HL Deb 05 June 1984 vol 452 cc496-502

3.9 p.m

Report received

Clause 2 [Designation of authorities]:

Lord Graham of Edmonton moved Amendment No. 1: Page 2, leave out lines 24 and 25 and insert ("before and approved by the House of Commons in the preceding financial year and on such report having been approved as aforesaid the Secretary of State shall serve").

The noble Lord said: My Lords, I think it would be helpful to the House if I indicated clearly what it is that we are seeking to delete and also the significance of the words that we intend to insert. Clause 2 deals with the designtion of authorities, and as the House is already aware from the happenings at the Committee stage, this is a very significant stage in the process. Clause 2(1) states: The authority or authorities in whose case a maximum is to be prescribed under section 1 above for any financial year shall be designated by the Secretary of State in a report laid". Then we delete the next two lines: before the House of Commons in the preceding financial year; and on laying any such report the Secretary of State shall serve".

The significance is that what we seek to do here is to indicate not merely that the reports shall be laid before the House but that they shall also be approved. The House will be aware that in Committee the noble Lord, Lord Evans of Claughton, sought to persuade your Lordships that this was a sensible thing to do when he moved an amendment remarkably similar to this one. However, there is a significant difference, because in Committee we were proposing that the legislation should be laid and approved by both Houses of Parliament.

We took very much to heart the words of the Minister who on more than one occasion made reference to the other place. We took the view that one of the Minister's objections—and I do not know whether he is prepared to agree to this—was that the report had to be laid before and approved by' both Houses. What we are doing—and certainly this is considered reasonable by those outside the House—is probing to see whether we can make some progress in this respect. We bear in mind that there is a relationship between both Houses, and not for a moment do we want to take away any of the sovereignty of both Houses or the eminence of the other place in respect of primary legislation. We are seeking in this amendment to see whether we can make some progress in at least having the orders not merely laid, but approved by the House of Commons.

We are very concerned at our continued inability to secure from the Minister a more precise definition of the principles which are constantly being referred to. We shall be coming in later amendments to the importance of the principles, the application of the principles, the classes to which the principles can be applied and what we consider to be the remarkable flexibility which the Minister is showing at this stage as regards the extension of the use of principles in the designation order. We hope that the Minister will be able to tell us that he can see a glimmer of hope in adding some more authority to the ways in which the other place will be able to discharge its functions.

When we sought to do that in Committee, the Minister in rejecting our suggestion that the report should be approved in both places, said: This does not mean, of course—and here we are touching on the point debated in the last amendment—that we believe the Secretary of State should be immune from parliamentary scrutiny of his actions under the legislation. But parliamentary supervision is not exercised solely through the requirement to have all Executive decisions endorsed by way of subordinate legislation …I am referring to the parliamentary Question, to the adjournment debate, to the facility which the Opposition have to bring matters before the other place, and, more recently, to the detailed scrutiny possible through the mechanism of the Select Committees. These are not negligible devices".—[Official Report, 26/4/84; col. 222.] We would agree with the noble Minister that the procedures which he outlined and which he pointed out were available in order to have these matters raised and discussed are not negligible devices. We are seeking to make the approval of the report which designates an authority, more than merely something which can be raised in an adjournment debate, or in a parliamentary Question or discussed in a Select Committee. We believe that there is stature and status outside the parliamentary arithmetic which will govern these matters at the end of the day. We believe that any authority which is the subject of a report and which in effect is going to be designated with all that that implies is worthy of being treated as a major piece of parliamentary business.

The Bill is full of important and vital triggers. The first trigger is designation. At present the Bill lays down a very limited number of matters which the Minister will take into account when he designates. First, the authority should be spending more than £10 million. Those which are spending below £10 million are excluded. Secondly, the authority should be spending above its GRE. Thirdly, the authority's expenditure should appear to the Secretary of State: to be excessive having regard to general economic conditions". "Appear", "excessive", and "general economic conditions" are all judgments by the Secretary of State and only by the Secretary of State. According to the Bill, once he decides that an authority falls within those parameters he alone will decide that it shall be designated.

On the basis of criteria 1 and 2—that is, spending above 10 million and spending above the GRE—the Corporation of the City of London is a prime candidate for rate capping. In 1983–84 it planned to spend 229.72 per cent. above GRE. In 1984–85 it is planning to spend 246.95 per cent. above GRE compared with its neighbouring borough of Hackney which is planning to spend 79.16 per cent. When the Minister has repeatedly told us about the 80 per cent. and 90 per cent. overspenders, he never brought in the Corporation of the City of London. Islington, which has been mentioned, is planning to spend at the outrageously high level of 49.86 per cent.!

What we are saying to the Minister is that when he talks about "excessive" and about general principles, he must be very careful indeed. We believe that parliamentary scrutiny should be such that it ought to be possible to satisfy everyone outside that they have had a fair crack of the whip. We know that the Minister will have good arguments. In fact, I am prepared to believe that he had good grounds for initiating this legislative move in the first instance. We are not, in this amendment, arguing against the basis of the legislation. We are saying that once the Minister has decided that an authority by its own actions—and it will defend its own actions—has caused itself to be designated, then before that designation proceeds, the designation in the report ought to be subject to the approval of the House. I very much hope that the Minister will have something helpful to say to the handful of authorities that we are told are likely to be caught in the designation trap. I beg to move.

The Minister of State, Department of the Environment (Lord Bellwin)

My Lords, the noble Lord has explained the reasoning behind the amendment in some detail. I agree with him that it is an important matter and I will try to respond in the same way. I certainly agree that the changes from the original amendment do make it a little better. But the problem, so far as we are concerned, is that they do not remove the fundamental objection to it. Let me try to explain why.

The amendment proposes what we think is an unnecessary and over-cumbersome procedure which would require Parliament to consider an affirmative order about detailed decisions every year, whether or not there was a desire in the other place for a debate. I am aware that there may have been some confusion about the procedures we are proposing for designating authorities under the selective scheme. That is why I think I ought properly to take a moment to make the position quite clear.

Where there is a significant difference of opinion between the Secretary of State and a selected authority about the level of its rate limit, Parliament must decide. We have provided in Clause 4 for an affirmative order procedure where the Minister and the authority cannot agree. We do not accept, however, that every step on the way to a final decision about rate levels should be subject to reference back and formal procedures in Parliament. The intervening judgments which lead up to the setting of rate limits and the various decisions which have to be taken are for the Secretary of State. Naturally, Parliament will hold him to account for what he does, as with any other legislation. But this can be done through the usual channels of accountability without requiring Parliament to take the decisions itself.

For that reason, we have not provided a formal parliamentary procedure for the approval of the designation of authorities under the selective scheme. We have thought very carefully about this one—particularly in view of the strong feelings which were expressed by your Lordships in Committee. However, after reconsidering all the issues, we have remained persuaded that the report setting out the principles for designation and the names of selected authorities should not be subject to a vote in the other place before they come into effect. Instead in Clause 2(1) we have proposed that a report be laid before the House of Commons.

We have also undertaken to send a copy of the report to every authority named in it. In this way the decisions of the Secretary of State and the basis on which the decisions have been taken will be set out publicly in a formal document. I have explained before why it is appropriate for the report to be placed only before the other place, which has responsibility for questions of public finance. However, the report will, of course, also be available to read and consider for such of your Lordships as follow these matters.

When it is published it will be for the House of Commons to consider the report and to take up matters in it with Ministers in whatever way they believe to be appropriate in the circumstances. There are many ways in which Ministers are held accountable in the other place, and it is by no means the case that a formal debate required by statute is the best way. For example, Members of that place may write or bring deputations from the authorities concerned to see Ministers to explain their case. They may ask Parliamentary Questions or use an Adjournment Debate. The noble Lord, Lord Graham, with his great experience of another place, is particularly knowledgeable in these matters.

If the feeling in the other place was that there was a need for a more general debate of the principles on which the Secretary of State had acted, then that House has procedures for ensuring that that is achieved. The Environment Select Committee could determine that it would investigate the report and call for Ministers and officials to give evidence. The Opposition can always ensure a debate in the Commons through the use of one of their Supply days, or by asking the Government to make time available. As I said in Committee, if there was a genuine desire for a debate in the Commons and there was a danger that this could not otherwise be arranged, no doubt the Government, operating through the usual channels, would consider sympathetically a request for assistance.

All these ways of holding the Secretary of State to account will be available when the report designating authorities is published. But they will also be available throughout the course of the rate limitation procedures whenever the Secretry of State has been given authority to make judgments and take decisions. Of course, the Secretary of State is also accountable in the courts for any unlawful exercise of his power. At various stages it has been suggested that the Bill should provide that the Secretary of State may only use his powers reasonably. We have made it clear that this is a principle enshrined in British justice and requires no specific reference in statute. It is a further safeguard on the selective scheme.

Finally, I should like to mention those additional provisions which have been written into the face of the Bill which enhance accountability. These provisions cover the special circumstances where detailed parliamentary scrutiny is appropriate. The first I have already mentioned. It is the requirement for rate limits to be approved by the other place in cases where the Secretary of State and the authority could not agree. Two other provisions relate to the fundamentals of the selective scheme rather than to detailed implementation. First, there is the requirement to put any increase in the £10 million exemption in an order before the Commons. Secondly, there is the power to provide for areas where the rate or precept is not levied as a uniform rate in the pound. The Secretary of State may only make arrangements for how maxima for rates and precepts are to be calculated in these areas by putting his proposals before the other place in a statutory instrument subject to negative resolution.

These three statutory procedures, and the requirement to lay a report designating authorities before the other place, provide strong checks on the use of the Secretary of State's powers. In addition, there are the many other avenues by which the Secretary of State can be held to account in the other place. When all these are considered together, I believe that we need have no fear about the ability of Parliament to scrutinise, and to ensure that rate limitation is operated fairly.

I believe that this amendment goes too far in burdening Parliament with the details of rate limitation. For this reason I cannot advise my noble friends to accept it.

Lord Graham of Edmonton

My Lords, I shall begin by acknowledging what the Minister has said today and at previous stages—that there is ample opportunity for an aggrieved authority to make its case by bringing deputations to the Minister or, at the derogation stage, by seeking to argue and thus convince the Minister. But in this amendment we are not concerned with seeking to convince the Minister. I am satisfied that if the Minister has taken a stand and has listened very carefully to the leaders and the chief executives of councils who come to London to argue their case, and if he still sticks to his brief (which he is entitled to do), a debate in the House will not change his mind.

The Minister may ask, "What is the point of having a debate which must be subject to the report being approved?" The purpose of the approval is to bring these matters into the drama, into the spotlight, into the centre. It may be that, from the point of view of disseminating to the public what happens here, we hold the parliamentary arena at a higher level than the Minister. Hundreds of thousands of people will be affected by this who will never hear the details of what happens in Marsham Street, who will never hear the details of what happens in Committee Room 19 or Committee Room 20 upstairs, but who will listen to a report of "Today in Parliament" or "The Week in Westminster" and who will hear their Members of Parliament and the Minister arguing about why their rates are higher or lower, or about what has caused them to be penalised or not, as the case may be.

The Minister referred to the burden on the parliamentary timetable. If the Minister seeks to relieve the parliamentary timetable of spending possibly 20 hours of parliamentary time on these suggested 12 or 15 designated authorities, that would be one way of lightening the burden. The Minister asked why we should write into the Bill the obligation that the report be approved. The Minister said that there may be no wish in the other place to take advantage of this, but that if it is written in, it must be done. I can tell the Minister that the representatives of any authority which is designated will not hesitate to use the opportunity if they are able to do so. The Minister will appreciate that, with the fluctuations in parliamentary fortunes and with the legislation drawn as it is—and we shall come to other amendments which have even greater significance—we are not talking about a permanent situation; we are talking about a situation in which, in political terms, the shoe can be on the other foot whenever there is a change of political control.

On this side of the House we are disappointed that, after all the arguments, the authorities will be sent a report in a formal way. That is a big deal! When the authorities realise the anguish that will flow from the decisions, they will want their people to understand not merely that they fought the case behind closed doors, but that their representatives fought the case to the best of their ability on the Floor of Parliament. We are very dissatisfied with the Minister's reply. We do not intend to withdraw the amendment. We propose to have it negatived, and have the opportunity of bringing it forward again.

Lord Harmar-Nicholls

My Lords, is my noble friend aware that many people will be pleased that he is resisting this amendment, because Parliament has several functions? It is its function to produce good legislation in as much detail of the right sort as possible. But it also has the job of preserving the parliamentary system itself. I believe that, if the sort of extension suggested by the amendment is brought in, we shall overburden Parliament. Parliament will get to the point where it will not be able to do all the things statutorily put upon its shoulders. This is an example of where it is right that Members of Parliament in both Houses should do the job they were intended to do.

The noble Lord who has just expressed his disappointment about the fact that this amendment is not acceptable said that people in the various areas would like to know that these things had been examined. He rather suggested that it was more important that somebody should have a good report on "Today in Parliament" than that the Members of Parliament, whether behind closed doors or not, should be doing their job. Members of Parliament are the watchdogs who make certain that the points of view of their constituents are taken properly into account, and are not to give a good show on the radio report of what has gone on in Parliament. Because of the fact that it is on their heads to do it, they are more likely to do it effectively and at the same time not waste the time of Parliament by deliberately instigating debates which take up time merely to get a showing on the radio report of what has gone on in Parliament that day.

Those who have had some experience of the way that Parliament works know that, however eminent a Minister may be, if a Minister does something that is fundamentally wrong and ought to be criticised, it is criticised. There is the Adjournment Debate, and Question Time, and, as my noble friend said, in the last resort the courts themselves can be brought in under those sort of circumstances, and they are an adequate safeguard and a proper safeguard. But, if we make every application of every detail a statutory requirement, then the parliamentary system, as it is working today, will not be able to work.

We have to have some confidence in the people who reach the position of being Ministers of the Crown. If we work on the basis that every Minister of the Crown of whatever party he may represent is a potential rogue, or somebody who wants to cover up things that ought not to be covered up, then we are criticising the system under which we live. Generally speaking I think that, with the people who are elected to Parliament and who, because of their skill, eventually come into government, the fact that the Bill lays down that they have to make this disclosure is all the safeguard that is necessary, bearing in mind all the other ways open to Parliament to see that the searchlight is put upon the matter.

I support my noble friend in resisting this amendment. The damage it could do to the system as a whole by overburdening it in the jobs that it has to do is far greater than any danger that could accrue from a full disclosure not having been made through being approved eventually by the House every year.

Lord Graham of Edmonton

My Lords, may I merely explain that the amendment is not friendless? It is brought to this House by the Association of County Councils, the Association of District Councils, and the Association of Metropolitan Authorities. To the extent that this House will pay respect to the consultation procedure, those bodies have been consulted on what they would like to see happen. If Members on the other side reject the advice that they have been tendered, that is up to them.

So far as the use of "Today in Parliament" is concerned, I wanted to point out that, whereas we are well advised and informed on these matters and do not need to rely on such a device, there are millions of people who will understand better what happens in this place by virtue of the radio. We have had a good debate, and we shall be asking to withdraw the amendment.

Amendment, by leave, withdrawn.