but with interest to the late nights that we are obviously going to have to spend discussing the Local Government Finance Bill in the future. This has been a useful pipe-opener to these lengthy discussions and I am very thankful to everyone who has taken part. I will not take the advice of the noble Lord, Lord Houghton, and I will not demand Papers because I have had enough without carrying the Motion. I therefore beg leave to withdraw the Motion for Papers.

Motion for Papers, by leave, withdrawn.