Local Democracy

HL Deb 21 April 1993 vol 544 cc1582-640

4.10 p.m.

Lord Williams of Elvel

rose to call attention to the case for local democracy, and in particular to the role of local authorities in providing housing, welfare, educational and cultural services for the benefit of the communities which they serve, and to the financial constraints under which they now operate in providing those services; and to move for Papers.

The noble Lord said: My Lords, I beg finally to move the Motion standing in my name on the Order Paper.

The Motion calls attention to three themes, all of which, as I hope to show, are interlinked. The first is what I call the constitutional question of the relationship between different levels of democratic decision-making in a pluralistic society such as we have; the case, in other words, for local democracy.

The second theme calls attention to the services that local government can and should provide and I hope to demonstrate that the principle of subsidiarity applies just as strongly from Westminster downwards as it does from Brussels to Westminster. The third theme deals with local expenditure and local taxation and, as a consequence, with local accountability.

Let me start with the constitutional theme. It is, in our view, self-evident that local authorities, properly and duly elected, are a basic element in our constitutional structure; that central and local government must recognise their interdependence and conduct their relationship on the basis of consultation, openness and respect. I should have thought that those principles would command general acceptance, but the truth is that throughout the 1980s and early 1990s there has been a stream of legislation, Bill after Bill, attacking those very principles. We have now reached the point where a Whitehall spokesman can brief the press that the Prime Minister wishes to call an end to "head-butting" between central and local government; and where the Conservative chairman of the Association of County Councils—itself Tory controlled—describes the Government's attitudes as "obnoxious". There is, in other words, a crisis in local democracy.

Of course, the rhetoric is now starting to change, but I hope that I will not be accused of being unduly cynical if I note that we are coming fairly close to the county council elections, and on those occasions the children must be given sweets. But the Prime Minister would like to see a renaissance in local government: the Minister for local government confesses dismay—he would be very worried, he says, if he thought that the result of their reforms was going to be to centralise power. But the Prime Minister and the Minister are a little late. Local government has already almost been brought to its knees in the past decade. It will take more than a few kind words on the eve of local elections to restore what has been so recklessly smashed over a period of years.

Let me give your Lordships some examples of what I mean by that. In doing so, I come to the second major theme contained in the Motion: the services that local authorities should properly provide. I do not wish to go into the vexed question of local government reorganisation, although other noble Lords may wish to do so. I only say that sensible reorganisation starts from the point of asking where local loyalties lie; what is the nature of the community with which people can identify? The inquiry then asks what services are required, moves to the point of asking what is the optimal combination between economies of scale and local identification and moves finally to a decision. The community is the centre, the enabler, ensuring that demands for services are met, sometimes on their own and sometimes in partnerships, of which there may be a great variety depending on the nature of the service required. That is the way to proceed. In other words, not to put too fine a point on it, the process moves in precisely the opposite direction to that taken by the Welsh Office in its recent White Paper.

The Motion lists four headings under which local authority services may be grouped. I accept that those headings are in themselves arbitrary. I have no intention of listing seriatim all the services that local government can provide. I only refer those noble Lords who are keen to find out to Annex A of the second consultative paper on Scottish local government reorganisation, where a total of 69 different functions are set out. Not all of those can be performed without the close assistance of central government. There are obviously degrees of subsidiarity. For example, in order to avoid central authority poking its nose into every nook and cranny, if I may borrow that expression from the Foreign Secretary, it would be absurd for burials and cremations to be administered at anything other than the lowest tier of government. The same goes for community councils, food hygiene, street markets, and the collection and disposal of waste. Equally obviously, crime prevention, social services, transport, emergency planning, arts, leisure and recreation require an administrative infrastructure which is rather more developed.

The point is that all those services are essentially local authority functions and need to be performed or led by authorities who are sensitive, and compelled to be sensitive through the operation of the ballot box, to the communities that they serve.

What has happened over the past decade or so? What has happened is that more and more of those vital functions of local authorities have been taken over, either in whole or in part, by central government or unelected quangos. It is that process that has led to the demoralisation of local government that is so apparent today. Perhaps I may give your Lordships an example: housing. It is, I believe—and I hope the Minister will accept this—common ground right across the political spectrum that there is a severe need for social housing in the United Kingdom. Indeed, an Audit Commission report of May 1992 estimates the need at between 58,000 and 90,000 units per annum throughout the period up to the year 2000. The commission went on to write that the available resources would be more effectively used if there was a single, unambiguous national strategy for housing.

Since that report, it has become increasingly evident that despite the efforts of the housing associations, which play a valuable role, it is the local authorities which are the proper agency to co-ordinate and operate such a strategy, not least because of the responsibilities laid on local authorities for the renovation of the private sector housing stock.

In the face of that problem, in the face of the Audit Commission's recommendations, what has been the Government's response? Leaving aside the extent of resources made available, the Government's response has been one of sustained attack on local authority housing departments, in the Local Government and Housing Act 1989. Now we see it again in the Housing and Urban Development Bill before your Lordships' House; and an unelected, unaccountable body, the Housing Corporation, taking upon itself a role in strategic decisions about housing spending—cutting right across the role of local authorities responsible to their own electorate. No wonder the whole thing is in such a mess.

But not only is it a mess; it is a mess that appears to have been very carefully planned. The 1987 White Paper set it out all too clearly. Housing associations would be the new providers of social housing. Local authorities should, over time, divest themselves of a landlord role. Nevertheless, the White Paper argued: Local authorities should increasingly see themselves as enablers who ensure that everyone in their area is adequately housed". It is quite simple. The Government say to the local authorities: "You have the legal responsibility, but we will pay somebody else the money".

Nor did that very careful planning stop at the 1987 White Paper. It is, as I understand it, still the basis of government housing policy. Authorities are to develop "strategies", concentrating on the renovation of private and public housing stock and the need for new housing. At the same time, the Housing Corporation has as its principal aim, according to its own management statement, to secure, through housing associations, a supply of decent and affordable housing for people in priority need". So there are two sets of worthy bodies trying to do the same thing but answerable to different masters and working on different systems of finance; and only one—the local authorities—has statutory responsibilities which bear heavily on the provision of housing, such as planning, community care and care of children. No wonder the Audit Commission concluded (in its delicate language) that: It is not clear that two separate channels for allocating resources are either efficient or effective". Housing is only one area in which there is confusion, consequent inefficiency and low morale. Everywhere we look, new quangos have sprouted: 11 urban development corporations, their members appointed by the Secretary of State; 82 training and enterprise councils, managing local training and enterprise programmes, the chairmen appointed by the Secretary of State; some 180 district health authorities; 90 family health service authorities, all central government-funded with chairmen appointed by the Secretary of State; and some 300 NHS trusts, chairmen appointed by the Secretary of State. There is also the further education funding council; the new funding agency for schools and our friend the new urban regeneration agency, all presently under discussion in this House, chairmen appointed by the Secretary of State.

To whom are all those bodies accountable? They are accountable to the Secretary of State who appointed them. In the case of Wales, the Secretary of State for Wales, given that the Welsh Office is multi-functional, has the power of patronage in all central government activities within the Principality. So he appoints all the chairmen of all the Welsh authorities in the areas that I have mentioned. What a marvellous opportunity for jobs for the boys! And what a marvellous opportunity for corruption.

I turn now to my third theme: the financial constraints under which local authorities operate. I have no wish to bandy figures with the Minister; I regard that as a sterile pastime. I am much more concerned with the financial relationship between central and local government, since that lies at the heart of the general constitutional problem with which I began.

Noble Lords will recall—indeed who does not recall?—the monstrous fiasco that was known as the poll tax. It was perhaps Mr. Michael Howard, the present Secretary of State for the Environment, who predicted its effect most accurately. It would, he said in February 1988: give power to the people … . As local people grasp the significance of the new power we are giving them, they will not be slow to use it". He was absolutely right—though not, I imagine, in the way he intended. The "local people" that he referred to certainly used their power in a succession of by-elections that forced the dumping of a Prime Minister and a total climb-down by the subsequent Government.

Just over two years and £19 billion later we are landed with another conundrum. In the switch out of the poll tax the Treasury had to find large sums of money to fund the financial black hole that was left. The formula it devised, it must be said, was extremely ingenious. VAT would be raised and local authorities would be compensated for the loss of locally raised revenue by an equivalent sum from the Exchequer. But—and this is the important point—that process reduced the proportion of local authority revenue raised by local tax quite dramatically. Instead of being (depending on the type of authority) on either side of 50 per cent., as it was in the mid-1980s, it has become on either side of 15 per cent.

The effect of that change has been profound and, I believe, has not yet been fully appreciated. Put crudely, it means that the Treasury, through the operation of the revenue support grant and the distribution of the national business rate, now controls 85 per cent. of local government revenues. Furthermore, authorities are then told, through the mechanism of standard spending assessments and capping, how much they can raise from their electorate. So the whole of the cake is simply awarded by central government. The only decision that the authorities have to make is how to divide it up. To quote again the Conservative chairman of the Conservative Association of County Councils: The man who pays the piper calls the tune. The Government is paying up all the money. They are saying we have an absolute right to say what should happen". What the chairman did not add, but I will, is that it is a system of which the old Soviet Union would have been proud. For the truth is that we now have a highly developed economic command system in the local government sector. But like all command systems, as Stalin's successors found out, there is a potentially fatal flaw. One can control the supply quite easily, but for the system to work one has to be sure what the demand is. It is no good delivering 10 tonnes of potatoes to a village where the demand is for only three tonnes. Equally, it is no good delivering three tonnes where the demand is for 10. In the first case, the result is a pile of rotting potatoes; in the second case, the result is inflation or rationing. That is why we are seeing cuts in services in local authorities.

What is the remedy to this situation? It so happens that part of the answer was provided by the Treasury itself, in a White Paper on public expenditure planning produced in 1988, when the present Prime Minister, as we know, was Chief Secretary to the Treasury. The idea was simple: central government planning totals should exclude local authority expenditure if it was financed by local authorities themselves. That, after all, is how others do it. Indeed, federal authorities such as Germany could not do it in any other way; so why should not we?

Next, we must increase the proportion of their own revenue for which local authorities are responsible. There seems to be no reason at all why the business rate should not be returned to local jurisdiction. After all, it will be in their interest, in an economic world as competitive as the one we live in, to keep that rate as low as possible to attract investment into their area.

Finally, we must re-establish the direct democratic link between authorities and the communities which they serve. In our view the best way to achieve that would be to ensure that there are frequent opportunities for the electorate to express its views on the performance of its representatives. There should be open debate on the trade-off—we have to accept that it is a trade-off—between level of local tax and the provision of local services.

Above all—and I return now to the constitutional question with which I started—we must all recognise that local democracy is about spreading power. Inevitably that means recognising that our political opponents, however much we disagree with them, are part of a healthy, democratic system with proper checks and balances. There has been far too much cronyism, far too many attempts to smash all opposition and far too much arrogance under the Conservative Governments that we have had. Local democracy is a vital element in the balance of forces that make for a truly free society. It must be nurtured and encouraged and not be killed off. That, I hope, will be the message of today's debate.

My Lords, I beg to move for Papers.

4.30 p.m.

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

My Lords, I welcome the opportunity we have today to discuss this vital issue, to put the Government's view of local democracy and the role of local authorities in providing essential services, and to set the record straight.

I begin with a quotation.

We are moving rapidly towards a system in which central government, by the final power of the purse, will have effectively destroyed the supposed, though admittedly limited, autonomy of the local authorities". The noble Lord's opening speech, and indeed much that is said about local government, chimes with that view. It is a picture of central government bent on centralisation and increasing its control and of local government losing its independence and its functions, starved of funds, impotent and on the verge of extinction.

The quotation is from G.D.H. Cole just after the First World War. Charges of centralisation and the decline of local government are a constant theme of central-local relations since at least that time. And yet, for all that apparent 70 years of centralisation, stripping of functions, underfunding and all the rest, the one constant in local government is the inexorable rise in real terms in local authority spending. Even over the past 14 years, when the assault has supposedly been at its most intense, I see that local government spending in England has risen by 15 per cent. in real terms.

It does not square, does it? Local government is stripped of its functions and yet is spending ever more money. Our starting point in this debate should be to cast aside the myths and woolly thinking and begin at the beginning.

First, let me look at day-to-day control over local government and local authorities' freedom of action. We in Britain are probably unique in Europe in having no general system of state supervision of local authorities—no prefects, no governors, no commissioners, no voivodes, to approve, confirm or otherwise second-guess local authority decisions. We are also unusual in having no state approved manual which sets out how local authority officers and councillors are to act in any given situation. And we are unusual in having no hierarchy of local government, with one tier supervising the actions of the tier below it. In all this we differ from most European countries. Indeed, visitors to my department from overseas are quite staggered by government's lack of control.

We have government inspectorates, that is true, but their role is almost exclusively advisory. They do not generally have powers to impose their views on local authorities. We also have a few powers of appeal where central government can overturn local authority decisions, such as in planning appeals or school closures. But we clearly do not have the power and day-to-day control over local government that is the reality in much of Europe.

I can hear noble Lords opposite say, "But in many European countries the trend is now to decentralisation, while in Britain it seems to be precisely the opposite". It is often the case in Europe that there is a difference between theory and reality. I recall reading in the Local Government Chronicle a few months ago an interview with a French mayor who said that the apparently great changes in France were mainly theory. The reality was that he still needed the sous-préfet's de facto agreement to any action. It is as well to remember that heavily centralised states such as France or Sweden can decentralise and yet remain considerably more centralised than the United Kingdom.

But is the trend in Britain towards greater state control? It is often forgotten, particularly by noble Lords opposite, that one of the first actions of the incoming Conservative Government in 1979 was a bonfire of some 300 controls over local government. And they were detailed controls—the sort that are now being abolished on the Continent to the sound of warm approval from British local government. Let me give just one example. Before our bonfire of controls every local authority proposal for a capital spending project had to be examined in detail by the Government and approved by them. Take housing, for example. The Government set national house building standards—the Parker Morris standards. Projects had to satisfy those standards in every detail if they were to have a chance of being approved. The DoE had armies of architects, quantity surveyors, civil engineers and all sorts of other experts who were kept fully occupied poring over local authorities' plans, discussing detailed specifications with their experts and second-guessing local housing decisions.

What about financial controls? How much freedom do our local authorities have to decide their own spending priorities? The noble Lord, Lord Williams, explained the problems that he had with how the money was raised. What counts is the ability to spend. In 1993–94 local authorities in England will spend some £70 billion. Of that sum only £16 billion—nearly a quarter—is received in the form of specific grant and allocated by the Government to specific purposes. That means that local councillors themselves decide how the remaining £54 billion is spent. Local councillors decide the service and spending priorities of 77 per cent. of local government spending. It is worth remembering that that constitutes over a fifth of total public expenditure. Together with their planning and economic powers, it gives local authorities enormous potential power to influence the life and development of their areas and citizens.

The charge is sometimes made that capping is an attack on local democracy. Perhaps in an ideal world we could give local authorities carte blanche to tax and spend as much as they like and not worry about the consequences. But we live in the real world. We do not have infinite resources—quite the opposite. Local government expenditure is a major part of public expenditure and as such can exert a significant influence on the development of the economy.

This year's RSG settlement in England allows for a 3.5 per cent. increase in local government spending, taking account of changes of functions. That compares with inflation currently at 1.9 per cent. and a public sector pay restraint policy range of zero to 1.5 per cent.

There can be no doubt of this Government's commitment to democracy and in particular local democracy. But they, unlike the Opposition parties, do not equate local democracy with the protection and maintenance of vested interest. We believe that the functions of local government have been given to it because Parliament believes that those functions are best organised at local level. But central government has to set standards and be there to protect people when local government does not deliver adequate services. Time and again we have seen local authorities let down the people by whom they have been elected.

Central government is also responsible to Parliament and the country for the huge amounts of taxpayers' money that is spent by local government. We have a duty to ensure that the money is spent efficiently and effectively and in the provision of good and responsive services to the citizen.

That means our policy towards local government must be based on increasing value for money, responsiveness and accountability. We have therefore pushed forward the idea of the enabling authority—the principle that a local authority does not have to provide every aspect of every service with its own directly employed staff. Through compulsory competitive tendering we have ensured that authorities obtain services delivered from the most efficient, effective and economical source.

That does not entail any diminution of the power of the local government. On the contrary, CCT and the enabling authority have freed authorities from the conflict that is inevitable in the direct provision of services. We are freeing authorities to be unequivocally on the side of the citizen, to be the champions of the consumer and to secure value for money and responsive change in the whole culture of local government. We are now seeing a move towards a performance and consumer-oriented culture. The Citizen's Charter and performance measurement will act as a shop window to illustrate the progress that local government is making. It will spread best practice and it will help local authorities gain a new respect.

The noble Lord, Lord Williams, mentioned subsidiarity. In this context I prefer to call it "localisation". Parliament has given local government the services it now provides because it believes that those services are best organised at a local level. But sometimes even the best local authority can appear remote and unresponsive to the citizen receiving the service. That is why, when possible, such as with schools or services to council tenants, our policy has been to bring the organisation of services as near to the consumer as possible. That is localisation. It is all about empowering the citizen to have as much direct influence on services as possible.

Housing is one of the areas where we are particularly keen to develop local authorities' role as enablers. We want them to reinforce local democracy by working for local communities to ensure that housing need is met and not to turn themselves into monopoly providers like the worst examples of municipal socialism seen in the past. We want to get rid of the idea that the measure of success for a council's housing policy is the number of units that it builds itself. What matters is whether the needs of its local community are met, not who provides or who owns the homes. That is why the Citizen's Charter made clear our determination to make housing management less remote and insensitive. If tenants do not have the opportunity to set out their priorities, to tell an authority where it is going wrong and what it is doing right and to make their voices heard, then an authority can have little chance of securing their satisfaction in the long term.

If I may turn briefly to education, legislation throughout the 1980s progressively increased the accountability and responsiveness of schools to parents. The Government have strengthened the representation of parents on school governing bodies and have enhanced the role of individual governing bodies in the running of schools. Our experience is that just as the people best placed to take key decisions about the management of the school are its governors and head teachers, so they are the most responsive to parents' views and, when there are problems, to parents' concerns.

Local authorities also have important and wide ranging responsibilities for social services. During the past three years local authorities have been implementing a number of significant new initiatives: the Children Act, the new community care arrangements and the implications of the Criminal Justice Act. The Government have recognised the implications of all these and have fairly funded authorities to tackle them. Overall standing spending in 1993–94 for social services will be some £5.5 billion, an increase of a third in real terms since 1990–91.

In the cultural field, local authorities have a statutory duty to provide a comprehensive and efficient public library service. They too have been funded to do this.

In conclusion, it is not true that the Government are bent on centralisation and trampling local democracy underfoot. It is not true that we have increased and are increasing the controls over local government. It is not true that local authorities are impotent bodies with little control over services and little chance to influence their areas. On the contrary, the Government believe strongly in local democracy and local leadership. That is why we resist the temptation to make more use of specific grants. That is why our policy has been to encourage local government, through the enabling authority and localisation, to be more responsive to the consumer.

Much of the anguish and propaganda that we hear is the sound of vested interest whining because we have dared to put the interest of the citizen above that of a cushy life for providers. This Government are about empowering the citizen and empowering the local authority to serve the citizen better. Much of local government now shares that objective. This debate gives the Labour Party the opportunity to demonstrate that it too shares that objective. I regret and fear that, with the notable exception of the contribution of my noble friend Lord Prentice, the debate will disappoint me.

4.44 p.m.

Baroness Seear

My Lords, the noble Lord, Lord Strathclyde, does not very often rouse my sympathy. He is not the kind of man who creates that emotion in me. But today I must say that I have never heard him or any other Minister have a worse brief to promote a worse case. He has no case to present and that is why it has been such a deplorable performance. He had to quote G.D.H. Cole, who, incidentally, got it wrong nearly every time. The noble Lord had to go back to him to support his argument.

I do not believe that the noble Lord understands what this whole argument is about and I do not believe that many of the people behind him do; or, if they do, why are they not here to support him? Either they know that he has an impossibly bad case and they agree with us, or else they cannot think of anything to say in his defence. I have great sympathy with them. There is nothing to say in his defence.

The noble Lord, Lord Strathclyde, has, if you like, the advantage of me—but the disadvantage on this occasion—that he did not live through the rise of the despotisms in Europe. What made me a incurable Liberal was that I was in Germany in the summer of 1932. I am not saying that the noble Lord, despite his hair style, is in any way a budding Hitler, but what happened then was that bit by bit the countervailing powers which make it safe to have strong central government were whittled away until all power was at the centre. That is what happened and that is why the distribution of power is the most important central principle of any democracy. When that is undermined democracy goes out of the window.

One of the most important countervailing powers is local government—local government, with all its limitations and defects. Of course it is not perfect, but local government, however inadequate and however much in need of reform, is a very powerful countervailing power. In some ways I go along with the criticism of aspects of local government. After all, I live in Lambeth. The noble Lord cannot tell me anything about what goes wrong in local government. But let me say to him that people put it right themselves. Did he notice that in a recent by-election there was a most outstanding swing towards the Liberal Democrats in protest against what the Labour council of Lambeth had been doing? People take matters into their own hands when they need to. They do not have to be told by central government what they need to do.

The noble Lord gives the impression that he thinks that central government graciously allows local government to develop. It is the other way round. Real democracy comes from the ground upwards, not from the centre downwards. Running throughout the noble Lord's speech was the idea that powers were graciously given from the centre to allow people at local level to do what central government thought it was good and right that they should do. That is not the way democracy works, and the sooner the noble Lord realises that and the implications of it, the better.

There are a number of ways in which local government has been undermined. The noble Lord had the nerve to talk about housing. How many times in your Lordships' House have we asked that the money that local government already has be used for housing? We have been told that it is not allowed to use it. Is that giving local government control over its housing? How many times in recent debates have we made the point on education that local authority powers in connection with education are being whittled away? Is that the development of local government? Is that local democracy?

Why are there all these quangos? Why cannot these matters be left to the control of local people? On occasions there is a case for a quango. I am not automatically anti-quango. We have seen quango after quango developed, and who gets on them? Will the noble Lord tell us how many of the chairmen of quangos who have been appointed have been members of parties other than the Conservative Party? It will be very interesting if we can have an answer to that question. This countervailing power lies at the centre of the whole argument and it is vitally necessary that it should be maintained.

However, there are other questions about local government which need to be considered if local government is to be what it ought to be. Let us not forget that it is the training ground of democrats. People learn through taking part in local government what democracy is all about. In my own party—some of them will not be listening—I have seen some very odd young men and women elected to local councils. In six months one would not know them because the responsibility of having to make a decision—for example, that either one puts up the rates and makes oneself unpopular or one denies a scheme that one would have liked to have put into operation—provides training in which people learn what democracy is about. They learn what is possible and what is not possible. They also learn responsibility, and there is no other way of doing so.

If one discourages, by limiting what local government can do, ordinary citizens from giving themselves to the work of local government—it is a very heavy responsibility which they undertake in terms of time and commitment—then one is undermining the very springs from which democrats grow, which is a very dangerous thing to do. In any case, local people very often know best what is needed in their own area. Even if central government departments are as wonderful as we are told they are—and some of us have grave doubts about that—they cannot really know what is needed in local districts.

Local people can get at their local councillors, and that is what matters. The noble Lord will know, as everyone in this House knows, many people in all parties who have given a great deal of their time to local government. It is a very hard task because their constituents are around them all the time. If one is chairman of a local housing committee, one's telephone rings morning, noon and night—and, from my observation, especially at night. One cannot escape from it. Even a Member of Parliament can get away from his constituents in a way in which very few local councillors can, but that is democracy in action and how people learn what it is all about.

I agree that there are things about local government which are not right. We need two very important changes. We need local government to have more real responsibility for what is undertaken. That means raising a higher proportion of the money expense itself, and not depending on what the Government decide it should have. For that we need a sensible system of local government finance. We on these Benches have urged again and again that local government should be financed by local income tax, which is fair, and local voters can see—just as national voters can when it comes to voting for central government—how the money that they are asked to pay is to be spent. They can criticise that in terms of value for the money they have had to give to local government. Surely, that is the essential way of doing it.

We also need to have local government which is genuinely representative. One of the great troubles has been that under our electoral system, they are not genuinely representative. If we had proportional representation (we are not in Italy) for local government, we would never have had the extremist local councils to which the noble Lord has referred and which have given some slight colour to some of the criticisms which he has made.

I shall be very interested to learn whether the Labour Party, in its present consideration of proportional representation is prepared to commit itself to proportional representation for local government. There would be a much better representation of local interests if that took place. I am extremely interested to see the noble Lord nodding his head because what is sauce for the goose is sauce for the gander, and in this case the gander is central government.

4.55 p.m.

Baroness Fisher of Rednal

My Lords, we should thank my noble friend Lord Williams of Elvel for giving us the opportunity for this debate. I wish to commence with an essential service which was carried out with great competence by local authorities. I am talking about the provision of water. My noble friend Lord Howell is with me. Birmingham's water was some of the finest in the country. It was not provided by Labour, socialist municipalisation; it was provided in the first instance by Joseph Chamberlain.

At the moment public officials are showing very serious anxiety about hepatitis and dysentery arising from the serious action of cutting off the water supply to many households. I say to the Minister that last year 21,000 households in England and Wales were disconnected from their water supply, a rise of 17 per cent. on the previous year. I say to the Minister very sincerely that we have to recognise that the people who are disconnected have to live in the real world as well. Birmingham was one of the local authorities, with Bristol, Liverpool and Sheffield, where densely populated communities were without water for two solid weeks. Therefore, the real problem for the public health officials now is very serious.

As regards the seriousness of the disconnection of water, water prices have risen throughout Britain by an average of nearly 50 per cent. in the past five years. But that increase has not been matched by any increases in housing benefit or income support, so the people who are suffering are the poorest people. Perhaps I may remind the Minister that the Housing Act 1985 defines a house without an adequate supply of wholesome water and an effective drainage system, as a house which is not fit for human habitation. It will come about that local authorities will have to take legal action against water authorities because it is they who are breaking the law and making the houses in which people live unfit for human habitation. It is up to the Government to make quite sure that local authorities do not have to take on the water authorities. But drastic action is necessary.

The disconnection of the water supply has taken us back into the 19th century. It would never have occurred under the local authorities. I say to my noble friend Lord Howell that I am convinced that Birmingham would never have cut off anybody's water supply. I feel that that would be the same situation with Manchester, Liverpool and the other places. But there is a moral aspect to this.

Lord Howell

My Lords, I am much obliged to my noble friend.

Baroness Fisher of Rednal

My Lords, one minute!

Lord Howell

My Lords, I shall be 30 seconds. When I was the Minister of State responsible for water for five years, I forbade any water authority to cut off water supplies. I insisted that they negotiated with the social services department to overcome the problem.

Baroness Fisher of Rednal

My Lords, this is a moral issue. While on the one hand the poorest are having their water cut off, on the other hand, the highest salaries ever are being paid to the people who manage the water supply. Those people never put anything into the building of the water supply, but just happened to be around at the time of privatisation. Their salaries are a disgrace in view of the moral issue. In fact, some of them could pay off the water bills of those whose water supplies they are disconnecting.

I turn now to another of the Government's schemes, the assisted places scheme. Again, the Government thought that that would be a laudable scheme, but it overspent its estimated budget by more than £10 million in 1991–92. Many of the pupils receiving places under the scheme now have all of their fees paid because the cost of the places has increased and there may be unemployment in their family. I repeat that there has been an overspend of £10 million. If a local authority had overspent by £10 million, down would come the big chopper well and truly, and the Government would say that education was being wasted, but they do not say that now because they are overspending.

I turn now to another small example about which local authorities are crying out all over the country. I cannot be the only Member of your Lordships' House who has found that my largest postbag over the past three weeks has reflected the fear that is felt all around the country about nursery schools being closed. I have received literally hundreds of letters about that. I do not know much about Hounslow, but I should think that practically every parent in Hounslow has written to me about this. On the one hand therefore the assisted places scheme is allowed to overspend; but, at the other end of the scale, nursery schools, from which everybody knows that children benefit, are suffering. We can see those two sides and we understand why there is a difference and that one group of people is being given greater benefits than the other.

I do not think that the Government have any housing policy at all. When they go to bed at night they think that somebody will come up with a good scheme. But what have we found? Perhaps the Minister can tell me how many tenancies have been created over shops. He spoke at great length about a terrific number of thousands of homes being created over shops; but can he give us any information about the number of people who now live over shops? Has it increased?

Do housing associations charge affordable rents? Is it not true to say that too many of the local authorities which thought that they would form their properties into housing associations have been passed over? The Minister is now having to say, "Only a few at a time". Why? Because the cost of housing benefit went right out of the window. When the Government agreed to that policy, they did not realise that the cost of housing benefit would rise so much because they did not realise that, under the most recent housing legislation, local authority tenants have to pay so much towards housing benefit. Those who can afford to pay have to help those who cannot. However, that does not apply to the tenants of housing association properties. The Minister is now saying, "We cannot have that—it costs too much money". Again, that is a scheme that went completely wrong.

I am not entirely sure, but I believe that there has recently been a Question in the House about the number of properties being held by Her Majesty's Forces. I believe that they are to be transferred to a new, non-profit-making body in the private sector. Does the Minister know anybody in the private sector who does anything for no profit? I do not. But the mind boggles.

I turn now to housing policy for the elderly. In the past, local authorities recognised that elderly people were living in houses that were much too large for them and so they created nice residential homes for the elderly. But the Government said, "No, we cannot do that. We must have some private homes", so private nursing homes started up. I was not against private nursing homes; but, here again, expenditure on them rose by £20 million a year because their charges could be claimed as social security benefits. The Government did not realise that at the time, and they have now clamped down. After April of this year, residents in such homes will be allowed to have only a certain amount of the charges paid under social security benefits and then, if they are new to the property, they will have to ask their relations to pay the rest.

Another problem which the Government did not fully appreciate at the time was that involved in transferring people from mental hospitals into the community. That is another burden that is being placed on the local authorities. A report in the British Medical Journal only a fortnight ago referred to the fact that the money that should be accompanying patients into the community in the form of dowries is not being paid. About 850 people went out into the community from such hospitals in the previous 12 months and £300 million should have been passed from the hospitals to the local authorities for their care, but just £12 million was passed over. That is another burden that has to be picked up by the local authorities.

The Minister may think that there is local democracy, but it is being eroded. We must recognise that, as others have said, local authorities do not comprise elected councillors only, but that many of the officers whom they employ live in the local area. Therefore, when local councillors draw their attention to something, such as holes in the road, they can quickly say, "Yes, I travel down that road every day myself, and I know what you are talking about". That means that people do not have to emphasise their points because the officials are aware of the problems. One cannot expect civil servants at Westminster to know what is going on in Bradford, Leeds, Birmingham or Manchester.

It is important that we understand what local democracy means and that the disciplines of control are being challenged. Those disciplines are being broken down by the Government who move in people to serve on what the noble Baroness referred to as "quangos", but what other people call "appointed bodies". Instead of democratically elected persons serving on such bodies, we are now getting what has been described as the "new lay elite"—people who are being chosen by the Government. The Minister may well look up, but it was only two or three days ago that the Home Office Minister discussed the new set-up and said that he would appoint the chairman. Once the Government have appointed the chairman, they will be home and dry, will they not?

As a result of such people being appointed to quangos, we are not finding that in response to Questions on the Order Paper, Ministers say that certain matters have been passed over to Mr. So-and-so and that he will reply to the Member concerned. So, in Hansard, we are getting not the voice of the Government, but references to some man with some job somewhere—perhaps in Manchester or Glasgow—who will reply to the Question. Ministers do not even bother to look at the Questions on the Order Paper now. They simply say, "Send that up to So-and-so", and could not care less what answer is given. That means that democracy is being lost to parliamentarians in both Houses.

I close by referring to what the Prime Minister said after Christmas. I listened to him with great interest when he started to project his own agenda for the future. He spoke about the new relationship that he would like to have with local government. One hopes that he will take notice of the real fear about centralisation in government policies and of the moral issues that arise when one gets rid of local democracy. That can lead to a breakdown of all services, all thought and all morals in the community. It is as well that the Prime Minister should be thinking seriously about his new relationship with local government.

5.10 p.m.

Lord Bottomley

My Lords, I congratulate my noble friend Lord Williams on raising the subject for today's debate, and, in particular, on the clear and concise manner in which he presented the case for local democracy. I am pleased to follow my noble friend Lady Fisher. We served together in the other place for many years. Like me, she started her public life in a local authority. I was a member of the Walthamstow Borough Council for over 20 years and its mayor. The town clerk of Westminster, Parker Morris—reference was made to him and his work on housing by the Minister—and I, as an organiser for the National Union of Public Employees, started the first fire watching scheme in the country without any help from central government.

In 1941, as a result of that work, the Home Secretary, Herbert Morrison, appointed me deputy regional commissioner for the South East region. I, and a commissioner, together with a deputy commissioner, were responsible for co-ordinating the work of 96 local authorities. The local authorities were responsible for running local government services, including the ARP. The South East region was bombed constantly during the 1939–1945 war. The towns of Dover and Folkestone, and surrounding districts, were shelled continuously from the French coast by the German long-range guns. The South East region also suffered from the flying bomb attacks, which destroyed many villages and killed hundreds of people. If local government could provide services during our darkest hours, why weaken its efforts today?

In 1945, when I became a Member of Parliament, the Prime Minister, Clement Attlee, appointed me as a junior Minister in the Dominions Office. When I could speak to him freely I said, "Why did you make me a Minister in the Dominions Office when I had so much knowledge of local govcernment". He said, "Arthur, first of all, it was time you got away from drains and dustbins. Secondly, I want a young Minister who will concentrate on helping to build a new Commonwealth". In due course I became Secretary of State for Commonwealth Affairs. To this day, I continue my friendship and association with most of the leaders of the Commonwealth.

Britain today needs strong local government more than ever. Democracy rests not just upon a national Parliament; it needs vigorous political debate locally. Instead of strengthening local government, the Government have imposed an unprecedented squeeze on council spending. That squeeze amounts to at least £500 million on the education and social services. The damage done to local government reflects the wider story of 13 years of Tory misgovernment.

I feel that only locally, democratically elected representatives know what are the needs of their areas and what amenities and services they require. Many local government services have been taken over by private enterprise. In many places, those private enterprise organisations have failed and the services have returned to local government. Many more private enterprise undertakings will fail local government. Local government will be given the task of rebuilding the ill-equipped services vacated by private enterprise.

In Cleveland, where I represented the parliamentary constituency of Middlesbrough for 21 years, the Government's fixed system for introducing council tax means that the county has lost out to the tune of about £5 million, which is equivalent to £31 for every council tax payer there. Cleveland received the lowest increase of any county in its SSA—just 1.4 per cent. compared to almost 7 per cent. for Tory-controlled East Sussex. Despite that, Cleveland has the highest ratio of police to population of any police authority in the country. It also provides more money for what is a more efficient nursery school service than that provided by most counties. Further progress in other services has been stopped or restricted, and as a result Cleveland's hopes of building up more efficient local government services have been destroyed by the Government.

5.18 p.m.

Baroness Hilton of Eggardon

My Lords, I wish to address the crisis for local democracy referred to by my noble friend Lord Williams in relation to the police service, particularly in the light of the Home Secretary's recent announcement that local authorities, through their police committees, will no longer be responsible for the police service in their areas. Police accountability has always been a thorny issue, with the Metropolitan Police accountable only to the Home Secretary and not at all to the elected representatives of the citizens of London.

Police forces elsewhere in the country have sometimes had difficulty in agreeing the exact nature of their accountability to police authorities which have been composed in the past of two-thirds local councillors and one-third magistrates. Some chief constables have had stormy relationships with chairmen and chairwomen of police authorities who, they felt, were taking too close an interest in day-to-day operational police duties. However, the essence of the democratic accountability of the police service is surely a dialogue that achieves a balance between the drive for greater efficiency and what is acceptable to the local populus.

An efficient police service, detecting all crimes and prosecuting all offenders, would not just impose enormous financial and bureaucratic burdens on the country. The methods needed to achieve that would be so draconian and unpopular that they would destroy the fabric of society.

During the past few years, relationships between the police and local authorities have been much more harmonious, and creative partnerships have been formed by the police, local authorities and local communities. The noble Baroness, Lady Seear, referred to the London Borough of Lambeth. It is in another borough, Brent, which has had a troubled history for various reasons, that an especially fruitful partnership has been formed by the local police, probation officers and the local authority. They have effectively tackled problems of crime and drugs on their local estates in a way which can only be achieved through local knowledge, local partnership and local respect.

One of the grounds for the Home Secretary's desire to reorganise the police service—apart from his notorious passion for confrontation—is the oft-repeated assertion that the police service has become more inefficient because the clear-up rate for crime has fallen or remained static. Here he displays his usual shallow analysis of the problem. A glance at the clear-up rates for the Metropolitan Police —a quarter of the country's crime is committed in London, so this is a reasonable sample—during the past 10 years shows that for all recorded crime between 1981 and 1991 they remained at a steady 17 per cent. However, as recorded crime during those 10 years rose by almost 46 per cent. and clear-up rates also rose by 46 per cent., that is effectively an increase in police productivity of nearly 50 per cent. rather than a decline in efficiency. Similar figures can be calculated for the rest of the country.

The Home Secretary is of course reluctant to examine the real nature of crime and the reasons for its increase in a divided and impoverished society in which greed and selfishness have had official encouragement for the past 14 years. Instead he prefers to use the police service as a scapegoat for the rising crime figures and alleges that police management is in need of overhaul. He ignores the fact that during the past 10 years there has been an enormous cultural change in the police service. There has been a change internally, with devolved management systems, reductions in the number of higher ranks and headquarters and administrative staff and more sophisticated appraisal systems. There has been an annual reporting and appraisal system in the police service for the past 40 years. I find it astonishing that the teaching profession, for example, sees it as a strange innovation. During the past few years promotion and recruitment selection have been greatly improved, with objective, structural and practical tests as well as interviews.

Externally, the police service has worked extremely hard to develop closer ties with the local community, to be responsive to criticism of police methods and to develop partnerships with local authorities and other agencies in order to tackle serious problems on a local basis. Of course, problems remain. Some police officers have found it difficult to accept a more socially-aware style of policing and there will always be the few who are racist or corruptible. However, one welcome offshoot of the recession is that there are now few vacancies in the police service and in consequence the overall standard of recruits has become much higher.

None of that is acknowledged by the Home Secretary. Last month he announced that in future police authorities will consist of 16 members of whom three will be magistrates, eight will be local authority councillors and five will be government appointees. The most sinister aspect is that chairmen will be appointed by the Home Secretary and will have a casting vote. If the other rumours about amalgamations are true, the local councillors will inevitably be drawn from more than one local authority area and all local accountability and democratic representation will be lost. Moreover, as in current joint police authorities—for example, Avon and Somerset—there will be tension between those representing different local authority areas with different policing problems, as with the city of Bristol and the county of Somerset.

Who, one speculates, will the Home Secretary appoint as chairmen? Is he likely to appoint barristers such as himself whose only contact with the police is in relation to cases of serious crime which come before the higher courts and who have no concept of the broad range of ordinary police duties? Seventy per cent. of police work has nothing to do with crime. In fact, most crime is local, petty crime, often committed within housing estates where people prey on their neighbours. It is not the kind of crime which barristers encounter in the higher courts.

It seems extraordinary to me that this Government have, first, the arrogance to assume that their appointees will produce better policing than locally-elected representatives with an intimate knowledge of the communities they serve and, secondly, that they do not see the danger of having a police service centrally controlled by political appointees. If the Government were out of power I wonder how they would feel about chairmen of police authorities appointed by a Labour Home Secretary. Our schools and hospitals are now run by government appointees and there can be more than one view about the wisdom or effectiveness of that. But to extend the principle to the police service is surely to strike at the heart of democracy; not only of local democracy but of the country as a whole.

Perhaps I may say in parenthesis that if the Home Secretary is in need of a challenge and seeks to improve police efficiency he should look at court boundaries, which are often, especially in London, coterminous with neither police nor local authority boundaries. When I was at Chiswick I had to send police, prisoners and process papers to three separate courts and to respond to three separate systems and personalities of clerks and magistrates. A great saving and efficiency could be effected in police time in London at least if the boundaries were coterminous. Tackling the Lord Chancellor's Department should be a worthy challenge for Mr. Clarke.

I return to my main theme. If Mr. Clarke's plans for amalgamation go ahead and the police service in England and Wales is reduced from 43 separate forces to about 20 or so we shall be in great danger of the police service becoming a tool of government. We saw the bitter consequences of that during the miners' strike when the precious neutrality of the police service was lost and it was made to appear to be supporting then government objectives. The then Prime Minister's references to "our policemen" and to "a thin blue line defending the right to work" were not helpful, to say the least. They made the task of policing in mining communities much more difficult at the time and for many years afterwards.

It is not at all clear what the Home Secretary's objectives are in setting out to create fewer and larger police forces. It is notoriously in the larger forces, such as the Met and the West Midlands, that the worst examples of corrupt practice have occurred. Of course, 20 forces mean that a convenient number of 20 or so police authority chairmen, all of whom would be personal appointees of the Home Secretary, could be gathered around a table to be given instructions by the Home Secretary. That secretive and centralised system of control of the police service would be wholly disruptive of local democracy and could jeopardise democracy at the national level as well. The noble Baroness, Lady Seear, spoke of despotisms in Europe before the last war. In some ways control of the police is the first step along the road to tyranny. The Home Secretary appears to be setting out to achieve nationalisation of the police service by stealth and by politicisation. The noble and learned Lord, Lord Hailsham, spoke of elected dictatorship. I greatly fear that that is now being replaced by dictatorship by appointment.

5.27 p.m.

Lord Parry

My Lords, Mr. Anthony Eden, who later became the Earl of Avon, once wrote an interesting book, which is worth re-reading in the light of my noble friend's Question. It pointed out that we in Britain had never achieved a democracy; all that we had succeeded in doing was broadening the basis of the oligarchy. The point from which I wish to begin is that it is clear from our debate that we are talking in oligarchic terms about a narrowed base to the pyramid of local government under which most of the Members of this House received their education and their opportunity to become whatever they are today.

During the 18 years in which I have been a Member of your Lordships' House this debate is the most curious in which I have ever taken part. With the exception of the noble lad —I mean noble Lord—on the Front Bench many noble Lords taking part were at some time members of the party in opposition. The noble Lord, Lord Prentice, learnt many of his skills, arts and abilities in the ranks which he now faces from the other side of the Chamber. Therefore, we are obtaining an Opposition view of democracy in Britain in 1993. That is being given almost without response from the Government side, as was pointed out by the noble Baroness, Lady Seear, in her characteristic speech. We are looking at the democracy that we shall hand on to our children and we are doing so on the basis of no presentation of the Government's case, except the prepared argument elegantly and well put by the Minister. I make that point sympathetically, as did the noble Baroness, Lady Seear.

When in 1944 the Education Act was being hailed as a great move forward in the creation of new opportunities within democracy in Britain, central government was probably stronger than any there had ever been. There was a settled pattern of local government which had become used to central government's systems and had within it people educated in the service, in the university of life and in the university of local government. Therefore, when the changes came to be made, a strong, newly elected government with a huge majority having access to orders in council, which would never have been provided to them in a peace-time situation, were able to change the nature of the education service and the truly advanced democracy of this country in a way that no other government have been able to do since.

The changes that came about in education at that time were implemented by a local government system that was understood, reasonably well funded and for which new funds were made available. The situation is vastly different today. One of the problems which the Government have made for themselves, or have historically inherited, is that they have caused changes to be made in almost every aspect of the community. While those changes are being carried through, they are proposing a mighty shake-up of the basis of local government. Therefore, if the Government are successful in getting their policies through the House, and are successful in putting them to the country, they would be trying to implement them in a broken-up system of local government in a series of changes which are far from complete and which will take three, six or even nine years to settle down.

The challenge to Ministers in office is immense. I do not believe that they have begun to realise what those challenges are. I do not say that in a party political sense. I say it as one who, 60 years ago, saw his own father enter local government. My father took his place as an independent Liberal in the local government of Pembrokeshire. Eventually he became chairman of the education authority. Twenty years later at 22 years of age I went into local government believing—and it is generally still believed today—that someone who has done fairly well out of the community and who has received a reasonable education should put something back into that community. It was a pleasure and a privilege to be elected to local government as a youngster and to be playing a part, as I thought, in implementing ideas and ideals that were worth implementing.

I have never said that those sitting opposite would have any lesser view than I have myself of what society is about or what their place in it should be. However, I believe that we have a tendency to rewrite history every time that we rise up in our places. One of the great aspects of local government of the past 50 years, over the period I have known it, has been that it has attracted to its ranks men of all parties and conditions who have given their time and energy to implement policies which they believe are for the general good.

In the clash of opinion there has been a refinement of policy. There has always been the knowledge that once every five years the whole system could be shaken up. One of the great things of our competitive democracy is that every now and again governments are "democked". That is George Brown's phrase. He was asked what had happened when he lost his seat. He said, "What happened? Democracy "democked". It is the very essence of our democracy that from time to time governments who might well have been good are thrown out by a populace which is fed up with them.

This Government continue to refuse to accept amendments to their policy on the basis that they know best. We have had examples of that. I wish to cite one or two examples that I take from my huge mail bag. I received one letter which states: We are concerned that we do not sufficiently ensure the continuation of opportunities for young people in maintained schools to take part in youth orchestras, bands and choirs whose quality and internationally acknowledged successes are an educational achievement of which the UK is justly proud". The writer of that letter believes that the proposals that are being made might accidentally rather than purposely cull and eventually kill off the opportunities for musical education that have long been built into our education system and have been a matter of great pride for the country.

That does not only lie within the Education Bill, which can be argued stage by stage. It lies within the Motion which my noble friend Lord Williams of Elvel has laid before us. One point which concerns the Association of County Councils is that the new local government system will not be in place in time to safeguard those very matters which the Government believe they are safeguarding. There will be local unitary authorities—I come from Pembrokeshire and we never believed that we should have been amalgamated with Dyfed but we understood the need of Cardigan and Carmarthen to join with a proud and upright county like ours—but those unitary authorities will of necessity take between five and 10 years to learn again the skills and to develop the processes which will give them confidence within the new situation.

Your Lordships know my preoccupation with special educational needs. I have received six, seven or eight letters on that subject including one from the Government on the implementation of proposals for the integration of children with special needs into the general system. This side of the House agrees with the other side that there should be an integrated schools service and that all children should be integrated except those who will never be able to be fully integrated because of their particularly serious special needs. We are agreed on that. But what will happen is that those children will be transferred now in anticipation of local government reorganisation. Psychologists and the educational support services are no longer referring to the special schools but are putting children directly into the integrated system because they know that that is what will happen. Therefore, by accident again, pressures are imposed on a well-tried and trusted system which has worked in advance of making certain that the new system will be able to accommodate properly those people whom it is moving.

I am giving a series of helpful warnings to the House and to the Front Bench opposite. The WJEC—the Welsh Joint Education Committee—has briefed Members of this House on its anxieties. It is not necessarily opposed to the general wishes of the Education Bill but it is worried that matters will be left in mid-air, stranded between systems and unable to operate adequately.

The whole purpose of the Motion before the House is to discuss local government. Low morale can frequently be found in the local government service. That is not helped by the general state of the economy and factors occurring outside the control of the nation which affect it. However, it is essential for the Government and for the systems of government of this country to change the mood of the nation for good.

I should point out to the young noble Lords on the Front Bench that in 1945—when the Clement Attlee Government gained power, when tremendous changes for the common good were put in hand—it seemed almost perverse that a Minister who has already been mentioned in this debate, Herbert Morrison, should have instituted the Festival of Britain. That was at a time when Britain was in great economic difficulties and all its systems had been strained by a world war. The Festival of Britain somehow changed the mood of the nation and focused the eyes of the country on new opportunities that were occurring. I only introduce that point at the end of my remarks.

I believe that it is absolutely essential that within the education system the children of our country should continue to receive the kind of opportunities that gave us the chances to do the things that we have done with our lives. I issue in general terms a warning against a country that fails to do that because it is too mesmerised with economic indices or too concerned—although perhaps it is not possible to be too concerned—about the economy. If it neglects the education of its children by accident, with the best of intentions, that is as bad as if it was done on purpose.

5.40 p.m.

Lord Prentice

My Lords, the House owes a debt of thanks to the noble Lord, Lord Williams of Elvel, for introducing a debate of great importance. I hope that he will not be too embarrassed if I say that I go along with part of what he said on the constitutional problems. It seems to me to be a pity that that argument was somewhat overwhelmed by the kind of routine partisan points that he made against the Government. However, the devastating arguments of my noble friend Lord Strathclyde disposed of all that, and if they are not going to be repeated from this side of the House by me or by anyone else, it is simply because it would be superfluous. My noble friend did that job. The day-to-day criticisms on such matters by the Opposition are falling very flat.

But, having said that, I should like to return to the constitutional point. I believe that that strand runs through the debate. Indeed, the noble Lord, Lord Parry, spoke about it to some great effect a moment ago. Of course, the trouble did not start in 1979. I shall not go back as far as G. D. H. Cole, but I shall go back to my own entry into Croydon Borough Council as a very young Labour councillor in 1949. I listened to my elders and betters on both sides of the council complaining about the extent to which the Labour Government was taking away powers and responsibilities from local authorities. In particular, the councillors in Croydon, and throughout the country, were very upset by the removal of their hospitals (which they had run very well and of which they were very proud) from their control into the machinery of the new National Health Service.

On that point, I think that the House may be interested in a certain quotation. I am indebted here to Peter Hennessey and his book Never Again which is a history of Britain from 1945 to 1951. He quotes from a Cabinet paper (now, of course, public property due to the passage of time) put before Cabinet by Herbert Morrison on 12th October 1945. Herbert Morrison was opposing Aneurin Bevan in relation to the future of local authority hospitals. The point he made has been relevant to many issues since, including those still facing the country today. The quote reads: It is possible to argue that almost every local government function, taken by itself, could be administered more efficiently in the technical sense under a national system, but if we wish local government to thrive—as a school of political and democratic education as well as a method of administration—we must consider the general effect on local government of each particular proposal. It would be disastrous if we allowed local government to languish by whittling away its most constructive and interesting functions". Herbert Morrison lost that argument in Cabinet. In subsequent Cabinet meetings, both under Labour and Conservative Governments, that same argument has been lost several times. Perhaps, worse still, it has gone by default.

I shall cite just one or two obvious examples, though there are many others. In the 1970s the Labour Government (of which I was a member) introduced legislation to compel local education authorities to produce plans for reform along comprehensive lines. They did not leave it to discretion. They were not content with the circular for which I had earlier been responsible, but followed it up by compulsory legislation. A few years later a Conservative Government compelled local authorities to offer council houses for sale to tenants. They did not leave that to the discretion of each local authority; they said, "This must be done".

I move on now to other examples which bring us to the present time, including some aspects of the Education Bill currently before the House, the proposals of the Home Secretary for the reform of the police to which the noble Baroness, Lady Hilton, referred, and many others. My point is that such things have happened under governments of both parties and that they have involved both large and small matters. I have to concede that very often there has been a good ad hoc argument for a particular proposal. Some of those policies have been matters of election manifesto commitments upon which a government was elected; for example, the Conservative Government in 1979 was committed to the right-to-buy legislation. They had a reasonable argument to say—and I speak as someone who voted for it in the Division Lobby—that they could not tolerate the opposition of local Labour-controlled councils preventing that promise from being fulfilled.

I admit that we are in a very complex field here, just as Herbert Morrison versus Aneurin Bevan was a complex argument in which there were genuine points to be put on both sides. The trend of the past half century or so has been to reduce the power of local government vis-à-vis national government. The trend was not to reduce its work; indeed, the work of local government has perhaps increased as has its expenditure. But the scope for making local decisions of real importance to the locality has, on the whole, diminished. Somehow or other that tread ought to be reversed.

Perhaps I may put a few general propositions to the House upon which I shall not be able to expand because of the time limit. First, it seems to me that democracy requires some degree of pluralism. It is not sufficient for people simply to have one vote for one national assembly every five years or so. Secondly, in a country which is not federal but which has a unitary constitution, the main instrument for that pluralism must be local government. In a country which is not a federal country it is therefore all the more important that it has strong local government.

Thirdly, the complex social problems that we face today are better tackled if there are a variety of authorities, each with their own responsibilities, and tackling them in varying ways so that when dealing with housing or social service problems, and so on, local authorities can learn from their own and one another's successes or failures. That comparative exercise can produce better answers than simply a code of practice issued from Whitehall.

Fourthly, it seems to me that good candidates will only come forward for election and good officials will only stay in post if they have a real job to do. If they become simply more and more the local instruments of national administration, the job will not be worthwhile; and, as regards councillors, it will not be worth all the sacrifice of time and effort involved.

Fifthly, our Government have successfully argued the case for subsidiarity in the relationship between the nation states and the European Community. That principle surely applies to today's discussion, and in my view is one that has not been sufficiently applied by this Government—nor, I repeat, by previous governments.

My final point is that there is inevitably therefore a morale problem among Conservative councillors. Here again I should like to add a personal note. I must keep showing that if I am a rebel against my own side I was also a rebel against the Labour Government when I was a Labour Member of Parliament. When I was a Labour Minister, I remember Labour councillors saying exactly the same thing to me that I now hear from Conservative councillors. They are saying, "Look, we have the experience. We have been at the sharp end of these problems for many years. Why do they not listen to us a little more? Why are we sidelined in policy making"? That applies particularly to the Education Bill that is in front of the House at this moment. I personally support the general purpose of that Bill. I believe it will help to raise standards, and that is vital. However, I believe those same objectives could have been pursued while placing a greater emphasis on the role of the local education authorities.

Throughout the country there are experienced Conservative chairmen of local education authorities in the shires and in the better London boroughs. The local examination results tables have shown that those authorities have achieved results that are well above the average. I am thinking of some authorities in particular but I shall not mention names. Those experienced people could have been consulted on the Education Bill. They should have been included in discussions at the formative stage of the legislation because of the input they could contribute.

In the recent past we have carried through reforms of local government finance. They were controversial reforms; but I shall not go into that. We are proceeding towards changes in local government structure. However, I believe something more is needed. We need some kind of initiative on the part of central government to improve their relationships with local government and to indicate the way in which those relationships can develop in the future. The Prime Minister's recent speech in which he spoke of a renaissance pointed in the right direction.

We should be encouraged by the fact that Mr. Major is the first Prime Minister for over 40 years who has had personal experience as a councillor. I am sure he will want to build on that speech. I believe that process could take the form of some kind of government statement—possibly a Green Paper or something of that kind although I do not wish to be dogmatic about that—which sets out the philosophy of that relationship and which emphasises the need to restore the stature of local government in Britain. The measure should be written in a tone of partnership. It should be followed up by a dialogue between national and local government on how to put flesh on to those bones and how to bring the proposals forward in practice.

That would constitute partly a process of formal consultation through the usual channels; but the consultation should be carried on informally too within each political party. The proposals could be discussed in many forums throughout the country. Our democracy will be richer if we can restore the status and the real power of local government and reverse the trends of the past half century. I plead with my noble friends on the Front Bench to work out these matters with their colleagues and to take new initiatives in that direction.

5.53 p.m.

Lord Morris of Castle Morris

My Lords, back home in Wales professors, poets, preachers and peasants tell us that there is no English equivalent of the Welsh word cynefin. It derives ultimately from the same root as the Latin domus, meaning a home in the sense of a dwelling place or a family seat, but it goes much wider. It refers to the totality of the place where one belongs, where one feels one's roots are, and it carries geographical, cultural, linguistic and familial connotations. This partly explains why local authorities and local democracy have for so long been deeply rooted in Welsh political life. It helps to explain, for example, why the Government's drive for grant-maintained schools has simply not taken off in Wales. Local authorities have been the providers and the nurturers of education, culture and the arts for a long time. It is about local authorities and the arts that I wish to speak. Indeed, local authorities have recently fulfilled the role of providers across the entire United Kingdom. However, the cultural health of the nation is now most gravely threatened by the Government's manifest intention to weaken local democracy and to limit the activities of local authorities at every opportunity. Yet local authorities are still the major supporters of arts activity throughout the country. The Chartered Institute of Public Finance and Accountancy leisure and recreation estimates for 1992–93 indicate that local authority expenditure on the arts and museums in England and Wales amounted to £325.7 million compared with an Arts Council budget of £198.8 million, of which more than £62.5 million went to the five "national" companies—ROH, ENO, RSC, RNT and the South Bank.

The pre-eminence of local authorities in arts support has not happened by chance. In local elections the public have voted for parties and policies which brought it about. It is clearly what the people want and what they are prepared to pay for. To be fair central Government have acceded to that demand since the Local Government Act of 1948, and especially in the 1972 Local Government Act, which lifted the restriction on the sum local authorities were permitted to raise from the rates to support arts and entertainments. That enlightened move was made under a Conservative government who deserve great credit for it, and it enabled local authorities to become the leading force in arts development.

Sadly, the intention of those enabling measures has been reversed by the assault on local government powers since 1979. Local authority arts funding remains discretionary. With the introduction of universal capping and continuing central Government restriction on overall expenditure, all areas of discretionary spending are prime targets for so-called savings.

It is not just the well-being of arts organisations which is put in jeopardy by this state of affairs but also the entire principle of local democracy. Many local councils stood for re-election on a platform in which support for the arts was by no means a minor pledge. They are now forced to renege on their promises as they have to comply with central government spending decisions through the Department of Environment. The threat to arts development, particularly at grass roots level, comes from a number of directions: first, from the reduction or the withdrawal of grant aid to independent arts organisations and projects—not merely from leisure services but also from education and social services budget headings. A silent battle is going on all around the country as councils wrestle with their appalling budget problems for 1993–94 and arts organisations continue to negotiate for the best level of support they can hope to secure. In many cases the combatants are all on the same side. Many of the most supportive authorities of recent years are forced by capping restrictions to consider cuts which they have absolutely no wish to impose.

Secondly, the threat to arts development comes from the reduction or the withdrawal of arts education support and services in response to the demands of the Education Reform Act, local management of schools and now the Education Bill. I shall mention one small instance of that. LEAs traditionally supply schools with library services, peripatetic music teaching and local advisory services on drama, arts and music. The staff inform, co-ordinate and liaise with schools and artists. Under the Education Bill that provision looks unlikely to survive at all.

Thirdly, the threat to arts development comes from the continuing decline in the availability of such things as discretionary awards to drama and dance students seeking training at the accredited schools offering vocational courses. More than one-third, 35 per cent., of all drama students and one-third of all dance students entering schools in 1992–93 had no grant towards their fees; 14 per cent. of local authorities are making no discretionary awards to drama students, and not because they do not wish to do so. All these measures endanger local authority provision for the arts and imperil the nation's culture.

I wish to illustrate the national danger from the particular position of the local authority in the city of Sheffield. I declare my interest as an unpaid director of its famous Crucible Theatre.

In 1992–93 Sheffield's expenditure per head on arts and museums was one of the highest in England. At approximately £10 per head Sheffield's spending on cultural facilities covered art galleries, museums, theatres, a concert hall and a wide range of directly provided activities, in addition to capital expenditure incurred in supporting major arts buildings. There are two great theatres side by side in the middle of Sheffield, neither of them in the red, but in the black.

Support from the private sector has been growing throughout the past 15 years for the arts in Sheffield. However, in 1993–94, with an SSA which provided approximately £40 million less than the city council believed it needed to continue supporting the current level of activities some hard choices had to be made.

That is the nub of the matter. Is it reasonable to compel local authorities to choose between, for instance, social services, education and cultural provision when any civilised society requires all three?

In Sheffield's case the city council decided that it had no option but to reduce expenditure on arts and museums. That cut strikes at the heart of the city's cultural activities. Opening hours of museums will be reduced; support for the famous Crucible and Lyceum Theatres will diminish, with all the dangers of a more conventional and safer programme of plays; art galleries will cease to purchase works of art; and the physical fabric of many buildings will remain unrepaired.

While it is right and correct in any democracy for local priorities to be determined, it cannot be right for the essential cultural fabric of a major industrial city in this country to be reduced in that way despite everything that its local authority can do.

I wish that I could feel confidence in the Government's oft-repeated assertions that they want a creative partnership with local authorities. There is remarkably little evidence of it. If we consider the nation's museums and galleries the truth is all too clear. In 1991 the Museums and Galleries Commission, the Government's principal adviser, published a report—Local Authorities and Museums—from a working party chaired by Professor John Last, who is not a member of the Labour Party by any means. May I ask the Government how many of the Last Report's recommendations have been accepted and implemented since 1991? One of those recommendations was that every local authority should have a policy for museums. The MGC sought government help to produce a simple circular to encourage implementation. There was no such help. The MGC had to distribute its own pamphlet—Building on Success—to take forward the proposals of the Last Report. The Government did not want to know.

The Last Report included a most careful and well-informed discussion of the question of whether or not provision of a museum service should be made mandatory on local authorities. That question has been with us a long time. The committee came down against the idea. Yet in the 1993 White Paper, Local Government in Wales, in section 4.19 on museums and galleries, we read: Authorities will be required to produce plans for the provision of these and other services and the Secretary of State proposes that he should, for the first year of the new authorities, have reserve powers which he would use if the local authorities' proposals would not safeguard these important services". Similarly, in Scotland, since the Local Government and Planning (Scotland) Act 1982 a duty has been imposed on districts and islands to ensure "adequate cultural provision". The Scottish Museums Council has found that phrase very useful in discussions with Scottish local authorities.

But what do the Government intend nationwide? What is good for Wales and Scotland is surely sufficient for England. When are the Government going to make clear their policy, if any, for some 800 local authority museums and galleries? At present there is none.

Strong local authorities are essential to democratic government, as every speech today has emphasised. In The Times last Monday Professor Norman Lewis of Sheffield University wrote about the new best-selling book Reinventing Government by Osborne and Gaebler. That is a book which should be on all our bookshelves. I recommend that the Minister goes out tomorrow and purchases a copy, at his own expense. In his essay Professor Lewis said: To reinvent government is to decentralise government. A revitalised and more autonomous local government, which will need greater financial autonomy, is central to the delivery of improvements in choice and community self-expression". I could not have put it better myself.

6.5 p.m.

The Earl of Longford

My Lords, I rise to offer strong support to my noble friend Lord Williams and the many eloquent speakers who have followed him. Partly but not entirely for reasons of prudence I shall single out the two sitting next to me, my noble friend who has just spoken and my noble friend Lord Parry.

If I understood my noble friend Lord Williams aright, he entertains a view, which I share, that this Government—I do not say all Conservative Governments but certainly the Conservative Government of today and those which we have had in recent years—dislike local government. If anyone doubts that, they might read the speech made by Mr. Howard, the Secretary of State for the Environment, on 3rd February when introducing the financial settlement. It includes a long string of taunts at the Labour Party. That is very unlike this House. I do not know what goes on in the other place: I once tried to get in and did not make it, and therefore cannot speak about the House of Commons. However, undoubtedly if Mr. Howard had made that speech in this House someone would have moved that he be no longer heard; he was so insulting to such a large number of Members.

Mr. Howard referred to the Member for Sheffield and asked whether he recalled that he was chairman of the council when Sheffield lost £10 million on the World Student Games. I suppose that everyone was too polite, even there, to rise and ask how many billions of pounds the Government had lost as a result of devaluation. However, I do not know whether that or anything would have stopped Mr. Howard. His dislike was very evident.

I do not know whether that dislike is shared by the noble Lord opposite, who is such an acceptable speaker. He will forgive me if I recall an experience of mine last Friday, which is not included in any points of which I have given him notice but to which he will be able to reply. Owing to the rail strike I had to travel by coach. I do not know whether other noble Lords have travelled by coach instead of by train or by car, but I do not recommend the experience. We were supposed to reach my destination, which was between Tonbridge and Hastings, in an hour and three-quarters but it took three-and-a-half hours. After we had been travelling for some time and were not making progress the driver turned round and with a beatific smile—almost as beatific as the smile of the noble Lord opposite—said that he appeared to have missed the way. I asked him if he had any idea where we were and he said that he could not be too sure but he suspected that we were somewhere on the A20. Anyone who knows the road to Hastings will know that the A20 does not get one to Hastings.

Lord Harvington

My Lords, will the noble Lord allow me?

The Earl of Longford

My Lords, may I finish this sentence? Personally I am in favour of interruptions in these time-limited debates and I give way to the noble Lord.

Lord Harvington

My Lords, I simply wished to ask the noble Earl if he could make sure that we hear what he says because some of us on this side of the House cannot hear everything that he says. Perhaps he could speak a little more slowly and a little higher. That would be of great advantage to us all.

The Earl of Longford

My Lords, it is very difficult to know how to cope with that request, even coming as it does from a co-religionist. I do not think that I can do anything. We have the microphones. Perhaps the noble Lord should sit on the Front Bench. Meanwhile, time is passing.

The gist of the story was that the driver had completely lost his way but kept on smiling. As I understand it, that is the position of the noble Lord.

The noble Lord, Lord Prentice, made a thought-provoking speech. I do not know whether to be sad or glad that he has left us. I miss him, but at the same time he could do more damage to the Government from where he sat; he could be a real thorn in their flesh.

The distribution of functions between local government and central government is an eternal issue. Let us take an example of a situation in which it is not right to do what the Government propose—although it could be reversed—in transferring a responsibility to local government. The EFFRA Trust has done unique work for mentally disordered ex-prisoners. It was funded by central authorities; but most of the money is now supposed to come from local authorities. However, those involved are inmates from all over England. How will they raise the money from local authorities throughout England? It is unlikely. I can only hope for the best. I give that example because I do not wish to give the impression that it is always right to transfer responsibility to the local authority. But where movement has occurred, I usually welcome it if the resources go with it.

However, let us take the treatment of those moved from mental homes. Such homes have been steadily closed over the past years. The main responsibility for those people falls on local authorities under the so-called community care arrangements. But what is the situation? In the area in which I live in Sussex there were 1,400 patients at Hellingly Hospital. The hospital has almost closed. Where are those 1,400 patients now? According to information, 80 per cent. are in their homes. Who is looking after them? The answer is, virtually no one. Those great responsibilities are cast on local authorities but the resources are not made available.

I refer to a statement issued by a number of organisations involved in the issue—Age Concern, MENCAP, Mind, the National Schizophrenia Fellowship and others. Those organisations issued a statement in which they call on the Government to match the principles of community care now enshrined in law with actions that will guarantee effective care. That is the actual situation with regard to community care. The Government have raised great expectations but there is no sign whatever of their being honoured under present arrangements.

I wrote a book which was published last April called Prisoner or Patient. It was about mentally disordered offenders. It was praised by a high authority; namely, the noble Baroness, Lady Cumberlege. In the book I stated that community care is a farce. Community care will remain a farce unless something very different is done by the Government.

I can give many other examples. I read an article in The Times recently about the youth service. Two thirds of local authorities are cutting their youth services. That has led to strong protests from at least one chief of police. That is at a time when it is generally considered that the youth services are one of the few bulwarks against the alleged youth crime rate. Many other examples have been given in the debate. As the noble Lord, Lord Williams, stated at the beginning of the debate, the truth is that the Government do not like local authorities. When they transfer functions, they transfer responsibility without resources.

What is the present situation? The noble Viscount, Lord Montgomery, had a favourite expression in this House—a dog's breakfast. The present situation with regard to community care is a dog's breakfast. I hope that the Government will bear those anxieties in mind. They come not only from me—they may or may not take me seriously—but from all the organisations involved.

6.14 p.m.

Lord Sefton of Garston

My Lords, when the noble Lord introduced the Government's case, he stated that he was about to be disappointed by all noble Lords on this side of the Chamber but thought that he would receive some comfort from his one noble friend on that side. I do not believe that he received much comfort from his noble friend. The debate seems to have been completely one sided. However, I was extremely glad that we were treated to a quotation from G. D. H. Cole; it implied that the Minister had done some reading on the post-war situation. I have no doubt that he read G.D.H. Cole's Great Britain in the Post-War World although some of his statements do not seem to indicate that. However, I wish to recommend some further reading. Perhaps the Minister will take time to consider the proposals of Beveridge. His views may well change on the health service. Perhaps he will peruse Buchanan's Traffic in Towns which dealt with the major problems of congestion in the cities of this country. The noble Lord, Lord Prentice, knows all about that.

Perhaps when the noble Lord utters the statement that there has been no centralisation, he will consider London, where the Government abolished the only directly-elected authority which could possibly have carried out the plans envisaged in Buchanan's Traffic in Towns. It was not because that particular authority was not doing a good job. It had already started on a very intensive programme of getting people back onto buses and the Underground. Since then everyone knows what has happened. London is in a wonderful state! Even the Evening Standard continually talks about the necessity to have a London authority although it does not go so far as we go and say that it should be a directly-elected local authority.

I do not wish to deal with any particular point but seek to indicate why we should restore local democracy to what it was, in the interests of the nation. I refer to the period during the war when local democracy was called on to mount all the emergency services. The whole country was dependent upon the work of local authorities for preserving the safety of the nation. The Minister stated recently that I was wrong when I said that local government has continuously lost power; he said that it had not. Let us consider the position in 1945. We had our hospitals and our electricity, gas and water undertakings. All of those were constructed because we had a consensus in Liverpool. I do not claim credit for the Labour Party with regard to that situation. Those organisations were established at great odds by a Conservative/Liberal alliance. That alliance used to run Liverpool, and I pay tribute to it. It is not the time to make party points.

I was extremely glad to hear the speech by the noble Lord, Lord Prentice. It went a long way towards expressing an ideal system. The organisations to which I referred were not achieved without cost. For instance, we had to ensure that when the water undertaking was built in Wales, we had the agreement of the people of Wales. We were conscious of that. The whole of the working class in Liverpool were conscious of it; and so was the ruling party. By and large, Liverpool was half built by Welsh people. They were coming off the land and because of their experience in building they built the whole of South Liverpool. Under its own steam, Liverpool City Council handled an influx of Irishmen from Ireland after the famine. I do not believe that any other single institution ever handled such a problem.

It would not be a bad idea to cast our mind back to those problems. Through a consensus of the Tory and Labour parties in Liverpool, we finally laid plans for the redevelopment of Liverpool after the loss of the docks. We began demolishing some 3-storey Victorian houses. Some of the younger elements on the job were amazed to find when they demolished the top of the house that the basements were full of sand. Why was it there? Because the influx of Irish had led to such bad conditions that the Irish people had literally to be taken out and the basements loaded with sand to prevent them flooding back. That was a major problem for Liverpool then.

It is amazing to me, with my experience in Liverpool, that because of the division in the field of religion we did not have repeated there the same kind of situation as exists in Northern Ireland. It is dangerously near. No one else claims credit for the peace except the local authority in Liverpool. It carefully established neutrality between the two sides and they managed to exist in a friendly and tolerant fashion. Let that be for ever to the credit of Liverpool and the local democracy that functioned by consensus.

When the economy started growing we found that other things had to be done. The issue then was whether local government should remain democratic and have powers or whether central government should take over some of the powers. The noble Lord, Lord Prentice, is right, the Labour Government were at fault on some matters. The first inroad of any serious proportion was the Bill applying to the police. The Government had already tried in a gentle fashion to remove police powers from the hands of the directly elected authority, the watch committees. They were rubbed out. Now all these years later, the Government accept the view that perhaps their way of administering the police in London is not the best way to do it and the trend is going the other way. I never tire of saying that if we talk about the way that police forces operate, fundamentally where they operated under the control of a watch committee we rarely heard of corruption. But, my goodness! As soon as we centralised power in London, the most corrupt police force in this country was the London Metropolitan Police Force. That is perhaps a reflection of what happens when one takes away the democracy which local authorities should have.

When we set up the water industry, we were praised in Wales, they did not accuse us of robbing them of the Welsh water. There was co-operation between the two, and if anyone goes to the Lake Vyrnwy estate from which Liverpool and Merseyside draw their water, he will see a well-managed estate, in spite of all that has been done since Liverpool left it. The same applies in the scrubland near Capel Celyn where we flooded a village; but the locals were pleased. We did it because we could sense and we knew that Liverpool and Merseyside were part of North Wales. It was necessary that Liverpool should contribute to North Wales, and we did so.

The electricity industry which we set up was the forerunner of Manweb. Without the electricity industry, we would never have had electricity in the Welsh hills and the farmers would have been deprived of power. Of course, it was sensible because the produce from North Wales was sold in Liverpool. When Liverpool people exercised their freedom, they went to North Wales, it was one area and it is a great tragedy that the boundary runs down the middle of the Dee. I have made many a plea that we should abolish the boundary and plan a local authority on the basis of the economic needs of the region. We should not allow borders to exist which were established many years ago because two barons fought over a field and then finally decided that the boundary would be there. It is cockeyed.

It is cockeyed when electricity is divorced from gas and electricity and gas are divorced from water. They are all necessary parts of our lives and we should have a local authority able to control them all. I shall give an example. People will know that Merseyside has a narrow estuary and wide basin with many sandbanks. There were complaints from people who used to go out in a boat and found sewage deposited upon the banks. They made their voices heard and wanted it cleaned up. I was the leader of the council and had a difficult task determining priorities. At that time we were responsible for the social services, so I called in the medical officer of health and asked: "What is your attitude to the terrible pollution of the River Mersey?" He said: "It is bad, Sir". I said: "Yes, I go down there myself and I can see that it is bad. Has anyone lost their life from it?" He said, "No". I asked how we stood in the hypothermia stakes, and that year 15 people had died of it. So I put the question to him: "Where should we put our limited amount of money?" That is the kind of priority that only a local government can decide. There is no need for me to tell the House where the priority was and where the money went. The rest had to wait. Those are the kinds of priorities that impinge upon the community. They cannot be dodged and they impinge upon the health of people within the local authority. I defy any civil servant in London to decide that kind of issue. They just cannot do it, it is an impossibility.

Now we shall lose education, to all intents and purposes, let us not be kidded about that. The Minister mentioned houses and the bonfire of controls. All I ask is for people to open their eyes and see what is happening in the land. I travel a lot. I like travelling in the country; I do not go abroad. There is no better place than North Wales. Yet, I see all around houses being deposited on little bits of land there. It is now completely understood in the building and farming industries that if someone has a bit of land and wants to put a house on it, if the local authority says: "No, that's not proper planning", it is all right; he can go to the Minister.

Of course, there has been a bonfire of controls. When we talk about housing, look at the municipal housing that was built between 1945 and 1950; then look at the municipal housing that was built 10 years afterwards.

Lord Parry

Rabbit hutches!

Lord Sefton of Garston

My Lords, I am not talking about rabbit hutches at the moment; I shall come to them later. The difference is that some houses were planned and built under Nye Bevan; and the others were built under Macmillan. Nye Bevan insisted that if working-class homes were built, the men or lads in the household would go in the garden. They were entitled therefore to an outside toilet. Then they would not have to go in the house and go upstairs to the toilet. So the houses all had two toilets. They all had something that was sneered at previously—Parker Morris standards—because the planners at that time insisted that working-class houses should have the best that could be afforded. Go to any estate, go to one which I know very well and the one which I represented for many years as a councillor: Speke, in Liverpool. Go down Damwood Road: on one side there are the Macmillan homes; on the other, Nye Bevan's. One can see which are the best.

The noble Lord mentioned rabbit hutches. Let us get bang up to date: a bonfire of controls with new towns and local authorities which were all persuaded to build what were called new starter homes. For those noble Lords who do not know what they are, they are one-block buildings which, normally, two houses would occupy. I am watching the time. I have a little time left and I shall finish on this point.

What occupies the site now? Four houses. When I went to see the first one, which was built under the magnanimous influence of Margaret Thatcher, I said to the man who showed us round (who was, of course a member of the Party): "What happens if somebody comes from abroad who has collected a lot of things? Where does he put them?" No account was ever taken of storage. I would bet that if the Government made inquiries as to how many starter homes are still in the possession of and rented by, or bought by, the original owners, they will find a tremendously high figure. The truth is that once decisions come under central government, local choice is decimated. This Government hate local government. It is about time things shifted. If we do not remove that detestation of local government and come round to accepting the idea that we need local government and local participation, the country is finished.

6.31 p.m.

Lord Grimond

My Lords, it is good that the noble Lord, Lord Williams, has raised the question of what is happening to local government. As we have heard, the subject arouses considerable passion. I find it useful to look at my local area, Orkney. Orkney is a very small authority. It is one authority. The community is reasonably homogeneous. One can see to some extent, as in a laboratory, the effect of local legislation on a fairly normal set of people.

The first point to be made about local government is that it has become positively enormous. It grows and grows. Not only does its staff increase to carry out what used to be its traditional functions, but it has spread into all sorts of new occupations. We have for instance an economist. Goodness knows, one would think that there is enough economic advice available without employing a full-time local economist. We have an archivist. We have a legal department, which I believe contains five fully qualified lawyers. When I first went to Orkney and Shetland, five fully qualified lawyers did all the legal business, private and public. There were only five qualified lawyers in the whole of the two islands. Now there are five in the local authority alone. On top of that, the authority constantly employs consultants. So there is no question—as indeed the Minister pointed out—of local government withering away. It is very expensive. It occupies tremendous new buildings and it employs a great many staff. Orkney has all that for the benefit of a total population of 20,000.

What is the result? There has not been a great improvement in efficiency. On the contrary, over the scandal of the local children and over the short sea route into which £30 million has been sunk in the Pentland Firth our record for efficiency has certainly not improved. Furthermore, it has the effect of deterring people from going into local government. Nobody who is reasonably busy and who has some sort of outside life to lead will spend hours and hours reading agendas, documents, minutes and the reports of consultants and attending innumerable committees. There are still many public-spirited people who do. But it becomes progressively more difficult to attract anyone of reasonable youth who is reasonably fully employed into local government. When a recent vacancy arose, it was quite difficult to attract any candidates. As a result local government is falling into the hands of those who are bureaucratically-minded, of those who are retired, and of a few people who find the allowances quite useful.

The changes are having a bad effect on the community, which has given up doing all sorts of things. For instance, many of the problems concerning the children in Orkney would have been solved in the old days by the pressure of the community. But now such matters are the business of social workers and others. So there are certain positively damaging effects.

Are we to accept that? There are two things to be done. One, which I shall recommend, is vastly to reduce the amount of work—not the responsibility, but the amount of work—which is now laid upon local councils and local councillors. If we find that impossible, then we must face the fact that being a local councillor is now a full-time job. That is what happens in Parliament and it may well happen in local government. If so, one has to pay councillors a full wage. I believe that that is contrary to the whole tradition of local government, and I am rather surprised that it is the direction in which a Conservative Government are driving us. But it is certainly the logical conclusion.

The other possibility is entirely to change the constitutional set-up in local government. It differs from parliamentary government. In parliamentary government one has an Executive. One has a clearly-defined Opposition and people supporting the Executive. One has party conflict. One has all sorts of other signs of the British constitution. The tradition in local government was that local councillors took decisions and to some extent implemented them. They had a small bureaucracy, but they were not divided into political parties. They were not divided between what one might call Parliament—which exists principally to protest and to criticise the Government—and the Government. Perhaps we have to give up that tradition. In a great many local authorities it has been given up. It does not seem to me, however, that the machinery has been brought into line with what we now expect local councillors to do. That is the first task.

Another development is that of quangos. They are not elected but they have enormous power. To the ordinary person the power of the quango is in many respects as great or greater than that of government. If one is a farmer, one is very much at the mercy of quangos. Any of us may find that our house is raided at the behest of a quango. There is no election to quangos. I do not know whether noble Lords read an article in the Sunday Telegraph by Matt Ridley the week before last: they certainly ought to. All that it said is true, and it is very alarming.

Part of the trouble arises from the general development of the country. But part lies squarely on the shoulders of the Government. Year after year the Government produce a rag-bag of stuff which they call a local government Act. That lays more responsibility firmly on the local authorities, whether they like it or not. That is partly the reason why local councillors become so bored. They are not interested in carrying out over the year the thoughts of the Government or the Civil Service. They are interested in innovating and in improving their communities, not in being dogsbodies for Whitehall. I beg the Government to give that up; to deny themselves the pleasure of producing a local government Bill every year; and to deny their civil servants the pleasure of laying on local authorities more and more responsibilities covering an enormous rag-bag of occupations which many of them do not consider are of prime importance. To do that is not to apply subsidiarity. Surely subsidiarity does not mean that everyone else is turned into a servant. Surely it means that one encourages initiative at lower levels, not simply that one operates through them. But that is what is happening in this country.

As already mentioned, some American academics have published a very popular book which has apparently received great acclamation, not least in this House. I must say that when I read it it seemed to be a glimpse of the obvious. I thought that everybody—at least, all Liberals—had known for years and years that we should not ask the Government to do things that we can do ourselves; that we should not force bureaucrats to do things which, by getting together and forming local associations, we can do ourselves. That realisation apparently has been rediscovered in America and is thought to be the great thought of the new presidential era. I am very glad to hear it. I thought that in this country it was well known about 1850 if not before. However, by all means let us press on with it.

However, if we are to do that, we must make a better distinction between the sort of public goods which it is thought that people can provide for themselves and those which it is essential that the Government or local authorities provide. So far as possible we should allow people to provide them for themselves, or if that is impossible we should encourage co-operation between them. Some time ago I went to Bologna, which is run by the communists. I visited an old folks' home where the old people were doing what business they could. The drink was passed around by the old folks; the chianti and martini were flowing. The old folks were bounding about dispensing it. In this country when one goes into an old folks' home one finds them all tucked up in blankets and waited on with coffee. Not a bit of that in communist Bologna. I suggest that we ought to get a few communists from Bologna over into this country and introduce that sort of thing here.

The same happens in other areas of the community. The Government seem to think that there are only two alternatives. One is that we have the present bureaucratic control; the other is that we privatise. It is the same in education or in the case of prisons, as in everything else. Some of these services are totally unfit for privatisation. Their whole raison d'être is quite contrary to the commercial ethic of today.

One has to get people to co-operate, to take part and to participate in running services. That is what they used to do and are willing to do so long as it is reasonably simple and their responsibilities can be discharged in a reasonable time. One cannot expect to spend all day every day in administrative and bureaucratic work.

The Government should not only cut down demands on local authorities. They should encourage participation. The charters are all designed to give the ordinary citizen some means of attacking or stopping the Executive. What is wanted is a means by which the ordinary citizen can feel that he has more power over the decisions of the Executive, whether local authority or government. The Government need to take a fundamental look at the organisation of local government. They should see how much responsibility local councillors can discharge and whether they need to be paid. Perhaps they do, although I should object to it. If they do not, a reduced local government must be so organised to enable democracy to function. By democracy I do not mean merely a few retired members of the upper middle class; I mean ordinary working men. The ordinary working man should be able to take some part in running the affairs of his community. Far too much government is tailored in this country to suit the middle classes and particularly the retired middle classes, of which no better example exists than the House of Lords.

6.42 p.m.

Lord Howell

My Lords, what this country needs at this moment in time is a conservative government. Whenever I go round the country I am told so by industrialists and other people. I have come to the conclusion that they are right. Indeed, having regard to the havoc, the destruction, the bankruptcies and the despair created in industry and among individuals everywhere, I would settle for a Conservative government (with a capital C) for a few months. However, I am not speaking in that sense. I speak of a government that will proceed (as did all previous governments before 1979) to change the institutions of the country by discussion, agreement and, so far as possible, consensus.

I once said at a Cabinet committee meeting that all the best Conservatives were socialists and all the best socialists were conservative. I think that there is some truth in that statement. I say that in the presence of my old friend, who is now the noble Earl, Lord Carnarvon. We were discussing at that time his appointment, at my invitation, to look into problems on Exmoor where farmers were ploughing up the country's national heritage. There was some astonishment expressed, particularly by Mr. Michael Foot, at my suggestion that the noble Earl should undertake the job on my behalf. "Isn't he a Conservative?" I was asked. I said, "I do not know if he is a Conservative but the fact of the matter is that if you want any change undertaken in this country, especially in the days of a Labour Government, you need a good Conservative to carry it out." I can only say that the good Conservative or near-Conservative, the noble Earl, Lord Carnarvon, did a splendid job for us on that occasion.

The point I want to make is that if one wants change it must be done by consent and agreement. People must be carried along with it. We do not have anything like that today. My noble friend Lord Williams, who is to be congratulated on raising this matter, said that we were moving to Soviet-style government. I have a lot of sympathy with that proposition. We now have departments of state which are constructed on the Soviet principle. They are little soviets. Heading each one of them is a commissar whom we describe as the Secretary of State. Those Secretaries of State or commissars are governing by diktat—their diktat —not in any way by agreement with local government or anyone else.

It seems that the noble Lord, Lord Strathclyde, has a lot of sympathy with that view. Throughout the whole of his extraordinary speech he showed great joviality, laughing and indicating—or so I thought—that he did not believe a word of the brief that he had been called upon to offer the House. Indeed, he concluded by saying that the Government believed in local leadership. He was not able to give a single example of anybody in local leadership anywhere in the country who supports his or the Government's view. He certainly could not find one today on his own Benches. There has only been one speech, apart from the Minister's, from that side. It was a striking speech from my old colleague, the noble Lord, Lord Prentice, who gave an extremely thoughtful speech on which the Government, if they had any sense (if I might say so without embarrassing the noble Lord) should build, especially having regard to the declared intention of the Prime Minister to try to move forward in terms of local government action. That is the one hopeful sign that we have at the moment.

The noble Lord, Lord Williams, mentioned the arrogance of power that we now see in the behaviour of Ministers. That is causing much alarm throughout the country right across the political spectrum. It is seen every day in the way in which they approach their work. It comes from the total, absolute power that they have given themselves. Lord Acton's dictum was never more appropriate than today. It is almost a text for this debate; all power corrupts and absolute power corrupts absolutely. I might also add, in reference to the arrogance of Ministers, that this is an opportune moment to recall the words of Henry Kissinger who reminded us that power is the ultimate aphrodisiac. I am bound to say that Ministers behave as if the power that they possess is an aphrodisiac. It always was, and it is a matter of great concern to us. All the things that they do, all these acts of personal and political arrogance, eventually come unstuck and have to be thought through again.

The poll tax is the obvious example. My noble friend Lord Williams reminded us of the speech of Michael Howard at the Basingstoke Conservative Supper Club. When I read what he said I assumed that he had had a very good supper indeed before addressing his audience. He told them that the poll tax would give power to the people. As has been said—one does not need to repeat it—that has in many ways happened.

Wherever we look we find the growth of quangos. Some of us have been involved in quangos. But today it is impossible to find out how one can make them publicly accountable. Whatever anyone says about local government, local government elections happen year after year and local councillors are called to account. That is a fundamental principle of tremendous importance. All the capping restraints, all the various government circulars imposing conditions on local government, the standard spending assessments and so on, are undermining local government democracy.

I have been a Minister in a government who themselves have had to say to local government, in the words of the late Tony Crosland, "The party is over". Governments have to have regard to public expenditure. I do not disagree with that. But today the Minister did not relate anything that he told us to the people who are being governed. At the end of the day it is the effect of government legislation on the quality of life and on the government of the people that is of tremendous importance to us.

I want to turn to one or two examples which are perhaps rather different from some of those that have been given in the debate. Perhaps I may start with my own great love of sport. We have had the Government dictating to local authorities the terms and conditions on which sports centres can be operated. We have had the Government responsible for a situation in which they are pricing out of sports centres around the country the very people who, especially at this time, we should be attracting into sports centres. We have had the Government instructing local authorities and education authorities to sell off playing fields at the very time we have trouble on our streets and in our communities and we should be opening up more and more playing fields and getting people involved in healthy pursuits. I am convinced that most of the trouble that comes under the heading of juvenile delinquency and football hooliganism originates from boredom in society. Unless we provide opportunities for people healthily to engage themselves in this way we shall not solve the problem.

With the opt-out of schools we now have a ludicrous situation in Birmingham. The local authority has put £1 million into a school which it is very content should become grant maintained. However, the local authority will now be totally dominated by the school governors and the headmaster on the question of whether the facilities provided at great expense by the local authority can be used by the people for whom they were provided or whether they are used exclusively by the school's narrow population. That is one aspect of what is happening.

Commissioner Patten, who is the commissar at the head of the Department for Education, is wreaking havoc wherever he turns his attention. School sports, the base on which all British sport is built, have been almost destroyed as a voluntary activity in this country. Such is the feeling that has been generated in the teaching profession, one cannot find teachers who will turn out on Saturday mornings or afternoons, or after school hours, in order to take school cricket teams, football teams or athletics meetings, all of which are the foundation of British international sport. It is a serious matter.

The noble Earl, Lord Longford, mentioned the Sheffield student games and quoted what Michael Howard said in a derogatory manner about Sheffield. Can we have a clear philosophy from the Government? Sheffield, to its great credit, went in for the World Student Games at great cost. It has had to find every penny itself and it has not received a dime of help from the Government. Edinburgh staged the Commonwealth Games and built facilities without any help from the Government. Birmingham has built the national indoor arena for the nation without a penny from the Government. However, all of a sudden the Government have discovered Manchester and think, for reasons which can only be described as political, that it might be a good idea to get the Olympic Games in the year 2000. I am in favour of the Government giving help to Manchester—let there be no misunderstanding about that—but the question I ask is how it can possibly be ethical or fair to offer help to one city in the hope that it gets the Olympic Games in the future but deny help to people who provide facilities for international sporting festivals and whose ratepayers have been left for years to come to carry the can in that respect.

This arrogance of power is now assuming extraordinary proportions in the health service. Dudley Road Hospital, of which I was chairman for 15 years—my noble friend Lady Fisher knows it very well—has gone through the process of consultation at every stage about building a new eye department, a new oncology department and a new pediatric department. The scheme has gone through and has ministerial approval. Suddenly, and very furtively, a body called the outbranch department, set up by the Ministry in Oxford, is reviewing all these procedures. The building of the eye hospital should have gone out to tender last Christmas in order to get it built by 1995, which is absolutely essential as the present eye hospital building will no longer be available. Now all this is to be reviewed. I want to say this to the Minister and I should be grateful if he would report it back. If the Government are to start reviewing procedures which have gone through in a statutory manner and have been approved by the Secretary of State, no alterations will be possible without that statutory procedure starting all over again. Everyone will have to be consulted and there will be a hideous delay of another two or three years. That is an example of what is happening as a result of this arrogance of power. We have a new Secretary of State who may change the procedures. The department will not consult anyone. It will not consult the local authority, the area health authority and so on.

I hope that out of this debate and the Prime Minister's new resolve, which is to be welcomed, that they the Government start talking to local government. One can do nothing before first talking. The Secretary of State for Education talks to nobody and listens to nobody. He does not meet teachers or parent teachers. When he came to Birmingham recently he did not meet representatives of the local authority or anybody else. He had a furtive, private meeting in an hotel to which he invited a few of his mates and no doubt hoped that nobody would hear about the meeting. It is for those reasons that I hope that this debate will help to move us towards a greater consensus in the politics of this country and that we get back to consultation, talk and consensus over the direction in which local government should move.

7 p.m.

Baroness White

My Lords, I believe that we have had a fairly generous helping of hype from the Minister. I shall not endeavour to analyse that in any detail. I have one particular concern which I wish to bring to your Lordships' attention. As we all know, in May we are due to hold local authority elections on a countrywide basis. But I doubt whether even now Members of this House realise that for some areas the elections in 1993 will enable successful candidates to hold effective office for one year only. I refer of course to the proposals of the Secretary of State for Wales to reorganise the entire system of local government in the Principality, with full effect from 1st April 1995, but with an elected shadow organisation to be in place by May 1994. In other words, there will be further local government elections in Wales in about 12 months' time.

To quote the Welsh Office White Paper: elections to shadow authorities are to be held on a convenient day in 1994". From that time the Secretary of State proposes that the shadows will exist pari passu with the present local government councils until the shadows take over in April 1995.

The Secretary of State has endeavoured to persuade existing local authorities to take preliminary action on the basis of the White Paper, without their having an opportunity even of seeing a draft Bill. However, I understand that in this endeavour he has not met with very much success. In the present state of government legislation it is difficult to see how the necessary Bill, when it is produced, can be given adequate attention in both Houses in time to justify the administrative timetable proposed. The White Paper appeared only a few weeks ago—needless to say, on 1st March which is St. David's Day.

In his foreword the Secretary of State expresses the hope, that as many people as possible will take the opportunity to read"— his proposals, for— they deal with a vital issue". Ordinary people might be more likely to study the proposals if the price of the White Paper had been, shall we say, £5 instead of the £11 which is charged for 36½ printed pages in English. In Welsh it is a slightly better bargain because we take rather longer to say things and one gets 37½ pages for £11. I have always thought that the way in which Her Majesty's Stationery Office has been organised in the past decade or so is an enemy to democracy.

Naturally, there had been some prior consultations, but from such evidence as one can glean, most of the responses, including some of those from the local authorities, were based on self-interest rather than the common good. The Secretary of State criticises previous local government reform in Wales as unsuccessful. He nevertheless calls in aid the example of his predecessors in the Welsh Office for not entrusting the preliminary investigations to an independent commission. A number of us believe that that would have been a much wiser procedure to follow. However, unlike England, the constitutional proposals and disposals in Wales are all in the hands of the Secretary of State, which makes scrutiny and discussion of the prospective Bill all the more vitally important.

Outside the Welsh Office, I do not believe that there is any feeling of desperate urgency in the Principality to turn the whole structure of local government upside down. There are serious reservations about some of the geographical entities proposed, the most obvious being the retention of the county of Powys as an area quite out of keeping with the general scheme. In those circumstances there can be no rational objection to Montgomeryshire reverting to independent status if it so wishes. I observe that the noble Lord, Lord Hooson, is not in the House. He is leading a campaign in Montgomeryshire with which I sympathise, having been a former resident there, that Montgomeryshire should be allowed to manage its own affairs as other former counties are allowed to under the proposals.

At the other end of the scale, as Ystradgynlais has indicated, by a well-supported local referendum, it does not want to be switched as is proposed, for fairly obvious political reasons, by the Secretary of State. If local wishes and opinion mean anything, Ystradgynlais should be allowed to remain as it is. The Secretary of State said that, without wholehearted public support, the structure of local government cannot be effective. In Ystradgynlais the people's voice should therefore be heard.

This is not the occasion to examine the White Paper in detail, but we are genuinely faced with a very serious situation. Small, unitary authorities—I am not speaking of the cities—do not necessarily solve the domestic problems of Wales. Nor will 21 relatively small authorities be strong enough and united enough to stand up to central government when and where that may be required. For strategic planning in its broadest social as well as physical sense, do we not need an all-Wales directly or indirectly elected body? That matter is pushed aside entirely by the current Administration which is happy to depend on a subservient Welsh Office and an ever-increasing regiment of personally appointed quangos and other centralised agencies to which reference has already been made in this debate. I have had it confirmed today by the Welsh Office that the number of such appointed bodies in Wales—which is a small country with hardly 3 million population in total—is no fewer than 160. That seems rather a large ration for what is after all a fairly small community. But there they are. To some extent they are all —I do not like to use the expression "creatures of the Secretary of State"—dependent on him.

I do not believe that we should abandon the present structure of local government in Wales before we have thought these matters through much more thoroughly. Hardly surprisingly of course, they are not dealt with at all in the White Paper. Nor, with all the current financial pressures, should we unthinkingly embark on an exercise, the cost of which was, I believe, at first estimated to amount to between £60 million and £150 million, but for which the current estimate is said to be much nearer £300 million. That is a luxury which our small population may find it difficult to afford. We can do a great deal with that amount of money in some of our poorer areas.

It is far from clear how far the proposed unitary authorities will in fact have to engage in elaborate collaborative activities and come to the conclusion that joint services will be necessary. It is difficult to rely on estimates from interested parties, among whom the Secretary of State for Wales easily ranks first. But, in any case, is it really local government which is foremost in his mind or are there some other even more predominantly political considerations which influence his train of thought? One can only surmise, but before very long we shall have to consider local democracy in Wales at length and in considerable detail.

When I jotted down my notes, I did not know that we should have such a relatively lengthy amount of time for this debate and, as a few moments of the time allotted to me are left, I hope that I may have your Lordships' indulgence to read a brief appendix to the eloquent plea for public support for the arts given my noble friend Lord Morris of Castle Morris a short time ago. I owe this quotation to an officer of the Development Board for Rural Wales who 10 days ago attended a seminar of the Prince of Wales' Committee which was held in that very agreeable seaside resort of Llandudno. His account reads as follows: A company Chairman was given a ticket for a performance of Schubert's Unfinished Symphony. He could not go so he passed on the invitation to the company's Quality Consultant. The next morning the Chairman asked him how he had enjoyed it … he was handed a memo which read:—

1. (a) For considerable periods the four oboe players had nothing to do. The number should be reduced and the work spread over the whole orchestra—thus eliminating peaks of inactivity.
2. (b) All twelve violins were playing identical notes—this seems unnecessary duplication—the staff of this section should be drastically cut. If a large volume of sound is really required—this could be obtained through an electronic amplifier.
3. (c) Much effort was absorbed in the playing of demi-semi-quavers—This seems an excessive refinement. It is recommended that all notes should be rounded up to the nearest semi-quaver. If this were done—it should be possible to use trainees and low grade operators.

No useful purpose is served by repeating with the horns the passage already handled by the strings. If all such redundant passages were eliminated the concert could be reduced from 2 hours to 20 minutes. If Schubert had attended to these matters he would possibly have been able to finish the Symphony after all. In the unfinished symphony of life, we live in a society of work study consultants. Our lives are increasingly measured by yardsticks of quantity rather than quality … we have to determine whether we are lesser people for it. I am sure that we all know the answer.

7.13 p.m.

Lord Monkswell

My Lords, at this late hour, I hesitate to follow the previous speaker, my noble friend Lady White, because I am sure that I shall not do half as well as she did. I must first declare an interest as a member of Manchester City Council. I am not sure whether it is a vested interest, but I do have an interest in local democracy as a result of that position.

I should like to give your Lordships a few examples of local democracy, then say a few words about the financial constraints on local government, and then give an explanation of how local government has come to the aid of the nation during the past 15 years and of how it is being prevented by the Government from coming to the aid of the nation now. Perhaps I could begin with a very local example. In my ward, Brooklands Road extends for some two miles. It is a dead straight road. Half of it is in the City of Manchester and half in the Borough of Trafford. As your Lordships may appreciate, there is a tremendous tendency for motorists to barrel down dead straight roads at a great rate of knots. When such a road is a major highway, it bears a lot of traffic. In fact, this is one of the busiest roads in Manchester. The net result is that it is very difficult for pedestrians to cross it because enormous numbers of vehicles travel down it at fairly high speeds and one has literally to take one's life in one's hands, or feet, and dash like mad to get across.

The point of the story is that on Monday Manchester City Council opened, or switched on, the second pedestrian crossing across that road within the Manchester portion of it. There is not one pedestrian crossing, however, on the Trafford portion of the road. That is a little example of the diversity of local democracy. It has been pressure by local councillors on the Manchester side (in response to the local people) that has caused two pedestrian crossings to be constructed there. There is not the same degree of pressure on local councillors on the Trafford side so there is no pedestrian crossing on that part of the road. Different communities have different priorities.

Another example (in a slightly less local atmosphere) is the difference between high schools in Manchester and in Trafford. Trafford has a system of selective education. At 11-plus the children are segregated into those who are deemed worthy of a grammar school education and those who are not deemed worthy of benefiting from a grammar school education. Those are the sort of words that are used. Trafford actually says that a proportion of its children will not benefit from a grammar school education. That is mind boggling. In Manchester, we have a comprehensive system of education. There is no segregation. Parents send their children to the school of their choice. Most children in Manchester go to their local high school.

Over the past few years one of the interesting results of the interference of central government in local government has been the ability of schools to opt out of local authority administration. The net result of that interference by central government in local government affairs on the education front is that no schools in Manchester have yet opted out. We have had one ballot which was enormously, decisively in favour of the school staying with the local education authority. In Trafford, in contrast, three schools (all secondary modern-type schools) have determined to opt out of local education authority control. Effectively, the parents, staff and governors of those schools have determined that they want nothing to do with the selective system of education. I suppose that that is a mechanism of local accountability, but I am not sure that it is terribly beneficial in supporting the Government's view of the way in which education should be conducted in this country.

Bringing matters onto a higher—or perhaps a wider—level, I know that Members of your Lordships' House have good memories and that quite a number go back a good number of years. I am sure, therefore, that your Lordships will remember the existence of the metropolitan counties which this Government abolished in 1985. One of the interesting things about the metropolitan counties was that because they covered different geographical areas and different urban conurbations each had different problems, and different solutions were available to resolve those problems.

We need look at just one area—waste disposal—which was a responsibility laid upon the metropolitan counties. In South Yorkshire, the waste disposal problem was resolved relatively easily and cheaply because as a result of the abstraction of minerals there were many holes in the ground which could be filled with waste. The Greater Manchester conurbation did not have such a plentiful supply of cheap holes. So the waste disposal authority investigated and developed the conversion of waste into oil. That was coming to fruition at the time when, unfortunately, the metropolitan county was abolished by the Government. That is an example of how two different authorities tackled a problem which had local and distinctive variations.

The last example I give relates to an area where there is virtually no democratic accountability. That is, unfortunately, the NHS. There are two distinct communities in the southern part of Manchester. There is Wythenshawe which is the urban conurbation to the south of the Mersey and the M.63 motorway. To the north of that boundary is Withington. They are two distinct communities which form the South Manchester Health Authority. For good reasons, there are two hospitals. There is the Withington Hospital and the Wythenshawe Hospital. The South Manchester Health Authority is currently engaged, and has been for the past two to three years, in effectively closing one hospital and relocating all the services to the other. That is being done in the teeth of local opposition. Every councillor, every MP in the area, and virtually every member of the community, realises that it is a nonsense and wrong for the community of southern Manchester.

Because the health authority is not democratic—it is effectively controlled by Whitehall—the decision is being made in the teeth of local opposition. That will mean that the people who live on the wrong side of the boundary between those two communities will be deprived of a local hospital. Enough of examples.

I shall touch now upon financial constraints. In the mid-1980s local authorities, broadly speaking, could borrow money on the capital markets and raise local revenue through the rates, which were a progressive form of taxation. By that I mean that the wealthier people paid more and the poorer people paid less. Unfortunately, the Government saw fit to interfere with that system of local government finance. Apart from reducing the revenue support grant, the Government introduced first, the poll tax, and then the council tax. Both were capped. They are both regressive forms of taxation, although the council tax is slightly more progressive than the poll tax.

Central government places strong constraints on local government capital borrowing. As a result, local authorities have little flexibility when it comes to raising additional revenue and spending it locally. They are effectively circumscribed by central government in those areas. Consequently, we cannot come to the aid of the Government during this recession. We are currently going through the deepest and longest recession since the 1930s. That is almost as long as living memory. At least, it is longer than my living memory. I am aware that many of your Lordships lived through the 1930s and experienced the horrors of that time.

In the early 1980s the Government instituted policies similar to those which caused this recession and we suffered a similar recession. But in the mid-1980s local authorities borrowed money, raised rates and generated economic activity. That helped pull the country out of recession. We cannot do that now, so the responsibility for getting us out of the recession lies with the Government. They must take action to deal with the problem. One of the ways in which they can do that is by relaxing the existing constraints on local government and relaxing the capping of the council tax to enable local government to raise revenue and capital to spend in productive economic activity, rather than by the Government borrowing money to pay people to be unemployed and on the dole.

7.27 p.m.

Baroness Hollis of Heigham

My Lords, at the core of the debate is what local government is and what it is for. Local government, the Government believe, says too much; does too much; spends too much; and, above all, is Labour too much. Central government wishes that local government was unnecessary, but even in centralised Britain not everything can be done from Whitehall. Therefore, they believe that local government should function, not as local, and not as government, but as a business enterprise subject to the market discipline and competition—never mind the fact that British business which local government is supposed to emulate is among the weakest in Europe, or that the traditions of public administration that local government represents and is required to abandon, are among the most respected in Europe; never mind that local government, required to function as a business, is being asked to do so without being allowed by the Government the basic rights of any business to plan, to invest, to manage its own financial affairs, to recycle its assets and to respond to its customers. They are skills without which even a winkle stall in Great Yarmouth would not survive the season.

Why not, my Lords? Because the Government insist that local government exists to administer locally the policies that the Government have determined centrally—the Minister said so himself—with as much uniformity, as little discussion and as cheaply as possible. Therefore, democratically elected councillors, as my noble friend Lord Longford said, are rather a nuisance. So, to bring them into line, we have had something like 152 Local Government Acts since 1979. Do councillors spend too much? Then control and cap their finances. Do they do too much? Well, remove many of their responsibilities to central government and quangos and privatise the provision of the rest. Do they say too much? Well, sack them from bodies such as health and water, whose services should interlock with local government and, under the Widdicombe rules, silence their dissent. Is it Labour too much? That is the deepest sin of all. Harangue it; subvert it; ultimately marginalise it.

Perhaps I may explore those points. "It spends too much", say the Government. The Government's first argument in coming into power in 1979 was that local authority expenditure was rising, was out of control and was displacing private-sector investment. Not one of those arguments is true. Local government expenditure as a percentage of GDP was falling while central Government expenditure was rising and, as we now know, was out of control. As a percentage of GDP, local government expenditure is one of the lowest in Europe.

Nor was local government displacing private investment. On the contrary, every job created in local government creates a job in private-sector supply industries. The infrastructure which local government provides—for instance, roads, training and housing —is essential to healthy industry. But that did not stop the Government controlling our borrowing or cutting our grant by £25 billion during a decade. Rates rose to compensate for the loss of grant. Had they not done so, rates would have risen by less than the rate of inflation during the period of Tory Government.

So in the mid-1980s the Government moved to their second argument about finance; that central government needed control of local government finance as part of macro economic policies. Again, that argument was revisited by the Minister tonight. They nationalised the business rate thereby ensuring that central government controlled 85 per cent. and not 45 per cent. of local authority revenues. That was an act of supreme folly because at a stroke it broke the link between the business community and local authorities. There was nothing that a local authority could do to improve its business revenues as a result of the Government's nationalisation of the rate, so why should they bother? That was quite perverse.

But still local voters voted Labour so the Government's policy was to make what was left of local revenues even more painful. They invented the poll tax, an Act of such supreme statesmanship that it had to be reversed within a couple of years. By the late 1980s local government raised only 15 per cent. of its money. The Government could therefore no longer argue that it was a burden on the private sector and that it deformed government economic policy. Therefore, they hit on a new argument; that we needed a further centralisation of finance to protect the local taxpayers from the Labour councils which they so foolishly persisted in electing. The Government introduced universal capping based on standard spending assessment criteria. That regarded Kent as more educationally deprived than Barnsley; as Brent having more snow than Cumbria and ignoring unemployment altogether. And as it so happened they each and every year gave more money to Westminster and Wandsworth; one year because Westminster had too many extra people as a result of tourists coming in by day, and the next year because it had too few people as a result of commuters going home by night.

Those standard spending assessments were used to determine not only grant but capping. With capping, the Secretary of State finally overcame the problem of voters electing Labour councils. For whatever and whomever they voted, the Secretary of State would determine what they received. Whatever the majority vote or view only one vote and one voice would prevail; that of the Secretary of State. Whatever people voted for, whatever they were willing to pay for and whatever they were willing to raise from local revenues was irrelevant. Voters, citizens, were to be protected from their own democratic judgment.

As a result, we now have in the field of finance grant fixed by central government; we have the business rate fixed by central government; we have capital borrowing limits fixed by central government; we have housing borrowing fixed by central government; and we have our own local council tax revenues fixed by central government. So much for local government. We see the consequences around us. We see them in housing with social housing starts only a fraction of the 100,000 starts per year needed. We see young people sleeping rough. We see families waiting months in bed-and-breakfast accommodation rather than just for the crisis weekend. We see elderly people waiting for the sheltered housing which will never be built.

Meanwhile, the housing stock deteriorates. My own local authority saw its housing allocation cut from £17.5 million to £9 million and can barely repair its own stock. It certainly cannot meet the proper demand for mandatory repair grants in the private sector. As a result, housing stock falls into serious disrepair—probably a quarter has already done so—and we face decades of slum clearance. Those problems are not inevitable. The housing problems were constructed by the Government. They are housing problems which we do not need to have and which no civilised society should tolerate.

As regards social services, we see that community care has been so underfunded that the government chief inspector has to warn local authorities not to tell the disabled and the frail what they are entitled to in case they should happen to ask for it, which would take the counties through their capping limit. My noble friend Lord Parry described educational cuts and my noble friend Lord Morris of Castle Morris described the effects of the cuts on the arts. Your Lordships will not need me to repeat that. My noble friend Lord Howell mentioned what is happening in sport and my noble friend Lord Bottomley spoke of the effect of the cuts in Cleveland.

In my local authority of Norwich, there were two swimming pools; one outdoor and the other indoor. As a result of the cuts, the outdoor pool has had to close and this year children will not learn to swim. To turn to amenities, the city's glass-houses, which since the 17th century and the Dutch emigres have made the city a garden of flowers, have had to close. There will be no flowers provided by the city on the roundabout nor in its public buildings. As regards economic development, one sees sheltered workshops for children and young people with special needs at risk of closure. That is just in one city.

Why is such suffering necessary? Is our national economy really the stronger because a young man with special needs no longer receives training? Is our manufacturing base really the stronger because an elderly couple do not obtain central heating or sheltered housing? If we cannot answer yes to those questions, as I believe we cannot, the Government have no moral authority to require local authorities to inflict such damage on our services.

But over and beyond the cuts, the controls and the centralisation—that is centralisation of finance and the cuts in services which I have mentioned—a more serious challenge was mentioned by almost every speaker today. It is the removal of local government responsibilities to unaccountable private agencies and unelected quangos. In the field of housing, as was said by my noble friend Lord Williams, while local authorities retain all the statutory responsibilities for housing, housing associations are to be the main providers and the Housing Corporation seems increasingly reluctant to work with local authorities in determining the strategy.

We could look at education and training. From opt-out schools to TECs, and to the new funding agencies we see the incremental destruction of local educational authorities. We could look at planning. From enterprise zones to UDCs, and to the new urban regeneration agencies, we see the removal of planning powers from local government. Therefore —and this is what it means—the power of local government to ensure that new development benefits the local community in which it is sited. That is to say nothing about the removal of local councillors from health authorities, mentioned by my noble friend Lord Monkswell, at the very time when community care requires that very interconnectedness which the Government have destroyed—or their removal from water authorities or, as my noble friend Lady Hilton so powerfully described, from the police authorities themselves.

Who replaces them? Why, businessmen, of course, thus meeting the three objectives of the Government; they are business methods, government policies and, as the DTI Minister said of the appointees, "never knowingly Labour", in a phrase which will come back to haunt her. One might ask why, if those business skills were so impressive, the country is in the mess that it is and if businessmen have all the spare time why is that not being applied to the rebuilding of British industry rather than to the wrecking of local government?

We have a new unelected magistracy, as so many of my noble friends have said. They are men—they are nearly always men—whose quangos spend more than local government spends in its entirety. There has been a threefold increase since 1979; as my noble friend Lady White said, 160 of those in Wales. There are many in East Anglia and in London.

Gladstone, Chamberlain and Salisbury spent the final quarter of the 19th century coralling the unelected quangos, the improvement commissioners, the health boards, the metropolitan board of works, the school boards and the JP poor law guardians into accountable local government. Why was that? There are two reasons. The first was that they recognised the problem of the democratic deficit. As Margaret Simey has said: Of those to whom responsibility is given, an account of their stewardship shall be required". In a similar fashion, Professor John Stewart said: Those who exercise public power in society should be answerable for it because the power does not belong to those who exercise it, but it belongs to the citizens on whose behalf it is exercised". Quangos are not locally accountable and are not even locally known. After all, they do their damnedest to keep the press out of their meetings in case what they do and say should be scrutinised by the people who pay for them. Without that scrutiny, quangos make poor policy, which is the second reason for bringing them back within democratic local government. By definition they are single service bodies confined to and blinkered by their boundaries. Inevitably each quango seeks to lower its costs by exporting whatever problems it can to others. My noble friend Lady Fisher powerfully described what happened with water authorities. They disconnected 21,000 houses last year. Therefore, there was a threefold increase in dysentery and hepatitis. Houses become unfit and families become ill. The bill for housing, social services and health authority rises but so do the water authorities' profits.

In a world of individualised quangos, pursuing their narrow interests and maximising profits, who has an eye to community need and the community interest? If local government does not perform that role, no other body can.

As I said at the beginning, we know what this Government require local government to be. It should be local administration—not local government—by local Tory businessmen (not elected councillors) of central government policies. That is the difference between us as the debate makes clear, although we have heard no arguments to the contrary from noble Lords opposite, apart from the Minister's opening speech.

What do we believe local government to be? We believe that it is a means by which a community defines and meets its local collective needs for those services like parks and libraries, which only the wealthy and worldly can buy for themselves. It also provides those services like travellers sites or special needs housing which only the altruistic and the worldly would provide. It also provides services like planning and policing which only those without original sin do not need.

Local government constructs the social and physical infrastructure of our lives. It helps in part to distribute life chances of the most disadvantaged so that just because you are poor does not necessarily mean that you live in an unfit house. Local government does not have to do all that itself, nor should it. It knits together partnerships with voluntary and commercial sectors but local government is what enables it all to happen.

If the primary function of local government is to define and meet local needs, the second function, in defining those needs and priorities, is a political process. That is the second reason that we value local government: it is about democratic values and enlargement of citizen's rights. As the noble Lord, Lord Prentice, and the noble Baroness, Lady Seear, have said, local government represents pluralistic values which extend participatory democracy to, for example, tenants committees, decentralised offices and residents' associations in ways that allow people to own their lives and to become active citizens in their community.

The third reason that we value local government is that, unlike the Minister, we recognise the distinctiveness of local government. Norwich is not Nottingham any more than Cleveland, as my noble friend Lord Bottomley said, is Manchester. Local government is precisely about those local differences. It speaks for its place—whether a mining community, an ageing seaside resort, the Orkney Islands of the noble Lord, Lord Grimond, an ancient cathedral city or a deprived inner borough—as no other body can. Yes, local government has customers for its services and it has constituents when defining needs, but above all it has citizens to whom it is accountable and to whom it offers choice. Perhaps the Government need reminding that government is about choice. Central government find it easy to forget that it is about a choice of policies, priorities and service levels. Local government offers that choice to its community. That is why this Motion has been moved today.

7.45 p.m.

Lord Strathclyde

My Lords, it is one of the great privileges of being in your Lordships' House—and perhaps more so being one of the younger Members of the House—to be present in a debate which has certainly been steeped in history, experience and knowledge. We have heard mention of Herbert Morrison, Clement Attlee and the Labour Government of 1945. The noble Lord, Lord Bottomley, told us of how he became a Minister and secured his job as Secretary of State for the Commonwealth. My noble friend Lord Prentice recounted his experiences in 1945 when he became a local councillor for Croydon. He clearly has a tremendous perspective of how local government has changed over the course of the past 50 years.

The noble Lord, Lord Sefton, guided us through Beveridge in 1944 and Nye Bevan. The noble Lord told us about how the Welsh had built Liverpool. He forgot to tell the House how entrepreneurs had also built it, how free trade had built Liverpool and contributed so much to the wealth which was then lost by Labour local authorities during the 1970s and 1980s.

The noble Baroness, Lady Seear, told us why she became a Liberal and told us about the rise of Hitler in 1932. That reminded me of why I became a Conservative. That was because of the dark decade of the 1970s when the noble Lord, Lord Howell, was in office. Or was he? His Government abdicated power not to quangos, which are accountable to the Secretary of State and, therefore, to Parliament, but to what became the United Kingdom's national disgrace—the abdication of power to the trade unions which dragged us to the feet of the IMF and, most despicably, led to the Bills on devolution for Scotland and Wales which tried to break up the United Kingdom.

We heard about local democracy and decentralisation. That comes from a party that still has Clause 4 in its constitution and still has a commitment to nationalisation. It is a sham to have heard the noble Lord, Lord Howell, speak in the way that he did. That is why he and his party have been out of office for four consecutive elections; because they have not been forgiven by the people of this country for creating the disastrous economic conditions of the 1970s. That is repeated in every Lambeth, in every Liverpool and every Haringey local authority that is run by the Labour Party.

Lord Howell

My Lords, I am grateful to the Minister for giving way. I can only say that most people in this country, certainly in industry, wish that they had a Labour Government at present. In view of what the noble Lord said about nationalisation, will he tell us why his party nationalised water without paying compensation, which is something that the Labour Party never would have done?

Lord Strathclyde

My Lords, I believe that the Labour Party are still committed to renationalising it. The noble Lord, Lord Howell, has a very short memory. He complained about local authorities being bombarded by government circulars. That is a bit rich. In the last year of a Labour Government there were 1,873 government circulars issued to local authorities. By 1981–82 that figure had been reduced to 592 and it has stayed at that level ever since.

As to the detail of the controls, I shall give noble Lords some examples of the pre-1980 detailed controls on local government—they include those on appeals concerning bus shelters, bridge restrictions, street lighting and even arrangements for the provision of children's PE clothing. That came by direction of central government and yet noble Lords opposite talk about local democracy and decentralisation: it is all piffle.

Even the noble Lord, Lord Monkswell, complained about capital controls on local government being too strict. Let us compare that with the Labour capital controls in the 1970s. Indeed, it was then a very tight squeeze. In the five years spanning 1975–76 to 1979–80 the real terms year-on-year changes in local authority capital expenditure were minus 12.9 per cent., minus 17.4 per cent., minus 21.7 per cent., minus 12.5 per cent. and minus 1.9 per cent. That is the record of the noble Lord's party.

Lord Monkswell

My Lords, I do not think that at any time during the 1970s unemployment went above 1.5 million. However, twice during the period of the past 15 years it has been over 3 million. I believe that that says something.

Lord Strathclyde

Of course, my Lords; it was because the Labour Government ran a policy with the trade unions which meant that they were not able to shake out British industry in a most necessary way, which every other developed country was doing at the time. That led to the recession of the early 1990s as has been recognised time and again. I give way to the noble Lord.

Lord Williams of Elvel

My Lords, I am grateful to the Minister for allowing me to intervene. He opened his remarks this afternoon by quoting G.D.H. Cole. He has accused us of going back into history but now, as I am sure he recognises, he is himself returning to the 1970s. Can we please get on to the subject of the debate and get back to the 1990s?

Lord Strathclyde

My Lords, I shall get on to the 1990s, but I have sat here listening to noble Lords opposite talking about the golden era of the 1950s, 1960s and the 1970s. I have listened to them and now they will listen to me.

Several speakers talked about the philosophy of local government. That philosophy is central to today's debate. The noble Baroness, Lady Seear, talked about the difference in approach between her party and mine. She said that local democracy should come from the ground upwards rather than from central government downwards. I believe that possibly there is an irreconcilable difference between us on the matter. Modern local government is the creation of Parliament. It is for Parliament to decide the powers, functions and responsibilities of local government. The functions of local government are not immutable. There has been an ebb and flow of functions over the years. Indeed, the noble Lord, Lord Sefton, reminded us of our gas, our electricity, our hospitals and our water. They were all local authority functions. But no one really suggested that they should be so again.

Lord Sefton of Garston

My Lords—

Noble Lords

Order!

Lord Sefton of Garston

My Lords, I merely wish to remind the Minister that he told me in this Chamber that local government did not lose those powers.

Lord Strathclyde

My Lords, local government has clearly lost those powers and no one is suggesting that it should regain so many of them. For example, local government has just lost education; but, at the same time, it has gained care in the community which is a major new responsibility.

It is for Parliament to represent the nation as a whole—elected, if I may say so, by a far higher percentage of the electorate than the 35 per cent. to 40 per cent. that turn out in a good year for local elections—and to decide the role and functions of local government. That leads me on to something else mentioned by the noble Baroness as regards proportional representation. I do not think that we need go into that debate, but it will be interesting to see how the Labour Party dig themselves out of the hole that they have created on proportional representation.

The noble Lord, Lord Williams, accused me of going back in time, but I believe that much of what I have heard today has been out of date. It has been out of date because more and more people on the ground in local government now accept that CCT is necessary and that it has provided much needed improvements. They accept that the "enabling authority" is the model for the future. In May last year, Councillor Jeremy Beecham, the leader of the Labour-controlled Association of Metropolitan Authorities, said: Local government should be ready to admit that CCT has brought cost effectiveness and genuine savings that might not otherwise have been achieved". I suggest to noble Lords that they are also out of date in criticising the state in central-local relations. They do not seem to be aware of the very real progress in that area over the past few years. It is the result of much hard work by both sides to build up co-operation and understanding and thereby create a new understanding relationship. Perhaps I may give the House just a few examples. There are now regular two-monthly meetings between the Secretary of State and the chairmen of the three local authority associations at which problems can be anticipated and defused. At those meetings, the views of local authorities are taken on board at an early stage and in an informal way. There are also regular seminars for senior officials from both sides. Moreover, a year ago the Secretary of State and Association Chairmen jointly launched the secondments initiative programme (SIP). That is a major initiative aimed at achieving 140 new secondments between central and local government over three years. Those secondments of executive and policy officers will greatly increase mutual understanding and co-operation and the flow of new ideas and best practice between the two sides.

But the best and most concrete example of successful central-local government co-operation must be the way in which the council tax has been introduced. That allows me to turn once again to the point raised by the noble Baroness, Lady Seear, on local income tax. The noble Baroness knows perfectly well why this Government regard local income tax as not workable. If taxpayers were required to make the same contribution as they currently do to local services through a local income tax, it would mean either an increase in the income tax rate of four pence in the pound, or £600 extra on an income of £20,000. That excludes all the terrible related problems of tax evasion, the self-employed, local brain drains, and so on. But I am sure that the noble Baroness has thought the matter through.

I turn now to the question of local taxation and business rates, which was raised both by the noble Lord, Lord Williams, and the noble Baroness, Lady Hollis. The existing system ensures that a very fair and even distribution of the resources is derived from the business rate without placing areas with a high concentration of business at an unfair advantage over others. The Government also seek to protect businesses from excessive burdens. Between 1979 and 1990 the business rate poundage set by the local authority so admired by the noble Baroness, Lady Hollis, rose by nearly 40 per cent. more than inflation and that, incidentally, was paid by businesses that have no direct vote under the current system. Under the current system the poundage cannot increase more than inflation. If the business rate had not been introduced, business would have paid a full £1 billion more in 1990–91. I see that the noble Baroness wishes to intervene. I give way.

Baroness Hollis of Heigham

My Lords, I am most grateful. Is the Minister challenging my assertion that, had government grant remained constant and, therefore, there is no need to raise rates to compensate for its reduction, rates would have risen by less than inflation?

Lord Strathclyde

My Lords, that is simply not the point; the point is that business rates in the hands of local authorities represented by the noble Baroness, Lady Hollis, squeezed their businesses to get more money from them. Forty per cent. higher than inflation cannot be something about which the noble Baroness is proud.

In 1990 in the UK, local government expenditure as a percentage of GDP was 11.3 per cent. In Belgium it was 6.6 per cent.; in France 8.5 per cent. and in Germany 5.8 per cent. Clearly, United Kingdom expenditure was the highest. The noble Lord, Lord Williams, asked about the lack of co-ordination between the Housing Corporation and local authorities. As the noble Lord correctly pointed out, local authorities are charged with the preparation of housing strategies. These strategies cover not just the need for renovation of its own and private sector stock but also deal with the need for new, affordable housing. I would be most surprised if a local authority were to achieve that aim without close co-ordination and discussion with local housing associations and with the Housing Corporation.

The noble Baroness, Lady Fisher, made a heartfelt plea on the question of the disconnection of water. Under the Water Industry Act 1991 water companies have powers to disconnect non-paying customers but they must first obtain a county court order. This gives them the protection of county court scrutiny of the circumstances. In assessing income support and other benefits the increase in water charges is taken into account by reference to the Rossi index. But the point about water is that currently the water companies have to put right decades of under-investment in the water infrastructure of this country. It is that that costs so much money.

Baroness Fisher of Rednal

My Lords, does the Minister not accept the figure I have, which shows that during the past five years water charges have increased by 50 per cent.? Also, does the Minister not accept that many companies in the water industry that were formerly public authorities are now investing in projects in other parts of the world, many of which do not even concern water? Those companies are using the assets of what were former public authorities to increase their profits so that they can increase the salaries of their personnel.

Lord Strathclyde

My Lords, I cannot confirm the figure the noble Baroness gave as regards the increase in water charges. However, I can confirm that when local authorities controlled water authorities the necessary investment to maintain the infrastructure of the water industry was breaking down. We introduced privatisation to solve that problem.

The noble Earl, Lord Longford, complained that community care was a dog's breakfast. We have matched action to theory in community care. We are transferring to local authorities all the money the DSS would have spent had the previous arrangements continued. By 1995–96 this will amount to more than £1.5 billion in England alone. To that we have added a further £140 million this year to help local authorities take on their new responsibilities. Incidentally, they were keen to take on those responsibilities.

The noble Lord, Lord Morris of Castle Morris, asked about the pressures upon local authority funding. The Government accept that partnership with local authorities is vital to secure the health of the arts. For that reason we welcome the fact that the Arts Council and regional arts boards work so closely together with local authorities. While we recognise that currently there are constraints applying to public expenditure at both a central and local level, the Government hope that local authorities will continue to recognise that arts and cultural spending represents good value for money. As well as improving the quality of life it has significant economic benefits and can raise the national and even the international profile of an area.

I suspect that the noble Lord, Lord Howell, did not listen to my opening speech. I hope he will read it because it concentrates very much on the effect that local authorities have on people and on how we believe that people should control more aspects of their own lives. The Opposition parties talk about local democracy but they have no vision of the future role of local authorities. They can only envisage a return to the tired, sterile and unresponsive provider-centred, municipal socialism of the past. That does not work. It does not work in Monklands and Hackney. It did not work in Liverpool and it certainly does not work in Lambeth. The Government's vision of local democracy involves people having as much influence as possible over the services they receive.

Local authorities will continue to decide spending priorities for huge sums of public money but our aim is that local services should be organised as closely as possible to the consumer. We believe they should be as responsive as possible to the consumer. The Government's vision is of efficient, effective, performance-orientated authorities. We envisage authorities whose performance gains them the respect and the support of their communities. Because of that respect those authorities will be able to provide vitally needed local leadership. The Government's policies are bringing about a revolution in the quality of local services and they are strengthening and deepening local democracy. That is the democracy that is the reality of the many and not just the slogan of the politically active few.

Lord Williams of Elvel

My Lords, I am most grateful to all noble Lords who have taken part in this debate. It has been an interesting occasion and I am most grateful to the Minister for his heroic response. I thought he adopted a slightly high tenor in the early stages of it, but nevertheless we much enjoyed his performance. I shall do no more than ask leave to withdraw the Motion. I beg leave to withdraw the Motion.

Motion for Papers, by leave, withdrawn.