Local Government and Housing Bill

HL Deb 19 October 1989 vol 511 cc1055-128

5.26 p.m.

Consideration of amendments on Report resumed on Clause 1.

[Amendments Nos. 3 and 4 not moved.]

Lord Graham of Edmonton moved Amendment No. 5: Page 3, line 12, at end insert— ("(6A) No regulation shall be issued under subsection (5) above in respect of persons falling within section 2(1)(f) below before the completion of consultation by the Secretary of State with such organisations representative of local authorities and employees as appear to be concerned.").

The noble Lord said: My Lords, the Minister will understand that this is a probing amendment designed to establish the fact that there will be consultation before regulations are introduced in respect of political restrictions on political assistants under the Bill.

The consultative document on political restrictions was issued on 2nd October. Paragraph 23 states that a separate paper will be issued covering political restrictions on these officers. The general position of the officers confined to a salary limit of £13,500, despite the amendments to be agreed later, is left uncertain at this stage.

It would be helpful if the Government could use the debate to indicate the date on which the consultative paper will be available. It would also be helpful to know whether they will introduce a lighter regime in respect of officers who have been appointed explicitly in the knowledge of their political activities and whether the timescale for compensation will allow this House the opportunity at Third Reading—scheduled for 1st November—to consider the issues in the light of the consultative paper.

Inevitably there are hard cases. We believe that people who are employed because they are political are entitled to be considered differently. We also wish to know whether there will be consultation before the i's are dotted and the t's are crossed. I beg to move.

Lord Hesketh

My Lords, the effect of the amendment is to require the Secretary of State, before issuing any regulations under Clause 1(5) of the Bill in respect of assistants to political groups, to consult such organisations representative of local authorities and employees as appear to him to be concerned.

We have issued a consultation paper on the proposals for the formulation of the restrictions as they would apply to the holders of other restricted posts. We have every intention of doing the same in the case of assistants to political groups. Indeed, the consultation paper which we have issued says so specifically. I shall undertake to arrange for the separate consultation paper in respect of assistants to political groups to be issued before the Third Reading of the Bill in your Lordships' House.

Lord Graham of Edmonton

My Lords, the Minister has been most fair. It will be rewarded because the final form of words will be more sensible and acceptable. I am grateful; I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 6 to 11 not moved.]

5.30 p.m.

Clause 2 [Politically restricted posts]:

Lord McIntosh of Haringey moved Amendment No. 12: Page 3, line 38, after ("with") insert ("subsection (1A) below and any directions under section (grant and supervision of exemptions from political restriction) below or with").

The noble Lord said: My Lords, in moving Amendment No. 12 I shall speak also to Amendments Nos. 13, 14, 15, 18 and 19. These amendments do not deal with the issue of the nature of political restriction, which has been the subject of our most recent debate, but with the issue of who is covered by political restriction.

It would be absurd to pretend, in the light of the extensive press coverage on this matter, that we were engaged in gladiatorial combat on this question. I think it is public knowledge that there have been constructive discussions—I pay tribute to Ministers and officials who have taken part in them—over the past few weeks between ourselves and the Government on the issue of who should be covered by restrictions on political activity among local authority officers.

My noble friends in another place and ourselves on Second Reading made it clear that we were not opposed to some measure of political restriction, particularly as regards chief officers and their deputies. We appreciated that there should be some restrictions on what is called twin tracking; that is, the practice which has grown up in some local authorities whereby councillors on one authority could become senior officers for another authority. Some particularly bad examples of that have been drawn to the attention of this House and another place.

All this arose originally from the Widdicombe Report. In some ways, with these amendments we are going back closer to the recommendations of that report at that time. It was strange and sad that when this Bill was first introduced the proposals for political restrictions were much more wide ranging than had originally been intended by Widdicombe. It is strange and sad that the Government held to those much more wide-ranging restrictions all the way through the passage of the Bill in another place and attempted to do so here. Because we were able to defeat the Government on the matter in Committee and because, in my view, the Government are running short of parliamentary time on this Bill, there has been pressure combined with good will, I believe, on the government side to reach a conclusion which would not result in amendments going backwards and forwards between the Commons and the Lords, I believe and hope that we have achieved that.

What is the nature and result of these amendments? As I said, considerable publicity has been given to them. I believe that the House would wish me to set out my understanding of what is now the position with the Bill as it would be amended by my amendments. There are three types of officers who are subject to restrictions: first, chief executives, chief officers and their deputies, monitoring officers—that is, those charged with the responsibility of putting these regulations into effect—political assistances and those officers who have been delegated power to perform the functions of the local authority; that is, in general terms, those who sign or approve contracts on behalf of the local authority. Those officers will not be able to apply for exemption from restriction.

The second category is officers who are paid, either full time of part time, above a certain salary level. The salary level proposed by the Government was £13,500. The salary level now proposed is £19,500 and there is provision for regulations to be enacted—I hope the Minister can confirm this—which will provide for an automatic uprating as pay increases take place. Also, as soon as a legal way has been found of achieving it, there will be recognition of nationally agreed regional weightings; that is, along with London weighting those nationally agreed weightings which are not in the power of individual local authorities to vary. Those will be added to the £19,500 figure.

It may be as well to explain why, having criticised putting a figure in pounds on the face of the Bill at an earlier stage, I am now proposing that that should be the case. I recognise that if we talked about a spine point, as, for example, .44 on the scale which is roughly what this is, it would be possible for some local authorities to pay people at a lower spine point but give them permanent bonuses which would bring them above £19,500. That would not be our intention, and I think it is right that this should be done in this way. These officers affected by salary level will be able to apply to an adjudicator appointed by the Secretary of State if they are not in a politically sensitive category.

There are other officers who are paid less than £19,500 but are in a politically sensitive category. That brings us to the definition of what is a politically sensitive category. The House will remember that the Bill as orginally proposed contained a three-part definition: first, officers who gave advice to the committees or sub-committees on a regular basis; secondly, officers who communicated with the media on behalf of the authority on a regular basis; and, thirdly, those who had, under certain conditions, contact with the general public. I deliberately simplify in order not to weary the House.

The most important change which has taken place is that the third category—those who have contact with the public—has been removed altogether. That was in numerical terms by far the largest and most contentious category because it included all those in neighbourhold offices, at town hall front desks, social workers and large numbers of people in local authorities who have contact with the public; because that is the nature of the local authority service. That gave rise to an enormous amount of concern and even alarm among local government officers. That category has been removed altogether.

As regards advice, I am reassured to learn that the Government believe that advice does not include the provision of factual information. I hope the Minister will confirm that when he speaks to this amendment.

In regard to dealing with the press, the restriction has now been reworded to cover only those who regularly speak on behalf of the authority with journalists or broadcasters. My understanding is that that will be restricted to senior press officers—those whose telephone numbers might be at the bottom of a press release—rather than those who send out factual press releases or answer factual questions from the press. Again, I hope the Minister can confirm that.

I have referred to two major changes: first, in the salary restrictions, and, secondly, in the nature of the definition of politically sensitive posts. The third major effect of these amendments concerns the process for appeal. Our concern throughout this was that there should not be an unnecessary and unjustifiable difference in the ways in which local authorities interpreted the legislation or subordinate regulations. It seemed to us that local authorities might be tempted, on the one hand, to be too lenient about it in order to have too much political restriction but also might be tempted to be too stringent and severe and might be tempted to impose unnecessary and unjustifiable political restrictions on some of their officers.

We were keen to see that so far as possible through the role of the adjudicator there should be some consistency between one local authority and another. What is now incorporated in these amendments is the provision that the adjudicator can hear appeals from those who think they have been unjustly classified as being in posts which are politically sensitive. The corollary of that, of course, is that an adjudicator may, off his own bat or on application from someone else, take action if he thinks an authority is being too lenient in its classification procedure. This applies whether the officer concerned is included because of a specific salary level or because his post has been designated as too sensitive.

The distinction of the £19,500 salary level, put simply in an analogy with trade union legislation, is that above £19,500 they have to contract out and below £19,500 they have to be contracted in. There are complications around that but that is the broad effect.

I apologise for taking so much time to set out the amendments, but it will be appreciated that they are of enormous and urgent importance to a large number of local government officers. They are of importance because we are coming up to a major round of local authority elections, in May 1990. Certainly in my party, and no doubt in other parties, the panels for selection as councillors are now being drawn up. All over the country, certainly within the Labour Party, people are withdrawing from the panel if they feel that going on to the panel, which may become public, would start to disqualify them from doing their jobs and, indeed, lose them their jobs. We are anxious that as soon as possible—I hope it will happen immediately after these amendments are agreed this afternoon—there will be the clearest possible guidance given to everyone concerned in local authority service about the nature of the proposals and restrictions which are now made in the Bill.

I hope the Minister will feel able, if possible after today but certainly after the Bill receives Royal Assent, to consider issuing guidance to all local authorities, for the benefit of their staffs, as to the precise meaning of the Bill as it now stands so that they can refrain from such political action as they think proper.

These have been complicated negotiations. I repeat my gratitude to Ministers and officials who have taken part in them. I believe that the result has largely justified the effort we have made by entering into the negotiations. I believe that we have achieved at least 90 per cent. of what we wanted. It would be churlish of me to harp on that part of the 10 per cent. which I still consider to be serious. I believe that this is a package of proposals which can be commended wholeheartedly to the House. I beg to move.

Lord Evans of Claughton

My Lords, I say briefly that the compromise incorporated in this amendment, which has been so clearly moved by the noble Lord, Lord McIntosh, broadly speaking—all compromises mean that someone has to make some sacrifices—covers the situation far better than one had feared at the beginning of the dicussion. My noble friend Lord Ross of Newport, who cannot be here today but who spoke on this matter during our Committee proceedings, has asked me to say that he is more than willing on behalf of our noble friends to support the amendment.

Lord Pitt of Hampstead

My Lords, I read in the press that the Government intended to accept this amendment. I hope that is so because the amendment is a good step forward. Noble Lords will remember that on Second Reading I expressed considerable alarm at the Government's proposals, and I am glad that we have moved forward in this respect.

5.45 p.m.

Lord Hesketh

My Lords, I think I can safely say that here, as so often, your Lordships' House has been able to play the proper role of a revising Chamber. When this Bill came from another place there was deep disagreement between the main parties about the provisions in Clauses 1 to 3. We now have a fair degree of agreement.

The debates, both on Second Reading and in Committee, allowed views from all parts of the House to be expressed. Those views came from people with deep understanding of the issues and with wide experience. In the light of the views expressed I have been able to have what I consider to be a fruitful exchange with the noble Lord, Lord McIntosh of Haringey. The result is these amendments which we are now discussing. We regard it as a major step to have won the agreement of the Opposition parties to an amended form of these provisions. In matters of this kind, which set the dividing line between the party political battle and impartial public administration, it is highly desirable that there should be the widest possible agreement on what the rules are.

We believe that there used to be such agreement in the form of unwritten conventions. Those have, sadly, in part disappeared, and it is necessary to restate the rules in statutory form. Doing so requires a precision not needed in a convention. That is why there is scope for disagreement about the details. In the Government's view, these amendments reinstate in the Bill the essentials of the proposals that were passed by another place and were therefore in the Bill as introduced into this House.

There are of course changes—that is the essence of the work of a revising Chamber. I should therefore explain our view of the changes that have been made from the scheme in the Bill as introduced. In doing so, it is important to have in mind one fact—a fact which has often been misunderstood. The salary level, whether the £13,500 in the Bill as introduced or the £19,500 which we now have, has never been the deciding test of whether or not a post was subject to restrictions on political activity. As the noble Lord, Lord McIntosh, pointed out, there is the trade union analogy of opting in and opting out.

Above the specified salary level, the restrictions apply unless the post is exempted. Below that level they do not apply unless they are specifically applied. In both cases, above and below the specified salary level, the criteria for whether or not a post is to be restricted are the same.

The first question must then be the criteria for deciding which posts are so politically sensitive that restrictions should apply. These will be the same criteria as are applied by local authorities and by the adjudicator. There are two changes from those in the Bill as introduced. First, we have agreed that the third criterion in the Bill as introduced should be dropped. This concerned local authority staff who dealt with the public in circumstances in which the public could conclude that the officers could affect the authority's decisions. This was never going to be easy to apply, and we concluded, on reflection, that such officers would be applying council policy rather than determining it, and that the potential conflict between their role as impartial servants of the council and their personal status as active politicians was not so great as to make it necessary to retain them in the restricted category.

Secondly, we have agreed that the definition of the second category of a politically sensitive post should be improved to make it clearer that those covered are those who actually speak on the council's behalf and not those who do other tasks such as issuing printed press notices, as mentioned by the noble Lord, Lord McIntosh, earlier.

In talking of the criteria, I should also make it clear that the first and most important criterion—those who advise the council—is not intended to cover anyone whose sole function is in supplying the council or a committee with purely factual information. The noble Lord, Lord McIntosh, suggested an amendment to clarify this, but I am advised that the present drafting is as clear as it can be on this issue. I am glad, however, to emphasise the point.

The second question which is before us is the machinery by which these criteria should be applied. It is here that there are more extensive changes. First, we have agreed that the salary level which divides the two approaches should be raised from £13,500 to at least £19,500. We intend to use the power given by the amendments to specify the salary in a regulation to replace the bare reference to £19,500 by a reference to spinal point 44 on the national joint council scale as suggested by the noble Earl, Lord Carnarvon. We think that this is more appropriately done in regulations, since such arrangements can easily be changed. We also intend to use the power given by the amendments to make different provision for different areas to allow for nationally agreed local weightings, if we are satisfied that this will not lead to manipulation.

Secondly, to make sure that this increase, and the consequent reduction in the number of those who are automatically restricted unless they gain exemption, does not reduce the uniformity of the application of the criteria, the amendments give the adjudicator power to direct that posts below £19,500 shall be added to the restricted list. The adjudicator will be able to exercise this power either on his own initiative or as a result of complaints.

Thirdly, again to improve the uniformity and consistency of the application of the criteria as to what posts are politically sensitive, there will be an increased opportunity for review by the adjudicator. This will not apply to those who are covered by Clause 2(1); that is, chief executives, chief officers, their deputies, monitoring officers or assistants to political groups or those to whom council functions have been formally delegated. All others paid at over £19,500 will be able to apply for exemption. Those who are paid less than £19,500, and who are therefore unrestricted unless their council designate them, will be able to apply to the adjudicator for review if they think that they have been wrongly designated.

Finally, with the same aim of consistency, the adjudicator is empowered to issue general advice on the application of the criteria, which the local authorities must take into account. These provisions will be the stronger and more effective for the support of all the main political parties.

I assure the noble Lord, Lord McIntosh, as regards his final point concerning the elections next year, which I know are of great concern to him, that I shall study closely what he has said. At the moment we do not believe that it would be appropriate to put out a formal government statement to local authorities until another place has considered the amendments. After that I hope that the information will be issued quickly—and I mean quickly.

I believe that the changes to the Bill as introduced, which will be achieved by these amendments, are a genuine improvement to the new rules. I pay tribute to the noble Lord, Lord McIntosh of Haringey, for his efforts in helping this House play its role as a revising Chamber. I also pay tribute to the officials who helped greatly in this task. I join with the noble Lord, Lord McIntosh of Haringey, in commending these amendments to your Lordships' House.

Lord McIntosh of Haringey

My Lords, I begin by thanking the noble Lord for his penultimate remarks. It is vitally important that clear guidance notes should be made available as soon as possible to all the local authorities and employees of local authorities. I quite understand the constitutional position that it would be improper to do so before another place has considered these amendments. However, I can assure the noble Lord that the Opposition in another place are not going to query the principle behind them or seek to delay the amendments.

I welcome the Minister's assurance that the notes will be issued quickly after consideration has taken place elsewhere. It must be said that those concerned have been in a state of considerable confusion about their political rights and constitutional obligations. The Minister has been good enough to confirm all the other points I asked him to confirm about the Government's interpretation of those parts of what we are seeking to achieve which have hot yet been accomplished through these amendments. With the combination of these amendments and the regulations that are to follow I echo what the Minister has said. I commend the amendments to the House.

On Question, amendment agreed to.

Lord McIntosh of Haringey moved Amendments Nos. 13, 14 and 15: Page 3, line 41, at end insert— ("(1A) It shall be the duty of every local authority to prepare and maintain a list of such of the following posts under the authority, namely—

1. (a) the full time posts the annual rate of remuneration in respect of which is or exceeds £19,500 or such higher amount as may be specified in or determined under regulations made by the Secretary of State;
2. (b) the part time posts the annual rate of remuneration in respect of which would be or exceed that amount if they were full time posts in respect of which remuneration were paid at the same rate as for the part time post; and
3. (c) posts not falling within paragraph (a) or (b) above the duties of which appear to the authority to fall within subsection (2) below,

as are not posts for the time being exempted under section (grant and supervision of exemptions from political restriction) below, posts for the time being listed under section 100G(2) of the Local Government Act 1972 or section 50G(2) of the Local Government (Scotland) Act 1973 or posts of a description specified in regulations made by the Secretary of State for the purposes of this subsection"). Page 3, line 43, leave out ("any one or more") and insert ("one or both"). Page 3, line 47, leave out from ("represented") to end of line 5 on page 4 and insert— ("(b) speaking on behalf of the authority on a regular basis to journalists or broadcasters. (2A) It shall be the duty of every local authority to deposit the first list prepared under subsection (1A) above with their proper officer before the expiry of the period of two months beginning with the coming into force of this section; and it shall also be their duty, on subsequently making any modifications of that list, to deposit a revised list with that officer. (2B) It shall be the duty of every local authority in performing their duties under this section to have regard to such general advice as may be given by virtue of subsection (1)(b) of section (grant and supervision of exemptions from political restriction) below by a person appointed under that subsection.").

On Question, amendments agreed to.

Lord Graham of Edmonton moved Amendment No. 16: Page 4, line 38, at end insert ("and who deputises from time to time for that officer and whose post is graded at an equivalent level to that of such a deputy").

The noble Lord said: I move this amendment standing in the name of my noble friend Lord McIntosh. We consider this to be an important amendment. We are dealing with the position of deputy chief officers. In essence the amendment proposes a fuller definition of a deputy chief officer as set out in Clause 2(5) of the Bill. Deputy chief officers will be among those officers whose posts are specified in the Bill as clearly being subject to political restriction. We have had already indications from the Government that officers in these categories will be faced with the tightest regime of such restrictions.

In these circumstances we think it is important that no one who is not properly graded at the level of a deputy is included by default. I am aware that the Government themselves sought at the Report stage in another place to clarify the position of a deputy. The amendment now tabled is put forward in a constructive spirit in order to see whether the Government's current understanding of the Bill is more acceptable in the light of earlier discussions.

The current formulation is that a person is covered if he or she, report(s) directly or is directly accountable to one or more of the statutory or non-statutory chief officers".

The possible problem with this formulation on which the Government's views would be helpful is that officers somewhat lower down the scale without a direct line manager between themselves and a chief officer could be the persons regarded as reporting directly to that chief officer.

This matter has been raised with us by a member authority of the AMA. It wishes to establish whether officers providing administrative services who report directly to a chief officer but who are graded somewhat below the level of deputy should be included. I have seen advice that it is the Government's apparent intention that they should not be regarded as a deputy chief officer. The purpose of this amendment is that we believe it would be helpful for the Government to clarify that this is also their understanding of the intention of the subsection.

We are trying, before the Bill leaves this House, to raise legitimate fears or queries that have been brought to us by those outside who will have to operate these provisions. Our aim is to see whether, by a change or addition of words, we can make the Bill work more harmoniously. I beg to move.

Lord Hesketh

My Lords, this amendment would further restrict the definition of those who are to count as a deputy chief officer, by requiring not only (as the Bill does) that they report regularly to a chief officer, but also that they deputise from time to time for the chief officer and also that they are graded at an equivalent level to such a deputy. The noble Lord, Lord Graham, occasionally complains that the Government do not know enough about how local authorities work. I have to say that I fear that this amendment does not make enough allowance for the diversity of organisation among local authorities.

Local authorities, particularly smaller ones with which the noble Lord may not be quite as familiar, have increasingly organised their staff into two or three large departments with a single chief officer in charge. These large departments are then divided into sub-departments, which often correspond to the older divisions under chief officers. For example, a department of technical services, under a director of technical services, may now comprehend divisions under the chief architect, chief engineer, chief planning officer, and, say, the parks superintendent. None of these is necessarily designated as deputy director. Each will deputise in his or her own field. The same arrangement can be found on the administrative side, with legal adviser, personnel officer or secretary reporting to a single director. These different divisional heads may be graded at different levels. We therefore think that the amendment is slightly grounded in a system in which there is always a single deputy who is identified as such. We do not think that this is the case and we therefore believe that it is necessary to provide, as the Bill does, for a wider definition of a deputy chief officer. With this explanation, I hope that the noble Lord will see fit to withdraw the amendment.

6 p.m.

Lord Graham of Edmonton

My Lords, I followed carefully and appreciatively what the Minister said. Accountability and responsibility have changed not only in local government but also in industry. The Minister may have a point. We believe when we talk about a deputy that it is a person who deputises; but there are people who are deputies but not necessarily the deputy. I take that point. There are people who are to all intents and purposes the number two or the next one in line but do not necessarily have the nomenclature of deputy legal adviser, and so on. I shall study what he said and see whether at a later stage it is advisable to come back. I beg leave to withdraw the amendment.

Amendment, by leave withdrawn.

Clause 2 [Politically restricted posts]:

Lord Graham of Edmonton moved Amendment No. 17: Page 5, line 1, leave out ("or lecturer") and insert ("lecturer or other member of the staff (other than a person the duties of whose post fall within section 2(2)(a) above)").

The noble Lord said: My Lords, with this amendment we return to the issue of whether or not non-teaching staff in educational institutions should be subject to potential political restrictions. An amendment was moved in Committee to exempt such staff. The Government rejected it but said on that occasion: We admit that it is unlikely that those other than teachers are in politically sensitive jobs. However, there may be such cases as a bursar or administrator who regularly advises the local education committee on some matter".—[Official Report, 19/7/89; col. 889.]

If one accepts the logic of this position, the amendment is put forward to exempt as a group non-teaching staff in educational institutions other than those staff who are regularly involved in advising committees, and so on, in the terms of Clause 2(2)(a). The argument for a general removal of restrictions on educational institutions subject to the limitations proposed in the amendment is that these institutions are generally considerably removed from the policy formulating process of the council, and that the relationship between administrative officers in such bodies and the council's committees and so on is genuinely remote. We would be glad if the Minister could respond helpfully. We should like him to accept the amendment. Considerable progress was made in the earlier exchange between the noble Lord and my noble friend Lord McIntosh. We think that this would be a small movement. The Minister should understand that these points are put to us by the local authority associations which generally would welcome an easement of this kind. I beg to move.

Baroness Blatch

My Lords, I was persuaded against putting forward my amendment again at this stage. My personal feelings on this subject are well known. I believe that involvement in political activity by a member of the teaching profession should come under the specific ban contained in the earlier part of the Bill. I do not think that there should be an extension of the exemptions in this clause and I hope that my noble friend can be persuaded not to accede to one. Anyone who has been involved in a local education authority will know that advice is frequently taken from members of institutions such as colleges and schools. The difficulty would be in selecting who should and who should not be subject to this amendment. I hope that the Minister will not accept any extension of the exemptions contained in this clause.

Lord Hesketh

My Lords, this amendment would extend the exemption from political restrictions for teachers and lecturers to include non-academic staff in schools and colleges, unless they are involved on a regular basis in giving advice to the authority. I think that the amendment does not pay enough attention to the other amendments that we have considered and are going to consider.

By Amendment No. 15 we have deleted the third criterion for the political sensitivity of posts: those who deal with the public in circumstances where the public would think that they could affect the council's decision. That leaves only two criteria: those who regularly advise the council, and those who regularly speak for the council to the media.

This amendment specifically says that it would not extend the exemption to non-academic staff to those who regularly advise the council. What then is left? Non-academic staff in schools and colleges who regularly speak to the media on behalf of the authority. If there are any such posts, then we do not see why they should be treated any differently from those who do the same outside schools and colleges. The only other arguments that can be mounted in favour of it are that non-academic staff in schools and colleges who are paid at more than £19,500 and who do not advise the council or speak to the media will have to claim exemption, rather than be exempted outright.

We have accepted that special considerations apply to teachers and lecturers. But we do not see why the most senior non-academic staff—and by definition we are talking of those earning more than £19,500—should be treated any differently from other senior staff; let their position be scrutinised in the same way as other senior staff.

My noble friend Lady Blatch moved an amendment in Committee. I have always felt that the Government's position in this matter has been midway between the Benches behind me and the Benches before me. I have always felt secure, in resisting this amendment, that I was somewhere in the middle.

Lord Graham of Edmonton

My Lords, I am extremely disappointed by the Minister's reply. He is right and the noble Baroness, Lady Blatch, is right—we are seeking to extend to a category of public employee an exemption from having to jump through hoops, stand up to measuring rods and prove one's innocence in daring as individuals to hold political views. The noble Lord has gone a long way to take into account not only the views of this side of the House, but also the views of those at the sharp end. For the life of me I cannot see why he is not prepared to give what in effect would be a blanket exemption for people in this limited category.

It strikes me that the noble Lord or his advisers are determined to worry a good many people needlessly. We have always said that this part of the Bill is an over-reaction. The Government have taken a sledgehammer to crack a nut. By resisting this amendment, they are holding the threat over people who are not in direct contact with the public that if they are not careful they will be brought into the net. The noble Lord has failed to satisfy me. I intend to seek the view of the House.

6.8 p.m.

On Question, Whether the said amendment (No. 17) shall be agreed to?

Their Lordships divided: Contents, 54; Not-Contents, 80.

DIVISION NO. 1
CONTENTS
Ardwick, L.	Kennet, L.
Aylestone, L.	Listowel, E.
Birk, B.	Lloyd of Kilgerran, L.
Boston of Faversham, L.	Longford, E.
Buckmaster, V.	Lovell-Davis, L.
Callaghan of Cardiff, L.	McGregor of Durris, L.
Carmichael of Kelvingrove, L.	Mcintosh of Haringey, L.
	Molloy, L.
Carter, L. [Teller.]	Mulley, L.
Cledwyn of Penrhos, L.	Nicol, B.
Dormand of Easington, L.	Northfield, L.
Evans of Claughton, L.	Ogmore, L.
Ewart-Biggs, B.	Peston, L.
Ezra, L.	Phillips, B.
Falkender, B.	Pitt of Hampstead, L.
Falkland, V.	Ponsonby of Shulbrede, L.
Foot, L.	Russell, E.
Gallacher, L.	Seear, B.
Graham of Edmonton, L. [Teller.]	Sefton of Garston, L.
	Serota, B.
Harris of Greenwich, L.	Shackleton, L.
Hatch of Lusby, L.	Shepherd, L.
Hayter, L.	Stedman, B.
Houghton of Sowerby, L.	Turner of Camden, B.
Irving of Dartford, L.	Underhill, L.
Jay, L.	Wallace of Coslany, L.
Jeger, B.	White, B.
John-Mackie, L.	Williams of Elvel, L.

NOT-CONTENTS
Ailesbury, M.	Campbell of Alloway, L.
Arran, E.	Carnegy of Lour, B.
Auckland, L.	Carnock, L.
Belstead, L.	Carr of Hadley, L.
Bessborough, E.	Coleraine, L.
Blatch, B.	Colwyn, L.
Blyth, L.	Cox, B.
Brougham and Vaux, L.	Craigavon, V.
Caithness, E.	Crathome, L.

Cross, V.	Mowbray and Stourton, L.
Dacre of Glanton, L.	Munster, E.
Darcy (de Knayth), B.	Murton of Lindisfarne, L.
Davidson, V. [Teller.]	Nelson, E.
Denham, L. [Teller.]	Norfolk, D.
Elliot of Harwood, B.	Nugent of Guildford, L.
Ferrers, E.	Oppenheim-Barnes, B.
Gainford, L.	Orkney, E.
Glenarthur, L.	Orr-Ewing, L.
Harmar-Nicholls, L.	Rankeillour, L.
Havers, L.	Reay, L.
Henley, L.	Renton, L.
Hesketh, L.	Rochdale, V.
Hives, L.	Russell of Liverpool, L.
Holderness, L.	Saint Albans, D.
Hooper, B.	Sanderson of Bowden, L.
Hylton-Foster, B.	Shannon, E.
Killearn, L.	Skelmersdale, L.
Kinnoull, E.	Somers, L.
Lauderdale, E.	Strange, B.
Long, V.	Strathmore and Kinghome, E.
Lothian, M.
Lucas of Chilworth, L.	Sudeley, L.
Lyell, L.	Swinfen, L.
McColl of Dulwich, L.	Teviot, L.
Mackay of Clashfern, L.	Thomas of Gwydir, L.
Malmesbury, E.	Trumpington, B.
Margadale, L.	Ullswater, V.
Marley, L.	Vaux of Harrowden, L.
Merrivale, L.	Westbury, L.
Monk Bretton, L.	Wynford, L.
Mountevans, L.

Resolved in the negative, and amendment disagreed to accordingly.

6.17 p.m.

Lord McIntosh of Haringey moved Amendment No. 18: Page 5, line 5, leave out from ("(8)") to (regulations") in line 7.

The noble Lord said: My Lords, I have already spoken to this amendment and therefore I beg to move.

On Question, amendment agreed to.

Lord McIntosh of Haringey moved Amendment No. 19: After Clause 2, insert the following new clause—

("Grant and supervision of exemptions from political restriction

—(1) It shall be the duty of the Secretary of State to appoint a person—

1. (a) to carry out the functions in relation to political restriction which are conferred by subsections (2) to (7) below; and
2. (b) to give such general advice with respect to the determination of questions arising by virtue of section 2(2) above as that person considers appropriate after consulting such representatives of local government and such organisations appearing to him to represent employees in local government as he considers appropriate.

(2) A person appointed under subsection (1) above—

1. (a) shall consider any application for exemption from political restriction which is made to him, in respect of any post under a local authority, by the holder for the time being of that post; and
2. (b) may, on the application of any person or otherwise, give directions to a local authority requiring it to include a post in the list maintained by the authority under section 2(1A) above.

(3) An application shall not be made by virtue of subsection (2)(a) above in respect of a post under a local authority except where—

1. (a) the authority have specified or are proposing to specify the post in the list maintained by the authority under subsection (1A) of section 2 above; and
1069
2. (b) in the case of a post falling within paragraph (a) or (b) of that subsection, the authority have certified whether or not, in their opinion, the duties of the post fall within subsection (2) of that section;

and it shall be the duty of a local authority to give a certificate for the purposes of paragraph (b) above in relation to any post if they are requested to do so by the holder of that post.

(4) If, on an application made by virtue of subsection (2)(a) above in respect of any post under a local authority, the person to whom the application is made is satisfied that the duties of the post do not fall within section 2(2) above, that person shall direct—

1. (a) that, for so long as the direction has effect in accordance with its terms, the post is not to be regarded as a politically restricted post; and
2. (b) that, accordingly, the post is not to be specified in the list maintained by that authority under section 2(1A) above or, as the case may be, is to be removed from that list.

(5) A person appointed under subsection (1) above shall not give a direction under subsection (2)(b) above in respect of any post under local authority except where he is satisfied that the post—

1. (a) is a post the duties of which fall within section 2(2) above; and
2. (b) is neither included in any list maintained by the authority in accordance with section 2(IA) above, section 100G(2) of the Local Government Act 1972 or section 50G(2) of the Local Government (Scotland) Act 1973 nor of a description specified in any regulations under section 2(1A) above.

(6) It shall be the duty of a local authority—

1. (a) to give a person appointed under subsection (1) above all such information as that person may reasonably require for the purpose of carrying out his functions under this section;
2. (b) to comply with any direction under this section with respect to the list maintained by the authority; and
3. (c) on being given a direction by virtue of subsection (2)(b) above, to notify the terms of the direction to the holder for the time being of the post to which the direction relates.

(7) It shall be the duty of a person appointed under subsection (1) above, in carrying out his functions under this section, to give priority, according to the time available before the election, to any application made by virtue of subsection (2)(a) above by a person who certifies that it is made for the purpose of enabling him to be a candidate in a forthcoming election.

(8) The Secretary of State may—

1. (a) appoint different persons under subsection (1) above for England and Wales;
2. (b) provide for the appointment of such numbers of staff to assist any person appointed under that subsection, and to act on that person's behalf, as the Secretary of State may with the consent of the Treasury determine;
3. (c) pay to or in respect of a person appointed under that subsection and members of such a person's staff such remuneration and such other sums by way of, or towards, the payment of pensions, allowances and gratuities as the Secretary of State may so determine; and
4. (d) provide for a person appointed under that subsection and such a person's staff to hold office on such other terms as the Secretary of State may so determine.")

On Question, amendment agreed to.

Clause 4 [Designation and reports of monitoring officer]:

Lord McIntosh of Haringey moved Amendment No. 20: Page 6, line 13, after ("represented") insert ("other than a decision in connection with the operation of section 2 above").

The noble Lord said: My Lords, let me say at the outset that this is a probing amendment. I say that with due humility knowing that the conditions for the work of the monitoring officer will have changed as a result of amendments which have just been agreed.

We have now reached Clause 4, which deals with the role of the monitoring officer whose function in a local authority is to see that the political restriction provisions in Clauses 2 and 3 are properly carried out. We seek the Government's view at this time, before the Bill completes its process through the House, as to what the role of the monitoring officer is in the designation of staff in sensitive posts.

The effect of the amendment would be to remove the monitoring officer from having a role in the operation of the process under subsection (2). Among the functions of the monitoring officer are, for example, those of dealing with the certification of appointments to ensure that the proper procedures have been followed. If the monitoring officer feels that something has been done incorrectly he must report within three weeks to a meeting of the authority to ensure that action is suspended on the issue in the meantime.

The Minister made clear in Committee that the authority has a discretion about what action should follow the issue of the report. The procedure makes it clear that the monitoring officer is a whistle-blower—I think that that is the word—in other words, he has the duty of drawing to the attention of the authority anything which has been done incorrectly.

It seems to us that the amendments which have now been carried might shift the balance of responsibility between the adjudicator, who now has the function to which I should have referred when moving the amendments—that of giving general advice to authorities, to which they should have regard, about the operation of t he political restrictions provisions—and the monitoring officer, who had that role before the amendments were agreed to. We are seeking information. We want to know now how the Government see the role of the monitoring officer. I beg to move.

Lord Hesketh

My Lords, the amendment would exclude decisions in connection with Clause 2 of the Bill from the duty of the monitoring officer to prepare a report under Clause 4(2).

I cannot see any justification for that. The provision for a monitoring officer to be designated in every authority and to prepare reports where appropriate is based on the recommendation in the White Paper The Conduct of Local Authority Business that each authority should designate an officer to be responsible for matters of legality and propriety. It seems to me that decisions in connection with Clause 2 are likely to raise questions of legality and propriety. If, for example, an authority did not correctly identify the characteristics of a post which should be politically restricted it would be right for the monitoring officer to consider taking action and to have power to do so.

The subject of politically sensitive posts covered by Clause 2 is controversial and involves questions of definition, propriety and legal correctness. I think that is exactly the area in which the monitoring officer should be involved. The intension behind Clause 4 is that the monitoring officer should be able to deal with any instance of suspected illegality or impropriety, and it would be logical to exclude decisions in that important area.

The noble Lord, Lord McIntosh, said that the amendment was by nature a probing amendment. I hope that what I have said provides him with a better idea of the Government's position.

Lord McIntosh of Haringey

My Lords, I am grateful to the Minister. His explanation provides a better idea of the Government's position. However, it does not satisfy me that it is right. In talking about the monitoring officer's role, the Minister has not paid adequate attention to the adjudicator's changed role.

The amendments which have just been approved give the adjudicator the duty to consider appeals made to him against the incorrect classification of a post as being politically sensitive, and also the duty and the right to consider, whether as a result of application to him or otherwise—in other words, off his own bat if he wants to—any case where he considers that an authority has been too lenient in the classification of a post. After all, it is the classification of a post with which we are concerned in Clause 2.

In addition, the amendments provide that the adjudicator shall issue general advice about the application of the Bill and its subordinate legislation, and that the local authority concerned shall have regard to that general advice. In those circumstances, it seems to us that the adjudicator is taking over most, if not all, of the functions in relation to Clause 2 which were originally intended to be the monitoring officer's functions.

It is difficult for us to see why the monitoring officer should be duplicating work which, in the end at any rate, should be done by the adjudicator. It may well be that as a result we should all, including the Government, read the amended Bill before the next stage and consider whether we have reached the right relationship between the adjudicator and the monitoring officers to be set up by local authorities. I rather fear that we have not, and that we have not had time to give adequate consideration to that relationship.

I fear that we are setting up a system which will be unwieldly and will involve duplication between those two types of officials. I should like all of us to have time to think about it before the next stage, and in order to give us time I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 7 [Duty to adopt standing orders with respect to staff]:

Lord Graham of Edmonton moved Amendment No. 21: Page 10 line 3, after ("may") insert ("subject to subsection (1A) below and").

The noble Lord said: My Lords, I shall speak also to Amendment No. 22. We are dealing with Clause 7, which in the margin says: Duty to adopt standing orders with respect to staff". It may be helpful if I give the preamble. Clause 7(1) provides: The Secretary of State may by regulations require relevant authorities, subject to such variations as may be authorised by the regulations—

1. (a) to incorporate such provision as may be prescribed by the regulations in standing orders relating to their staff; and
2. (b) to make or refrain from making such other modifications of any such standing orders as may be so prescribed".

I am seeking to add: (1A) A local authority shall not be required to incorporate regulations, or make or refrain from making modifications to standing orders contained in such regulations (or in regulations made under section 18 below) where it determines with the agreement of all parties to make alternative provision".

In Committee, the possibility was held out that local authorities might be able to opt out of prescribed standing orders where there was general agreement among authority members that a local alternative was preferable. The amendment seeks to give effect to that option. We hope the Government will be able to indicate that their own thinking, through the standing orders working party, has been moving in the same direction.

In essence, we are saying that where there is no local political or party animosity, and where there is common agreement that they can devise a set of standing orders which is more suitable and more local, we believe that they should not have laid upon them the prescriptions contained in Clause 7(1)(a) and (b). I beg to move.

Lord Reay

My Lords, the effect of the amendment is to restrict the power of the Secretary of State to require local authorities to incorporate core on mandatory standing orders prescribed by regulations under Clauses 7 and 18. Provided that all parties on the local authority agree on an alternative provision to the core standing order, a local authority would not be required to adopt it or to make or refrain from making modifications to the standing order.

A working group of representatives of the local authority associations and the Department of the Environment has within the last few days presented to the Secretaries of State a report which proposes a new model core of standing orders for local authorities. The working group has recommended that in appropriate circumstances local authorities should be able to suspend certain of the core standing orders where proper notice has been given of the proposal and all political groups on the council are content. However, in a number of other cases, such as the provisions concerning the appointment and dismissal of staff, suspension would probably not be appropriate.

The desirability of requiring general rules on the appointment and discipline of local authority staff can also be justified on further grounds. First, the council may be composed merely of one political party. It should not on that account be able to rewrite the rule book. Secondly, the appointments are permanent. A future council should be able to rely upon the fact that appointments have been properly made. Thirdly, the staff should be able to rely upon the observance of national standards. We shall be consulting local government on these issues. In the light of these arguments and that assurance, I hope that the noble Lord will feel able to withdraw his amendments.

Lord Graham of Edmonton

My Lords, I am grateful for what the Minister said but I should like further clarification. He referred quite rightly to the working party and indicated that it was of a mind to include in its recommendations the kind of move which this amendment seeks. Of course some elements cannot be left to local choice but other elements can.

The Minister tells us fairly that, when we talk about all-party agreement, in some councils with only one party that could be a prescription for Tammany Hall, gerrymandering, riding roughshod and all the other clichés which Ministers and Opposition spokesmen use from time to time. Can the Minister tell me, if I withdraw the amendment, that what I have suggested is not wholly ruled out but that it could still be put into effect through the working party on these matters?

Lord Reay

My Lords, I cannot give any assurance other than that we shall continue to consult local government on these issues. At the moment the arguments which I put to the House are those which we feel should apply. Therefore I cannot accept the noble Lord's amendment.

Lord Graham of Edmonton

My Lords, before I withdraw the amendment, is the Minister saying that it is still part of an ongoing discussion or consultation? He understands that it is academic as to whether I withdraw this or press it because at the end of the day what matters is the Government's intention.

I believe that we have gone a fair way. I recognise that there are problems. If the Minister will give me the assurance that those better able than myself—and with no disrespect to him perhaps better than himself—will involve themselves in the argument and that it will still be on the table, I shall withdraw the amendment. Can he give that assurance?

Lord Reay

Yes, my Lords, we shall continue to consider the matter.

Lord Graham of Edmonton

My Lords, I am more than grateful for that clarification. It has been a worthwhile seven minutes of the time of the House. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 22 not moved.]

6.30 p.m.

Lord Graham of Edmonton moved Amendment No. 23: Page 10, line 23, at end insert— ("(aa) to set out requirements in respect of the manner of advertisement of posts;").

The noble Lord said: My Lords, this amendment deals with the advertisement of matters contained in standing orders which relate to jobs being advertised externally. This is a probing amendment designed to elicit further details of the Government's thinking on the requirement to be incorporated in standing orders that all jobs should be advertised externally.

The hope is that the Government will be able to indicate that the manner of such advertisement will be a matter for local authority discretion. At the moment the Bill says, in the rubric, Duty to adopt standing orders with respect to staff". Under subsection (3), it says: Without prejudice to the generality of subsection (1) above, regulations under this section may require a relevant authority's standing orders— (a) so to restrict the manner of exercising the power to take steps for or towards the selection of candidates for interview, or for appointment, as to make it exercisable only by the authority themselves, by a committee or sub-committee of the authority or by particular officers of the authority". We suggest the insertion of: to set out requirements in respect of the manner of advertisement of posts". We believe that if that phrase is inserted, it gives a little discretion. That would ease the weight of deciding whether posts of these grades should be advertised nationally, in local newspapers or by means of factsheets available from the local authority etc.

It is hoped that the Minister will give a satisfactory reply because we believe that without the amendment there is potentially an onerous requirement which would cost a great deal of money and create frustration and delay. As the Minister and his colleagues are concerned about better and more accountable local government, we believe that this simple amendment ought to help them. I beg to move.

Lord Reay

My Lords, this amendment would authorise the regulations requiring local authorities to adopt standing orders on specified lines to include provision setting out requirements on advertisements for posts in the local authorities' service.

It is to a certain extent surprising to find noble Lords opposite wanting to widen the Government's powers to impose requirements on local authorities. The general refrain that we have heard from the Benches opposite has been that we are trying to do too much in that direction. However, we are always happy to consider proposals, from what ever source, on their merits. Nevertheless, having considered this one, I am afraid I cannot recommend your Lordships to accept it. What it proposes is that the regulations should be able to deal with, the manner of advertisement of posts". As the noble Lord, Lord Graham of Edmonton, is no doubt aware, we have this week received the report of the Joint Working Group on Local Authority Standing Orders, set up jointly by the Government and the local authority associations, under the distinguished chairmanship of Mr Richard Brockington, the director of administration of Newcastle-upon-Tyne City Council. Among other things, this working group considered the provisions which should be introduced under this section. Its recommendations contain provision for requiring local authorities to address their minds to the question of which posts should be advertised publicly. It has not, however, recommended that there should be any requirements for the manner of the advertisement, nor has it suggested that the Bill should be amended so as to permit this.

Let us consider an example of how the requirements for regulations on the manner of advertisements might work. Some local authorities make a practice of including in every advertisement a statement in detail about their employment policies, for example, for minority groups and the disabled. Others content themselves with saying that they are an equal opportunity employer. Others think that this is so obvious that they do not use advertising space on it at all.

The noble Lord's amendment suggests that we standardise on one of these approaches. It does not seem to the Government to be a matter on which standardisation is necessary. We are reluctant to intervene in local authority procedures except where there is a clear case for doing so. I recognise the sincerity of the views put forward by the noble Lord, but I am not convinced that local authorities need any direction from Parliament or the Government in this matter. We believe that it is one which should be left to local discretion.

Lord Graham of Edmonton

My Lords, what the Minister has said in his last 20 words was what I thought was the gravamen of my amendment. If that is what he intends, I shall not press the amendment, although the Minister's words do not have the same strength as words on the face of the Bill. I had to smile wryly when he said that it was not the Government's intention to interfere in the affairs of local government. Over the last few years they could have fooled me.

However, the Minister has genuinely tried to be helpful and drawn to my attention that what the amendment seeks to achieve is in the mind of the Government. I was interested that he rested his case heavily on the fact that the working party made no reference to this matter. I would like to believe that the working party's comments form the noble Lord's Bible and that he will not pick and choose from them as is the habit of Ministers when they receive a report. When a report contains issues Ministers wish to plead in aid, they refer to it, but when they do not like what we are saying they do not acknowledge that we are using the same report to support our arguments.

However, the noble Lord has been helpful, and obviously those outside the House who watch these matters with great care will read his words with care. I believe what he has had to say is helpful in this context. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Graham of Edmonton moved Amendment No. 24: Page 10, line 31, after ("a") insert ("clearance").

The noble Lord said: My Lords, in moving this amendment I wish to speak also to Amendments Nos. 25 and 26. On 20th July the Minister explained that the role of a monitoring officer in relation to appointments to politically restricted posts was intended to be narrower than the words on the face of the Bill suggested. He said: We feel that it is enough for the monitoring officer to sign a clearance report without having to submit it before the appointment is confirmed. This should ensure that, except where an appointment has not been properly made, appointments are not delayed … The Government's intention is that this power to require a report by the monitoring officer should be used only in respect of posts where councillors are involved in the appointment process".—[Official Report, 20/7/89; col. 979.] The Minister explained that the monitoring officer would not personally have to attend every appointment meeting but would merely have to ensure that there was a system in place to bring to his or her attention any questionable cases.

We believe that these were helpful statements and that they pointed to a practical system which would not serve to clog up the appointments procedure in local authorities, nor disadvantage candidates while procedures were being ratified with which they themselves had no connection. We very much hope that the noble Lord will accept Amendments Nos. 24, 25 and 26 because we believe that they would give effect to the Government's intentions.

The noble Lord and his advisers are well aware that those outside the House are always anxious to translate what has been said into words on the face of the Bill for the very good reason that Ministers come and go but the words remain. We all know that it is the words on the face of the Bill that will be interpreted, re-interpreted or even misinterpreted outside the House.

If the noble Lord is unable to accept the amendments, I hope that he can point to the means by which the apparently broad terms in which the Bill is drafted will be limited in practice. Clause 7(3)(c) states that the monitoring officer will be required to: prepare a report to the authority in respect of every proposed appointment of a person to a politically restricted post".

Clause 7(3)(d) sets out the requirements for such a report. It states that every report must state whether or not there had been any contravention of Part I of the Bill or whether any matter had been taken into account which should not be taken into account and which may call into question the procedure used. These are potentially onerous requirements, particularly as authorities will be anxious to give proper effect to the provisions of Part I. It would be helpful if the Government were to seek a more tangible expression of the practical sentiments which were expressed by the Minister in Committee. I beg to move.

6.45 p.m.

Lord Reay

My Lords, Amendments Nos. 24 and 25 would replace the requirement of a report by the monitoring officer of proposed appointments with a requirement for a clearance by the monitoring officer of such appointments. These amendments would replace the Government's clear proposals with something in our view much less clear and less workable. Our proposal is that when members are involved in the appointment process the monitoring officer should be required to issue a report that all is well. Once he has done so the proposed appointment may proceed. If he cannot report that all is well, his report must explain why, and then the appointment would be delayed until the full council has resolved that, notwithstanding the monitoring officer's reservations, the appointment should proceed.

These amendments would instead provide that the monitoring officer should merely issue a clearance. Such a clearance would not be a report in the sense of Clause 4, and so would not attract the suspensive provisions of that clause, which are what (on our proposals) would give the requirement its effect: even if the monitoring officer failed to issue a clearance, there would be nothing to stop the appointment proceeding. Likewise, the deletion of the word "proposed" would mean that the appointment could proceed, in spite of the monitoring officer's reservations.

Our view is that if the council's senior adviser thinks that there is something legally wrong with an appointment, the council as a whole should have an opportunity to consider the reasons for that view and decide whether it agrees. The monitoring officer cannot overrule the council: he can merely require it to consider his reasons. In the light of that explanation, I hope the noble Lord will withdraw those amendments.

Before I sit down I wish to speak also to Amendment No. 26. This would limit the power to prescribe the requirement of a monitoring officer's report to appointments involving the participation of elected members. I can confirm that it was always the Government's intention that the provisions to be made in this direction should be those that involve elected members in the process of appointment. We have no intention of doing otherwise, and indeed the proposals that have emerged from the joint working group of government departments and local authority associations on this topic make this clear. However, we are not convinced that it is appropriate to spell this out in the legislative power for this requirement. The reason for this is the difficulty of defining quite what involved means. If we restrict the power of the regulations in the way proposed, there is a risk that the words: involved in the process of appointment", or whatever other formulation is adopted, could be interpreted to mean a more restrictive type of involvement than it is appropriate to regulate.

Any regulations that are made under this clause are subject to parliamentary scrutiny and debate: we shall have to justify our proposals to your Lordships if any of your Lordships so wish. We think that, given the manifold ways in which appointments can be made, it is desirable to keep as flexible an approach as possible on the details of precisely which appointments can be subjected to general rules, always subject, as I have said, to parliamentary scrutiny and control.

I hope that, in the light of this explanation and the assurance that I gave at the outset that in principle the Government agree with the policy behind Amendment No. 26, the noble Lord will feel able to withdraw his amendment.

Lord Graham of Edmonton

My Lords, as always the noble Lord has been helpful. Nevertheless, I am still puzzled at what I believe is a contradiction between what was said on 20th July and his inability to accept our Amendments Nos. 24 and 25 which give effect to that. I repeat what the Minister said on 20th July (at col. 979 of the Official Report): We feel that it is enough for the monitoring officer to sign a clearance report without having to submit it before the appointment is confirmed. This should ensure that, except where an appointment has not been properly made, appointments are not delayed". Will the noble Lord take that point on board? I listened carefully to every word the noble Lord said, but I believe that in his opening remarks he expressed a view that was contrary to what was said on 20th July. Our amendments give effect to what his ministerial colleague said on that earlier occasion.

I accept the noble Lord's comments on Amendment No. 26, as he said that he accepted the thrust of the policy. Those outside the House will have to make the best they can of those remarks, but I am genuinely puzzled as to why he is unable to accept the amendments. The arguments he has made tonight are not the arguments that were made by his ministerial colleague in July. In the light of the comments he has made tonight, I can see that we have a problem. We tried to give effect to what his ministerial colleague said in July. I should be grateful if the Minister could give me some further help before I withdraw the amendment because I have no intention of pressing it.

Lord Reay

My Lords, our objection is that "clearance" as described in the amendment is not the same as a report and would not have the same function as a report. That was one of the objections that I tried to bring out.

Lord Graham of Edmonton

My Lords, we shall not get any further. I repeat that the Minister's colleague said: We feel that it is enough for the monitoring officer to sign a clearance report without having to submit it before the appointment is confirmed". Clearly, there is room for misunderstanding. The Minister said that one of the arguments is an inability to understand what could be meant by the word "involved". It is clear that there are hundreds of words which will be interpreted differently by monitoring officers, councils, councillors and trade unions. The Bill will be a minefield. The issue will run and run, and there will be cross relationships between all levels of activity in local government. However, unless the Minister wishes to intervene in my peroration, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 25 and 26 not moved.]

Clause 8 [Assistants for political groups]:

Lord Graham of Edmonton moved amendment No. 27: Page 12, line 23, leave out ("£13,500") and insert ("any amount specified in regulations under section 2").

The noble Lord said: My Lords, we have already dealt with amendments which impinge upon Clause 8. The clause deals with political assistants to party groups on councils.

Amendment No. 27 relates to the £13,500 salary bar for political assistants. Time has moved on. There was debate at Committee stage on the removal of the salary bar for political assistants appointed under Clause 8. The amendment was withdrawn in the light of the feeling in the Committee that some salary limit might be appropriate for posts in which political affiliations were relevant to the appointment.

However, amendments to Clause 2 were agreed under which political restriction bites at the level of spine point 44 in respect of all other current officers of the council. Amendment No. 27 is tabled in order to enable the Government to state whether a similar level would be appropriate for political assistants. It seems to us anomalous to impose a fairly low salary level, equivalent to junior management in a local authority, on such persons, who will as a result face substantial political restrictions.

The restrictions are all the more onerous because such persons are precisely those who are known to have political affiliations and who undertake political activity since that is a relevant factor in their appointment to the post. To require someone who is politically active both to give up his or her activities in large measure and also to accept a fairly low salary seems to us to be particularly severe. The severity is underlined by the much more reasonable regime which the Government have now agreed should be applied to the rest of local government.

The general issue of the position of political assistants under the Bill is now somewhat uncertain. I refer to the consultative document, in which political activities are to be restricted for such officers. That document is still awaited. It would be helpful if the Government would indicate at this stage, if they have not done so in relation to earlier amendments, when that document can be expected and whether its contents will inform parliamentary discussion at any stage. Given the uncertainty concerning the activities likely to be restricted, the question of the level at which such restrictions might bite is all the more important as a late issue to be dealt with by Parliament following its agreement to the new regime under Clause 2.

The Minister and his advisers have been helpful. However, there remains that sore thumb. It does not affect one party only. It affects the political assistants to more than one party in large authorities. I hope that the Minister can be helpful. I beg to move.

Lord Hesketh

My Lords, the amendment would link permanently the maximum pay for assistants to political groups to the dividing line in the system of political restrictions. We do not believe that that is the right approach. There may be arguments at some future date for the maximum pay of political assistants to be higher, or even lower, than the dividing salary point in the restriction system. The amendment would prevent that.

However, I can announce that the Government accept that the figure of £13,500 in the Bill is too low. I can undertake that we shall use the power in the Bill to raise the maximum forthwith to £19,500. I hope that that assurance will persuade the noble Lord, Lord Graham of Edmonton, that there is no need for the amendment.

Lord Graham of Edmonton

My Lords, as my colleague the noble Lord, Lord Underhill, says, it is a move in the right direction. Whether it goes as far as we should like is another matter.

The Minister has placed political assistants in the same position as other officers. We tried to make the case that those who are employed professionally as assistants to political parties are in a very special category. In many cases they deserve higher salaries. However, I note what the Minister has said. I shall read the Official Report very carefully. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Graham of Edmonton moved Amendment No. 28: Page 14, line 9, at end insert— ("(10A) Nothing in this section shall affect the terms and conditions of any person holding a post at the date of Royal Assent whose duties would otherwise fall within this section, nor any such postholder thereafter.").

The noble Lord said: My Lords, in our view this is a very important amendment. We want the Minister to place on record what we hope will be a useful indication as to the position of existing postholders in analogous jobs. It is understood that the Government have decided that, since political affiliation is a relevant factor in the appointment, the posts under Clause 8 are unlike any other post in local government. For that reason the restrictions contained in Clause 8,—for example, with regard to salary—would not apply to persons performing analogous roles in local authorities at present.

A number of local authorities of all political colours employ officers to act as researchers and personal assistants to elected members, performing an analogous role to that envisaged in Clause 8 of the Bill. There has been considerable concern that such persons, particularly where they perform a management role in an office of such officers, could face a reduction in salary and a change to their terms and conditions as a consequence of the operation of the clause. It is understood that that is not the Government's view of the operation of the clause and that existing postholders would therefore be unaffected by its precise terms. However, it must be assumed that such postholders are affected generally by the political restrictions provisions in Clause 2 to the extent that they would fall within either of the sensitive categories or, in an isolated case, might fall above the salary limit.The latter seems unlikely given the generally fairly junior nature of the posts concerned.

We are talking in terms of existing posts. A further question arises concerning the status of such a post once an existing postholder moves on. I wonder whether the Government are able to give assurances in respect of existing postholders. Do those assurances as to salary and terms and conditions hold good for successors in post? Similarly, would any reorganisation of such posts at a future date by an authority bring them within the ambit of Clause 8? To put it simply, many authorities have more than one officer employed to work with elected members of the political parties represented on the council. A simple interpretation of what is now understood to be the Government's position is that Clause 8 would apply only to such arrangements as are instituted afresh within its provisions, probably by an authority which has not until now employed political assistants.

Amendment No. 28 says it all. It states: Nothing in this section shall affect the terms and conditions of any person holding a post at the date of Royal Assent whose duties would otherwise fall within this section, nor any such postholder thereafter".

It might be termed protection or insurance. We are talking here about dealing with people in existing posts who may not be wholly covered by the terms of Clause 8. I beg to move.

7 p.m.

Lord Hesketh

My Lords, the effect of the amendment would be that any person holding a post at the date of Royal Assent whose duties would otherwise fall within Clause 8 would not be caught by the restrictions on assistants to political groups.

The amendment is unnecessary. A person holding a post of assistant to a political group at the time the Bill receives Royal Assent will not be holding an appointment pursuant to Clause 8 and will therefore be outside its controls. However, when that post becomes vacant and the local authority wishes to fill it, or if the local authority wishes to create new posts, then the provisions in Clause 8 will apply. But I remind noble Lords that that situation will arise in respect of those posts after Royal Assent. That is why I hope that the noble Lord, Lord Graham of Edmonton, will see fit to withdraw his amendment.

Lord Graham of Edmonton

My Lords, the Minister has given me the assurances that my amendment seeks to protect; namely, that those in post on the date of Royal Assent who fulfil functions that would otherwise be caught by Clause 8 will be able to continue in post and will not be subject to the conditions. I note that he was quite right and proper in using the Royal Assent date as the measuring rod, but perhaps he will tell us a little more about what will happen to the person concerned if a council seeks to continue with the post but not the postholder after Royal Assent. In other words, the post will continue; only the man or woman in the post will be replaced. What will be the effect of the Bill upon a person holding a job of that kind?

Lord Hesketh

My Lords, as I understand it, if that person left the post and went back into the mainstream, so to speak, he would be subject to the rules in Clauses 1 to 3.

Lord Graham of Edmonton

My Lords, that is a very good answer but it is not an answer to the question that I asked. Let us suppose that there is a post and a person in that post. I am not concerned with the person at this stage. The person leaves, but the post remains. The council then wishes to fill that post. Will the conditions of protection that the postholder enjoyed before he left also apply to the incoming postholder?

Lord Hesketh

My Lords, I apologise to the noble Lord, Lord Graham of Edmonton. Now that he has put his question a second time I think that I understand it. I believe I am correct in saying that once it becomes a new post—a post-Royal Assent post—it will have to fit in with the new rules with regard to the authority's power as contained in Clause 8. The assurance that I give this evening applies only to those posts in existence now.

Lord Dormand of Easington

My Lords, the Minister said, "Once it becomes a new post". I am not sure that that is what my noble friend is saying. He is agreeing with me. If I understand my noble friend correctly, he is saying that the post remains even though the postholder has moved on somewhere else. The Minister has just said that that creates a new post. Perhaps we should have another comment upon that.

Lord Graham of Edmonton

My Lords, to be helpful to the Minister—and I appreciate that I have not explained myself with my customary clarity—the point that I want him to take on board is that we have not created a new post or even a new situation. We have the same post with a new man or woman doing the same old job. What will be the impact of the Bill on the salary, proscriptions and control of that man or woman? It is a case of the same job, but a new man or woman.

Lord Hesketh

My Lords, I hope that I can answer the question succinctly—new post, new person.

Lord Graham of Edmonton

My Lords, what about old post, new person?

Lord Hesketh

My Lords, old post, new person. That is in the same position as a new post.

Lord Dormand of Easington

My Lords, with the leave of the House perhaps I may speak again. As I understand it, the Minister is saying that, if it is a new person, ipso facto that makes it a new post. That is what puzzles me and perhaps my noble friend too.

Baroness Seear

My Lords, perhaps I have misunderstood everything, but I thought that I had got the position clear. Perhaps it would help if I said what I thought to be the situation. I think that the Minister means—if I may put words into his mouth—that, as long as the existing chap stays in the job, he keeps his existing conditions of employment. When he goes and a new person is appointed to step into his shoes in that position, that new person is subject to the new law. Is that right?

Lord Hesketh

My Lords, as always, the noble Baroness, Lady Seear, has with clarity extolled the position exactly as I understand it to be.

Lord Graham of Edmonton

My Lords, of course, the Minister would say that because what the noble Baroness, Lady Seear, said is exactly what the Minister said. That is not my question. When a man or woman leaves a post and the post must be filled, it is a new situation. But it is not a new post. It is the old post. It is the same post. What are the conditions to which the new person who takes up the old post is subject? The purpose of the amendment is to protect the old person in the old post. I have that assurance. The gravamen of my amendment is accepted. I asked a question some minutes ago about the status of the new person in the same post.

Lord Hesketh

My Lords, I believe that what the noble Baroness, Lady Seear, said is exactly as I understand the position to be. I shall try, in a less effective way than the noble Baroness, to explain it again. If a new post is created—

Noble Lords

No!

Lord Hesketh

My Lords, I must put the parallel. If a new post is created, the new rules apply. When an old post is vacated and refilled, the new rules apply.

Lord Graham of Edmonton

My Lords, I understand that the new person is subject to the new rules. That is an answer and I appreciate the position. I should have thought that, if we are talking about the post and the functions involved in the post, we should not be concerned about the man or woman carrying out those functions. It is a matter of the protection of the post. But the Minister says that, as soon as that man of woman has gone, the new regime will be imposed upon that postholder. That certainly is not to my liking. The Minister has satisifed me so far as concerns this amendment. However, I shall tell him for nothing that there are those outside the House who will read what he has said in explanation of the points raised and who will have some questions to ask. I wonder whether it would be helpful for me to continue to make the point or to leave it there.

Lord Denham

My Lords, if the noble Lord will give way, perhaps I may remind him that this is Report stage and not Committee stage. We are getting out of order. When my noble friend has replied, I am afraid that at Report stage that must be the end of the matter.

Lord Graham of Edmonton

My Lords, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Reay

My Lords, I beg to move that further consideration on Report be now adjourned until ten minutes past eight o'clock.

Moved accordingly, and, on Question, Motion agreed to.

[The Sitting was suspended form 7.10 to 8.10 p.m.]

Clause 10 [Confidentiality of staff records]:

Lord McIntosh of Haringey moved Amendment No. 29: Page 15, line 18, leave out ("Subject to subsection (3) below").

The noble Lord said: In moving Amendment No. 29 I should like to speak also to Amendment No. 30: This matter was debated in Committee in this Chamber and at considerable length in another place. It concerns the issue of confidentiality of the detailed identifiable information about salaries of local government employees from public inspection.

In another place, Mr. Gummer, and in Committee here the noble Lord, Lord Hesketh, expressed some sympathy for the view that even with the general extension in the right to information about local authority activities, with which we agree, it would nevertheless not be wrong for there to be some protection for individual officers' salaries. After all, in the private sector individual salaries are not publicly available. Scales of salaries are available in the Civil Service though not individual salary positions on those scales. There is provision in companies legislation for information on a very limited scale about directors' salaries but not of other highly paid employees. It seeems to us wrong that in local government there should be an unfettered availability to the public of the salaries of individual officers.

That is not something new. It has been a matter of discussion between the local authority associations, the Audit Commission and government for a considerable time. A joint working party of the local authority associations and the Audit Commission is working at this moment on the relative priority to be given to the rights of electors and objectors in relation to local authority accounts and the rights of individual local government staff to some degree of confidentiality about salaries.

In this amendment we do not suggest that we should prejudge the decision of that working party. We suggest that the Bill as at present drafted prejudges the decision of that working party. As a holding operation—perhaps no more than that—we suggest that subsection (3) of Clause 10, which is concerned with confidentiality of staff records, in prudence would be better excluded from the Bill. Amendment No. 30 provides for that.

Amendment No. 29 provides in subsection (2) for the deletion of the reference to subsection (3), which Amendment No. 30 deletes. These amendments are perhaps rather negative. They do not provide for as much openness and accountability of salaries as might be desirable. However, as drafted the Bill seriously prejudges the working party report, and we do not think that legislation ought to be put in in the middle of the consideration which is being given to this somewhat thorny issue.

We hope the Government will feel that the deletion of subsection (3) is a wise precaution at the moment. It would be possible at any later stage, of course, to give effect to the conclusions of the joint working party of the Audit Commission and the local authority associations. I beg to move.

Lord Reay

My Lords, the effect of these amendments would be that the protection provided by Clause 10 to employees of local authorities and certain other bodies at the time of audit would not be limited.

The clause provides that, while otherwise personal information about employees should not be available for public inspection at that time, information about individuals' gross pay and other benefits, before deductions, remains publicly available. With this clause we were fulfilling an undertaking, given after full consultation, to put the law back to what it had always been understood to be before a High Court ruling in April 1986.

As my noble friend made clear in Committee, we have a great deal of sympathy with the view that the law might indeed go even further so as to extend protection to all personal information about individual employees. But we remain of the view that it is important to keep the right balance between personal privacy and public accountability. Therefore, as the noble Lord, Lord McIntosh, mentioned, we have sought the views of the Audit Commission and the local authority associations so as to see what might be the best way of achieving that balance. We shall wish to consider their recommendations very carefully. But we are concerned to ensure that, in the meantime, there should be no question of any information about individual local authority employees being open to abuse.

On that basis, we are prepared to accept these amendments.

Lord McIntosh of Haringey

My Lords, I am grateful for that response. I am sure that the local authority associations will also be grateful for it. It shows that the Government are willing to listen to argument and that they take consultation seriously. The noble Lord rightly referred to the High court judgment of April 1986 which upset the previously understood balance between accountability and privacy. It is right that the balance should be restored to what had generally been agreed was the right position and it is right that this Bill should not seek to upset consultations and discussions which are in progress.

On Question, amendment agreed to.

Lord McIntosh of Haringey moved Amendment No. 30: Page 15, line 27, leave out subsection (3).

On Question, amendment agreed to.

Lord Hesketh moved Amendment No. 31: After Clause 16 insert the following new Clause:

("Schemes for basic, attendance and special responsibility allowances for local authority members

—(1) The Secretary of State may by regulations authorise or require any such relevant authority as may be specified or described in the regulations to make a scheme providing for the payment of—

1. (a) a basic allowance for every member of the authority who is a councillor;
2. (b) an attendance allowance in relation to the carrying out by any such member of such duties as may be specified in or determined under the regulations; and
1086
3. (c) a special responsibility allowance for any such member who has such special responsibilities in relation to the authority as may be so specified or determined.

(2) Regulations under this section may also authorise or require a scheme made by a relevant authority under the regulations to include provision for the payment to appointed members of allowances in respect of such losses of earnings and expenses as—

1. (a) are necessarily sustained or incurred in the carrying out, in connection with their membership of the authority or any committee or sub-committee of the authority, of duties specified in or determined under the regulations; and
2. (b) are not of a description in respect of which provision is made for an allowance under any of sections 174 to 176 of the Local Government Act 1972 or sect ions 46 to 48 of the Local Government (Scotland) Act 1973.

(3) Without prejudice to the generality of the powers conferred by subsections (1) and (2) above, regulations under this section may contain such provision as the Secretary of State considers appropriate for requiring a scheme made by a relevant authority under the regulations—

1. (a) to make it a condition of any payment by way of allowance that, in the financial year to which the payment would relate, the aggregate amount which t he authority has paid out or is already liable to pay out under the scheme does not exceed such maximum amount as may be specified in or determined under the regulations;
2. (b) to make provision for different maximum amounts to be applicable, for the purposes of any such condition, in relation to different allowances or in relation to different members or members of different groups;
3. (c) to make provision in relation to claims which cannot be paid by virtue of such condition and provision for the payments to members of the authority who are councillors of an amount by way of supplement to the basic allowance where, in any financial year, the aggregate paid out or owing under the scheme is less than an amount specified in or determined under the regulations;
4. (d) to provide that the amount authorised by virtue of subsection (2) above to be paid by way of allowance in any case shall not exceed such amount as may be so specified or determined;
5. (e) to contain such provision as may be so specified or determined with respect to the general administration of the scheme, with respect to the manner in which, time within which and forms on which claims for any allowance are to be made and with respect to the information to be provided in support of any such claim;
6. (f) to contain such provision as may be so specified or determined for avoiding the duplication of payments or of allowances, for determining the bodies by which payments of allowances are to be made and for the apportionment of payments between different bodies.

(4) Regulations under this section may—

1. (a) prohibit the payment, otherwise than in accordance with sections 174 to 176 of the Local Government Act 1972 or sections 46 to 48 of the Local Government (Scotland) Act 1973 or in such other cases as may be specified in the regulations, of any allowance to a member of a relevant authority who is a councillor or to any appointed member of a relevant authority;
2. (b) impose requirements on a relevant authority with respect to the publication, in the minutes of that authority or otherwise, of the details of amounts paid in pursuance of a scheme made under the regulations; and
3. (c) contain such incidental provision and such supplemental, consequential and transitional provision in connection with the other provisions of the regulations as the Secretary of State considers appropriate.

(5) In this section "relevant authority" means—

1. (a) a local authority of any of the descriptions specified in any of the paragraphs of section 19(1) below, other than paragraphs (d) and (j), or in section 19(2) below; or
2. (b) any body on which a body which is a relevant authority by virtue of paragraph (a) above is represented and which is designated as a relevant authority for the purposes of this section by regulations made by the Secretary of State; 1087 and references in this section to an appointed member, in relation to a relevant authority, are references to any person who is a member of the authority without being a councillor or who is a member of one or more of the authority's committees or sub-committees without being a member of the authority.").

The noble Lord said: My Lords, in moving this amendment I propose to speak also to Amendments Nos. 193, 194, 196, 198, 199, 200, 202, 208, 209, 210, 211, 212, 213, 214, 215 and 216. This new clause and the group of amendments to Schedules 11 and 12 make provision for the Secretary of State to introduce a new scheme of councillors' allowances.

When noble Lords considered an amendment on this subject moved by the noble Lord, Lord McIntosh, in Committee, I reported on the joint proposals then recently put forward by the main English and Welsh local authority associations for an alternative system of councillors' allowances based on a combination of a flat rate and attendance allowances, with a limit on the total that each council may spend, and a restriction on the definition of approved duties. I said then that the Government considered this to be a constructive approach, which we were willing to consider and discuss further with the local authority associations.

I am glad to be able to report to your Lordships that these discussions have made excellent progress, and we have been able to develop a scheme which meets the local authority associations' main concerns about a straight flat rate allowance, while meeting the Government's objectives set out in the White Paper. This has enabled us to bring forward these amendments which provide the necessary powers for the Secretary of State to set up the new scheme, which we intend should be introduced from 1st April, 1990.

Although there are some detailed points which we have yet to resolve, I am very pleased that the main English and Welsh associations have been able to endorse the main features of the scheme. Lord James Douglas-Hamilton has also held discussions recently with the Convention of Scottish Local Authorities and was able to meet some, if not all, of its anxieties. I think that this is important because I know it is a very sensitive issue among councillors, and opinions differ widely across political groups. The new scheme will provide councils with a good deal of flexibility to set up a system of allowances which best suits them, and I hope that the local authority associations will help to put this message across.

The amendments are mostly framed in terms of regulation-making powers which will enable the Secretary of State to specify the way in which the new scheme will operate. It may therefore be helpful to your Lordships if, in describing the provisions, I explain the main elements of the scheme which it is proposed to provide under the regulations.

Subsection (1) of the new clause enables the Secretary of State to require each local authority to draw up a scheme for the payment of three main allowances: a basic allowance payable to all councillors which is what we have previously referred to as the flat rate allowance; an attendance allowance as at present, but with the definition of approved duties determined by the Secretary of State; and a special responsibility allowance for councillors such as committee chairmen who have additional responsibilities. Under subsection (2), councils will also be able to make provision for the payment of a financial loss allowance to appointed members, who are not councillors for the authority, as they can at present.

Subsection (3) enables the Secretary of State to prescribe a limit on the total expenditure that local authorities may incur on all main allowances, or on any individual allowance. The intention is to set an overall cash limit which will vary by type of authority—and population in Scotland—and take account of the number of councillors on each authority. Local authorities will be free to determine the level of allowances within this amount, subject to certain limits set by the Secretary of State. These will ensure that a minimum proportion of the overall limit is allocated to the basic allowance, and provide maxima and minima for the special responsibility allowance.

The scheme which local authorities will be required to draw up is central to the new system. It will enable each local authority to determine its own system of allowances, and in particular whether it wishes to adopt the simpler flat-rate system that we originally envisaged in the White Paper, or to retain an element of attendance allowance to ensure that the additional workload of some councillors is recognised in their remuneration. Just as importantly, it will make councils more aware of the cost of allowances, and what they pay them for them, as well as focusing attention on the timing, extent and need for meetings. This must be a better and more effective system than we have at present.

The remaining amendments are mostly consequential, and deal with the administration of the scheme, and the effect on travel and subsistence allowances, which are to remain broadly unchanged. However, I should like to draw your Lordships' attention to two points. The first is that the existing system of allowances will be retained for parish and community councils in England and Wales. This is appropriate given that parish councillors may only claim allowances for duties outside the parish, and it would be unreasonable to expect them to draw up a scheme.

The second point concerns the definition of approved duties. The amendment provides for the Secretary of State to prescribe the definition of approved duties for the purpose of all the allowances, including travel and subsistence. We are proposing to restrict the range of approved duties for attendance allowance, to meetings of the council, committees, and subcommittees, as well as cetain representative duties. This recognises the fact that the basic allowance will cover the other miscellaneous duties that councillors carry out. However it is not our intention to restrict the range of approved duties for the purpose of travel and subsistence allowances in this way, and we will be considering with the local authority associations a wider definition for this purpose.

Finally, I turn to the question of resources, and the levels at which the local authority allocations will be set. When noble Lords considered this matter in Committee, I drew attention to the White Paper which said that expenditure under any new arrangements should not exceed what is currently being spent under the existing system. In the current year, that has been estimated by local government to be some £37 million if all councillors claim what they are entitled at an average level of claiming. The present system is however virtually open-ended except for a maximum daily rate. I undertook to consider the matter further in the light of the views put forward by the local authority associations, though making clear that an increase to £75 million, which represents what Widdicombe recommended, was out of the question.

As a result of that consideration, the Government have decided that the allocations to individual local authorities under the new scheme should be worked out within the context of a clear ceiling of £42 million at current prices. That takes account of the fact that in future, total expenditure on the main allowances will be capped. It will also allow enough flexibility for the adjustments which are inevitable when a reform of this kind is carried through. The impact of expenditure on allowances will of course feed through to the community charge, and authorities will be accountable to their electorate for the decisions they take.

My right honourable friend the Minister for Local Government and Inner Cities, has written to the chairmen of the local authority associations informing them of this decision, and we shall be holding further discussions with them about the distribution to different types of authority, and a number of important features which need to be settled in detail. We shall of course also consult the associations on the regulations themselves when they have been drawn up.

The Government believe that the new arrangements will deal with the unsatisfactory features of the present system to which Widdicombe drew attention. At the same time they will allow a great deal of local flexibility. They are the better as a result of the constructive changes proposed by local government during the course of the negotiations. I commend the amendments to the House.

Lord McIntosh of Haringey

My Lords, the House will be grateful to the Minister for setting out so clearly this complex series of amendments to deal with a complex question, one to which it is perhaps impossible to find a perfect answer. There will always be a degree of compromise among the different elements of local government concerned and the interests of central government in the control of expenditure.

The first thing to be said is that the local authority associations appreciate the extent to which the consultation has taken place and the extent to which, although far from complete, the Government have taken account of the views of the local authorities in reaching this conclusion. The system which the Minister has outlined involves a flat rate, an attendance allowance on a very much more limited basis than has previously been provided, and a special responsibility allowance. I shall deal with each of those in turn; but before I do that I should like to comment on the overall financial provision and on what is missing from the scheme.

The Minister has told us that the figure at current prices which will be allowed for members' allowances is about £42 million. If one updated the Widdicombe figure, we would be closer to £75 million, so it is quite clear that the Government are envisaging a very much more restricted scheme of members' allowances than had been intended by Widdicombe.

I appreciate that members' allowances come out of the local authorities' expenditure a s determined by the community charge and by government grants. But at the same time either figure, whether £42 million or £75 million, is a very small proportion indeed of total local authority expenditure. A large number of electors feel that the time that councillors put in to local government work justifies some part of what in very many cases would be financial losses being recovered from the public purse.

I started in local government on borough councils when there was no allowance of any kind—not even travelling and subsistence allowance. Everything was assumed to be at the expense of councillors. That had a number of advantages, let us be clear about that. It meant that nobody was under any pressure to create meetings or activities in order to receive allowances. At the same time it meant that nobody was under pressure to create extra subsidies or extra inspection panels, although there are quite a number of items such as licensing panels, for example, which were imposed on local government by central government and for which members had to be found to attend, just as Members have to be found to deal with private Bills in your Lordships' House. It is not easy to do. It is difficult to find people to do it morning after morning and sometimes afternoon after afternoon. In that respect the analogy with local government is very close.

The other advantage of having no allowances was that members were not tempted to do the officer's job. They were not tempted to intervene in administration rather than deal with policy. I appreciate that the department is temperamentally resistant to the idea of making a philosophical distinction between policy and administration. At the same time there is something behind philosophical dispute which deserves to be retained. To that extent, the old regime in which I was originally brought up has some merit.

I make those comments on my own account rather than representing the views of any organisations. However, it is clear that since I first entered local government the situation has changed dramatically. The number of duties imposed on local government by central government has increased enormously. The complexity of the legislation under which local government must work has increased enormously. The social problems, particularly in inner city areas, with which local government must deal, have increased enormously. The size of local authorities has increased enormously. That has never been the responsibility of my party; the party in government has been responsible for the size of local authorities in the 1960s in London and in the 1970s elsewhere in the country. An inevitable result of the increase in the size of local authorities is that there will be greater demands on individual committee chairman. That cannot be gainsaid and it is the responsibility of the Conservative Party, having willed the end, to do something about the means.

We end up in a position which is very different from where I started. I recognise that with all the necessary precautions to avoid work creation by councillors there must be compensation for financial loss and for the heavy duties imposed on local councillors, particularly senior councillors.

I regret the omission of the financial loss allowance. I was one of the few members of the Greater London Council who took advantage of it. I had the good fortune to run my own business and was able to reduce my salary by at least the financial loss allowance which I received from the GLC. I took off my salary many times that amount because I had to reflect the loss of my services to my colleagues. I certainly made no profit but it was a starting point. It was suitable for someone in employment, as was I, but less suitable to those not in employment.

I look at the three elements which are left—the flat rate, the attendance allowances and the special responsibility allowance—and I wonder how the mix will work out. We can all understand the flat rate. The attendance allowance will be prescribed by the Secretary of State. Indications are that he will restrict it to those duties which are of such importance that the rule of pro rata representation between the parties shall apply. In other words, many activities of non-chairmen (back-bench councillors) are on an individual basis—for example, visiting children's or old people's homes—and they would not qualify for an attendance allowance.

I query whether it is wise to be as restrictive as it is hinted government will be. We are familiar with the special responsibility allowance. However, we shall not know whether we have a fair and workable procedure until the consultations are concluded and the final mix is arrived at.

I welcome the fact that the travelling and subsistence allowances will not change. I also welcome the fact that there will be no change for parish and community councils. I query the notion of a cash limit. I understand the Government's wish to have an overall cash limit, but one applied to each local authority could well result in a council running out of allowances and the rate having to be made on a charitable basis. That applies particularly at the end of a municipal year because that is the rate-making time when there are many burdens for senior local authority members. Councillors who give up a considerable amount of time and potential income will be encouraged to spend too little time debating the setting of the budget and the community charge, which, after all, is the single most important part of their duties. I wonder whether the idea of an individual council cash limit is the right way to approach the matter.

After all the detailed criticisms our fundamental criticism relates to the total amount available. A proposal to provide £42 million when the updated Widdicombe proposal would provide £75 million is not adequate. I urge the Government to think again about that.

Earl Russell

My Lords, we on the Liberal Democratic Benches join with the noble Lord, Lord McIntosh of Haringey, in saying that we welcome the amount of consultation that has gone into the production of the amendment. It is a serious attempt to get it right. However, as with so many matters, it will go further in form of regulations and we must debate the amendment without the regulations before us. Before we can say how far the Government have got it right we must wait as usual to see what is in the regulations. We must look at them with care.

I shall touch on only two points tonight: first, the point about capping made by the noble Lord, Lord McIntosh. I shall not waste your Lordships' time by putting a case against capping but I am concerned about the figure at which it may take place. The Government's record in deciding how much money other people and institutions need to spend is not one of Papal infallibility. I hope that the matter will be considered with care. I listened with a great deal of interest to the comments made by the noble Lord, Lord McIntosh, about the Widdicombe report. When we have a cash limited figure will it be index-linked? If not, I can see problems arising very rapidly.

My second point relates strictly to the regulations and I ask the Secretary of State to bear it in mind. In the course of working out what will come under the attendance allowance, can an allowance be made for the cost of child care resulting from the need to attend council meetings? It is important that people—and I say "people" because it cannot be repeated too often that 9 per cent. of single parents are men—should be able to attend council meetings without worrying about what is happening to their children meanwhile. I hope that the Minister will bear that in mind.

Lord Hesketh

My Lords, I am sure that your Lordships' House is grateful for the concise exposition given by the noble Lord, Lord McIntosh, of the transformation which has occurred in local government from a basis of no recompense to where we are today and where we hope to go tomorrow. It was far better than any other exposition I have received on its history.

Lord McIntosh of Haringey

It is copyright.

Lord Hesketh

My Lords, I am sure that a cheque will have to be forthcoming from the Department of the Environment. The sum will not be index-linked but will be reviewed on a regular basis by the Secretary of State. On the point made by the noble Lord, Lord McIntosh, with regard to the financial loss allowance, as I pointed out in my original statement we shall keep that for those on the authority who are appointed members. We considered that carefully. As the noble Lord, Lord McIntosh, pointed out, it involved very few people and we felt that it would overcomplicate the scheme.

We shall certainly discuss the definition of approved duties with the associations but I should point out that the precise purpose of the flat rate allowance is to recompense councillors for those other important duties such as visiting children's homes or other matters for which we made an allowance.

Baroness Seear

My Lords, as regards compensation for financial loss, the Minister gave an extraordinary answer. He said that very few people were concerned which means that it will not cost much. That must be very appealing to the Government. He then said that it would complicate the administration. Surely providing a small number of people with a financial loss payment cannot be beyond the wit of people who are handling these enormously complicated and difficult local authority finances. I find that an extraordinary situation.

Lord McIntosh of Haringey

My Lords, perhaps I may intervene before the Minister sits down. In speaking of financial loss allowance he has confused two different issues. I was not referring to appointed members. A number of elected members not only have jobs but have flexible jobs which allow them to have the amount of their financial loss allowance deducted from their wages and salaries. That is not an uncommon situation. It was made very unattractive in the 1970s when I adopted it but I thought it was right. I still think that a financial loss allowance, combined with adequate encouragement to employers to make use of it, would be a valuable part of members' remuneration. I am sorry that the Government appear to have rejected that completely.

8.45 p.m.

Lord Hesketh

My Lords, I did not misunderstand the noble Lord, Lord McIntosh. I was merely indicating that there was still an element of the financial loss allowance although it applied to separate criteria.

The noble Earl, Lord Russell, has mentioned child care. I shall draw that to the attention of those involved in the consultations under way with the associations at present.

Finally, there was a reference to cash limiting. We are prepared to envisage that towards the end of the year, if there is a danger of its cash limit running out, the authority will be able to use a small percentage of the following year's allocation. I am sure that in view of my very long opening remarks noble Lords will have an opportunity to see what I have said and to decide what they propose to do about it at a later stage.

Lord Graham of Edmonton

My Lords, before the noble Lord sits down, if there comes a point when the budget for councillors' allowances is strained and the Minister is looking for a means of easing the strain, he might care to look at comparable jobs being done in a range of quangos where we are talking in terms of people who have enormous allowances—thousands of pounds per year. When one contrasts that with a leader of a county council who is dealing with not only millions but hundreds of millions of pounds—and in one case a billion pounds—per year, then the amount of compensation for doing that job is all out of kilter. The Minister and his colleagues should reflect seriously about the two levels of payment by the public for equal work.

Lord Hesketh

My Lords, as always the point of the noble Lord, Lord Graham, is interesting even if it somewhat broadens the argument. I felt from the earlier remarks of the noble Lord, Lord McIntosh, that in many areas it was accepted that the Government are trying to find an acceptable answer to the problem. I am sure that there will be occasions when noble Lords on the Benches opposite disagree.

Lord McIntosh of Haringey

My Lords, modified rapture.

Lord Hesketh

My Lords, on the basis of that modified rapture I shall return to my seat.

Baroness Stedman

The noble Lord said that it may be possible for the Government to allow local authorities at the end of the year, which., as the noble Lord, Lord McIntosh, said, is their busiest time—the time they are fixing a rate—to draw on the proceeds for the next year. Has that been discussed with the local authority associations? It seems to me that to draw on the next year's allocation will only exacerbate the position in that year.

Lord Hesketh

My Lords, I believe I am correct in saying that it has been discussed.

Baroness Blatch

My Lords, as I understand the Minister's statement, in calculating what each authority may spend in councils' allowances, a flat rate allowance will be taken into account plus a definition of approved duties. Therefore, a sum of money would be needed to cover that in addition to a responsibility allowance, subsistence and travelling. If that is properly taken into account by each authority then authorities will be well satisfied with their allocation. I believe that there are very few local authorities in the land which could not look to the frequency and purpose of meetings. That would be an important area for local authorities to look to.

I admit to a personal reservation about cash limiting. I believe that with the introduction of the community charge an opportunity has been missed. Where a local authority wishes to go beyond what I consider to be a reasonable assumption of allocation by the Government, then it should go to its electorate to say that it needs more money for councillors' allowances. To expose that particular budget heading might be a better way for a local authority to account to its public than for the Government to cash limit and then encourage councils to eat into the following year's allowance which only exacerbates that year's problems. However, with a reasonable assumption by the Government of a council doing its business, then the allocation will probably be acceptable.

On Question, amendment agreed to.

Clause 24 [Implementation of recommendations of Commissioners for Local Administration in England and Wales]:

Baroness Stedman moved Amendment No. 32: Page 30, line 44, at end insert ("and he shall inform the person aggrieved in writing that they have the right to seek an order in the County Court requiring that the authority take appropriate action to remedy the injustice reported by the Local Commissioner and to prevent similar injustice being caused in the furture").

The noble Baroness said: My Lords, in moving this amendment I shall also speak to Amendment No. 33. One amendment deals with the position in England and Wales and the other with the position in Scotland. This expresses the same sentiments as an amendment tabled in my name in Committee when I sought to ensure that when a local commissioner of administration finds a local authority to be guilty of maladministration, that local authority can be taken to court by a complainant if the authority fails to take action to rectify the maladministration.

At present, the system in England, Scotland and Wales is purely voluntary whereas in Northern Ireland the system of enforceability has existed since the Commissioner of Complaints (Northern Ireland) Act 1969. In Northern Ireland the complainants have recourse to the county court if a local authority refuses to act on the ombudsman's finding of maladministration.

During a debate on 24th July the noble Lord, Lord Hesketh, stated that if such a system of enforceability were allowed in England and Wales, investigations would become more formal, legalistic, lengthy and expensive. Those same arguments in almost the same words were used by the Parliamentary Under-Secretary in Committee in another place.

That is nonsense and flies in the face of the evidence. The right of recourse to the courts does not lead to lengthy, formal and legalistic procedures in Northern Ireland. There is no reason why it should do so in the rest of the United Kingdom. The 1988 report of the Northern Ireland Commissioner for Complaints demonstrates that extremely well. In 1988 a total of 314 complaints were received and 59 cases were brought forward from 1987. Action was concluded in 317 of them and 56 were still being dealt with at the end of the year. Of those complaints, 247 were rejected for various reasons and 61 reports were issued. In 11 of those maladministration was found. In all 11 instances settlements were effected without recourse to the courts. Therefore, that is a latent rather than a much practised remedy. In 1988 one-quarter of the cases in Northern Ireland were dealt with within six months. In recent years the average time has been 10 months, but in England and Wales it is about 13 months.

One of the main objectives of the Northern Ireland Commissioner's office is to try to avoid any recourse to the courts. In many cases the bodies concerned have agreed, after consultations with him, to review their procedures and to rectify any administrative malpractice. I do not want to cite examples here because time is moving on, but the Northern Ireland report is a fascinating account of how a commissioner's office ought to be run. I recommend it to noble Lords on all sides of the House as edifying bedtime reading.

These amendments are modelled closely on the amendment tabled by the Labour Party in the House of Commons; yet the Labour Party has changed its mind somewhere between the House of Commons and this Chamber. I promised in Committee to look at what the noble Lord, Lord McIntosh, said. He felt that if the local ombudsman's findings were enforceable in the courts by a complainant the word of the ombudsman would become like that of a tribunal and therefore subject to the rules of the Council of Tribunals. He felt that would prevent the ombudsman from carrying out a wide-ranging investigation. I do not believe that is the case.

Yesterday I had an extremely interesting meeting with Dr. Maurice Hayes, the Northern Ireland Commissioner for Complaints. He does not have to run his office as if it were a tribunal; nor is he bound by the rules of the Council on Tribunals. He is bound by the Commissioner for Complaints (Northern Ireland) Act 1969. If our amendment were to be passed tonight, the rest of the United Kingdom would find things no different from that which applies and prevails already in Northern Ireland. There would be no need for the local commissioners to act as a tribunal or to be subject to lengthy and legalistic procedures. The system works perfectly well in Northern Ireland and there is no reason why it should not work in the rest of the country. There is no evidence to suggest that the English, the Welsh or the Scots are more inherently litigious than are the Northern Irish. There is no evidence to suggest that there would be a sudden, mad, impulsive rush to the county court if we pass these amendments tonight. Dr. Hayes was able to inform me exactly how the system works in Northern Ireland, and also how well it works. The threat of a possible court action seems to be a preventive measure, encouraging local authorities and other bodies to settle outside the courts.

I was interested, too, in the assertion by the noble Lord, Lord McIntosh, during the Committee stage that some members of Justice were not concerned about the likelihood of recourse to the courts leading to local commissioners becoming more like tribunals and were dubious about instituting the Northern Ireland system here. I have checked on that again. In its 1980 report, The Local Ombudsman: A Review of the First Five Years, Justice recommended that the local ombudsman's findings should be enforceable through the courts at the suit of the complainant. In the 1980 All Souls Review of Administrative Law in the United Kingdom the committee stated: While recognising the force of the above objections, we have concluded that enforcement through the courts does offer the best solution to what has become a major problem… the time has now come to add teeth to the Ombudsman scheme by making it possible for successful complainants to apply to the County Court". Therefore, the committee as a whole clearly favoured reform, and reform along the lines we have suggested in the amendment. The ranks of Justice, the local ombudsmen in England and Wales and the Widdicombe Report all want the Northern Ireland system to be brought into effect here.

I am at a loss to know why the noble Lord, Lord McIntosh, and the Labour Party no longer find themselves able to support my earlier amendment. During the course of the 1988 Local Government Act it was the noble Lord, Lord McIntosh, who tabled an amendment in Committee, on 2nd February 1988 (reported at col. 1029 of Hansard) allowing recourse to the courts. The noble Earl, Lord Caithness, who was the Minister responsible at that time, stated in his reply: I have some sympathy with the noble Lord's concern about local authorities which have refused to comply with the findings of the local ombudsman and have failed to provide a satisfactory remedy where injustice has been found…The amendment would deal with this problem by giving complainants the right to apply to the court for a satisfactory remedy. This was another of the Widdicombe recommendations and one which we are currently considering. It would, however, involve a radical change in the whole concept of the local ombudsman as an informal investigatory procedure". With all due respect, that is nonsense because such an amendment would not involve a radical change. The situation already exists in Northern Ireland which is not a foreign country but a part of the United Kingdom. On that occasion the noble Earl went on to say: If local authorities know that the findings of the ombudsman may be enforced by the courts they are likely to be much less forthcoming and co-operative in investigations and the whole procedure would take on a more formal … character".—[Official Report, 2/2/88; col. 1031.] That is simply not the case. Experience in Northern Ireland is quite different. The latent threat of court action has made the authorities more and not less co-operative. I urge Members to read the annual report of the Northern Ireland commissioner. The facts bear out the arguments.

During that same Committee stage of the Local Government Bill in 1988 the noble Lord, Lord McIntosh, himself seemed to be wholeheartedly in favour of recourse to the courts, yet by Report stage his enthusiasm had waned a little. I am at a loss to understand this inconsistency from someone who I always thought to be a very consistent person.

Dr. Hayes assured me yesterday that the ability of a complainant to go to the county court if the commissioner found a council guilty of maladministration had not led to a rush of court cases. Since 1972, right up to 1986, there have been only 32 applications to the county court in Northern Ireland. It seems that the knowledge that they might just be taken to the court has prompted local authorities to take more seriously the findings of the commissioner and to follow the remedy suggested by him in order to rectify any maladministration that is found. It is worth noting that in none of the cases dealt with in Northern Ireland has the factual basis of the commissioner's report ever been challenged by a local authority.

I feel that I must mention what is perhaps the most spectacular case that went to court. I refer to St. Peters' Gaelic Football Club v. Craigavon Borough Council. The borough council was found guilty of maladministration in failing to allow the club to acquire some land for a sports complex. The decision had been made on a discriminatory basis and the commissioner found that there had been maladministration. The council then agreed to make over the land to the club, but it then procrastinated in doing so for a number of years by obstructing the club and making a number of quite unreasonable demands which prevented the club from using the complex in a reasonable manner.

Eventually the club took the matter to court under Section 7(2) of the 1969 Act. The court awarded damages for delay amounting to £107,763, and costs. Eventually the local government auditor was called in to assess the public money wasted during the delay from the date on which the ombudsman's report was made up to the present time. He then imposed a personal surcharge of £225,000 on the 17 councillors. On appeal this was later reduced to £84,457 on 12 councillors.

Perhaps it is this striking case which has been a lesson to any possible erring councils in Northern Ireland. I can only say that the system of enforceability out there works perfectly well, and there is no reason at all why it should not work equally well in the other parts of the United Kingdom. I beg to move.

9 p.m.

Baroness Carnegy of Lour

My Lords, the noble Baroness has explained her argument very fully. I have to point out to her that there is no such thing as a county court in Scotland.

Earl Russell

My Lords, we on the Liberal Democrat Benches warmly welcome this amendment and support it strongly. I believe it is a basic legal principle that there ought not to be a wrong without a remedy. Where we as legislators find a wrong without a remedy, as the noble Baroness has done here, we ought to think very hard indeed about providing one. It is no excuse for the denial of justice to say the wrong is only a little one. As the noble Baroness, Lady Carnegy, said in Committee, in dealing with a recalcitrant local authority adverse publicity is not always enough.

I know it will be argued that the number of recalcitrant local authorities is not very large. But I believe it is dangerous to argue that a wrong should not be remedied because it is not a very large one. That attitude is precisely the opposite of eternal vigilance. I also personally feel quite strongly about this because I happen to live in the London borough of Brent. It has been censured twice by the ombudsman in the past few months, once for allowing a racket of charging private traders for the collection of refuse and long-standing mismanagement of its refuse collecting system. The other cause for censure was persistent failure to pay out housing benefit for a long time.

The council is liable to be censured again for failing to pay out student grants for the current term until the end of November or later. That example suggests that the London borough of Brent, if it has nothing else, has a very well equipped duck's back. These are the kinds of circumstances in which there has to be a chance to have an enforceable remedy. We who support this amendment are not envisaging a whole flood of cases going to court. We are envisaging the possibility of going to court as something which will force the local authority just occasionally to push the matter up its list of priorities and do something about the problem.

There is the further point of which the Minister has already reminded us tonight. There are certain local authorities where there is in effect single party government. In those local authorities the threat of the ballot box is not particularly grave. There has to be something behind the law to carry a threat of enforcement. Without that, the law is only breath and of no use. We hope that it will not be used regularly. Non-compliance has to carry some kind of sanction.

Lord Wynford

My Lords, I wish to support the noble Baroness, Lady Stedman, in her amendment in the strongest possible terms. I confirm everything that she has said resulting from her meeting yesterday with Dr. Hayes, the commissioner for local administration in Northern Ireland. I was present myself at that meeting. He described to us exactly how the situation works today in Northern Ireland and has worked during his time in office there. He was full of praise for the good practical effects which were experienced by all the interested parties and for the availability to him of the civil court as a last resort, though it was seldom used.

I believe he said that in his memory the proportion of cases that had to go to court was very small indeed—something like 20 in his period of office. These experiences of Dr. Hayes would seem to refute the caveat which was expressed at Committee stage, particularly on 24th July, by several speakers who were then calling for a policy which really boils down to "Let us wait and see" rather than grasping the decision to bring the county court provision into this Bill.

The noble Lord, Lord McIntosh of Haringey, was chief among those on the Front Bench opposite who took this line. During the summer recess I found other reasons for saying that wait and see is the wrong policy today. The circumstances that I now have to relate centre on a local authority in West Dorset exactly at the point where the inter-county boundaries of the three counties, Dorset, Devon and Somerset, all coincide.

I cannot help the House by quoting a large town which is to be found at that point. It is in a rural area and has not even a large village to mark it. Part of the area is known as Marshwood Vale. It is an area of outstanding natural beauty, at the head of which is the well known prominence called Pilsdon Pen. It is more than 900 feet in height and overlooks the Marshwood Vale at the western end of the vale. Noble Lords who are not acquainted with the area should imagine a largely stock rearing and milk producing region of grass farms and small woodlands, girthed with solid hedgerows lined with oak trees. Here is an example, if ever there was one, of the unspoilt patchwork quilt. I know it very well myself from my boyhood.

Dotted in this area are large numbers of small grass farms. In this lovely setting a landowner seeks to develop a sporting complex. There is absolutely nothing wrong with that in itself. One aspect of this venture concerns your Lordships today. There is, in the process of development, a shooting enterprise. It is in two parts. First, there is a clay pigeon shooting club already in partial operation. Secondly, there is a full bore, high velocity rifle range in the open where shooting has not yet begun. The local authority granted planning permission to those proposals a few years ago. If I seem to be holding up progress in the House, I must explain that noble Lords will see the force of what I have to say in a moment.

The planning permission was given for clay pigeon shooting for four days a week for six hours each day for the lightest six months of the year. That is 24 hours of shooting each week for the best six months of the year. For the rifle range (not yet in operation) permission was granted for four days a week for six hours each day all the year round. That is 24 hours of shooting in each week all year. In this area there are 31 households in earshot. The closest is at 400 metres and the most distant, taking a circle, are about 1,500 metres. The houses include a mansion, converted farmhouses and farmhouses still being used as such, and cottages and converted cottages. They are not in the form of a village or hamlet. They are spread out. That is why the people who now own them bought them.

An appeal was made to the local commissioner or ombudsman who ruled against the local authority, finding "maladministration and injustice". The local authority stood its ground and played its cards very close to its chest. The chief environmental health officer put his telescope to his blind eye and ruled that all was well at present under the reduced usage position of today. Meanwhile, harrassed householders had not been idle. They sought first to obtain noise nuisance readings from a reputable firm in Amersham, Buckinghamshire. They took a number of samples and found in the end, to put it briefly, serious disturbance for some of the localities; that is to say, at the present rate of usage.

Secondly, the householders obtained from a well-known agent and chartered surveyor property valuations under present circumstances but bearing in mind the possible ultimate full level of firing as approved by the local authority. The outcome amounts to the fact that the best properties have lost an open market value of between 20 per cent. and 40 per cent. That is a professional estimate. Other properties, of a different kind, have lost somewhere between 15 per cent. and 30 per cent. in value.

So what has happened? We have a planning blight. Many people are facing a huge loss in capital asset. Taken over 31 properties, we are looking at hundreds of thousands of pounds. Who can possibly think that this will long remain an isolated case? It probably is an isolated case at present. But how is it likely to remain so for very long?

On this crowded island all leisure and sport will mount fast and consistently. The local commissioner must have a legal way out when all else fails, and he must have it soon. "Wait and see" will not do. There must be some redress for people who are losing property value at that kind of rate. That spells access to the county court as a wise and urgent decision.

9.15 p.m.

Baroness Blatch

I also rise to support the amendment. This issue has exercised my mind since 1977 when I first entered local government. I do not think that anyone can possibly understand the injustice felt by a member of the public who goes to the local ombudsman with a complaint against a local authority only to discover to his horror that although the authority is found guilty after a full investigation and although he thinks he has won the case, no action is intended and, moreover, there is no requirement for it. The greatest punishment such authorities can receive is to have the felony exposed. However, the kind of local authority which would take no regard of what an ombudsman is saying is impervious to that kind of exposure; it is really not very worried about the matter.

The case is then taken to the local ombudsman for the second time. The ombudsman again finds against the local authority. Similarly, the local person feels that he has won the case but once more the local authority takes no account whatever of what the local ombudsman has said. Such injustice is very real. There must be some recourse. There must be some enforceability. Therefore, if this amendment is not technically correct, then the principle of enforceabilty is one which I wish to support.

It is not a sustainable argument to say that there are not many such cases and therefore we should not do anything about the matter. That is an unprincipled approach to what I regard as a matter of principle. The Northern Ireland model is one which we know works. We know because of what has happened there that where there is a threat that the matter could be taken to court as a last resort then local authorities very quickly take remedial action.

Therefore, where a local authority refuses to comply with the local government ombudsman's request, it seems to me that there must be a place where an aggrieved person may go. A few local authorities claim to have absolute power; that is what we are talking about. A local authority which can do almost anything, be investigated by a local ombudsman and be found guilty but thereafter take no action whatever is claiming a kind of absolute authority.

No local authority should be allowed to claim absolute authority, and so I support strongly the principle of enforceability as a last resort. For that reason I support the noble Baroness who moved the amendment so well.

Lord McIntosh of Haringey

My Lords, I was taken comprehensively to task by the noble Baroness, Lady Stedman, for inconsistency in that I felt differently 18 months ago. I plead guilty to that. I approached the matter 18 months ago with less information about the subject than I should have had, and now have. I should have known about the 1980 report of Justice because my father-in-law was its secretary at the time. He was one of the instigators of the ombudsman system in this country.

It is true that in 1980 Justice expressed the view that the local ombudsman's decisions should be enforceable in the county courts, although, as the noble Baroness, Lady Carnegy, has said, there would have to be different provisions in Scotland.

I do not believe that Justice holds that view at the moment. When I sought its views—I do not know that there was an official view of the council of Justice—the person who was deputed to speak to me expressed the kind of concern which I had expressed and which has been expressed to me by people who have worked in the local ombudsman's service since February 1988, despite what has been said about Northern Ireland. Enforceability in the county courts would, in this country at any rate, lead to the requirement that the local ombudsman's investigations be more rigidly controlled and come under the Council of Tribunals. Unless the county court were to repeat the investigation, using the more rigid controls required by tribunals, it would be taking as evidence an investigation which had been conducted in a more informal way.

The view which has been expressed to me, which I advocated in Committee and which I still advocate, is that the loss in increased formality and decreased flexibility of investigations by the ombudsman would be greater than the benefit which would be gained, as has been admitted on all sides, by the few cases which would be remedied in the county courts.

I am not familiar with the law in Northern Ireland. I was interested to hear what the noble Baroness, Lady Stedman, said about the Commissioner for Complaints (Northern Ireland) Act 1959. That may provide the answer which we do not have in this country. The legal advice that I have been given, and the advice that I have been given by people working in the service, is contrary to that which has been expressed by so many speakers today.

As I said in July and October 1989, I believe that the balance of judgment is, "If it ain't broke, don't fix it". I hope that the Government will not accept the amendments. Apart from anything else—I would never make this a major consideration—amendments requiring that the ombudsman should inform a person that he has a right to seek an order, without providing that right in legislation, create some difficulties in legislation which it would be not too easy to overcome.

Lord Reay

My Lords, we have had a most interesting debate which has found support in some quarters of the House. The amendment would require the local commissioner to inform a complainant who had suffered injustice as a result of maladministration but who had not received a satisfactory remedy from the local authority that he could seek an order in the county court requiring the authority to remedy the injustice.

The amendment is clearly defective because a complainant does not have a right to seek such a remedy in the courts and it would be misleading for the local commissioner to inform him otherwise. No doubt the noble Baroness is suggesting there should be such a right and that local ombudsman decisions should be subject to judicial enforcement.

That is a matter which noble Lords considered fully in Committee and which was also the subject of amendments on two occasions in another place. The question has therefore received considerable scrutiny already. I do not think that there is much that I can add to what has already been said but I shall try. It is, I fully agree, an issue which deserves close attention.

I think we are all agreed that local authorities ought to comply with local ombudsman remedies—whether they agree with them or not. The issue before us is how much pressure should be put on authorities to make them comply. That is a difficult question which involves making fine judgments about the effect of enforcing decisions on the conduct of the investigations themselves. We do not want to lose more by enforcing decisions than we would be likely to gain.

We are much in agreement with the view expressed by the noble Lord, Lord McIntosh, in Committee that it is not so much the effect on the time taken to carry out investigations, though that is important, but the effect on the way the investigation is carried out. Local authorities will inevitably be more cautious and less forthcoming if they know that the local ombudsman's judgment is ultimately enforceable. This will affect all investigations, not just the small minority that result in non-compliance.

There was considerable discussion about Northern Ireland. It has been suggested that judicial enforcement in Northern Ireland works successfully. That is not disputed, but there is a fundamental difference between the two systems. In Northern Ireland the law provides for evidence to be tested and for witnesses and complainants to be cross-examined by counsel in cases where it appears that there may be grounds for an adverse report. It is this provision which underpins the system of judicial enforcement in Northern Ireland and explains why the facts of the cases have not been challenged in court there. Such a provision, if adopted on the mainland, would certainly slow down and formalise investigations. We believe that that is not desirable and not necessary.

There are other considerations. In making comparisons with Northern Ireland, one must take account also of the very different scale of operations. For example in 1988–89 there were some 242 findings of maladministration by the English commissioner, whereas in the same year in Northern Ireland there were fewer than 20. So we can doubt whether we are comparing like with like.

In Northern Ireland the local authorities do not provide services such as education, planning, libraries, social services and many other functions. So there is another side to the comparison and perhaps we should look at the whole matter rather more carefully and over a longer span of time. I believe that my noble friend Lord Wynford suggested that only a few cases would find their way to court. That may be true, but our objection is not to the delay that would occur in those cases but to the effect on all the other cases which the ombudsman investigates and which would be made much more difficult if the council were to adopt an obstructive attitude because it might end up in court.

We should like to carry further the possibilities of using and, if necessary, extending the informal system which we have. The government view is that if we are to apply further pressure to local authorities to comply with remedies—and we think that that is needed—we should do so one step at a time. That is why we have introduced the provisions in the Bill to tighten up the procedures that local authorities must go through in cases of non-compliance. I note that the English commission says in its last annual report that proposals embodied in Part II of the Local Government and Housing Bill should be tried out before any further consideration is given to judicial enforcement. That is also our view, and I can assure noble Lords that we shall be monitoring the effect of these new provisions closely.

I have listened with great attention to this debate and I note all the views expressed. It is an important subject to which I am sure we shall return. I think the contributions made this evening have illuminated the matter, but for the reasons I have given I must still ask noble Lords to reject the amendment.

9.30 p.m.

Earl Russell

My Lords, if the noble Lord is not satisfied with the form of this amendment, will the Government undertake to give serious and urgent consideration to trying to find an alternative way of achieving the same effect?

Lord Reay

My Lords, I think I have made it plain that we on this side believe that we should continue to rely upon the system we have here rather than move to a system such as that proposed in the amendment of the noble Baroness. Therefore, I cannot give the noble Earl the assurance he asks for.

Baroness Stedman

My Lords, I am disappointed with the reply. I had hoped that, in the light of the evidence we have brought forward today, the noble Lord would at least agree to take the amendment away and have another look at it to see whether it is possible to do something in the rest of the United Kingdom to make the system work as it does in Northern Ireland.

Dr. Hayes tells me that at all stages local authorities there are kept fully informed of where his findings are leading him. They see the evidence and they confirm and agree that it is right and just before a decision is taken. Once the matter goes to court, the ombudsman is not concerned with it. However, the fact that a local authority has accepted that his report is fair and correct is sufficient for the courts there to begin to act upon it. I should like to see something like that happening in England. I accept that half past nine at night is not the time to test the feeling of the House after a long debate, but I shall read what the Minister has said. I still think we have a point.

I had hoped the Minister would be more helpful and that he could tell us that the matter would be kept under review by the department. The concept of waiting to see how the proposals work could involve us waiting for years and years before we get the system to work in this country. Nevertheless, with the consent of my two co-sponsors, I shall not press the House for a decision at this time of night. However, we reserve the right to return at the next stage of the Bill, if we have more information. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 25 [Implementation of recommendations of Commissioner for Local Administration in Scotland]:

[Amendment No. 33 not moved.]

Clause 31 [Promotion of economic development]:

Lord Graham of Edmonton moved Amendment No. 34: Page 38, line 7, at end insert— ("(1A) The functions in subsection (I) above shall not be limited by the application of any restriction based on geographical factors.").

The noble Lord said: My Lords, I beg to move this amendment standing in the name of my noble friend Lord McIntosh. I shall also speak to Amendment No. 36. The purpose of these amendments is to override the proposed geographical limitation on the use of the economic development power as it relates to travel-to-work areas, rather than the area of a particular authority.

An amendment was moved in Committee which was worded slightly differently but which addressed the difficulty of those authorities whose overall prosperity concealed small but often severe problems of unemployment. During that debate the Opposition made the point: The most important single restriction is of the power to do economic development work on a geographical basis according to the diktat of the Secretary of State".—[Official Report, 24/7/89; col. 1216.]

The point was made then that the economic development powers could be used only in assisted areas and in travel-to-work areas which had above average unemployment. A consultation paper has been produced in which the proposed geographical restrictions are confirmed. Paragraph 7 of the consultation paper states that: there should be restrictions on grants and loans to, and guarantees of borrowing by, undertakings conducted with a view to profit by local authorities which do not have within their area any of the following:

1. (a) an urban programme area;
2. (b) a development area;
3. (c) an intermediate area;
4. (d) a derelict land clearance area;
5. (e) a rural development area;
6. (f) a travel-to-work area where the unemployment level is above the average for England or Wales as appropriate;
7. (g) in Wales, an area within the responsibility of either:
1. (i) the Welsh Development Agency; or
2. (ii) the Development Board for Rural Wales for industrial or commercial development".

That may appear on the face of it to be rather generous. However we pointed out during the previous debate that it is the Conservative-controlled associations, particularly the ADC, which will find that the provision affects their members adversely. In the earlier debate it was pointed out, on the basis of a survey carried out by the Institute of Local Government Studies in Birmingham, that no fewer than 40 per cent. of local authorities (139 authorities, mainly shire counties and district councils) will be excluded from the use of the power which they now have under Section 137.

I am concerned, as someone who lives in London, that it is clear that a substantial number of London boroughs will be affected. Yet the economic development power is simply a power. It adds not one penny to the funding available to local authorities. Surely the power to undertake those activities should be used at the discretion of individual local authorities, which know the problems and needs of their areas, and not at the whim of the Secretary of State.

During the July debate the Opposition also raised the restrictive and deceptive nature of the travel-to-work provision. For example, there are two travel-to-work areas in London—"London" and "Heathrow". In August 1989 the national average unemployment was 6.8 per cent., in "London" it was 5.8 per cent. and in "Heathrow" 3.3 per cent. The regulations as currently drafted exclude the majority of the outer London boroughs from exercising that aspect of the economic development power, despite the very real need which may exist in individual boroughs.

A further example was cited during the Committee stage. The employment rate for the whole travel-to-work area of Bridlington and Driffield is close to the average and would therefore be excluded by the Secretary of State. But Bridlington has an unemployment rate of 19 per cent. The: local council can do nothing about it because it has been excluded on geographical grounds.

Given the concern that currently exists in the UK and the European Commission about the need to promote enterprise and, in particular, small and medium sized companies, it is anachronistic that the Government should now be trying to limit local authorities' ability to help small firms and encourage entrepreneurs.

I know that this is not the first canter over this course. However, the fact that we have come back to the matter will indicate to the Minister that it is not only opposition politicians who sense that this is a matter which could be put right to the benefit of the Bill. There are people in the country who very much hope that this very marginal easement, with very little if any financial impact, can be agreed by the Minister. I beg to move.

Lord Hesketh

My Lords, the amendment attempts to make it clear on the face of the Bill that the functions of a local authority in relation to promoting the economic development of its area under Clause 31(1) cannot be limited by any restriction based on geographical factors. The amendment fails to recognise the scope of the new power and the way in which the Government have stated that any geographical restrictions imposed under Clause 32 are to be applied. I think that I could assist your Lordships therefore by making some important general points to clarify the scope of the new power.

First, it should be recognised that the power under Clause 31 is drafted in the widest possible terms so as to give individual authorities considerable discretion in the way they propose to promote economic development in their areas. The amendment would prevent local authorities themselves exercising their discretion to concentrate steps for economic development on particular parts of their area.

We are firmly of the view, however, that the case for local authorities using significant amounts of public funds to provide cash subsidies for commercial undertakings which compete in the market should exist only where there is a particular need to promote economic development. Hence the power of the Secretary of State in Clause 32 to impose certain restrictions on the very wide powers given to authorities under Clause 31—certain restrictions, I think, rather than a diktat.

Our preliminary thoughts are that significant levels of that form of assistance should be provided only in areas already recognised by central government as having priority, such as the assisted areas and rural development areas and other areas where unemployment is above the national average, as the noble Lord, Lord Graham of Edmonton, pointed out.

The power to provide cash grants, loans or guarantees of borrowing to undertakings conducted with a view to profit above a level of £10,000 per annum per undertaking will therefore be limited to those areas. This will ensure that all areas of the country can benefit from some assistance of that kind, but with significant support of that kind being concentrated in the areas which we believe most need it. We do not intend to restrict any other form of support under the power in Clause 31 by imposing geographical restrictions.

We have recently conducted a consultation exercise on these issues. Our consideration of responses is continuing and the detailed arrangements will be framed in the light of the comments that we have received. There is no question of the Government placing a general limitation based on geographical factors on the power to promote economic development other than in the limited circumstances that I have outlined.

Amendment No. 36 proposes that there should be no geographical limitations on the use of the power for any local authority which has unemployment at or above a level of 3 per cent. below the national average. In determining the areas of the country which have a particular need to promote economic development, we have accepted that all areas already receiving central government priority, such as the assisted areas, should be covered as a matter of course.

However, it was clear that that excluded other areas which, while not so designated, had high unemployment levels which demonstrate the particular need for the promotion of economic development. We have therefore proposed that all areas where unemployment is above the national average should also be included. However, we do not support the view that unemployment levels of 3 per cent. below the national average represent an overriding need for the cash subsidies to be provided by local authorities to profit-orientated businesses.

This is only a proposal and we have yet to make a decision on the precise formulation with regard to unemployment levels. That will be determined following the completion of the current consultation exercise. We therefore think it preferable that such matters should be set out in regulations, not in the Bill, thus providing the Secretary of State with the necessary flexibility to respond to changing circumstances.

In closing, the noble Lord, Lord Graham of Edmonton, also drew the House's attention to the matter of travel-to-work areas which he brought to the Committee's attention before the Recess. During our consideration in that debate about the way in which we propose to identify those areas with above average unemployment whose local authorities will be able to give grants, loans and guarantees to businesses conducted with a view to profit, I explained that the only reliable figures that we could use were those based on travel-to-work areas. The reason for that is that, in order to arrive at a rate of unemployment as opposed to raw numbers, one needs to know not only the number of people unemployed but also the working population of an area. Such data is not available at a level below travel-to-work areas. Thus, a reliable rate cannot be determined, for instance, at a London borough level. It is for those reasons that we resist the two amendments proposed by the noble Lord.

Lord Graham of Edmonton

My Lords, I am grateful to the Minister because he has said a great deal in defence of the Government's view which will repay careful study. It is somewhat sad that when local authority associations which primarily represent the Minister's political view ask him to listen to what they know will be the effect of the Bill, unless it is amended, on those people whom he and the associations have primarily at heart from a political point of view—we are not talking about anything other than that—he is not prepared to listen to them.

All the amendments seek is that, where an authority believes that it can prime the pump or stimulate or initiate economic activity which will call for some pump-priming money, it may be enabled to do so. I know what the Minister is saying; he has said it in two or three phrases. Like the rest of his colleagues, he is paranoic about local authorities engaging in enterprise. They are already engaged in an exercise of dismantling the fabric of current local authority services. When it is possible that a business or businesses might be started by a local authority to encourage others to provide work, it is like a red rag to a bull for the Minister. I think that the Minister will rue the day that he was not prepared to listen to his own political colleagues trying to ease the position.

However, I appreciate that the Minister has come well prepared with a raft of arguments that others will need to study and on which they will perhaps advise me at a later date. I beg leave to withdraw the amemdment.

Amendment, by leave, withdrawn.

9.45 p.m.

Clause 32 [Restrictions on promotion of economic development]:

Lord Graham of Edmonton moved Amendment No. 35: Page 39, line 11, at end insert— ("(1A) Where any de minimis figure is specified in regulations applying a limitation on the exercise of financial assistance by certain local authorities, the Secretary of State shall revise any such figure in accordance with the Retail Price Index or such higher figure as he considers appropriate.").

The noble Lord said: My Lords, the purpose of this amendment which stands in the name of my noble friend Lord McIntosh of Haringey is to preserve the value of any de minimis figures which are specified in regulations. The Minister referred to the regulations on this range of issues.

The consultation paper, New economic development power for local authorities in England and Wales was published on 3rd August this year. Although the regulations propose a geographical restriction on the use of this power, paragraph 9 states that the restrictions would not apply to grants, loans or guarantees which in any one financial year of the authority did not exceed £10,000 in total to any one undertaking.

That concession is very welcome indeed, particularly as it addresses concerns expressed by the ADC on behalf of its members who would be affected by the geographical restriction, even to the extent that they could not make relatively small loans, grants or guarantees. Nevertheless, it is essential to have some mechanism whereby the value of such a loan, grant or guarantee may be maintained. In the same way as Amendment No. 13 (which was discussed earlier) makes provision for the Secretary of State to set a figure higher than £19,500 as the bar for political restriction, it seems logical to make similar provision in this instance, even accepting that the retail price index may be manipulated. This would at least provide a benchmark against which the relative value of £10,000 may be assessed. That does not preclude the Secretary of State from being more generous should he find it appropriate.

In this instance, the Government appear to have taken on board not only representations made in Parliament but discussions held at official level between the local authority associations and the DoE. In this amendment we seek, by one small further step to build in an appropriate inflation-proofing factor.

The case I make is, I believe, well understood. First we are satisfied—in fact, happy—with the provision but we want to build in, if not inflation proofing, then some basis whereby that figure can be reassessed. I beg to move.

Lord Hesketh

My Lords, it is always a pleasure when the noble Lord, Lord Graham, feels that the Government have taken some steps, no matter how uncertain. Amendment No. 35 relates to the figure which may be specified in regulations and above which level only certain authorities will have the power to provide financial assistance. On an earlier amendment I made it clear but I think it is worth re-emphasising that the geographical restrictions will only be applied to the power to provide cash grants, loans and guarantees to undertakings conducted with a view to profit. Other uses of the power will not be subject to such restrictions.

The amendment imposes a duty on the Secretary of State to revise the de minimis figure in accordance with the retail price index or such higher figure as he considers appropriate. The amendment is simply not necessary. The Bill, as drafted, already provides the Secretary of State with ample powers to make such changes and we think it would be inappropriate to specify when and how such changes should be made on the face of the Bill. We would not, for example, wish to limit the Secretary of State's flexibility by imposing a requirement to adhere to all changes to the retail price index. We do not think that the RPI is necessarily the best indicator for such purposes.

I should reassure your Lordships that the limit will only be set once we have concluded our present consultation exercise on the use of the economic development power, Once set, the limits can be varied as and when the need arises. When this might be can only be judged once local authorities have begun to use the new power and to test its practicality over a period of time. The regulation-making power in the Bill already provides for this. I hope that the noble Lord, Lord Graham, will feel able to withdraw his amendment.

Lord Graham of Edmonton

My Lords, I shall, but I was intrigued by the Minister saying that the measure would be revised as and when circumstances indicated that that would be right. But earlier the Minister rested his case on the fact that the Secretary of State would already have the power to vary it. There is no guarantee that he will. The fact that the Secretary of State has the power does not mean that he will vary it unless there is some proscription in the Bill. For example, the £10,000 limit should perhaps be increased because of need to £12,000 or £15,000. The fact that the Secretary of State has the power to do so does not mean that he will increase it.

I am satisfied from what the Minister has said that he has taken on board our concerns. He believes that our concerns can be met by what is in the Bill. He then tells us that consultations are taking place and I am satisfied that the matter will be re-examined and come to a satisfactory conclusion. I beg to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 36 not moved.]

Lord Graham of Edmonton moved Amendment No. 37: Page 39, line 11, at end insert— ("(1A) Any regulations made under subsection (1) which have the effect of limiting the application of financial assistance by certain authorities shall—

1. (a) be reviewed every two years, and
2. (b) contain a power whereby the Secretary of State may lift or vary restriction at short notice in respect of a particular authority on the application of that authority.").

The noble Lord said: My Lords, with this I speak to Amendment No. 41 in the name of my noble friend Lord McIntosh. The purpose of the amendment is to ensure that any application to the Secretary of State to limit economic development is monitored on a two-year-basis. The amendment also explicitly provides for any such restriction to be lifted or varied.

Clause 32(1) provides: The powers of a relevant authority…shall not include power, for the promotion of the economic development of their area, to take any such steps as may be specified or described for the purposes of this section in regulations made by the Secretary of State".

Where Clause 31 sets out a general power—it is important to remember that this power is not linked to additional funding—Clause 32 allows the Secretary of State to restrict the way in which that power is used. The amendment would require the Secretary of State to undertake a review within two years of first promulgating regulations to restrict the operation of this power. It would also spell out a corresponding power to lift or vary such restrictions in response to an application from the local authority affected. Circumstances do not remain static. It surely cannot be the Government's intention that restrictions once imposed are written in tablets of stone.

The consultation paper indicates a number of areas where councils will be unable to use the economic development power to carry out certain activities. The existence of the consultation paper removes to a certain extent the element of doubt, addressed in earlier debates. There was little on the record as to the nature of such restrictions. The effect of such restrictions however is still unknown and this amendment will ensure that attention is given to the way in which they operate. I beg to move.

Lord Hesketh

My Lords, we do not believe that Amendment No. 37 is necessary. The Secretary of State will have the power to vary any restrictions which he may prescribe in regulations. The position will be reviewed from time to time and I am sure that authorities will be quick to make representations to the department if they think there are circumstances that warrant special arrangements. For example, there could be circumstances where because of the closure of a large firm in an otherwise relatively stable local economy a local authority wishes to take some urgent action which would otherwise be subject to restrictions under the power. The flexibility to deal quickly with such circumstances is already available under the Bill as drafted.

Amendment No. 41 has two purposes. First, it proposes that the order-making power under Clause 32(3) shall not be exercised unless a draft of the relevant statutory instrument has been laid before and then approved by affirmative resolution of each House of Parliament.

We have had cause during the course of this and other Bills both here and in another place to refer to this issue. As your Lordships will be aware, the affirmative resolution procedure is normally used in only the most exceptional circumstances. It does not seem to me that the order-making power under Clause 32(3) to impose a financial limit on expenditure incurred for the promotion of economic development falls into any of these categories.

As I have already explained, our proposals are intended to create a new power for local authorities that is both flexible and tightly focused. By leaving much of the details to regulation we hope to achieve this end and to be able to provide a power that properly meets the needs of local authorities. The consultations we are undertaking are the key to safeguarding against getting the detail wrong. I do not see any reason why this regulation-making power will need the further cumbersome affirmative resolution procedure. The second purpose of the amendment is to place a requirement on the Secretary of State to lay a report demonstrating any disproportionate effect between local authority areas which would result from any regulations made under Clause 32.

In discussing earlier amendments we debated in some detail the rationale behind the Government's desire for certain forms of direct financial assistance to local businesses to be concentrated on areas of high priority.

We have taken the view that local authority assistance in economic development should mirror and be complementary to similar support provided by central government. Central government assistance is directed at those areas where there is a particular need for the public sector to provide financial assistance. This ranges from deprived inner city areas to rural areas. The new power for local authorities will therefore be framed so that such areas take priority over other more prosperous areas in the provision of financial support by local authorities.

For those reasons we cannot support the argument put forward by the noble Lord and we hope that he will withdraw the amendment.

Lord Graham of Edmonton

My Lords, I intend to withdraw the amendment. Provided that his objectives and mine are the same, I can understand the Minister saying that there is no necessity for it. He rests his case heavily on the fact that he is in constant touch and is flexible, and he and his officers are well aware of the needs. He instanced the possibility of a local disaster of major economic proportions which can be dealt with quickly. I am delighted, as will be those outside the House, to hear the Minister say that in such circumstances not only can he act quickly but he will do so. It would be hypocritical of him to tell the House that such things are possible when in the event they do not mature.

The Minister also tells us that the procedure for which we are asking is cumbersome. He knows that the powers are being requested by the local authority associations. I am willing to allow them to fight their corner inside any consultative process. However, the Minister will understand that some councils will wish to be busy and energetic. They will not wish to wait for other people to act but rather get on and do it themselves. We are asking for the sums and the powers to be reviewed every two years. Although the Minister says that it is not necessary we consider it to be a helpful long stop ensuring that the matters are reviewed periodically.

I am grateful to the Minister. If what he says turns out to be true those outside the House will also be pleased. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Graham of Edmonton moved Amendment No. 38: Page 39, line 11, at end insert— ("(1A) No regulations made under subsection (1) above shall have the effect of prohibiting subsidies payable in respect of employees over a period of up to 3 years in any particular case.").

The noble Lord said: My Lords, the amendment is designed to allow a general but time-limited power to pay wage subsidies to promote economic development. The draft economic development regulations impose a general ban on wage subsidies to, undertakings conducted with a view to profit".

Specific exemptions are proposed: first, to meet part or all of the costs of employing persons who have been unemployed immedately before becoming employed by the grant recipient for a period of up to one year; secondly, grants towards the cost of employing trainees while receiving training; thirdly, grants towards employing not more than three people with a particular knowledge or skill; fourthly, grants forming part of any scheme financially supported by a government department or the European Community. Those exemptions, together with a general power to subsidise wages of nonprofit making bodies—that is, to promote economic developmentߞare welcomed. Again, representations in Parliament and at an official level have had some effect.

The Government have expressed concern that a local authority should not be able to offer a package amounting to, "Come to Bassetshire and we will see you all right"—in other words, inviting people to come along and they will be looked after. Imposition of a time limit in respect of certain types of wage subsidy is presumably used to prevent abuse and disruption of neighbourhood economies. In that case, why not allow wage subsidies to organisations which may well eventually trade at a profit but will need a certain running in period before they begin to do so? The three-year ceiling would impose a realistic limit on any such subsidy but would give local authorities additional flexibility in promoting economic development.

It would also provide greater flexibility in assisting the long-term unemployed. The exception within the draft regulation allows a one year subsidy for those unemployed immediately before the grant recipient employed them. Incidentally, the one year figure does not arise from local authority association—DoE discussions where the emphasis was on establishing a finite period. "Up to three years" is still a finite period.

If, as it appears in the regulations, local authorities are to be given discretion in three out of four exempt cases it would be consistent to widen the subsidy power within the ceiling suggested by the amendment. As comments on the draft regulations were due in by 29th September, it would also be helpful to know what comments if any the Minister received on that issue. I beg to move.

10 p.m.

Lord Hesketh

My Lords, we believe that this amendment would run contrary to our basic philosophy about wage subsidies to commercial undertakings being provided by local authorities. It may assist your Lordships if I set out the Government's reasons for wishing to place restrictions on wage subsidies.

We do not think that it is appropriate in general for local authorities to pay grants which are aimed specifically at meeting all or part of the wage costs of a commercial or industrial undertaking. We believe that direct wage subsidies to particular firms can be unfair to other firms competing in the same market without that subsidy.

We made it clear in the consultation paper which we issued on this subject in August this year that there were nevertheless a number of special circumstances where that general rule needs modification. The regulations made under Clause 32 will make it clear that there will be a prohibition on financial assistance being provided to undertakings conducted with a view to profit for the purpose of meeting all or part of the costs of employing employees.

It is the purpose of the grant that is crucial. For example, there will be no prohibition on grants to support a business generally. Moreover, we propose specific exemptions to which the noble Lord, Lord Graham, drew the attention of the House and I shall not repeat them.

We believe that that should meet all the cases where the need to provide specific financial support towards the cost of employing staff overrides the general rule that wage subsidies, particularly to commercial undertakings, should not be provided by local authorities. The precise formulation for exemptions will be finalised in the light of the current consultation exercise on the use of the new economic development power. I have not yet seen the result of that but of course I shall. The moment I have it to hand I shall bring it to the attention of the noble Lord, Lord Graham of Edmonton. That is why we resist the noble Lord's amendment.

Lord Graham of Edmonton

My Lords, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 39 to 41 not moved.]

Clause 33 [Guidance and consultation about promotion of economic development]:

Baroness Blatch moved Amendment No. 42: Page 40, line 4, after ("available") insert—

1. ("(i) to such bodies as are representative of commercial or industrial undertakings in their area;
2. (ii)").

The noble Baroness said: My Lords, in speaking to Amendment No. 42 I shall also speak to Amendment No. 43. In Committee my noble friend Lord Jenkin of Roding tabled an amendment to Clause 34, which is now Clause 33. His amendment was aimed at ensuring that such bodies as chambers of commerce are consulted by local authorities when drawing up their economic development programmes.

At that time the Minister thought that the Bill as drafted allowed for consultation with bodies which the local authorities considered appropriate and that such consultations would include the local chambers of commerce. However, the Minister also agreed to consider whether there was a case for the Bill to be made more explicit.

Unfortunately, my noble friend Lord Jenkin is not able to be here today as he is abroad on business. I know he still believes that there is a case for making the Bill more explicit. On his behalf, and with my full support, I commend Amendments Nos. 42 and 43, and I hope that my noble friend the Minister will find them both acceptable. I beg to move.

Lord Reay

I am grateful to my noble friend for bringing forward these useful amendments. Your Lordships will recall that my noble friend Lord Jenkin (who I know regrets that he cannot be here today) moved an amendment at Committee stage which had very much the same intention as these. He was, quite rightly, concerned to ensure that when local authorities draw up their economic development programmes there is effective consultation with those best placed to represent the local business community and in particular local chambers of commerce.

The response of my noble friend the Minister to that amendment was, as your Lordships may remember, encouraging. My noble friend acknowledged, as I do now, the valuable contribution that could be made by good, well-organised chambers of commerce to the consultative process. He was not sure however whether the amendment then under discussion would have achieved what was required. The amendments by my noble friend Lady Blatch however hit the nail on the head. They require local authorities to make their consultative document available to such bodies as are representative of commercial or industrial representatives in a local authority's area as well as individual persons. In this way local authorities will be obliged to consult chambers of commerce.

I believe that these amendments will meet the requirements of my noble friend Lord Jenkin, and the Association of British Chambers of Commerce, which has been concerned that its members should not be omitted from the consultative process. I thank my noble friend for bringing the amendments forward and I commend them to your Lordships.

On Question, amendment agreed to.

Baroness Blatch moved Amendment No. 43: Page 40, line 6, after ("and") insert ("(iii)").

On Question, amendment agreed to.

Lord Graham of Edmonton moved Amendment No. 44: Page 40, line 21, at end insert— ("(4A) Nothing in this section shall prevent a local authority from amending its plan, or taking urgent action, in unforeseen circumstances.").

The noble Lord said: This amendment stands in the name of my noble friend Lord McIntosh of Haringey. Throughout the debate on this Bill, local authorities have expressed concern that the requirement to draw up an economic development plan might imply rigid adherence to that plan. By coincidence this part of the Bill was first discussed in the Commons Committee stage at the time the Birds Eye factory was closing. Similarly, throughout the debate on this Bill the Government have made reassuring noises to the effect that there is sufficient flexibility for a local authority to respond in such circumstances. The Minister repeated those assurances earlier this evening and this amendment writes them into the Bill.

The amendment has been carefully worded because it specifies "unforeseen circumstances" as the reason for amending the plan or taking urgent action. That should surely overcome any reservation that local authorities might seek to evade their obligations under the Bill or perhaps draw up a very sketchy plan which they would then fill out as the year progressed. I beg to move.

Lord Hesketh

This matter, as the noble Lord, Lord Graham, pointed out, was raised in Committee, and I am in the happy position of being able to tell the noble Lord, Lord Graham, that there is nothing between us on this issue, though we believe that the amendment is unnecessary. The example was quoted of a local authority finding itself faced with a problem in the local economy that did not exist when the authority drew up its economic development programme at the beginning of the financial year. There might, for example, be a sudden closure of a large manufacturing plant which has played a vital role in the local economy. The local authority could not have predicted such an event, and their year's programme for expenditure under this power may therefore be inappropriate to deal with the problems arising from the closure. The authority may need to support retraining or relocation of staff or redevelopment of the vacant premises, none of which had been mooted in their economic development programme. There is nothing in Clause 33 which would prevent a local authority expanding or redirecting its expenditure under the economic development power from that originally agreed at the beginning of a financial year.

As I said during the debate in Committee, the duty imposed by Clause 33(3) is a duty to draw up a programme of proposals that it wishes to undertake and to consult, as the amended clause will now read, bodies representative of commerce and industry in the area and other persons that are thought to be appropriate. So long as the authority has satisfied this obligation as regards the proposals that it had in mind prior to the beginning of the financial year, it does not have to have consulted on proposed activities which arise later in the year as a result of unforeseen circumstances. It would be both unreasonable and inflexible to expect local authorities to have the necessary powers of clairvoyancy to be able to predict every upturn or downturn in the local economy.

Clause 33 will not prevent local authorities from amending or redirecting, where necessary, their economic development programmes during the course of the year. That is why I say to the noble Lord, Lord Graham, that he and I are at one on this point, but we do not believe that the amendment is necessary.

Lord Graham of Edmonton

My Lords, I am happy to accept the Minister's assurance. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 34 [Amendments of existing power to incur discretionary expenditure]:

Lord Graham of Edmonton moved Amendment No. 45: Page 40, line 33, at end insertߞ ("(2A) Nothing in subsection (2) above shall be taken to apply to town-twinning arrangements undertaken by a local authority.").

The noble Lord said: My Lords, I move this amendment standing in the name of my noble friend Lord McIntosh of Haringey. It returns to an issue that was debated at the Committee stage and the introduction of a direct benefit test under Section 137 expenditure. There is also the explicit link to town-twinning in the original Notes on Clauses. This matter has provoked concern with several local authorities. For example, some are actively engaged at present in fostering and assisting bilateral links and economic development in the Soviet Union under twinning arrangements.

The Minister may be able to confirm that such arrangements are not intended to be caught by the test. In particular, economic development work currently being undertaken under Section 137 might possibly be capable of falling within the new economic development power. The Minister would be helpful if he were to specify what twinning activities could or could not continue to take place under Section 137 as amended. It would also be helpful if he could confirm or otherwise that some twinning activities will continue to be available under Section 137. I beg to move.

Earl Russell

My Lords, I hope that the Minister will give some sympathy to the purposes behind this amendment. Perhaps some noble Lords remember an amendment to the Education Bill moved by my late noble friend Lord McNair which revealed considerable concern in many quarters of the Chamber that people should be able to study more than one foreign language. In possibly a roundabout route, town twinning is one way in which that objective might possibly be secured. Anyone who considers the present balance of payments figures might also concede that foreign languages have something to do with economic development.

Lord Hesketh

My Lords, this amendment attempts to answer a concern which I believe has mistakenly arisen as a result of the amendments which Clause 34 makes to local auhorities' discretionary spending power under Section 137 of the Local Government Act 1972. Clause 34 proposes a number of minor changes to Section 137 to help clarify the scope of the power. Section 137 already requires any expenditure under it to be in the interests of the area of the local authority or any part of it or all or some of its inhabitants. It is the change to this requirement to ensure that direct benefit must accrue to the area or any part of it or all or some of its inhabitants that is giving rise to concern here in relation to local authorities' overseas town twinning exercises.

I am anxious to set the record straight. But first I would like to pay tribute to the fine work that is done through the twinning activities of local authorities. I know that this opinion is shared with my colleagues in the Foreign and Commonwealth Office and the Overseas Development Administration who have worked closely with local authorities in this field. As noble Lords will be aware, there are a number of powers available for local authorities to use in town twinning and these have been quoted on previous occasions. The amendment to Section 137 is not intended to alter these powers; it has no impact on local authorities' other powers and its purpose is only to ensure that the benefits arising from Section 137 expenditure are clearly in the interests of the area or its inhabitants.

In the Notes on Clauses on Clause 34 an example was given of the type of expenditure under Section 137 which we feel would not fall within the new scope of that clause. The notes cited a local authority contributing to a fund to build homes in a foreign city with which it was twinned. This reference may, I fear, have given rise to some unnecessary concern among twinning authorities. The reference to twinning was, however, purely incidental; the example being intended to demonstrate that we do not think it appropriate that ratepayers' money should be used to fund such exercises, either in a foreign country or indeed elsewhere in the United Kingdom. It was irrevelant whether the local authority was twinned to the other town.

Economic development work in connection with twinning will be possible under the new economic development power, but we believe that the misunderstandings that arose due in part to the Notes on Clauses is part of the reason the noble Lord, Lord Graham, will not feel it necessary for his amendment to proceed.

Lord Graham of Edmonton

My Lords, the amendments were put down as a result of misunderstandings, not least in the department. The local authorities will hear what the Minister has said. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

10.15 p.m.

Lord Hesketh moved Amendment No. 46: Page 41, line 21, leave out from ("area") to end of line 23.

The noble Lord said: My Lords, perhaps I may speak at the same time to Amendments Nos. 47, 50 53 and 54. These are technical amendments. I beg to move.

On Question, amendment agreed to.

Lord Hesketh moved Amendment No. 47: Page 41, line 27, leave out ("subsection") and insert ("subsections").

On Question, amendment agreed to.

Lord Hayter moved Amendment No. 48: Page 41, line 28, at beginning insert ("Subject to subsections (4AB) and (4AC) below,").

The noble Lord said: My Lords, in moving this amendment I should like to speak also to Amendment No. 51. Indeed, only by looking at Amendment No. 51 can one make any sense out of Amendment No. 48. It may be recalled that when we debated this clause in Committee I argued that the transitional protection should be available to the local authorities which are losers in the amount of Section 137 money that they can spend after the new system is in operation. I suggested at the time that the local authorities should be able to spend up to the old limit for three years, thus enabling them to control their funding arrangements more sensibly.

My reason for returning to this issue again at Report is that the Minister's reply at that time gave me some cause for hope. He said: Any transitional arrangements should surely allow for a smooth change rather than simply postpone a sudden change. I therefore suggest that the amendment is not appropriate".—[Official Report, 24/7/89; col. 1242.]

On reflection, I thought that the Minister was, as so often, right. I have therefore brought back this amendment which provides for that smooth transition from the old system to the new. I hope therefore that the noble Lord will now accept on his own arguments that this arrangement is appropriate.

I shall explain why. For voluntary organisations, many of which are funded under Section 137, the amendment would mean much greater security and certainty. Instead of being subject to potentially drastic cuts in April next year, they, and indeed the local authorities which fund them, will have time to explore the scope for alternative funding powers or alternative funding arrangements. This will be particularly important to those metropolitan areas such as London where the Government are proposing a limit of £4 per head of the adult population rather than £5. By having more time authorities will be able to make better decisions. The introduction of the community charge system will, heaven knows, provide enough headaches as it is, and sudden changes of this nature to Section 137 on their spending limits is one headache which local authorities could do without. Having adopted the Minister's own suggestions, I hope that he will consider them favourably tonight. I beg to move.

Lord McIntosh of Haringey

My Lords, I should like to add my support to the amendment. It seems to follow very closely the content of a debate which we had in Committee. From my time in London local government I am conscious of the increasing demands which are made on Section 137 expenditure. With the increasing powers of local authorities it is not as if the need for a residual power for such authorities is declining; indeed, on the contrary, as social problems increase, especially those in inner urban areas which had not been anticipated in legislation and are not therefore within the specified powers of local authorities, the need for this reserve capacity is even greater. This is a modest amendment, providing only transitional relief. I would wish that it were more, but it seems to be what the Government indicated might be acceptable to them. I hope that it will be.

Lord Hesketh

My Lords, these amendments would introduce a transitional scheme for the limit on expenditure under Section 137 of the Local Government Act 1972 (general residual discretionary expenditure power). The noble Lord raised this question in Committee. I realise that his new amendment meets some of the criticisms I raised against the earlier proposals. It is true that the Bill will change its expenditure limit under Section 137 from a limit based on rateable value to a limit based on population.

The total amount available to local authorities throughout the country remains the same. As with any change in the system of distribution of fixed amounts there will be some who gain and some who lose. We consider that the new approach will be much fairer, instead of concentrating the greatest power to spend in the areas with the greatest rateable value, which are often also the areas with the least problems. We shall be distributing the power according to population, which will more closely mirror the distribution of problems calling for the use of this power. In that way the large metropolitan authorities in the North will be those which receive the largest increases in permission to spend.

As I said, some authorities will suffer reductions. We do not think there is likely to be very many which, as a result, will have problems. We have taken our latest return and only 32 per cent. of the total headroom for expenditure under this power was used, leaving some 68 per cent. unused. In 1986–87, the last year for which reasonably comprehensive data are available, nearly 26 out of over 500 authorities used more than 80 per cent. of their available headroom.

Lord McIntosh of Haringey

My Lords, the Minister is calling in evidence the fact that many local authorities do not use the powers to the full; however, has he any evidence to show which authorities in inner urban areas—which is what we were talking about—do not use such powers to the full?

Lord Hesketh

My Lords, I was giving the overall picture because I think it is important that the House should have the chance to know what the situation is across the United Kingdom.

I should also stress that we are making other changes which are of considerable importance in this respect. The Bill also provides that from the commencement of the system any expenditure towards which central government pay grant shall not count against the Section 137 limit. That is especially important for some expenditure; for example, in the urban programme where authorities have to count their contribution against their Section 137 limit. Henceforth that expenditure, even though technically referable to Section 137, will not count against the limit. Likewise, we are introducing the new economic development power which will remove a substantial degree of expenditure from Section 137.

I hope that the amendment tabled in the name of the noble Baroness, Lady Strange, which will be discussed shortly, will also enable us to ensure that some further expenditure is taken out of the ambit of Section 137. Hence we do not think that there is likely to be a major problem. If there were a problem in any particular group of local authorities, the Bill already gives the Secretary of State power to change the limit on expenditure for any description of authority. It would therefore be possible to define a group of local authorities and provide a transitional arrangement for them if that were shown to be desirable.

I am glad to be able to repeat our willingness to consider any claims of this kind and to stress that we shall listen sympathetically to the requests for transitional provision. However, I must inform the House that we have not so far had any request for such transitional treatment. Therefore we do not think that it would be justified to provide a general transitional regime for all local authorities.

I hope therefore that, having heard how few authorities might be affected, the steps we are taking to remove expenditure from Section 137 and our willingness to consider special transitional arrangements, the noble Lord, Lord Hayter, will feel able to withdraw the amendment.

Lord Hayter

My Lords, having already demonstrated how carefully I listened at a previous stage to the Minister's speech, I think that I must therefore do the same again. In a way I am in a dilemma because, as I understand it, he feels that I should be comforted by an amendment which is yet to be debated. That amendment may or may not be carried. Nevertheless, in the circumstances I think that I must reserve my position and accordingly I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord McIntosh of Haringey moved Amendment No. 49: Page 41, line 29, after ("order") insert ("by a review").

The noble Lord said: My Lords, I should like to speak also to Amendment No. 52. These amendments follow closely upon the discussions that we have just had on the amendments moved by the noble Lord, Lord Hayter. The Minister said that the Secretary of State may, out of his charity, be prepared to consider transitional arrangements for local authorities that apply for them. He said that one reason for not supporting the amendment which put transitional provision on the face of the Bill was that so few local authorities had so far applied.

If Marsham Street goes on treating local authorities as if they were the kind of people who have crumbs thrown to them from their master's table, which is the way in which the Government are approaching the matter at the moment, it is not surprising if the beggars who have to pick up the crumbs do not lift their heads frequently and complain. They are treated as dependants. They are put into a dependency culture, and then when they behave as dependants it is said, "Oh, well, you did not apply so we shall not give you the consideration that we said only a few months ago was reasonable. We will give it on a grace and favour basis rather than on a proper statutory basis".

I did not like the answer the Minister gave to the noble Lord, Lord Hayter. I know that with his customary courtesy he will read it carefully, I listened carefully to as much as I could keep up with. I did not like the tone or the content of the response. That is a good way of getting support for my amendment, is it not?

Amendments Nos. 49 and 52 say, "OK. All other pleas have failed. We know that you are not going to behave honourably towards those local authorities which will suffer at the outset, but at the very least recognise that there may be a problem in the medium and longer term and that a proper public review, to which everyone can contribute and not merely Marsham Street, would be of value". We propose in Amendment No. 52 that, The Secretary of State may, after a date two years after the date of Royal Assent, undertake a review of the impact of this statute or any scheme made under section 48 of the Local Government Act 1985".

We are asking for a little gesture towards open government. Local authorities will obviously not work towards maximum expenditure under Sections 137 or 48. The Minister's own statistics make that clear. There are cases, in particular in inner city areas, where the funding of voluntary organisations under the Local Government Act 1985 depend heavily on Sections 137 and 48 funding. The matter is of such public concern that a review which is provided for only after a period of two years would be some assurance to the voluntary organisations, which depend on local authorities, that the Government have not merely brushed them under the carpet.

Lord Hesketh

My Lords, sometimes after listening to the blandishments of the noble Lord, Lord McIntosh, I wonder how I can get myself back to Marsham Street the following morning. I seem to find that a good night's sleep restores my faith in the system.

The amendments are similar to some amendments which we debated in Committee. They concern the effect of the new Section 137 limits on the capacity of London borough councils and metropolitan district councils to contribute to schemes run under Section 48 of the Local Government Act 1985. Your Lordships will be aware that such schemes make grants to voluntary organisations across the boundary of more than one council. It is our intention that, in order to bring expenditure under those schemes in line with that for similar expenditure by local authorities within their own areas, reductions will be made in the Section 137 limits of the authorities within Section 48 schemes.

As I promised in Committee, we have been in touch with the local authority associations and the relevant authorities on this matter about agreeing an appropriate sum for that limit. To bring your Lordships up to date on this issue, the current situation is that the London boroughs grants scheme, which organises grants for Greater London, has been looking at the figures involved. We are awaiting the outcome of that review before making any final decisions.

These amendments are of course more concerned with the future in that they ask the Secretary of State to review the impact of Section 137 limits on Section 48 schemes two years after Royal Assent. I have to say that we think that such a requirement is totally unnecessary. Matters such as this, especially where there has been some change of this nature, are always kept under scrutiny. I am sure also that, as experience suggests, any authority that is experiencing difficulties will have no hesitation in bringing the matter to the Secretary of State's attention. It will then be looked at and, if there is justification, Section 137 makes adequate provision for the limits to be altered by order.

I am sure that the noble Lord, Lord McIntosh, will not be satisfied with the Government's approach on this; but these are the reasons why we are resisting his amendments.

Lord McIntosh of Haringey

My Lords, the Minister is right in saying that the amendment looks to the future. It only does so in a sense because we have despaired of the Government doing anything other than sweeping the crumbs from the table onto the poor man's plate in the shorter term.

It is extremely disappointing that the Minister not only fails to recognise present needs and relies on the consultations taking place, for example, with the London Boroughs Grants Committee, as an excuse to fail to make provision on the face of the Bill. He also fails to recognise that, I should have thought, a review would increase confidence in the Government's good intentions. It would increase confidence among the voluntary organisations that continued funding for worthwhile activities is likely to take place.

One of the constant bugbears of the work of voluntary organisations is that they have to live from year to year, with never any assurance of continued funding. It makes it difficult for them to commit themselves to decent premises; it makes it difficult for them to attract staff who will stay with them for a useful period of time. It makes it difficult for them to have consistent and coherent programmes of operation.

The refusal now to grant even a review, after two years, seems the ultimate kick in the teeth for the proper organisation of voluntary organisations. It is deeply disappointing that the Minister should find it impossible to give any ground at all on any of these amendments. However in the light of the time of night and bearing in mind that we may have to return to this matter at a later stage, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Hesketh moved Amendment No. 50: Page 41, line 37, at end insert— ("(4AB) For the purposes of subsection (4)(b) above the relevant population of a local authority's area shall be determined in accordance with regulations made by the Secretary of State; and a statutory instrument containing such regulations shall be subject to annulment in pursuance of a resolution of the House of Commons.").

On Question, amendment agreed to.

[Amendments Nos. 51 and 52 not moved.]

Schedule 2 [Local Government Act 1972, Section 137, as amended]:

Lord Hesketh moved Amendment No. 53: Page 173, line 2, leave out from beginning to end of line 4.

On Question, amendment agreed to.

Lord Hesketh moved Amendment No. 54: Page 173, line 14, at end insert— ("(4AB) For the purposes of subsection (4)(b) above the relevant population of a local authority's area shall be determined in accordance with regulations made by the Secretary of State; and a statutory instrument containing such regulations shall be subject to annulment in pursuance of a resolution of the House of Commons.").

On Question, amendment agreed to.

Clause 35 [Conditions of Provision of financial assistance]:

Lord Hayter moved Amendment No. 55: Page 42, line 34, leave out ("£500 or such other") and insert ("£2,000 or such higher").

The noble Lord said: My Lords, the Bill requires voluntary organisations in receipt of grants of £500 or above from the local authority to provide the authority with a written statement about the use to which the grant has been put within 12 months of receipt of the grant.

In general terms, I am sure that people would agree that this is an excellent idea. It would increase accountability and give the public an opportunity to see how their money is spent. It was an idea that was put to the Widdicombe Committee by the National Council for Voluntary Organisations, with which I am sometimes in touch. The Widdicombe Committee then included it in its report and the Government have included it in the Bill.

The only point on which I differ from the Government is the limit at which this position should come into force. We believe that the sum of £500 is far too low. It would mean that many thousands of voluntary organisations in receipt of relatively small grants for items of equipment, holiday play schemes, hire of premises and other things would have to provide written statements. Furthermore, it would mean local authorities would have to chase up these written statements, and that would involve more and more bureaucracy and more and more paperwork.

I am sure we are all agreed that there needs to be a limit, but I propose in this amendment that a limit of £2,000 would be far more sensible than one of £500. I could ask what £500 represents these days, but perhaps I had better not. My proposal would exempt the thousands of small projects which are not geared up to provide formal written statements and it would reduce the bureaucracy of what is otherwise a very sensible provision. I also propose that the Secretary of State should not be able to lower this limit in the years to come, although he may raise it to take account of inflation. I beg to move.

Lord Hesketh

My Lords, the amendment standing in the names of the noble Lords, Lord Hayter, Lord Ross of Newport and Lord McIntosh of Haringey, would raise the level of grant below which a local authority is not required to insist on a report from a voluntary association on how the grant was used. The level would be raised from £500 to £2,000. Having heard the arguments of the noble Lord, Lord Hayter, I am happy to accept this amendment.

On Question, amendment agreed to.

Baroness Strange moved Amendment No. 56: After Clause 35, insert the following new clause:

("Information etc. on individuals' rights.

.—(1) Section 142 of the Local Government and Housing Act 1972 (provision of information, etc.) shall be amended as follows.

(2) There shall be inserted after subsection (2)— (2A") A local authority may assist voluntary organisations to provide for individuals—

1. (a) information and advice concerning those individuals' rights and obligations; and
2. (b) assistance (whether by the making or receiving of communications, by providing representation to or before any person or body, or otherwise) in asserting those rights or fulfilling those obligations.

(2B) The power conferred by subsection (2A) above is a power to incur expenditure for the purposes mentioned in that subsection within the meaning of paragraph (a) of subsection (1) of section 137 above, but is otherwise without prejudice to any other power exercisable by the authority for those purposes.".")

The noble Baroness said: My Lords, I am in the unenviable position of moving possibly the last amendment of the day. I hope your Lordships will bear with me if I trip over my tongue now and again in trying to be as quick as possible. When this Bill went through Committee, I was delighted to hear my noble friend the Minister express his sympathy with the aims of the amendment, which sought to make specific provisions for funding advice services like the Citizens' Advice Bureaux.

At the moment local authorities have no specific powers to fund such services and have to rely on more general powers such as Section 137 of the Local Government Act 1972 which concerns a local authority being able to incur expenditure for certain powers not otherwise authorised. Equally, local authorities often have to depend on Section 142 of the 1972 Act, which is a general power to fund information and dates back to the Local Government Act 1948. My noble friend said on Monday 24th July that our views have developed since then. We welcome my noble friend's view that this is a convenient point to look at the provision in the 1972 Act and his commitment to bring back a suitable amendment on Report. We also welcome his kind words on the subject today.

The past 40 years have seen enormous developments in the advice services. New legislation and changes in society in a wide range of areas require advice services to give further assistance to their clients over and above pure information. Advice on debts involves the adviser in time-consuming negotiations with a wide variety of creditors. In the year ending in May 1988, for example, the Coventry Citizens' Advice Bureau wrote 2,173 letters, made 2,166 telephone calls, 59 court submissions and 17 court appearances for clients with debt problems.

Increasing recognition of the needs of disabled people and the move to community care demand that advice services act to put their views and fulfil their rights and obligations. Similarly, advice and law centres facilitate good management in the voluntary sector by advising smaller community organisations on their rights and obligations. I welcome this opportunity to amend Section 142 so that it is appropriate to the needs of the present day. I hope that my noble friend the Minister is now in a position to fulfil his promise and will feel able to adopt the amendment as drafted. I beg to move.

Baroness Darcy (de Knayth)

My Lords, I wish to add a few brief but nonetheless warm words of support for the amendment of the noble Baroness, Lady Strange. As she said, it will benefit agencies which give valuable and much needed advice to people with disabilities. I very much hope that the Minister can accept this amendment, which is very modest.

Lord Hacking

My Lords, I wish to endorse the views that have already been expressed, and I hope the Minister will accept this amendment.

Lord McIntosh of Haringey

My Lords, I should like to add my support and the support of these Benches for the amendment. I said earlier this evening that the range of demands on local authorities has increased, is increasing and shows no sign of abating. One of the most conspicuous of those demands is for advice, in particular on individuals' rights and obligations. Some of that advice is provided by voluntary organisations such as the Citizens' Advice Bureaux, some of it is provided in some local authorities by the authorities' own staff. But whoever carries it out it is important that it should be officially recognised as a proper duty of local authorities and a proper use of local authority financing and that it should not be at the expense of other matters which come under Section 137 of the Local Government Act.

Therefore an amendment which spells out the necessary amendment to the 1972 Act, seems to us to have very great merit. I hope that the Government will be able to support it.

Lord Reay

My Lords, the amendment would provide a new general power for local authorities to assist advice agencies.

In Committee my noble friend promised to consider an amendment of my noble friend Lady Strange which had a similar purpose to this amendment. He has now done so. The Government accept in principle that it would be desirable to make the amendment that my noble friend has moved. However, constraints on drafting resources have so far prevented us from bringing forward an amendment of our own. The amendment put forward by my noble friend at this stage, although an improvement on the one which she tabled at Committee stage, is still not technically quite right. In order that the Bill at Third Reading should contain provision on this topic we are prepared to accept the amendment but on the understanding that she will accept further amendments to improve it at a later stage.

Baroness Strange

My Lords, I thank my noble friend the Minister very much. I am delighted with the concessions that he has made and that we can accept the amendment as it stands in the meantime.

On Question, amendment agreed to.

Lord Hesketh

My Lords, I beg to move that further consideration on Report be now adjourned.

Moved accordingly, and, on Question, Motion agreed to.

House adjourned at eighteen minutes before eleven o'clock.