Lords Sitting of 25 January 2000

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Lincoln.

Reading: Key Stage 2 Assessments
Lord Quirkasked Her Majesty's Government:
Whether they are satisfied with the adequacy of information on reading ability provided by the tests at key stage 2.
The Minister of State, Department for Education and Employment (Baroness Blackstone): My Lords, we have confidence in the assessment arrangements to provide reliable results of pupil attainment at all key stages. The reading test at key stage 2 is designed to provide information about children's ability to read for accuracy and knowledge of language as well as reading for meaning. The Government are fully satisfied that the outcomes from the reading tests provide the information needed for the improvement of literacy skills.
Lord Quirk: My Lords, I am grateful to the Minister for that reply and I have no doubt that she recognises the crucial importance of key stage 2; that is the point at which children move from primary schools, where the teachers know them, to secondary schools where the teachers do not.
First, is it not the case that the present SATs at key stage 2 (which blandly lump together all four of the English skills) provide secondary schools with next to no help in identifying what may be 20 per cent of the new intake who will need special reading lessons in order to engage properly in secondary education?
Secondly, is the Minister aware that, in consequence, secondary schools—not least specialist schools like the John Cabot in Bristol with an intake from literally scores of primary feeder schools—have to use their resources and time to set their own reading tests and assessments in order to identify those who need help?
Baroness Blackstone: My Lords, it is not true to say that the SATs scores lump everything together. Children's performances are looked at in terms of a whole range of different aspects of English. Indeed, the reading scores, for example, have improved rather more than the writing scores. But I entirely accept that it is important that, when children transfer from primary to secondary schools, the secondary school teachers are given the maximum amount of information about the performance of those pupils so that they can work with them to improve the areas where they are weakest. It is important to remember also that the SATs are not the only measure of a child's
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performance; the teacher's assessment is equally important. That is particularly valuable and of significance in planning future learning. Both sets of results have to be reported to parents as well as to the secondary schools.
Lord Pilkington of Oxenford: My Lords, this may be anecdotal evidence, but many noble Lords will not understand the technicalities of the noble Lord, Lord Quirk, and the Minister. What worries us, and what teachers tell me, is that literacy is less than it was in 1900. Do the Government worry about that?
Baroness Blackstone: My Lords, it is difficult to come to any firm conclusion as to whether or not literacy is worse now than it was in 1900. I do not know what anecdotal information the noble Lord is basing his statement on. I do not know how many people he knows who learnt to read before 1900, though there are a few of them around.
However, the noble Lord is right in drawing attention to the fact that we all need to be concerned about levels of literacy in our schools. Indeed, with that in mind the Government introduced a national literacy strategy in order to put more emphasis on the teaching of reading, not just in our primary schools, but also in our secondary schools where young people do not perform at the level they should.
Lord Tomlinson: My Lords, can the Minister advise me whether, in her opinion, the literacy hour has been a success? If she evaluates it as a success, perhaps she can give us her view as to how that success has been manifested.
Baroness Blackstone: My Lords, I am grateful to my noble friend for asking that question. It is early days to judge the literacy strategy but so far it seems to be working. The percentage of pupils achieving the expected level for their age at key stage 2—in other words, at the age of 11—rose by 5 per cent last year up to 70 per cent. But we must not be complacent about that. We have an ambitious target to take that figure of 70 per cent to 80 per cent and will want to raise it even further when we reach 80 per cent.
Lord Tope: My Lords, does the Minister agree that, while reading ability is obviously important, so too is understanding what is read and the two do not necessarily go together? Can the Minister tell us what information she has in relation to an increase in standards or otherwise at key stage 2 in comprehension as distinct from simply reading ability?
Baroness Blackstone: My Lords, the tests do not simply measure an ability to read; they also measure comprehension. The improvement to which I referred applies to comprehension as well as straight reading skills.
Lord Elton: My Lords, does the noble Baroness agree that dyslexia can seriously impede the academic development of a child and therefore interfere also

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with their personality and behaviour? It is suprisingly difficult to diagnose. Can she assure us that tests for dyslexia or the means of diagnosing it are available at all the key stages?
Baroness Blackstone: My Lords, I entirely agree with what the noble Lord said about the importance of early identification of children who are dyslexic. We must ensure that we identify them as soon as possible and give them the extra support and help that they need. This is a difficult area where teachers obviously need as much training as they can possibly get, together with the experience of knowing how to apply that training. I believe that a considerable amount of work is being done in this respect, including in-service training of primary school teachers in particular and the making available of tests that will help to diagnose this impediment.
Lord Hardy of Wath: My Lords, again, this is anecdotal, although I cannot go back to 1900. However, does my noble friend the Minister accept that between the 1950s and the 1970s the proportion of primary school children who entered secondary education as free readers improved dramatically? If there is a weakness in the present situation, is that not due to the fact that there may not be the time or the opportunity in secondary schools to promote reading as much as it should be?
Baroness Blackstone: Yes, my Lords; I accept that. However, we must not forget the huge importance of primary education from this point of view. Secondary schools should not have to be teaching reading. They should really be getting on with the business of developing the National Curriculum for key stages 3 and 4. If they have to spend a lot of time on remedial work teaching children to read, it gets in the way of progress in other areas.
Lord Dormand of Easington: My Lords, is my noble friend the Minister aware that the reading section of English key stage 2 has nine parts and that they, in turn, contain a total of 48 areas of study—areas which cover a very wide range of topics? Can my noble friend say what degree of success is being achieved in what appears to be a very demanding range of study? I have to say that I thought I heard perhaps a little over-confidence in my noble friend's first reply. I should like to have further information in that respect.
Baroness Blackstone: My Lords, in order to test children adequately it is right to consider a wide range of different skills; otherwise it would be very easy to accuse the QCA and others who are involved in developing these tests of focusing too narrowly and on too-limited a range of items. However, I have to tell my noble friend that I do not believe that I was being in any way over-confident. I recognise that we still have
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a very long way to go. As far as concerns reading, we have to get well above the 70 per cent of children who reached the expected target in 1999.
Baroness Blatch: My Lords, does the noble Baroness agree that some of the very best of our primary schools, which are achieving very well for their children, find the literacy strategy much too prescriptive and inhibiting in that it does not allow enough professional freedom, whereas those schools that could do with improving welcome it? Instead of having a blanket policy, would it not be better to allow the schools that are achieving very well by their pupils the possibility of varying the literacy strategy?
Baroness Blackstone: My Lords, when establishing a strategy of this kind, it is more important to make sure that it is universally being adhered to. I take the point that the noble Baroness is making. We need to make the system sufficiently flexible to enable those schools that are already reaching the target to go beyond it. Indeed, that is what we are working to achieve.

Penalty Fares
2.47 p.m.
Baroness Thomas of Walliswoodasked Her Majesty's Government:
Whether they intend to review the penalty fares systems currently in use on the railways.
The Minister of State, Department of the Environment, Transport and the Regions (Lord Macdonald of Tradeston): My Lords, Her Majesty's Government have no plans to review the penalty fares system. Train operators' penalty fares schemes are a matter for the Rail Regulator.
Baroness Thomas of Walliswood: My Lords, I thank the Minister for that Answer. However, the noble Lord will be aware that railway penalty fares schemes arouse some anger among passengers who think they are unfair. One reason why they believe them to be unfair is that it is so often quite difficult to buy a ticket in the first place. Can the noble Lord tell us whether the Government feel that they can use the franchising arrangements to ensure that the levying of penalty fares will only be allowed for train companies that provide adequate and convenient ticket purchasing facilities?
Lord Macdonald of Tradeston: My Lords, I know from the reaction in the House today that many noble Lords share the sentiments that lie behind the Question of the noble Baroness, Lady Thomas of Walliswood. However, under the Transport Bill, which is presently going through its Committee stage in another place, responsibility for penalty fares schemes will be transferred from the Office of the Rail Regulator to the strategic rail authority. We feel that the interests of consumers are better placed there. But

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that is not in any way to undermine the splendid efforts that the Office of the Rail Regulator has made to ensure that there is a high degree of assurance in the present schemes and that inspectors exercise their discretion properly. We would also ask, quite reasonably, that passengers allow sufficient time for purchase of their tickets. Let us be clear: if there are no facilities available for the purchase of a ticket, there is no liability.
Baroness Gardner of Parkes: My Lords, I introduced a private Bill on this subject some years ago and therefore I have a particular interest in it. Is the Minister aware that at that time there was much discussion as regards the necessity of providing machines which issue permits to travel? When these machines are available they work well. The machines are meant to record the station of embarkation and the date and time of embarkation. Will the regulator insist, or can it be provided for in the Bill at present before Parliament or in regulations, that every station has such a machine? Such a system would certainly distinguish between those who deliberately seek to evade paying their fare and those who simply cannot buy a ticket because the facilities to do so are not available.
Lord Macdonald of Tradeston: My Lords, that is certainly a suggestion that the Rail Regulator and the strategic rail authority might bear in mind. I know that where these machines are in operation they seem to work well. However, we should also be aware that where any penalty is about to be imposed it is possible under the present system for checks to be made to ascertain whether ticket offices were open and facilities for buying a ticket available. When a penalty is imposed, information is issued on how an appeal may be made against that penalty.
Lord Faulkner of Worcester: My Lords, does my noble friend agree that there is a considerable difference between a penalty fare and a fine imposed by a court for deliberately attempting to evade payment, and that no criminal stigma whatever is attached to the many distinguished public figures who cheerfully pay up when they find that, because of an honest mistake, they do not have a ticket? However, will my noble friend confirm that deliberate fare evasion is stealing by another name and that penalty fares were introduced in the 1980s on what used to be called Network SouthEast because the railways were losing in excess of£50 million a year and people who did not pay their fares were being subsidised by those of us who did?
Lord Macdonald of Tradeston: My Lords, I readily confirm that a penalty fare is a supplementary fare and is not a fine and that fare evasion is a criminal offence. However, the amount of moneys raised—I think of London Transport rather than the railways in this connection— are small in the context of the overall revenues raised by London Underground, for
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example. However, I take my noble friend's point about the importance of deterrence. That deterrence must, of course, always be mediated by discretion.
Lord Brabazon of Tara: My Lords, is the situation not confusing for passengers? On the Gatwick Express and the Heathrow Express one is positively encouraged to buy one's ticket on the train, but on the Stansted train, if one does not have a ticket, one is liable to a penalty fare. How can the average passenger know what he is supposed to do on those trains? How can foreign visitors in particular know what they are supposed to do?
Lord Macdonald of Tradeston: My Lords, I am, of course, grateful to the previous government for the thorough work they undertook when instituting the present system in 1996. I accept that there can be differences, but there is no appropriate system that fits all train services. For example, guards travel on InterCity train services, but the majority of branch line stations are unstaffed. I accept that there is inevitably confusion, particularly for those new to our transport systems. However, I hope that advances in technology, and in smartcard travel and so on, will begin to minimise the kind of inconvenience that is too often experienced.
Lord Harrison: My Lords, does my noble friend the Minister agree that in a few years' time, if Britain belonged to the single currency, tourists coming pinto the United Kingdom, or British tourists returning, say, from Portugal with escudos jingling in their pockets, would not be embarrassed at barriers trying to buy tickets for trains?
Lord Macdonald of Tradeston: My Lords, the question of the euro is just slightly less sensitive than the question relating to the escudos. Therefore I shall reply by saying, "In all probability, yes".

Directors' Remuneration: Consultative Document
2.54 p.m.
Lord Smith of Cliftonasked Her Majesty's Government:
Whether they are satisfied with the response of companies in implementing the recommendations of the combined code issued by the Department of Trade and Industry in July 1999 requiring shareholder involvement in the determination of executive directors' remuneration.
Lord McIntosh of Haringey: My Lords, the Department of Trade and Industry issued a consultative document on directors' remuneration in July last year which set out the Government's proposals for strengthening the current regulatory and best practice frameworks in this area. The consultative document made it clear that the Government are

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concerned that some quoted companies have failed to comply in full with the spirit of the recommendations made by the Greenbury Group in 1995. The responses to the consultative document have been carefully considered and the Secretary of State expects to announce his conclusions next month.
Lord Smith of Clifton: My Lords, I am grateful to the Minister for his Answer. I am glad to learn that the Secretary of State will make an announcement on this matter. However, only last month the Pensions & Investment Research consultancy showed that about 27 per cent, or 500 companies in this country, were putting directors' remuneration to their shareholders at general meetings. That is a low degree of compliance. I should like further assurance that the Government will take this matter seriously when the Secretary of State makes his announcement next month.
Lord McIntosh of Haringey: My Lords, the figures that the noble Lord mentioned are an improvement on the PriceWaterhouse conclusions of May 1999 which were reported to the House by my noble friend Lord Sainsbury in October last. However, the noble Lord is quite right to say that the position is not satisfactory. I give him the assurance that this is one of the issues that will be addressed when the Secretary of State makes his announcement.
Lord Lea of Crondall: My Lords, given that executive remuneration has been growing by 10 to 15 per cent year on year for many years now, while the remuneration of other people has grown by only 3 to 5 per cent—in other words, the result of this is growing inequality—and given the resulting scepticism when it is suggested that shareholders should blow the whistle, does not my noble friend the Minister agree that there will be a need for Ministers to revisit the basic parameters of public policy when they undertake the review which the Minister mentioned?
Lord McIntosh of Haringey: My Lords, I am not sure what my noble friend means by revisiting the basic parameters of public policy. Certainly the statement which the Secretary of State will make next month will cover all of the issues which were addressed in the consultative document last year. In the end it must be for shareholders to determine remuneration, but it is for government to ensure a framework for remuneration which supports the need for directors to be accountable to shareholders. My noble friend refers to the rise in directors' remuneration over the years at a rate higher than inflation and higher than the rise in remuneration of their employees. Clearly an increase in differentials between directors and employees, except in exceptional circumstances, is not in the best interests of a company or its shareholders.
Lord Mackay of Ardbrecknish: My Lords, before the Government announce their conclusions on the matter of directors' remuneration, will the Minister undertake
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that the Government will consult with some of his noble friends who have experience of high salaries, share options and golden handshakes? Is he aware that many of them are singularly absent today?
Lord McIntosh of Haringey: My Lords, it has never been my view that socialists have to be bad at their jobs.
Lord Borrie: My Lords, does my noble friend agree that the phrase "shareholder involvement" can have a number of different meanings? It may mean the influence of major institutional shareholders, who, I should have thought, have a lot of "clout" already with the board of the company concerned. Alternatively, it may mean the mass of ordinary shareholders who might number tens of thousands or hundreds of thousands and whose views are difficult to ascertain. It may also mean—this may be the meaning of the phrase in the Question of the noble Lord, Lord Smith—shareholders at general meetings who comprise a self-selecting group who may be there for the refreshments.
Lord McIntosh of Haringey: My Lords, one of the considerations that has been put forward in all seriousness is that if you have a shareholders' vote on directors' remuneration more shareholders will come to meetings and refreshment costs will rise. I do not think that is a very serious consideration. My noble friend is right, there are a number of ways in which accountability of directors to shareholders could be improved. It could be by a shareholders' vote; it could be by new disclosure requirements on remuneration; it could be in the way the listing rules are framed; it could be in the role of independent non-executive directors; or it could be in a strengthening of the combined code. These are all matters that the Secretary of State can address in his Statement.
Lord Marlesford: My Lords, does the Minister agree with the advice of the late J. Peter Grace, who used to tell his most highly paid executives, "I do not have a problem paying you that sort of money; you just have a problem earning it"?
Lord McIntosh of Haringey: My Lords, that sounds like very good advice. Of course there are exceptional people for whom exceptional earnings are appropriate. But far too often we see exceptional earnings being given to mediocre people.
Lord Mackay of Ardbrecknish: My Lords, as we have time, perhaps I may come back on this. I thank the Minister for his answer, with which I absolutely agree. Do I therefore take it that if people do a good job they deserve their high salaries and their share options? I am not quite so sure about the golden handshakes.
Lord McIntosh of Haringey: My Lords, I said to the noble Lord, Lord Marlesford, that there are exceptional people for whom exceptional remuneration—which can include all kinds of

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considerations other than basic salary—would be appropriate. However, the problem, as I think the noble Lord will recognise, is that in respect of too many people high remuneration is accompanied by mediocre performance.
Earl Ferrers: My Lords, does that apply to Ministers?
Lord McIntosh of Haringey: My Lords, Ministers are not directors. They are certainly not directors of quoted companies They do not come within the scope of the review.

Local Government Bill [H.L.]
3.2 p.m.
The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Whiny.)
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the Chair.]
Clause 1 agreed to.
Clause 2 [Promotion of well-being]:
Lord Peyton of Yeovil Lord Peyton of Yeovil moved Amendment No. 1:
Page 1, line 18, leave out ("they consider").
The noble Lord said: In moving the amendment standing in my name, I should like to begin with a heart-felt tribute to the party opposite. I do not think that, as yet, the patty I support has acquired the great skills which the party now in government had when it was in opposition and which it so frequently displayed. It was really very good. if I may so, at mustering indignation when a measure which it regarded as being incompetent and inadequate was put before it by the government of the day.
Today I am left wondering what on earth that party would have said if it had been confronted with this Bill. I believe this Bill is a rotten one. It is an example to any government and to any student of government of how a government ought not to proceed.
I begin by referring the Committee to the Second and Third Reports of the Delegated Powers and Deregulation Committee. We are all indebted to that committee for its singularly valuable work. It states in paragraph 2 of the Second Report of 15th December that,
"The Department's Memorandum states that the Government is already proposing to table a number of amendments to the Bill at committee stage which will confer new powers or affect powers already in the bill".
If the Minister has not already done so, I hope that he will take note of the sentence that follows:
"We do not think it satisfactory to proceed in this way".
In the following Third Report of the same committee, we are informed that the Government have to date tabled 140 amendments. Perhaps there are more, I do not know. My noble friend on the Front Bench is indicating that there are many more. Some 140 amendments are enough to start with, and quite enough for the Government to be thoroughly ashamed of. I am waiting until I have the Minister's attention. I am much obliged. There were 140 amendments at the time of the Third Report of the Select Committee. I do not know how many there are now. Perhaps my noble friend on the Front Bench knows.
Lord Dixon-Smith: My noble friend will be interested to hear that there are now 284 government amendments. I am not sure whether that will be the final tally.
Lord Peyton of Yeovil: I apologise to the Committee for being so out of date. I had obviously underrated hopelessly the Government's incompetence, their disregard of Parliament and their generally sloppy ways of handling legislation. There are some 285 amendments so far to this already bad Bill. It would be exceeding all the bounds of optimism if one were to suppose that even a very small proportion of those amendments would result in any acceptable improvement. I hope that when the Minister replies we will hear him speak on the subject of the number of amendments that are now before us and about whether he expects to table a lot more before the end of the Committee stage.
I am moving Amendment No. 1 on the Marshalled List. The clause that I seek to amend contains the words,
"Every local authority is to have power to do anything which they consider is likely to achieve any one … of the following objects".
Local authorities are being given huge powers here. My amendment seeks to place some onus on them to prove that their actions are necessary and sensible. As the Bill stands, all they have to do is to say, "We think it likely" or "We thought it likely". In other words, they can consider themselves the judges of the worth of their own legislation.
I have always found this kind of proposal very objectionable, from whichever side of the House or from whichever party it may come. I hope that the Government will be minded to accept this very modest, small amendment.
Amendment No. 16, which is grouped with Amendment No. 1, has exactly the same purpose. It seems to me not in any way injurious to the purpose that the Government have in mind or to the sense of the Bill.
This habit of taking more than is necessary in legislation is totally unacceptable. For that reason, at this early point in the Committee stage, I very much hope the Minister will consider that he would not be ill-advised to make a modest concession. It will cost the Government nothing. It will make no difference to the sense of what has been provided for in the Bill. The amendment will introduce a sensible limit to the

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powers conferred upon local government. Such powers cannot be left entirely to the purely subjective judgment of local authorities. I find that course unpleasant and unacceptable.
I hope that the Minister will not respond by saying that this is the kind of objection he always hears from the Opposition. In the past I made speeches of this kind when I sat on the Government side of the House. If necessary, I shall do so again. My future speeches will be conditioned by the reply that I receive from the Minister today. If he cannot give me the impression that he takes the matter seriously, I shall take the opportunity again and again to raise this and other similar points throughout the Bill. I beg to move.
Lord Elton: I rise briefly to draw the attention of noble Lords to the back of the Bill where it says that the legislation was introduced by the noble Lord, Lord Whitty, as the Local Government Bill, "House of Lords". When the noble Lord comes to reply to this interesting debate, I hope that he shall be able to explain how such an astonishing number of amendments have arisen in the department without the aid of any debate in the other place? Normally when one receives an enormous raft of amendments, it is as a result of debates in another place where the Government have had matters drawn to their attention which, sensibly, they then seek to put right. However, in the case of this Bill, who convinced the Government that what they have drafted is wrong or inadequate? Furthermore, why were these amendments not suggested before the Bill was printed and put before your Lordships' House?
Lord Bridges: I should like to support the amendment of the noble Lord, Lord Peyton, because I, too, feel that the words "they consider" go much too far. If the Bill goes on to the statute book in its present form, it will introduce new and undesirable conflict between local and central government. Using the terminology in Clause 2, it would be possible, for example, for a local authority to overrule and ignore a policy planning guidance on an important matter issued by the Department of the Environment, Transport and the Regions. Surely that would be undesirable? A local authority should have reasonable freedom to operate within the framework set down by central government. As drafted, this clause will lead to chaos.
Lord Campbell of Alloway: I support the amendment and all that has been said in support of it by my noble friend Lord Peyton. The phrase "they consider" confers an absolute delegation and subjective dispensation of discretionary power. It is wholly unacceptable, in particular when taken in conjunction with the concept of promotion, upon which I shall speak in a subsequent amendment. I support the amendment and hope that it shall be taken seriously.
3.15 p.m.
Baroness Hamwee: Before I turn to Amendment No. 1, I should like to add my voice to the critical comments that have been made on the number of government amendments to the Bill. At the time of the debate on Second Reading we were aware that whole swathes of amendments would be coming from the Minister. I then asked the Minister to ensure that we were given a period of 14 days from when we knew exactly which Bill the Government wished to promote until the start of the Committee stage. That has not proved possible, although I thank the Minister for the efforts made by himself and those in his office so that, at any rate, the Front Benches were made aware of the changes a little over a week ago. However, I stress that only the Front Benches were so informed and even then only with the aid of fax machines.
I acknowledge that, following my request for the revised Bill, the Minister's office has made sterling efforts to produce a version of the Bill incorporating all the proposed changes. However, I am sorry to say that the Minister's office was forced to use old-fashioned physical cut-and-paste methods rather than modern technology. I had already mentioned to a number of interested outside organisations that the Minister had agreed to produce a revised version. Those organisations were pleased because their lives would have been made easier and they had expected to be able to see that version through electronic means. I am sure noble Lords will agree that such outside bodies often provide invaluable assistance with their comments on how proposed legislation may affect their areas. I am sad that in this case the Government were unable to make use of modern technology and I hope that they will ensure that a version will shortly be made available using the appropriate technology.
I should like to make a few comments on the amendment of the noble Lord, Lord Peyton of Yeovil. My noble friend Lord Tope recently discovered that "Wednesbury" is a place as well as a principle. For that reason I assume—and I hope that the Minister can confirm this—that that principle will apply here. In other words, one must read into this provision the term "reasonably". The matters which form the subject of the clause are points of judgment. We on these Benches would always prefer a local authority to be able to be the judge—within reasonable constraints—of what is proper and appropriate and what will achieve the objectives provided for in legislation. Local authorities are not being offered a blank sheet here. However, we would prefer to see local government being able to take a reasonable view of local circumstances without too much imposition from central government.
As in other legislation, many provisions in the Bill provide for the Secretary of State to issue directions and generally refer to what the Secretary of State "considers appropriate". If every decision was made so prescriptive that it had to be passed to a court for consideration, progress would become very difficult.
Lord Filkin: I rise to support the thrust of the comments of the noble Baroness, Lady Hamwee. I should also like to express my concern that we might

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be in danger of taking away with one hand what we are seeking to give with the other here. I believe that this clause is particularly important because it recognises the need to give local authorities the general power to promote the well-being of their area rather than having always to seek a legal opinion as to whether they have vires.
A consequence of the very limited scope within which English and Welsh authorities have operated to date has been that, on occasion, they have proceeded with excessive caution and, as a consequence, have incurred excessive legal costs when trying to validate the question of whether they have legal powers. In some cases, such as major property deals, the costs of such validation have been quite astronomical. We should bear in mind that the amendment before us would take us straight back into that quagmire. That is not in the general interest of local authorities. In my opinion, it might be of interest to certain lawyers, but by no means all. For that reason, I believe that the form of words used in the Bill is well tried and tested—it is similar to that already used in Section 137 of the 1989 Act.
The provision marks an important new beginning for the relationship between central and local government. Does the Minister recognise that we should stand firm with the Bill as presently drafted and try to move forward towards a more positive relationship than perhaps has been the case in the past?
Lord Dixon-Smith: I hope that the Committee will grant me a few moments' indulgence to follow the remarks of my noble friend Lord Peyton of Yeovil and those of the noble Baroness, Lady Hamwee. It is an interesting—if somewhat salutary—thought that the Greater London Authority Bill, which comprised 300-odd pages, only attracted around 850 government amendments, and even then only after a great deal of work. On this Bill, the ratio of amendment to page of legislation is considerably worse. I feel sorry for the Minister, although I do not sympathise with him, if one may make that distinction.
The fact is that the Bill, as the noble Lord would like to see it amended, is an extremely useful document. It enables me to make yet another comparison, which is that the Bill will go from 51 pages to 64, an increase of the order of 20 per cent, as a result of the Government's amendments alone. That is not the end of our problems. I am well aware that it is a diversion, but there is also a document, 160 pages of it—The Local Government Bill Consultative Drafts of Proposed Guidance and Regulations on New constitutions for Councils ( Part II and Clauses 66, 67) So not only are we dealing with a major Bill which is to be changed in a dramatic way; much of the detail, the body and the substance of what is going to affect local councils is in another document which is not before us. That is highly regrettable.
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We can only deal with the situation we are in. As I said, I feel sorry for the Minister, but I do not sympathise with him. I add my protest to those already made. This is not a proper or an appropriate way to legislate. Still less is it a proper or appropriate way to treat local councils which are democratically elected. I should add here, I suppose in parenthesis, "as we are not", but, of course, the other place will plead democratic superiority as it does over us. However, local councils are democratic. They have a right to their own opinions and they should have a right to organise their own affairs. The Bill seeks to impose a form of organisation on their administration. However, as I said at Second Reading, if my memory is correct, it is outwith the convention on freedom for European local authorities.
That is as may be. As I say, we have to live with it. I make one point in support of the noble Baroness, Lady Hamwee. I suspect that that there are not many local authorities that could not have produced the Bill, as revised, straight off their own computers. Here we are with the Government unable to do that and yet seeking to force change down their throats. I do not think that that is satisfactory.
When one comes to the amendment itself, the difference between what the Government want and what my noble friend Lord Peyton of Yeovil would like might appear to be marginal. But if the amendment were accepted, Clause 2(1) would read:
"Every local authority is to have power to do anything which is likely to achieve any one or more of the following objects".
Thought is a wonderful thing. I have all kinds of random thoughts. But the idea that local authorities might act on the basis of random thoughts—I am sure they would not because I believe they are extremely responsible organisations with very good members—which they considered appropriate to this action seems to me wholly inappropriate. If nothing else, it is unnecessary wording. As someone who prefers to see plain English—we have some fairly obscure stuff coming towards us later on—I would prefer to see this little consideration considered inappropriate. I support my noble friend.
Lord Mishcon: Many of us who have served in local government have had cause to regret what has happened to local government over recent years. We have seen a falling off in the capabilities—let us be frank—of members of council and of officers. That is due, I suggest, almost entirely to the fact that powers and discretion have been removed from local authorities until we have reached the stage where, frankly, men and women of ability do not even apply to become members of local authorities.
I was delighted to see the wording that the noble Lord, Lord Peyton, and others have criticised. Otherwise one asks oneself who is to judge whether these things are likely to benefit the area for which the local authority stands. Who is to judge? Is it the Minister? Is it a court of law? Who is to say whether, in the face of a challenge, what has been done by the local authority is right or wrong? The clause says that the local authority will consider what is likely to be for

1425
the good of its area. What is wrong with that? It is completely clear that discretion is vested in the local authority. If this House were to say, "We do not trust that discretion", that will be one more removal of power from local government, which I personally would hate to see.
Lord Dixon-Smith: Before the noble Lord the Minister sits down, I rise with hesitation to cross swords with so eminent a lawyer. I suspect that we are discussing how many angels can dance on the head of a pin. I hope that if the noble Lord looks at the effect of the amendment of my noble friend Lord Peyton, he will see that it does nothing to remove the local authority's responsibility or indeed its discretion. It removes only some somewhat lax and unnecessary words.
Lord Mishcon: The noble Lord, Lord Dixon-Smith, has been very kind in promoting me—I hope it has been heard by the Chief Whip. Unfortunately, the Leader of the House is not here; nor is the Prime Minister. If the only argument against the provision is that the words are superfluous, and if I, as a humble lawyer, think that they are not superfluous but mean something, what harm is done by their inclusion?
Lord Whitty: I am deeply grateful to my noble friend Lord Mishcon for raising the sights of the Committee about the Bill. This is a very important turning point for local government in terms of broadening flexibility, broadening the freedom of choice and putting back responsibility on to local government for looking after the well-being of their communities. I had thought from the interventions of the noble Lord, Lord Dixon-Smith, in earlier debates on local government that he was also of that persuasion and concerned about the need to get local government back to the position where it genuinely leads its communities and takes decisions on behalf of its communities. That is what the power of well-being is really about.
I am not prepared to be abashed today over criticism of the tabling of amendments. The Committee will know that on previous occasions I have been slightly shamefaced in terms of our producing rather late amendments in relation to the GLA Bill when it had passed several days of Committee in another place and several days here. However, on this occasion I must say—it is perhaps presumptuous of me to say so—that I do think the noble Lord, Lord Peyton, is being a little disingenuous. He will know that Bills, and perhaps in particular local government Bills, whichever House they are introduced in, are often subject to detailed amendment before they are finally considered in Committee by that first House. That was the case under various regimes of the party opposite, and it is the case now. I am not saying that it is perfect, but it is hardly unprecedented.
In particular, I justify the procedure in this respect. I explained at Second Reading the necessity of coming forward with detailed amendments, many areas of the
1426
Bill having been subjected to a new and very important innovation in the way we approach legislation in this Parliament. The legislation has been looked at in great detail by a Joint Committee of both Houses, chaired by the noble Lord, Lord Bowness. A number of points were raised to which we had to give a response. The proposals have also been subject to a high degree of consultation with local government and other parties. That, in addition to the normal tidying up in which governments of all persuasions have always been involved, has produced a significant number of amendments, some of which are very important.
Although the noble Baroness, Lady Hamwee, is anxious that the House of Lords oversees the Government in their modernising agenda—I regret that we are only as far as fax machines and not as far as a complete new version of the Bill—it is important that the House understands that the changes we intend to make as a result of the amendments, subject to the views of the Committee, will strengthen the outline of the Bill which we provided at first print and which we discussed at Second Reading. Those changes will be informed both by a better assessment of what is necessary and, more importantly, by the opinion of the Joint Committee and by the opinion of local government itself.
Therefore, on this occasion I make no apology for the large number of amendments. When we come to specific amendments, noble Lords will no doubt have particular points to make which I shall take seriously, as always. However, I do not accept the general criticism with regard to the number of amendments.
3.30 p.m.
Lord Roberts of Conwy: I am grateful to the Minister for giving way. Will he clarify this point? I understand that we shall not be receiving amendments to the Bill in so far as it relates to Wales until Report stage and possibly Third Reading. That is because the National Assembly for Wales has not yet completed its consideration of the Bill. Will he confirm that?
Lord Whitty: Yes, I am happy to do so. The general theme of the Bill applies to Wales as it does to England. But where there are order-making powers which rest with the National Assembly for Wales, in parallel with the Secretary of State in relation to England, the precise details of those order-making powers have yet to be agreed with the National Assembly. That is a consequence of devolution. It means some slight delay in my being able to lay those amendments until the situation in Wales has been clarified. The Welsh dimension is the only major area where there would be amendments made by the Government beyond the Committee stage.
Lord Elton: While the noble Lord is on the subject of procedure and before we return to the subject of the amendment, perhaps I may leave something on the record which may be considered by the Procedure Committee when it comes to look at how all this works out. First, a procedure which enabled the Government to draft the Bill as they intended to debate it in

1427
Committee would be much more useful than one in which discussion took place against the rather misleading matrix of the Bill as it originally stood. Secondly, there would be sense in delaying the later stages if amendments are to be deliberated on by devolved assemblies so that those amendments receive a Committee stage discussion rather than only a Report stage discussion. The only alternative to that is to re-commit parts of the Bill when that becomes necessary. I do not want to delay the Committee, but I do not know of any other opportunity to put forward that idea.
Lord Whitty: I note the noble Lord's first point. Clearly, we are still on a learning curve in relation to pre-legislative scrutiny and the way in which both Houses of Parliament will engage in much more detailed consideration of Bills before they reach their formal stages. I accept his point in part, although I suspect that the business managers will find it hard to guarantee that we always meet the optimum timing in these respects.
As regards the position on Wales, I suspect that the amendments which arise as a result of our consultation with the Welsh Assembly will not be a huge surprise to noble Lords but they need to go through the process of agreement with our colleagues in Wales. Therefore, I should not have thought that there was a need to re-commit them. However, we are not at that point and noble Lords will no doubt reserve their judgment in that respect. I believe that this is not such a big issue. There is no conflict between ourselves and the Welsh Assembly. But we need to get matters right and ensure that the procedures agreed between central government and the devolved administrations are observed.
Perhaps I may now turn to the substance of the noble Lord's amendment. Clause 2 confers a broad power on local authorities in the promotion and improvement of the well-being of their area. That is a major step in the direction outlined by my noble friend Lord Mishcon in giving back to local authorities the ability to decide the priorities within their communities. The Government very much want local authorities to be able to act in the interests of, and react to the needs and concerns of, their communities, free from threat of intervention by the courts. Clause 2(5) makes clear that this can include action outside the authority's designated area if, in the opinion of the local authority, such action would promote or improve the well-being of its own community.
I say again to the noble Lord, Lord Peyton, that perhaps he is being slightly disingenuous in that this phraseology is quite familiar in local government Acts. If I remember rightly, the noble Lord was a member of the 1970–74 government. This precise phraseology was used in Section 137—a fairly wide-ranging section—of the Local Government Act 1972 which allowed local authorities to use that power if, in their opinion, it was in the interests of their area to do so.
As the Bill is drafted, the lawfulness of any activity would depend on the local authority being able to prove that in its opinion the activity promoted or
1428
improved the community's well-being. This is a well tried and trusted formulation in local government. It is not an innovation in that respect.
Of course, the local authority's opinion might differ from the opinion of some of its ratepayers, some of its political opponents, and no doubt other community interests. But at the end of the day, it is the local authority's responsibility to make that judgment.
Lord Campbell of Alloway: There is a problem here and I want to ask the noble Lord about it. "In its opinion" always gives the opportunity to go to judicial review on a decision and the court can say that it was not reasonably entertained. If one looks at the wording of the Bill, without my noble friend's amendment, it could well preclude judicial review—I think it probably would unless there were bias or ill will. Is that the intention of the clause?
Lord Whitty: If I understand the question correctly, no. In response to the noble Baroness, Lady Hamwee, it is clear that the Wednesbury rules apply in this respect, as in all other respects, in terms of the decisions of local authorities. In another words, local authorities are required to act reasonably. It is true that in the last resort judicial review could apply where the authority was regarded as not acting reasonably. The point is this: whose opinion is it that informs the decision? Local authorities must reasonably reach that opinion and reasonably implement that decision. If we were to take out the words as the noble Lord, Lord Peyton, suggests, it would leave the courts, and not the local authorities, directly to decide what activities could be undertaken within that area. Like the noble Lord, Lord Dixon-Smith, I assume that all local authorities do act reasonably and not randomly. I am sure that that is the case, even in Essex. Nevertheless, the reasonableness criterion continues to be applied.
I was asked whether this would allow local authorities to avoid, for example, planning policy guidance or other statutory measures. They could not do so because they are prevented by Clause 3(1) from doing anything which they cannot do because of restrictions or other legislation. Therefore, authorities' duties around planning issues are prescribed in other pieces of legislation and this is not the open door suggested by the noble Lord, Lord Peyton. Nor is it open to local authorities to use the clause to take unreasonable actions or have unreasonable opinions. The provision does, however, give a great deal of additional discretion to local authorities to act in the interest of the communities that they represent. If the two amendments promoted by the noble Lord, Lord Peyton, were carried, that would greatly confuse the exercise of that new power and would open it to detailed litigation. I hope, therefore, that I have said enough to persuade the noble Lord to withdraw the amendment.
Lord Peyton of Yeovil: I am grateful to the noble Lord for his thoughts on the subject. At least he has paused to think for a moment. It may be that I have misunderstood the whole purpose of pre-legislative scrutiny. I had supposed, perhaps rather simplistically, that the pre-legislative scrutiny would avoid, not precipitate, the need for the torrent of amendments that we find on the Marshalled List before even a word of the Committee stage has been delivered. That is what bothers me.
I am slightly surprised, and more than a little disappointed, to find the noble Lord declaring himself not at all abashed. I remember previous occasions when he had good reason to be abashed and when he said so. He did himself a great deal of credit. There is nothing to be ashamed of in saying that a slight mistake has been made. I was impressed on the previous occasion when that happened, and I am depressed on this one.
I hope that the noble Lord will make the effort to understand the position. I certainly have no petty intention of being hostile to local government. If I may again be slightly autobiographical, I recall, when I was on the Benches opposite, making a speech one more than one occasion about what I believed was the then government's deplorable messing about with local government. So I do not accept that I should be put in the position of someone who is prejudiced against local government and is determined to shackle it at every turn. All I am saying, and it is not too much to ask, is that local government should produce something that is likely to be of benefit. If it does that, that is sufficient. Under the Bill as drafted, all local government has to do is say that it thinks it is likely to be of benefit. That is not quite enough.
The noble Lord spoke rather as though it were the intention of the Government to preclude any possibility of intervention by the courts. I am glad to see the noble Lord shaking his head, but that was the impression that he gave. His remarks could easily be construed as meaning that any interference by the courts is to be resisted and avoided at all cost, whenever possible. If the noble Lord wants to intervene, I am happy to give way.
Lord Whitty: I hoped that I had made it clear that if the reasonableness of a local authority's action is in question, as the noble Lord, Lord Campbell, mentioned, the question of judicial review comes into account. I do not exclude the courts from every decision. I am saying that if we accepted this wording, it would be open to the courts to intervene on almost every decision of a local authority to clarify whether the opinion of the local authority or that of someone else was better.
Lord Peyton of Yeovil: I am grateful to the Minister and am slightly reassured by his remarks. I do not want to prolong my remarks, but one noble Lord opposite,
1430
who is not now in his place, said that if my amendment were passed, we should be returning to some old quagmire. I did not understand quite what that was about. I thought it rather extreme to say that this modest amendment would put local government back in some imaginary quagmire. That is certainly not my intention and I do not believe that it would be the effect of the amendment. When I find the noble Lord, Lord Mishcon, opposing an amendment of mine, I realise that I am up against very serious skills. I have nothing to offer which can possibly compete with the skills used with such ease by the noble Lord. Nevertheless, despite what the noble Lord has said, I still think that the amendment that I propose is quite a modest one.
I am sorry that the Minister should take such a lofty view in dismissing the amendment and saying that it would be greatly prejudicial to local government. I do not see that. If the noble Lord persists in that view, I shall, with some reluctance, press the amendment. The noble Lord does not respond. I should therefore like to take the opinion of the House.
3.45 p.m.
On Question, Whether the said amendment (No. 1) shall be agreed to?
Their Lordships divided: Contents, 84; Not-Contents, 126.

Division No. 1

CONTENTS

Allenby of Megiddo, V.

Howe, E.

Astor of Hever, L.

Howell of Guildford, L.

Attlee, E.

Hylton-Foster, B.

Belstead, L.

Jopling, L.

Biffen, L.

Laird, L.

Blatch, B.

Laming, L.

Blood, B.

Lamont of Lerwick, L.

Boardman, L.

Lane of Horsell, L.

Brabazon of Tara, L.

Liverpool, E.

Bridgeman, V.

Luke, L.

Bridges, L.

Lyell, L.

Brougham and Vaux, L.

McColl of Dulwich, L.

Buscombe, B.

Mackay of Ardbrecknish, L.

Butterworth, L.

Miller of Hendon, B.

Byford, B.

Montrose, D.

Campbell of Alloway, L.

Mowbray and Stourton, L.

Campbell of Croy, L.

Naseby, L.

Carr of Hadley, L.

Norfolk, D.

Cockfield, L.

Northbrook, L.

Cope of Berkeley, L.

Northesk, E.

Courtown, E.

O'Cathain, B.

Cox, B.

Palmer, L.

Craig of Radley, L.

Peel, E.

Crickhowell, L.

Peyton of Yeovil, L.

Cuckney, L.

Platt of Writtle, B.

Dacre of Glanton, L.

Plumb, L.

Dean of Harptree, L.

Plummer of St. Marylebone, L

Denham, L.

Prior, L.

Dixon-Smith, L.

Rawlings, B.

Elliott of Morpeth, L.

Rees, L.

Ferrers, E.

Renfrew of Kaimsthorn, L.

Flather, B.

Renton, L.

Fookes, B.

Roberts of Conwy, L.

Gardner of Parkes, B.

Rotherwick, L.

Geddes, L.

Ryder of Wensum, L.

Gray of Contin, L.

Saltoun of Abernethy, Ly.

Henley, L.[Teller]

Seccombe, B. [Teller]

1431

Shaw of Northstead, L.

Vivian, L.

Skelmersdale, L.

Waddington, L

Strathclyde, L.

Weatherill, L.

Swinfen, L.

Wilcox, B.

Vinson, L.

Young, B.

NOT-CONTENTS

Ackner, L.

King of West Bromwich, L.

Addington, L.

Lea of Crondall, L.

Ahmed, L.

Levy, L.

Alli, L.

Lockwood, B.

Alton of Liverpool, L.

Lofthouse of Pontefract, L.

Amos, B.

Longford, E

Archer of Sandwell, L.

McIntosh of Haringey, L.

Ashley of Stoke, L.

[Teller]

Ashton of Upholland, B.

Mackenzie of Framwellgate, L

Bach, L.

Maddock, B.

Barnett, L.

Masham of Ilton, B.

Bassam of Brighton, L.

Mason of Barnsley, L.

Blackstone, B.

Massey of Darwen, B.

Borrie, L.

Miller of Chilthorne Domer, B

Bradshaw, L.

Milner of Leeds, L.

Brightman, L.

Mishcon, L.

Brooke of Alverthorpe, L.

Morris of Manchester, L.

Brookman, L.

Nicol, B.

Bruce of Donington, L.

Northbourne, L.

Burlison, L.

Paul, L.

Carter, L. [Teller]

Perry of Walton, L.

Clarke of Hampstead, L.

Peston, L.

Cledwyn of Penrhos, L.

Phillips of Sudbury, L.

Clement-Jones, L.

Pitkeathley, B.

Cocks of Hartcliffe, L.

Prys-Davies, L.

Crawley, B.

Ramsay of Cartvale, B.

David, B.

Randall of St. Budeaux, L.

Davies of Coity, L.

Rees-Mogg, L.

Dealing, L.

Rendell of Babergh, B.

Desai, L.

Richard, L.

Dixon, L.

Roll of Ipsden, L.

Dubs, L.

Russell, E.

Elder, L.

Sandberg, L.

Evaas of Watford, L.

Scotland of Asthal, B.

Ezra, L.

Serota, B.

Falkland, V.

Sharp of Guildford, B.

Farrington of Ribbletor, B.

Shepherd, L.

Faulkner of Worcester, L.

Shore of Stepney, L.

Filkin, L.

Simon, V.

Gale, B.

Smith of Clifton, L.

Gavron, L.

Smith of Leigh, L

Geraint, L.

South wark, Bp.

Gibson, L.

Stone of Blackheath, L.

Goodhart, L.

Strabolgi, L.

Gould of Potternewton, B.

Taylor of Blackburn, L.

Graham of Edmonton, L.

Thomas of Walliswood, B.

Hamwee, B.

Thornton, B.

Hardy of Wath, L.

Tomlinson, L.

Harris of Greenwich, L.

Tope, L.

Harris of Haringey, L.

Tordoff, L.

Harrison, L.

Turner of Camden, B.

Haskel, L.

Varley, L.

Hayman, B.

Wakefield, Bp.

Hilton of Eggardon, B.

Wallace of Saltaire, L.

Hogg of Cumbernauld, L.

Warwick of Undercliffe, B.

Howie of Troon, L.

Watson of Richmond, L.

Hughes of Woodside, L.

Wharton, B.

Hunt of Kings Heath, L.

Whitaker, B.

Hunt of Tanworth, L.

Whitty, L.

Irvine of Lairg, L. (Lord

Wigoder, L.

Chancellor)

Wilkins, B.

Jay of Paddington, B. (Lord

Williams of Crosby, B.

Privy Seal)

Williams of Elvel, L.

Jenkins of Hillhead, L.

Williams of Mostyn, L.

Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.
3.55 p.m.
The deputy Chairman of Committees (Lord Strabolgi):I must inform the Committee that if Amendment No.2 is agreed to, I cannot call Amentment Nos. 3to 7.
Baroness Hamwee Baroness Hamwee moved Amendment No. 2:
Page 1, line 19, leave out from ("consider") to end of line 2 on page 2 and insert ("will further any one or more of its principal purposes, namely—

(a) promoting economic development and wealth creation in their area or improving the economic well-being of their area,

(b) promoting social development in their area or improving the social well-being of their area,

(c) promoting the improvement of the environment in their area or improving the environmental well-being of their area.").

The noble Baroness said: The intention of Amendment No. 2 is to explore exactly what powers the Bill proposes to confer on local government. My amendment, which I freely accept is not a particularly elegant piece of drafting, is based on the provisions of the Greater London Authority Act. It allows local authorities not merely to promote the matters which are the subject of the amendment, as is the case with the GLA, but to act directly. I have combined the provisions of the GLA Act with this Bill because I should like to explore with the Government the difference between economic well-being and economic development and wealth creation (to use the terminology of the Act), social well-being and social development and environmental well-being and the environment of a local authority's area.
There are two principal reasons for tabling the amendment. First, I am concerned that if there is slightly different wording in different pieces of legislation, which the average reader might expect to mean much the same thing, it may be interpreted as significant. If there are significant differences between the matters dealt with in the GLA Act and those set out in this Bill, the Committee will be assisted if it is made aware of them. In particular, can the Minister assure the Committee that, other than the explicit limits spelt out in the following clauses—we shall come to those constraints and restraints later this evening—there are no limits on the powers; in other words, that the wording of the Bill does not contain inherent limits that may be read into the legislation as a result of terminology which is different from that used in other statutes? The term "well-being" in Clause 2 is very general and is welcome to Members of the Committee on all sides of the Chamber who are great enthusiasts for local government. However, it may be argued that it is so wide as to be almost meaningless. I hope that that is not so.
The second principal reason for the amendment is to ask: what is the purpose of local government? When the Greater London Authority was established, one began with a completely clean sheet of paper. One had several hundred sheets of paper to deal with in the case of that Act! Local government as it is now is an agglomeration—perhaps conglomeration—of powers and duties that have been built up by statute, case law and custom.
I confess that I should like to see a single over-arching purpose: sustainable development—an issue that we shall debate later. However, it is relevant here because it confines the three types of well-being spelt out in the clause. It is not a balancing act but a process. Sustainable development is not just outcome; it is a way of achieving a combination of different types of well-being. It is not a matter of picking and mixing. The clause states:
"Every local authority is to have power to do anything … likely to achieve any one or more of the following objects".
Sustainable development is about all those objects. That is why I chose to approach the matter in this way and to use the term "purposes".
A subsidiary but important question, which I believe is linked to this issue, is this. Can the Minister tell us why the "objects" of town and parish councils are not included in Clause 1? I understand that the definition does not extend to them.
The Government acknowledge the role of local authorities in delivering many of their key measures which can be regarded as achieving a better quality of life. We believe, therefore, that Clause 2 should be as strong as possible. I beg to move.
4 p.m.
Baroness Miller of Chilthorne Domer: I support my noble friend's amendment. The amendment strengthens the message that I believe the Minister would wish local government to receive: that, after years of being undermined, local government has the power to do things for its local community.
The inclusion of the words "principal purposes" is important. Some have argued over past decades, and some cynics still say, that the private sector could deliver all the services that local government deliver without the bureaucracy. Of course, those who so argue may not be interested in the democratic process. But it leaves out an important piece of the jigsaw. It is the way those services fit together which differentiates between how they serve the community.
When I began to speak, I should have declared an interest as a county councillor in Somerset. I should like that interest to be recorded for all the times that I speak on the Bill. I am sorry that the noble Lord, Lord Mishcon, is not in his place now. I wanted to ask him why he had formed such a cynical view of members currently serving in local government. I do not wish to be seen to defend myself, but I meet many members and councillors who are extremely committed and energetic. They have virtually given up any form of meaningful life outside their jobs in order to serve their
1434
local communities. I do not believe that the quality of members is on the whole poor. I accept that members can always do with more training. I am glad that through the Improvement and Development Agency the Government are committed to delivering that training. But we should be pleased with the quality of members and young members coming in.
My noble friend mentioned that what we sought to achieve would be better covered by the term "sustainable development". However, to define the principal purposes of local government would be a step in the right direction.
Lord Whitty: It became clear from her remarks that the main point of the noble Baroness's amendment is that what is good enough for the GLA should be good enough for everywhere else. I suspect that the rest of the country views the issue the other way round.
As the noble Baroness indicated, in the case of the GLA Act we started virtually from scratch. The GLA was a new body with no existing functions, although it took some over from other statutory bodies. While we might have chosen to give that body a raft of specific powers, that would undoubtedly have lengthened the GLA Act. I do not think that that would have been appreciated in this House or by those who subsequently had to interpret the powers of the GLA. Instead, we gave the GLA a broad purpose.
It is not appropriate to apply the wording of the GLA Act to local authorities which already have statutory duties, powers and obligations through hundreds of years of local authority legislation. It is unclear how those would be affected if local authorities were now given principal purposes, as proposed in the amendment. Would the authorities' duties carry equal weight with these purposes? If there are principal purposes, what are the non-principal purposes, and so on?
The noble Baroness suggested that it was not the most elegant piece of drafting. However, the drafting is simple and the intention is clear, but with wide ramifications. I do not think that it is sensible to read across from the GLA Act in order to restate the purposes of local authorities which have existed for many decades.
The wording of the clause has been drafted to work effectively alongside existing local government statutes. For the same reasons, it is not possible successfully to transplant the wording from the GLA Act into this Bill.
The noble Baroness referred to parish councils and town councils. We are not giving powers to parish councils, but we want parish councils to engage in the kind of community strategies to which we refer here. To assist them, they will be able to use their existing powers under Section 137 of the Local Government Act 1972. We did not feel, therefore, that the new power should be reflected in parish and town councils.

1435
If the amendment were accepted, it would simply add to the confusion regarding local authority powers. The practical effect would be unclear and subject to serious problems of definition. We do not think that it would be prudent for us to accept a new definition of principal powers for local authorities. In the light of that explanation, I hope that the noble Baroness will not pursue the amendment.
Baroness Hamwee: I had not intended to put the amendment to the vote. I shall consider the Minister's remarks on parish councils. I am concerned that they should have all the powers they might reasonably expect in order to take a full part in the community, and in leading those communities. I shall read in Hansard the precise words used, but I am not sure that the Minister answered my point about the distinction between, for example, economic well-being and economic development and wealth creation. I should like an assurance that the objects—the term used in the clause—are at least as wide as the parallel terminology in the GLA Act and that local government is not constrained by the words in this Bill. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 3:
Page 1. line 20, leave out ("promotion or').
The noble Lord said: The intention of Amendments Nos. 3, 6 and 7 is to remove the words "promotion or" from paragraphs (a), (b) and (c) of Clause 2(1). I suggest that the word "promotion" is unnecessary. If it is removed, the Bill would read:
"Every local authority is to have the power to do anything which they consider is likely to achieve any one or more of the following objects … the improvement of the economic well-being of their area … the improvement of the social well-being of their area, and … the improvement of the environmental well-being of their area".
The word "promotion" has various meanings. The Oxford English Dictionary gives "preferment"; "furtherance"; "advancement"; and "encouragement". Some of those definitions apply and some do not. The dictionary has not yet got around to "advertisement" as promotion, but I have a son-in-law who makes an extremely good living out of advertisement and he would tell me that he advertises in order to promote products. So what does "promotion" mean in this context? I believe that the word is a little ambiguous because it has a diversity of meaning and that Clause 2(1) would be happy without it. I beg to move.
Lord Campbell of Alloway: I, too, looked in the Oxford English Dictionary and saw that the word "promotion" is a vague term. The concept has no precise meaning for the purpose of legal draftsmanship. The largest edition of the dictionary contains pages on it, but the definition I found was:
"to put forward into notice or attention, to publish, promulgate or advance".
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That is rather vague. In the context of the Bill, in particular Clause 2, which contains a massive delegation of power and a serious erosion of the supervisory jurisdiction of the courts under judicial review, it is not satisfactory to retain the term.
In any event, without pre-empting debate on Clause 68 and Amendment No. 365, which is not my intention, there is no doubt that the clause and the use of the word "promotion" must be seen in context with Clause 68 and Schedule 5, which repeal Section 2A of the 1986 Act and Section 28 of the 1988 Act. The concept of promotion was brought into the realms of local government law relatively recently. Its origins are in the Private Member's Bill of the noble Earl, Lord Halsbury, to amend Section 2 of the 1986 Act. It passed through this House, went to another place and was defeated. The concept of promotion was then taken up in local government law by Section 28 of the 1988 Act.
Surely, on an objective standard, it is only sufficient for the due discharge of the proper functions of a local authority on public funds that there should be the improvement of economic and social well-being in its area and that there is no need to import the inevitable ambiguity of "promotion".
4.15 p.m.
Lord Peyton of Yeovil: I should like briefly to refer to my Amendments Nos. 4 and 5. It is my most earnest hope that the Minister will take me seriously when I say that the amendments appear for no other reason than the desire to help and to abbreviate a Bill which is already overlong.
The Government want to give local authorities the power to do anything which will have economic, social and environmental benefits. I cannot think of a benefit which local government could produce which would not fall in one of those three categories. Therefore, the Bill would have the same effect if all three adjectives were left out and we state that local authorities can do anything they want to do.
I have tabled my amendments in an attempt to shorten the clause. I hope that the Minister will regard them as helpful. That is what is intended. The measures would simplify the Bill, making it briefer and more easily understood.
Lord Smith of Leigh: I must first declare my interest as leader of a local council. I am somewhat disappointed with the noble Lord, Lord Dixon-Smith, because having agreed that the purpose of the clause is to give local authorities the opportunity to act in the interests of their local communities and to tackle problems and issues which may arise in their local areas, he seeks to make what he regards as a simple amendment. It would remove the discretion which local authorities are given in this clause.
The noble Lord has looked in the Oxford English Dictionary and has missed the definition of "promotion" which most people in my area would recognise. In thinking of promotion, they would be worrying about who is changing divisions in rugby or football.

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The definitions of the word in this context advance the interests of the local community in the broad areas of economic, social and environmental well-being. Furthermore, in achieving many of the objectives of the clause, local authorities will be working in partnership with many other agencies and organisations. The idea of indirect activity is also encompassed in the word "promotion". That is why it needs to remain in the Bill.
I was somewhat relieved when I heard the noble Lord, Lord Peyton of Yeovil, explain his amendments because I was concerned that in seeking to reduce the number of paragraphs, he was further reducing the amount of power and discretion which local authorities could exercise. In some ways, the consequences of the policies of the party opposite in relation to mining in the early 1980s still remain. Only yesterday in my authority, a local firm which makes mining machinery closed with the loss of 200 jobs. That is the kind of situation in which I, as a leader of a local council, need powers to be able to act and intervene, not only directly, but also in partnership with local business and training organisations to make sure that those 200 people may soon be absorbed back into the labour force. I hope that we may accept the phraseology of the clause as it is laid down.
Lord Whitty: Like my noble friend Lord Smith, I recall a time when, for me, "promotion" meant solely the way out of the Third Division South! These days, "promotion" has a much wider meaning. It indicates a range of methods whereby a local authority could achieve the objectives set out in the Bill. Therefore, far from resulting in a degree of ambiguity, it is intended to provide a degree of comprehensiveness. If the local authorities' ability to promote economic, social and environmental well-being was removed, it could imply that the authorities could take action directly only if they themselves provided the intervention or the service.
There is generally held to be a difference between the provision of a function and the promotion of a function, because the promotion of a function involves other public and private bodies within the community, as my noble friend Lord Smith indicated. If we were to accept the amendments in the name of the noble Lord, Lord Dixon-Smith, it is clear that the authorities themselves could still take direct action to improve well-being but it is less certain that they could encourage or facilitate others to take such action. Moreover, the amendments might prevent local authorities taking any action which maintained current levels of well-being or which prevented current levels deteriorating, because such action would be promoting, but not improving, the well-being of the local area. Therefore, the terminology in the Bill as it stands is more appropriate.
I turn to the points raised by the noble Lord, Lord Peyton of Yeovil. We considered whether we should simply use the term "well-being" rather than any qualifying words. We believe that the formulation, "economic, social and environmental well-being"
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invokes the idea better than leaving it open to as wide an interpretation as may be made by referring simply to "well-being", which could theoretically be interpreted in a different way. While in general we welcome any amendments—this may not be borne out by my view on the previous clause—from the noble Lord which reduce the wording of the Bill, on this occasion his amendment could make the Bill's meaning slightly more obscure. That is why here and in other pieces of legislation before the House we have used the terms "economic", "social" and "environmental" in relation to "well-being". That gives a clearer idea of what we are about and what we expect local authorities to do in using those powers.
I therefore hope that noble Lords will not pursue those changes because I believe we are all agreed that they would not achieve their objectives.
Lord Northbourne: Before the noble Lord sits down, I have a query relating to his last point. The example of highways occurred to me; for instance, the creation of footpaths. Is that economic, social or environmental?
A noble Lord: Environmental, I believe.
Lord Northbourne: No, I believe it is social.
Lord Whitty: It is probably all.
Lord Dixon-Smith: I am grateful to the Minister for his explanation, which I shall consider carefully. If I feel the need to return to the matter at a later stage, there are still plenty of opportunities to do so. In the mean time, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 4 to 7 not moved.]
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 8:
Page 2, line 6, leave out ("or present").
The noble Lord said: This is really a probing amendment to try and tease out from the Government precisely what is the meaning of the paragraph which states,
"all or any persons resident or present in a local authority's area".
Subsection (2) states:
"The power under subsection (1)"—
which we have just been discussing—
"may be exercised in relation to or for the benefit of …
(b) all or any persons resident or present in a local authority's area".
The phrase "or present" might be a little difficult. No one would have any problem with the local authority acting on behalf of its residents in such matters. "Or present" in the area, however, implies anyone who happens to be visiting the authority's area. If they were tourists, businessmen or whatever, one would have no difficulty with that. But there are on occasions other types of visitor; a friend of mine lives in a house which was for a time occupied by people of North African extraction who were in fact members of a competent

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terrorist organisation under MI5 supervision, as I understand it. I wonder whether there is not a slight conflict of interest. Those people were resident in the area; they were there for several years, as it happens. I am not absolutely convinced that we should believe it reasonable that the local authority should be acting in relation to such matters.
One could equally conceive of a situation in which a major road improvement was to be carried out within a local authority's area and, before that improvement commenced, the site was invaded by what I believe are termed "eco-warriors". Indeed, a situation might well arise where the police had to do their utmost to remove them. Sometimes, I believe we should regard the action required to do so as rather less than fortunate, but it is none the less necessary.
I believed that it would be worth tabling the amendment to invite the Minister—who, I am glad to say, readily accepts such invitations—to discuss for a little while exactly what is meant by being "present" in a local authority's area. We should not want there to be any confusion about that. I know that the Bill is drafted in a benign sense, but someone else might be able to interpret it in a different way which would cause problems. I beg to move.
Baroness Hamwee: The noble Lord, Lord Dixon-Smith, is coming up with some colourful examples of situations with which local authorities might have to deal. My query is quite simple: as I read subsection (2), it gives a power to the local authority to carry out actions. It does not say that a local authority must prefer certain groups of people to those which comprise its residents. It is in the spirit of supporting local government and the autonomy of local authorities that their scope for taking rounded decisions should he in the interests of all those who might properly seek to benefit from them. Simply to allow local authorities to take decisions for the benefit of persons resident but not for other persons who might be in its area would be a regrettable restriction.
Baroness Miller of Chilthorne Domer: I want to give the Committee two or three examples of large groups of people which, certainly in the south-west, would be massively disadvantaged if the noble Lord's amendment were to be accepted. Some examples which spring to mind are seasonal workers who come to work in horticulture or agriculture; students who frequently have to cross county boundaries, for instance, to go to appropriate colleges; or even tourists in the summer season. Such groups number far more than would occasional eco-warriors or terrorists.
Baroness Hamwee: My noble friend might have added homeless people and, indeed, people who are sleeping rough on the streets. I am sure that local authorities, among other agencies, would not want to be forced to ignore their interests.
Lord Whitty: I believe that on this occasion noble Lords on the Liberal Democrat Benches have made my point for me. Clearly, the provision is not a requirement on local authorities to act on behalf of the North African terrorists mentioned by the noble Lord, Lord Dixon-Smith, or Swampy and his friends; rather, it provides an ability to act on behalf of exactly the types of group to which the noble Baronesses, Lady Miller of Chilthorne Domer and Lady Hamwee, have referred. I believe that almost every local authority has some, if not all, of the groups which we have mentioned. Therefore, it is important that they have the power to act on their behalf.
4.30 p.m.
Lord Dixon-Smith: I am grateful to the Minister for his reply because he has helped me, even if he believes that he has done so unwittingly. Of course, I accept all the examples that were given by the noble Baronesses on my right. However, the Minister has said that the provision is not a requirement. That will now be written into the record of the proceedings in this House because it will be reported in Hansard. If this matter becomes an issue in one of those ridiculous cases which I mentioned and of which we have all seen or know of examples, at some point the Minister's words in this House may be important. I am grateful to him for those words. They are helpful and, with that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees: If Amendment No. 9 is agreed to, I cannot call Amendments Nos. 10 to 12.
Lord Peyton of Yeovil Lord Peyton of Yeovil moved Amendment No. 9:
Page 2, line 7, leave out subsection (3).
The noble Lord said: This is a simple amendment and one which, again, is designed to help the Minister and to be helpful to local government. To say that a local authority must have regard to the effect which the proposed exercise of the power would have on the achievement of sustainable development in the United Kingdom seems to me to ask the local authority to make a judgment on a matter which is for national government rather than for the authority. I do not in any way belittle the capacity of local government. I seek simply to avoid putting upon them a burden which is beyond their competence to discharge. Unless this duty is put upon local government so as to give the Minister a locus on which he can intervene and restrain the local authority in what it intends to do, I do not understand why the burden should be imposed. Therefore, I propose that it should not be. I shall be interested to hear what the Minister has to say. I beg to move.
Lord Harris of Haringey: I have no difficulty with there being written into this part of the Bill references to the importance of the achievement of sustainable development. I believe that that is a fundamental objective towards which local government should be working. However, although I do not favour the

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removal of the subsection in its entirety, I have some difficulties with the wording and I should be grateful for the guidance of my noble friend.
Could the words,
"have regard to the effect … on the achievement of sustainable development in the United Kingdom",
be deemed to mean that if a local authority were pursuing something which would lead to the opening of a particular group of businesses, it would be necessary for the local authority to demonstrate that that would not affect the sustainable development of similar businesses engaged in similar work anywhere else in the United Kingdom? I am concerned that the phraseology "in the United Kingdom" will somehow create a kind of lawyers' playground. Although I understand that lawyers need playgrounds and that ambiguity in legislation is no doubt helpful, I am worried that this will produce a substantial restraint on local authorities pursuing and using the power in a sensible fashion. I am sure that that is not the intention.
I believe that the intention is try to ensure that, in pursuing the well-being of the people of their area, local authorities do so in a way which does not have a major negative impact on, say, residents of surrounding areas, and that they pursue that well-being in a fashion which can be sustained for future generations. Those are important principles. However, I am not sure that the subsection as drafted will necessarily achieve that. I hope that my noble friend can satisfy me that my fears of how lawyers might interpret this issue are completely wrong.
Baroness Miller of Chilthorne Domer: While I, too, am interested in the Minister's reply to the question of the noble Lord, Lord Harris of Haringey, on the intention of the drafting, we would certainly be sad if this clause were to be removed. Indeed, through our Amendment No. 36, to which I shall speak later, we express a wish to strengthen substantially the sustainable development duty of local authorities.
I had not read anything so sinister into the clause. I believed that it was attempting to make a building block of local authorities in an effort to make sustainable development occur nationally and to recognise that local authorities are the only building blocks that can deliver a national sustainable development strategy. They are, after all, the planning authorities. They will be responsible for how the Transport Bill is implemented. Virtually everything that they touch has an immediate bearing on sustainable development in the most obvious sense. Much of what they do has a longer-term and perhaps less obvious impact on sustainable development. Therefore, I believe that this subsection should remain. Indeed, we look forward to the sustainable development power of local authorities being considerably strengthened.
Lord Dixon-Smith: My name also appears in support of the amendment. I must confess to slightly different motives from those of my noble friend when
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I added my name, in that, rather like the noble Lord, Lord Harris of Haringey, I wished to probe this aspect of the meaning of "sustainable development" and particularly the relationship as regards local authorities and sustainable development in the United Kingdom.
Regrettably, "sustainable development" is not a precise phrase. If we were to enter a detailed discussion—I hope that we shall not—we should probably find that there are as many meanings to those two words as there are Members in this Chamber tonight. Therefore, we believe that we should once again invite the Minister to help us to clarify precisely what is meant because local authorities rightly are subject to public supervision of their actions.
It is not inconceivable that one of the environmental pressure groups might choose to take a different view of what a local authority does in the context of the meaning of the two words "sustainable development". Having taken that view, they would, I believe, perhaps be entitled to call for a judicial review of the matter if they felt sufficiently strongly about the issue. Therefore, if we are not careful we could involve local authorities in considerable expenditure which really should not be necessary. If we can do anything at this or, indeed, any other stage of the Bill which will avoid that situation, we should do it. It is for that reason that I added my name in support of the amendment. I was not in collusion with my noble friend Lord Peyton. We find ourselves arguing the same point but from different perspectives. However, I believe, and very much hope, that the Minister will be able to help us.
Lord Whitty: As the noble Baroness, Lady Miller of Chilthorne Domer, pointed out, the decisions and actions of local authorities may well have repercussions well beyond their own boundaries. In particular, they may well have an effect on the infrastructure, climate and economic development beyond their own boundaries.
This clause merely provides that in reaching their decisions under this power, local authorities must have regard to the broader picture in relation to sustainable development. Having had that regard, they must take that reasonably into account. It does not say, as my noble friend Lord Harris perhaps implied, that were a decision of a local authority to come into conflict with the decision of another local authority, that decision would be overriden.
The Government, like those on the Liberal Democrat Benches, consider the objective of sustainable development to be very important. Once a local authority has taken a view as to how its actions would affect sustainable development, it must then act reasonably. Therefore, this provision writes into the decision-making process that local authorities must take into account sustainable development for the United Kingdom as a whole. It has no broader implication. We believe that it is important that that should be written in as part of the way in which local authorities should reasonably exercise the powers.
Lord Harris of Haringey: Before my noble friend sits down, I should be grateful for further clarification.

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For example, a local authority in London may wish to create a series of units for small technological businesses. That would seem extremely sensible in terms of the economic well-being of its own area. It might appear to be very good in terms of the sustainable development of its own area, but because of the nature of the businesses being attracted, it might have a serious effect on the future well-being and sustainable development of other parts of the United Kingdom.
I am concerned that the local authority might be required to carry out major research into the markets of the firms which it was encouraging to come into those units and that unless it had done so and could demonstrate that it had done so, it would be failing to take into account the implication; of sustainable development for the United Kingdom as a whole.
I am not against what my noble friend says is the objective of the amendment; namely, that we should look at the implications of sustainable development for the UK as a whole. But I am concerned that it might create the expectation of an enormous research effort going into what could be quite small decisions with relatively minor implications. I want to be reassured that in practice local authorities will not find that their use of the power is hamstrung by a requirement to carry out a major exercise in demonstrating whether or not sustainable development in the United Kingdom as a whole, or in different parts of the United Kingdom, is affected by the subsection.
Lord Whitty: Clearly, the interpretation of the clause is giving rise to concerns which I do not believe should exist. We are certainly not attempting to use the clause to override the ability of local authorities, as part of their own sustainable development, to engage in some degree of competition with other local authorities. That is bound to happen. We are saying that local authorities must have regard to the broad objectives of sustainable development in the country as a whole.
It is clear that further guidance will be needed, and we intend to issue guidance. We shall consult widely with bodies with which my noble friend Lord Harris is extremely familiar in order to reach consensus. But we believe that some reference to the objective should be made on the face of the Bill and I hope that the guidance will clarify the matter.
Lord Smith of Leigh: I thank my noble friend for the undertaking to issue further guidance. However, I hope that he will follow up the point made earlier by the noble Lord, Lord Dixon-Smith, because I have some sympathy for what he said. We all support the principle of sustainable development and wish to see it included as an objective in the Bill. Those of us who have served on local authorities know that such matters may become the subject of legal challenge by individuals or groups who very effectively use the processes of the law to delay and damage developments. It is right that local authorities should consider sustainable development but we do not want
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decisions to be hamstrung by a small group of objectors who use the processes of the law to cause delay. Perhaps that can be examined in relation to the point made by my noble friend Lord Harris.
Lord Peyton of Yeovil: We have had a very interesting debate. I have been able to control my own excitement and I now beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
4.45 p.m.
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 10
Page 2, line 8, leave out ("have regard to") and insert ("determine").
The noble Lord said: I hope that the Committee will forgive me for what I consider to be a thoroughly bad amendment. I do not mean that in the sense of my intentions but it is the most appalling alliteration. I did not realise that until I had tabled the amendment. In fact, the word "ascertain" would be better than the word "determine".
The Bill states that,
"a local authority must have regard to the effect which the proposed exercise of the power would have on the achievement".
We hear the phrase "have regard to" often enough in this Chamber. I should prefer local authorities to have to sort out what the effect will be. I have used the word "determine" in the amendment although I do not like it. The word "ascertain" would be better so I shall quite understand if the amendment is thrown out. However, we should have something rather more positive than "have regard to", which, in the context, is rather loose as a phrase. "Ascertain" is rather more positive and, on occasion, may persuade a local authority to be rather more cautious than it might otherwise have been in relation to an action which somebody at some stage may come to regret. I beg to move.
Lord Harris of Haringey: On the last amendment, I expressed concern that we might be creating a lawyers' playground and I thought that the noble Lord, Lord Dixon-Smith, agreed. He now seems intent on making that lawyers' playground potentially worse by requiring that local authorities determine or ascertain the effects of sustainable development on the United Kingdom. I suggest that that makes the clause even more of a potential minefield in terms of litigation. When the noble Lord listens to my noble friend's response, I am sure that he will rapidly wish to withdraw the amendment.
Lord Whitty: I am not even sure whether we are dealing with the amendment on the Marshalled List or that deftly corrected by the noble Lord, Lord Dixon-Smith, in the course of his remarks.
However, the position is as my noble friend Lord Harris indicated. What is proposed is a much more onerous requirement on local authorities to engage in precisely the degree of detailed research into specific proposals which my noble friend feared would

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hamstring local authorities. Like him, I thought that the noble Lord, Lord Dixon-Smith, was also concerned about that.
Clearly, we want local authorities to have regard to the broad objective of sustainable development. We do not wish to impose on local authorities a huge research task to ascertain, determine, or whatever, the precise effect on all other local authorities throughout the United Kingdom. That would be too much. I do not suggest that, and I hope that the wording on the face of the Bill does not suggest it.
Baroness Hanham: I believe that the mischief lies in the words, "in the United Kingdom". The more I am told that there is to be guidance on the matter, the more nervous I become. I question—and I hope that the Minister will take this into account—whether each individual local authority will have to ascertain, determine or look at everything that is going on in the United Kingdom before it takes any decisions under this power. By removing the words, "in the United Kingdom", you remove the lawyers' paradise. You make a perfectly reasonable statement that local authorities should pay attention to sustainable development. At present it is almost like asking them to pay attention to sustainable development in Europe. The Government are making it nearly as bad by inserting the words "in the United Kingdom". Rather than adding another 15 pages to the large and voluminous guidance already issued, perhaps we should just omit those four words.
Lord Bridges: This amendment seems to trespass somewhat on the territory of environmental impact assessments that are already obligatory in certain spheres of local authority activity including planning applications. I am not sure how the amendment will affect the existing situation.
Lord Whitty: Perhaps it is in order for me to speak again. In part, I take the points made in relation to this matter. If sustainable development is to be looked at only within the area of a local authority, that will constrain the aim of the clause. Clearly, quite a number of decisions will affect at least enabling authorities and perhaps beyond. I do not believe that the amendment is intended to have quite the ramifications suggested by noble Lords. I am happy to consider what has been said in this debate and to look at whether there is a better way of dealing with the matter. I believe that noble Lords understand the objectives behind the clause and I hope that some anxieties have been allayed.
Lord Dixon-Smith: I am again grateful to the Minister for his reply. His words will become part of the record and, therefore, they will have validity and an importance beyond this Chamber. In that sense I am grateful to him. After a useful little debate,
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surprisingly, I am delighted to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Thomas of Walliswood Baroness Thomas of Walliswood moved Amendment No. 11:
Page 2, line 9, after ("on") insert ("the health of persons in their area and").
The noble Baroness said: I rise to speak to the amendment standing in the name of my noble friend, which seeks to add the words,
"the health of persons in their area"—
that is the local authority area—to,
"the achievement of sustainable development in the United Kingdom",
about which we have just been talking. Those are factors to which local authorities must have regard when deciding whether, or how, to exercise their powers under Clause 2(1).
The health of the local population ought to be, and already is, a matter of importance to local authorities. Many local authorities already have quite important powers in the field of public health. Their responsibilities in housing, planning and social services can have considerable impacts on the health of local people. They now have an obligation to co-operate with local NHS organisations on health matters. The health of local people, like benefit to the environment, provides an excellent litmus test of the wider impact and benefit of the exercise of powers to promote economic, social or environmental improvement. Noble Lords have discussed exactly that in relation to the previous amendment.
A government amendment introduced a similar provision to the GLA Act. During its passage, we introduced amendments to give powers to the mayor to create a health strategy for London and/or to publish a regular report on the health of Londoners. In responding to those amendments, the noble Baroness, Lady Farrington of Ribbleton, said on 21st June 1999:
"The effect of those amendments is that health considerations will be a top priority for the mayor in discharging his or her two most important functions—the preparation of strategies and the exercise of the general power. For example, in deciding whether or not to exercise the authority's general power, the mayor must have regard to the effect that the proposed exercise of the power would have on the health of Londoners".—[Official Report, 21/6/99; col. 766.]
Two days later she said:
"the GLA will be under a duty, both in the exercise of its powers and the preparation of its strategies, to consider their effect on the health of people in London and to promote improvements in their health".—[Official Report, 23/6/99; col. 979.]
Our amendment does not go quite as far as that. Despite what the Minister has said in reply to my noble friend, we submit that this duty should apply to all local authorities and not just to the GLA. If the amendment is accepted, the clause would be almost identical in its wording to the relevant provision—Section 30(4)—in the Greater London Authority Act. I beg to move.
Lord Harris of Haringey: I rise to speak in support of Amendment No. 12 standing in my name. The

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amendment requires local authorities, in exercising the new power relating to well-being, to have regard to the achievement of social inclusion in their areas. That is an important provision because I take the view that the creation of a socially cohesive community in a local authority area is a central part of the work of local government. Local government should be about delivering for all the people of the area represented by a local authority. As many local authorities have diverse areas, including extremes of poverty and wealth—many less deprived areas contain pockets of severe deprivation—it is critically important that a local authority in carrying out its functions, particularly in considering the exercise of these new powers, should try to achieve social cohesion. Local authorities should consider the social inclusion of people in such areas.
Social cohesion requires service delivery and the effective delivery of well-being for everyone in the area. In particular, it should require special efforts to be made to deliver well-being to those who suffer from deprivation. In practice, that is about making sure that the local authority delivers for all the people in that community, whether black or white, rich or poor, young or old. That seems to me to be a fundamental requirement. For that reason I believe that there should be an expectation that local authorities, in considering the exercise of these new powers, should have regard to their effect in relation to achieving social inclusion in their areas.
I take the view that this subsumes the implications of Amendment No. 11 in that a key part of social inclusion is to ensure that the health of all those in the community is taken account of and respected. I have heard the points already made in this debate. It seems that the matters of social inclusion and health go closely together. I hope that the Minister can take those matters on board and consider them at a later stage in the course of this legislation.
Lord Dixon-Smith: I speak to Amendment No. 14 in this group. It is designed to make local authorities, in particular, consider the impact of their decisions on their neighbours. I ask the Minister to consider this amendment seriously. It states:
"In determining whether or how to exercise the power under subsection (1), a local authority must have regard to the effect which the proposed exercise of the power would have on neighbouring authorities".
Of course, this is a simple and basic: matter: do unto others as you would that they do unto you. It is a simple exercise in "neighbourliness".
There is a serious purpose behind the amendment. In some circumstances, development in one area may have a dramatic effect on another. In relation to economic development, a small laboratory may potentially pose a major industrial accident hazard. We all know of such installations because they have to be inspected properly and they operate under strict regulations. In fact, if a local authority has such an installation within its boundaries, it is necessary to have a major accident plan to deal with the consequences of something going wrong. If there is an
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oil refinery, such as we have in Essex, major evacuation plans are put in place to deal with the consequences of something going wrong.
Such a disaster could occur, for the sake of argument, in a small laboratory working in the bio-medical field, causing a huge disease hazard. Again, if that happens a major plan must be involved. Such plans do not stop at local authority boundaries. In Essex we have a nuclear power station. If that went "bang", Ipswich and the county of Suffolk would also have to evacuate if the prevailing wind was blowing in its normal direction, to say nothing of a great deal of Essex and possibly a considerable proportion of Norfolk.
It may be said that those are extraordinary events. The big issues, which I used for illustrative purposes only, would normally be dealt with by somebody other than just a local authority. But when a local authority gives permission to a developer to develop a small industrial estate consisting of 20 or 30 units, it does not seek to control who goes into that estate. That is when problems can arise. Of course, the authority soon finds out because a laboratory of the type I described would have to be registered with the appropriate authorities.
That is not to say that local authorities should not permit that kind of development. We need that kind of development if the economy is to move forward. But as a matter of prudence, and indeed of neighbourliness—to go back to where we began—it would be wise if the local authority consulted the neighbours it placed in that situation. Amendment No. 14 is tabled with that in mind and I hope the Minister will consider it with slightly more favour than he has been able to dismiss the previous amendments.
5 p.m.
Lord Simon of Glaisdale: It is with trepidation that I intervene among so many experts on local government. My experience is obviously many years out of date and was only that of an ordinary constituency Member of Parliament. But I do so because, at enormous expense, the statute book continues to swell more and more through the insertion of a number of quite unnecessary provisions. The main classes of unnecessary provision are twofold: first, line after line teaching grandmothers how to suck eggs; secondly, page after page of departmental standing orders. That is cumulatively at great expense, and cumulatively far more than the£105 million which so concerned Members of your Lordships' Chamber last Thursday.
At great expense, Amendment No. 11 seems to fall clearly in the first class; that of teaching grandmothers how to suck eggs. Of course, any local authority will have regard to the health of persons in its area. If it does not do so, the members are not suitable to be members of a local authority and are highly unlikely to be re-elected as such. The provision is entirely unnecessary.
Amendment No. 12 is barely more acceptable. Amendment No. 14 is arguable because it asks a local authority not merely to concern itself with its own

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affairs, but with the repercussions of its actions on neighbouring affairs. However, I feel obliged to venture to warn the Committee that such a provision is bound to encourage massive, expensive litigation. With those observations, I hope the Minister will look charily on these amendments, in the same spirit in which he looked on previous amendments.
Lord Whitty: I regret that in relation to these amendments I have to exhibit a degree of chariness. They are unnecessary and could lead to confusion.
Reference to having regard to sustainable development and to social well-being subsume very much the matters with which my noble friend Lord Harris and the noble Baroness, Lady Thomas, were concerned. We do not therefore need a further specific amendment in relation to health or social exclusion. Clearly the Government are concerned about social exclusion, health and well-being, but spelling them out in this way is not necessary. There is no direct read-over from the GLA Bill, where we were dealing with a new authority with strategic powers. Here we are talking of the duties, when exerting their power, of all local authorities.
Clearly it is important that local authorities, in exerting their powers, pay some attention to their effect on neighbouring authorities, as I said in the previous debate. That is integral to sustainable development. We shall need to issue some guidance in that area. Whether or not that is teaching grandmothers to suck eggs, some guidance is probably necessary, though not on the face of the Bill. We shall also return to this issue of neighbouring councils under Amendment No. 17.
Therefore, while I understand the spirit behind this group of amendments—to which I am sympathetic—I do not believe they fulfil those objectives. I hope therefore that the amendment will be withdrawn.
Baroness Thomas of Walliswood: I am devastated to be the target of the extremely skilled advocacy of the noble and learned Lord, Lord Simon of Glaisdale. I would have done almost anything to avoid such condemnation. Nevertheless, I am not entirely convinced by the Minister's response. I shall read carefully what he said and consider the context in which the clause appears in the GLA Bill. In the mean time, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 12 not moved.]
Lord Harris of Haringey Lord Harris of Haringey moved Amendment No. 13:
Page 2, line 10, at end insert—
("( ) In determining whether or how to exercise the power under subsection (1), a local authority must have regard to the effect which the proposed exercise of the power would have on equal opportunities and on the promotion of harmonious race relations in that local authority's area.").
The noble Lord said: In moving Amendment No. 13 I shall speak also to Amendment No. 33. I have just spoken on the subject of social inclusion and hope that I am not already pre-judging my noble friend's response to this group of amendments.
Clearly, social inclusion and social well-being could be deemed to cover issues surrounding race and equal opportunities. But Amendment No. 13 would have the effect of placing at the centre of the new power an obligation to have regard to the effects of the exercise of that power on equal opportunities and the promotion of harmonious race relations. That is something which should be explicitly reflected on the face of the Bill. It is important to do that given the discussions which have taken place following the Stephen Lawrence inquiry and the implications of the Macpherson Report, not just for the police service but for all public services.
Quite clearly, that report was saying to local government, as it was saying to other public services and to the police, that local government needs to look at the way it operates and that part of the exercise of its powers should be promoting equal opportunities and thereby helping to achieve harmonious race relations. That is a critical responsibility of local government.
Britain is certainly a multi-racial society. That is something I am sure Members of the Committee would wish to welcome and foster. By the same token, local authorities should welcome and foster that multi-racial society within their boundaries. In practice, this means that at the centre of the power should be the expectation of promoting harmonious race relations, coupled with the achievement of equal opportunities and progress made towards that end.
Amendment No. 33 would require local authorities to publish an annual report on the use of their power under the clause and its effectiveness in promoting well-being, equal opportunities and harmonious race relations. I submit that it is a rather helpful requirement in the legislation that there should be an annual report on the use to which the general power of "well-being" is put. Whether or not Members of the Committee accept Amendment No. 13, I believe that the requirement for an annual report on how that power is used would be a very salutary exercise for local authorities in considering what they have done in the preceding year to promote the economic, social and environmental well-being of their communities. The production of such an annual report would enable the community at large to assess the extent to which the local authority is being effective in that regard.
If the powers have been exercised, the way in which Amendment No. 33 is phrased would also require the local authorities to report back to their communities on whether or not they regarded those powers as having been effective in achieving what they set out to do. Again, that seems to me a salutary requirement on local government. But, specifically, in that amendment are expectations to report on the implications for equal opportunities and for the promotion of harmonious race relations. In the spirit of the lessons learnt from the Stephen Lawrence case and in line with the recommendations of the Macpherson inquiry, it

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would be very valuable for local authorities to be required to report regularly to their communities on the way in which they have looked at these matters and promoted harmonious race relations in their area. I beg to move.
Lord Tope: I rise to speak to Amendment No. 57, which is grouped with the amendments tabled in the name of the noble Lord, Lord Harris of Haringey. In doing so, perhaps I may say that I agree with all that the noble Lord said. This is not the stage at which we argue whose amendment is best. I believe that we are trying to achieve the same objective. Amendment No. 57 encapsulates all that the noble Lord, Lord Harris, is trying to achieve, although it goes a little further in tackling all areas of discrimination.
I know that the wording of Amendment No. 57 will be very familiar to the noble Lord, Lord Harris, to the Minister and, indeed, to all of us who spent many happy hours working on the GLA Bill, as it was at that stage. We debated this issue at every stage of the legislation and made a little progress each time until we reached the Third Reading when the Minister said:
"The outcome of those discussions has been in my view to alter the approach of the Government to the matter and to improve the provisions".—[Official Report. 1/11/99; col. 584.]
So we have built on that experience and we have taken the amendment, almost word for word, from Clauses 33 and 404 of what is now the Greater London Authority Act. Having been so moved during the passage of the GLA legislation, I hope that the Minister will be moved to act rapidly today rather than making us wait three months before we achieve the same objective.
For all the reasons outlined by the noble Lord, Lord Harris, it is important to have a duty imposed on all local authorities similar to one imposed on the GLA. Amendment No. 57 suggests that it should be a duty of all local authorities to have due regard to the principle of equality of opportunity for all people. It requires each local authority to have regard to the need.
"to promote equality of opportunity",
but specifically mentions,
"persons irrespective of their race, sex, disability, age, sexual orientation or religion".
Those are the definitions of discrimination used within the European Union. That is why they appear in the GLA Act and why I believe them to be appropriate for all local authorities. Finally, for the reasons given by the noble Lord, Lord Harris, the amendment would require each local authority to publish a report each year stating what it had done to further those aims.
As we debated this issue so many times and with such eventual success only a few months ago, I am confident in speaking to the amendment now—and as I shall be when moving it at the appropriate time—that the Minister will feel able to accept it. Indeed, he may recognise the wording, as he proposed some of it himself. If that is rushing things a little too much and if the Government do not feel at this stage that they
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want to accept the amendment, I hope that the Minister, who, I know, takes these issues very seriously, will at least tell us how they propose to tackle the issue during the passage of the Bill. We shall certainly be returning to it if necessary, as I am sure will others.
When the Bill leaves this Chamber it needs to contain a proper, wide-ranging equalities clause. I suggest that this is the clause, borrowing as it does from a duty already imposed on one authority. I trust that the Minister will respond positively to the intentions behind this group of amendments.
5.15 p.m.
Baroness Hanham: Perhaps I may declare my interest at this stage as I am a member of a local authority. In case I happen to intervene on a few more occasions, I ask that that be recorded and noted for the rest of the proceedings on the Bill.
Basically, I wish to comment on the amendments that include reference to annual reports. Local authorities are falling under the weight of having to make reports. Therefore, can I ask that this is not made a specific issue. Perhaps something can be included in the annual reports that already have to be produced. But, please, let us not have another one.
Lord Whitty: I recognise many of the arguments that the noble Lord, Lord Tope, and my noble friend Lord Harris have advanced. Although I accept that it is important that the power of well-being and the rest of the reform of local authorities encapsulated in the Bill should clearly have regard to equalities and to the effect on race relations within the authority, I am not sure that any of the amendments in this group sets out the appropriate way forward.
I am not sure that we should directly link the question of the promotion of race relations and equality to the physical exercise of the power of well-being, as suggested by Amendments Nos. 13 and 33. Moreover, Amendment No. 57 replicates in part Section 71 of the Race Relations Act 1976. However, it only does so in part and, therefore, there is an ambiguity as to how it applies to local authorities compared with other public authorities. Again, that is a discussion that we had in the GLA context.
As certain Members of the Committee, I expect, are aware, the Government will be publishing a consultation paper within the next few months, which will look at equality issues. That paper will discuss placing a general duty of equality on all public sector organisations. Therefore, it is difficult for me to agree to an amendment to the Bill inserting a form of words relating to equality that might well be generalised as regards all public sector authorities at a later stage.
Nevertheless, I understand the breadth of feeling within this area and take note of the point made by the noble Baroness, Lady Hanham, regarding yet another annual report, along with other concerns. However, I think it would probably be better for me to consider whether there is a more appropriate way of achieving the objectives to which noble Lords have referred.

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Alternatively, I may indicate at a later stage that it would be better for us to proceed in relation to public sector authorities in general rather than specifically in terms of this Bill. I undertake to comment on the matter at a later stage in the proceedings.
Baroness Hamwee: Before the noble Lord, Lord Harris of Haringey, responds to the Minister's comments, I ask the Minister to understand—from the tone of his response I am sure that he does understand this—that many of us within this Chamber and elsewhere hope to see the Government build on the good example that they set in relation to this issue—with all-party consensus—in the Greater London Authority Act. It does not seem to me a complete answer to say that the matter is being considered in regard to all public sector bodies. We now have an example in legislation of how to deal with the issue.
Following their consultation the Government may propose changes to the Greater London Authority Act. They may also propose changes to what will be the Local Government Act 2000. In the context of the new powers that are proposed for local government—which are welcome—it is important to set down provisions with regard to the importance of equality, which are generally accepted, on the understanding that peripheral points arise with regard to the mechanisms that may be established. That is an important statement for the Government to make and it is one that we should like to see on the face of this Bill when it reaches the statute book.
Lord Harris of Haringey: I am grateful to my noble friend for his reply. However, I am not entirely satisfied as yet with what he has said. It is pleasing that the Government accept the importance of the amendments that have been proposed. It would be helpful at a later stage to be given an indication of how the Government feel that it would be appropriate to deal with these matters. I accept the points that have been made by the noble Lord, Lord Tope, and the noble Baroness, Lady Hamwee, as regards the precedent contained in the Greater London Authority Act. That precedent was much discussed in amendments that were tabled in Committee and at every stage of that measure in this Chamber. As a result of that, a provision emerged which distilled the objectives which we were all trying to achieve. Those objectives apply just as much to individual London boroughs as to individual local authority districts and individual county councils. I should have thought that the same principles could be included in an amendment to this Bill which would achieve those objectives.
I was interested to hear the comments of the noble Baroness, Lady Hanham, on annual reports. I accept that a proliferation of annual reports does not necessarily achieve the purpose of informing the local community. However, if local authorities were required to comment on this matter in their other annual reports, or in an appropriate annual report, that would meet the requirement.
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I note also what my noble friend has said about a consultation paper that is to be produced that concerns a wider duty with regard to public services in terms of the matter we are discussing. That would clearly be valuable. However, I submit—I hope that my noble friend will consider this—that local government is central to the delivery of so many public services in a local area. The whole philosophy of this Bill concerns community leadership. We shall debate the principle of community planning and other matters at a later stage. If there is to be the expectation that local government will offer community leadership, there should be an expectation—perhaps in advance of the wider consultation—that local government should promote equal opportunities and create harmonious race relations. Whatever form that provision may take, it should be included on the face of the Bill. However, having listened carefully to what my noble friend has said, I shall withdraw the amendment at this stage. I look forward to hearing from the Minister on this point at a later stage in the passage of this Bill. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 14 not moved.]
Baroness Miller of Chilthorne Domer Baroness Miller of Chilthorne Domer moved Amendment No. 15:
Page 2, line 19, at end insert—
("( ) For the purposes of subsection (4), a person includes another local authority.").
The noble Baroness said: I rise to move Amendment No. 15, which stands in the name of my noble friends Lord Tope and Lady Hamwee. The amendment seeks to link the power in Clause 2(1) to promote and improve the well-being of an area with joint working between local authorities. This link is extremely important.
Amendment No. 15 states:
"For the purposes of subsection (4), a person includes another local authority".
The Government may ask why we have chosen the words,
"a person includes another local authority".
We have chosen that wording because the powers in the Bill have been conferred specifically on local authorities but not on partner organisations. We believe that the amendment is necessary because the drafting of this Bill and of the Local Government Act 1999 relates primarily to unitary areas. It is only through local authorities working together—in the case of adjoining local authorities—or working through the tiers of authorities that the concept of best value will be delivered. In some places there are four tiers of authorities. Devon County Council, for example, has to contend with two national parks and, I believe, nine districts and many parish councils.
We must be more rigorous in ensuring that local authorities are enabled to work together and are given every encouragement to do so. If the Government wish best value and community planning to work, they must ensure that where the Bill's wording and

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structures seem to threaten those concepts they will consider those points closely. Has the Minister considered—I am sure that he has—the three or four pages of regulations regarding joint working arrangements? I have read them several times. They are extremely difficult and convoluted. I am sure that when we reach the appropriate part of the Bill the Minister will be able to explain them to me.
The amendment would at least ensure that local authorities regard co-operation and joint working as concepts that the Government recognise and seek to encourage. If accepted, the amendment would underline the basic right of local authorities to co-operate with others in the matter that we are discussing. I beg to move.
Lord Bowness: I have some sympathy with the proposal that local authorities should be able to co-operate with other local authorities. However, I hope that the noble Baroness who has moved the amendment which stands in the names of the noble Baroness, Lady Hamwee, and the noble Lord, Lord Tope, could help me at least, and perhaps also the Committee, as regards the implications of substituting or including in the definition of "person" a local authority in connection with Clause 2(4)(b) and (f). It seems to me that to make a specific provision for one local authority to be able to give financial assistance to another and to,
"provide staff, goods, services or accommodation"
to another local authority is fraught with difficulty. It is a matter that I believe would distort the already imperfect financial regime and national support for local authorities. I cannot support the amendment as it stands at present. I hope that at the end of the debate we can discuss how co-operation can be achieved between local authorities, as I believe that it can—Clause 2(5) goes some way towards underlining that—without the specific reference to financial support of one authority by another.
Lord Dixon-Smith: Amendment No. 39, which stands in my name, is grouped with Amendment No. 15. It deals with what I can describe only as a parallel situation although it is in fact rather a different situation. It would not have mattered if the amendments had not been grouped together. However, I am quite happy to discuss them as grouped amendments.
Amendment No. 39 relates to Clause 4, which deals with strategies for promoting the well-being of local authorities, the subject under discussion. Subsection (2) states:
"In preparing any strategy under this section, a local authority—
(a) may consult or seek the participation of such persons as they consider appropriate".
My amendment seeks to insert the words "or organisations".
The question arises as to whether "persons" are or can be organisations or whether they might be deemed to be singular. I have always taken the view that
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"persons" were persons, referred to on the whole as individuals, and that "organisations" can cover everything from businesses, to pressure groups, to residents' groups, to tenants' groups, and any other group of which we can think.
The insertion of the words "or organisations" will help the Bill quite considerably. It is for that reason that I have tabled Amendment No. 39.
5.30 p.m.
Baroness Farrington of Ribbleton: I understand the intention behind Amendment No. 15 and Amendment No. 39, which is grouped with it. However, I hope that I am in a position to reassure both the noble Baroness and the noble Lord, Lord Dixon-Smith, that the amendments are not necessary to achieve the objectives they have outlined.
The term "person" is a well-established legal shorthand and is defined in the Interpretation Act 1978 to include a body of persons corporate or incorporate. So, of course, local authorities will be able to provide the whole range of assistance envisaged in paragraphs(4)(a) to (e) to other local authorities. The only effect of these amendments would be to cast doubt on the scope of the term "person" throughout the rest of the Bill.
I hope that the noble Baroness is reassured that the clause, as drafted, already meets her objective in this area and that she will therefore withdraw her amendment. I hope also that the noble Lord, Lord Dixon-Smith, will not feel it necessary to move his amendment.
Baroness Miller of Chilthorne Domer: I thank the Minister for her reply. It is very reassuring and I am glad that we now have a clear definition from the Government of the legal meaning of the term "person".
I shall not dwell on the issue at length but I do not believe that the amendment is unnecessary. Although at the best of times local authorities work together unchallenged, perhaps in times of hostile opposition to such co-operation from within their own ranks there might be questions as to whether or not they are giving financial support to each other, or perhaps questions about arrangements whereby staff move between the two authorities. In such cases, it is necessary to have a very clear track of decision-making and accountability to ensure that they are not informal, casual arrangements but that they are properly accounted for by each authority. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 16 not moved.]
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 17:
Page 2, line 23, at end insert ("and, prior to the exercise of the power outside their own boundaries, they shall consult, and receive agreement from, the authority within whose boundaries the power is to be exercised").
The noble Lord said: Amendment No. 17 concerns a different point. It is a probing amendment which seeks to discover the meaning of Clause 2(5) and what are its limitations.
Clause 2(5) is somewhat unusual It states:
"The power under subsection (1) includes power for a local authority to do anything in relation to, or for the benefit of, any person or area situated outside their area if they consider that it is likely to achieve any one or more of the objects in that subsection".
That is providing a very open power for a local authority to undertake particular actions in neighbouring authorities, and even in authorities that are not neighbouring authorities. Presumably—although we shall come later to matters of finance—it will give them power, as is stated in subsection (4), to give financial assistance outside their own area.
My amendment would require a local authority to consult the local authority in whose area it intends to take such extra-territorial action, if I may put it that way. Again, that seems to me to be a matter of simple neighbourliness. I have also said that they should get the agreement of that authority. That is not unreasonable.
Clause 2(5) as drafted appears to contain an extremely open power. I am all for giving local authorities powers and, generally speaking, I would not wish in any way to restrict that. But a power which may be operated in another authority's area—possibly even at the expense of that authority, if only through inadvertency—should be questioned at this stage. I move Amendment No. 17 in order to tempt the Minister to rise to the bait once again and to tell us exactly what are the limitations on the power and how it will work. Unless we are extremely careful, we shall be putting into the Bill at this point a power which might at some time in the future cause considerable dissension between particular authorities. That is something about which we should be very cautious. I beg to move.
Lord Whitty: The Bill allows local authorities to pursue actions which would have an effect outside their areas. We obviously would not expect them to do that without consultation and without adopting a sensible and responsible attitude. Local authorities already have powers to act outside their areas—economic development powers, housing powers and, in some cases, education powers—so there are precedents.
We need to make it clear that we expect local authorities to co-operate. On the other hand, we do not want to be over-prescriptive on the face of the Bill. We would not want to be quite as limiting as the noble Lord is tempting us to be. None the less, I am happy to go away and to look at the matter in order to see whether there is a better way in which we can make it absolutely clear that local authorities should act in co-operation. I know that there are anxieties about that and we should like to be as reassuring as we can be. If the noble Lord will accept that reassurance, we can come back to the matter.
Lord Dixon-Smith: I am grateful to the Minister for the words he has used; they are extremely helpful. As
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I said, it is a probing amendment. I am glad that he acknowledges that there is an issue and I am happy to beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 18:
Page 2, line 24, leave out subsection (6).
The noble Lord said: Amendment No. 18 seeks to delete subsection (6) from Clause 2. I read subsection (6) and I had difficulty in understanding what it is supposed to mean. It states:
"Nothing in subsection (4) or (5) affects the generality of the power under subsection (1)".
Although subsections (4) and (5) may not deal with the generality of the power, they give powers to the local authority and state how they may be used. I do not see why we need subsection (6), which states that those subsections do not affect the power. They do affect the power, albeit beneficially. For that reason, I feel that subsection (6) is a strange little sentence and I wonder whether the Bill would not in fact be better off without it. Having decided that the Bill would be better without the subsection, I have sought to persuade the Minister of that. The subsection does not help the Bill or provide any useful service. Indeed, it might add a certain degree of confusion here. I beg to move.
Lord Whitty: I regret to say that on this occasion the noble Lord has not convinced me with his argument. The point of the power of well-being is that it makes a broad range of activities available for local authorities to promote. We have set out some of those activities in Clause 2(4), but that is not intended to be an exhaustive list.
If we were to accept Amendment No. 18, it could potentially cast significant doubt on the scope of the power. We need to make it absolutely clear that Clause 2(4) is simply indicative and not exhaustive. It is included principally to remove some of the doubts that currently exist about some of the activities referred to in Clause 2(4).
There are restrictions on the power in subsections (1) and (2) of Clause 3, but we do not wish to draft the power in such a way that it is unduly restricted. Subsection (6) leaves no doubt that the power is wide. Its deletion would unnecessarily restrict the power and damage the purpose of the Bill. For that reason, I hope that the noble Lord will not pursue this amendment.
Lord Dixon-Smith: I am grateful to the Minister for that reply, which I shall study with care. Should I need to return to the matter, the noble Lord will find out in due course. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 2 agreed to.
Clause 3 [Limits on power to promote well-being]:
Baroness Hamwee Baroness Hamwee moved Amendment No. 19:
Page 2, line 27, after ("any") insert ("specific").
The noble Baroness said: In moving Amendment No. 19 I shall speak at the same time to Amendment No. 20. In Clause 3 we move on from the extension of local authority powers to restrictions on those powers. My first point on this clause concerns subsection (1), where it is made clear that the new power of well-being is not to enable a local authority to do anything that it would be unable to do by virtue of a prohibition, restriction or limitation contained in another enactment.
Amendment No. 19 seeks to make the position clear as to when prohibitions, restrictions and limitations may apply by inserting the word, "specific". I have little hope that the Government will find this an attractive amendment because I appreciate that, in future legislation, they would not want to have to return constantly to this enactment in order to spell out those restrictions, notwithstanding Clause 2 of this Bill. Nevertheless, I should like to make the point that it would be unfortunate if, in the future, confusion were to arise as to whether a restriction is one that will bite for the purposes of Clauses 3 and 2.
The purpose of Amendment No. 20 is to clarify what is meant by the term "limitation", and in effect the amendment deletes that word. The words "prohibition", "restriction" and "limitation" could amount to a long list of circumstances in which the new powers could not be exercised. What is a limitation if it is not a restriction or a prohibition?
In particular, in explaining the aim of the clause and its impact in terms of achieving the laudable aims of the White Paper, can the Minister assure the Committee that the impact of Clause 2 would not be significantly reduced? Are the limitations both explicit and implicit? If Clause 2 is intended to give councils greater flexibility, will their community well-being powers be undermined by allowing implicit limitations?
Finally, how will this relate to resources? Councils will need to find resources for the process of checking whether there are any limitations. We are concerned at the expense and delay that might be incurred if councils wished to exercise the new well-being power but felt that they needed to be careful about the question of limitations. I beg to move.
5.45 p.m.
Baroness Farrington of Ribbleton: Unfortunately, the Government cannot accept Amendments Nos. 19 and 20. The wording of Clause 3(1) is very clear as to which restrictions in other legislation will limit the scope of the well-being power in Clause 2.
Local authorities may not use the ell-being power to get round any prohibition, restriction or limitation contained in any other enactment; in other words, any prohibition spelt out within another piece of local government statute. These are restrictions that have been expressly laid down by Parliament as necessary checks on authorities' various activities.
These checks may take a variety of forms. For example, some statutes expressly prohibit an authority from undertaking a particular activity. Those
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prohibitions will apply also to the well-being power. In other cases, local authorities are expressly restricted in the action they may take. For example, conditions may be attached which restrict authorities' freedom of action by requiring them to do things in a certain way. Finally, powers may be limited by the express requirements of other legislation. For example, the requirement to achieve best value under the terms of the Local Government Act 1999.
I suspect that it is these express, rather than specific, prohibitions and restrictions that formed the basis for the noble Baroness tabling Amendment No. 19. This amendment would not add anything to what is already enshrined in the Bill, nor would a reference to express restrictions. Both are unnecessary and would be more likely to confuse the very objective that the Government and the noble Baroness want to achieve.
The use of the words "prohibition", "restriction" and "limitation" is purposely broad. It is supposed to avoid future legal argument about whether a condition—expressly stated in other legislation—is a "restriction" or a "limitation". I hope that answers the question of the noble Baroness. It appears that the noble Baroness is seeking a definition as to why the terms were used in previous legislation. I fear that that could very considerably lengthen my reply, which nobody would wish.
If accepted, Amendment No. 20 might open up the scope for such arguments, and as such we feel unable to accept it. With these explanations, I hope that the noble Baroness can be persuaded to withdraw Amendment No. 19 and not to move Amendment No. 20.
Baroness Hamwee: I can tell the Minister that I shall withdraw Amendment No. 19 because her response has not surprised me. However, I reiterate my concern that, given the increasing pace of legislation, Parliament should be clear on how new legislation affects previous enactments.
As regards Amendment No. 20, I remain unclear about the difference between a restriction and a limitation. Here I am expressing not only a lack of understanding on my part, because this point has been raised by local government bodies. I take the Minister's point that a long explanation might prove rather tedious for the Committee, but I believe that it is an important matter. I wonder whether I may ask the noble Baroness to write to me following this stage. It is a matter of considerable concern, and I should not like to let the concern linger if there is a way of dealing with it.
Baroness Farrington of Ribbleton: We shall be delighted to write to the noble Baroness.
Baroness Hamwee: I thank the Minister for that response. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 20 not moved.]
Baroness Hamwee Baroness Hamwee moved Amendment No. 21:
Page 2, leave out line 29 and insert ("passed or made after the enactment of this Act.").
The noble Baroness said: I can be even briefer in moving this amendment. Clause 3(1) makes it clear that the enactments with which we are dealing, which might provide prohibitions, restrictions and limitations, are enactments, whenever passed or made. My amendment would seek to change that to enactments made or passed after the enactment of this Act. This is again a plea for certainty and clarity. If there are already prohibitions, restrictions and limitations which would apply, I think that they should be recorded, not necessarily on the face of the Bill but at this or at a subsequent stage, through guidance to local authorities as to where they might find the prohibitions, restrictions and limitations which are relevant. I think that the Government have a responsibility to assist local authorities in assessing what existing enactments will affect them. I beg to move.
Lord Whitty: As we have always indicated, we wish to give local authorities a fairly wide-ranging power in relation to well-being. Nevertheless, we have always indicated that it would not be a power to do absolutely everything and anything. There have to be some safeguards. Those safeguards must include areas which have already been limited by preceding legislation. That is why Clause 3(1) keeps in place those restrictions which have been laid down by Parliament, subject to something else I wish to say in a moment.
Were we to go through all the areas of previous legislation which qualify or restrict the role of local authorities, I suspect that the kind of schedule the noble Baroness is looking for would be somewhat lengthy. Therefore I think we have to rely on this being expressed in general terms. One very obvious provision that her deletion would remove is the restriction on local authorities being able to publish material of a party political nature. Clearly that is not the intention of the power of well-being. Likewise there will be more detailed aspects which exist to restrict local authority activity within existing legislation.
We do recognise the need to remove some of this legislation. That is indeed why we have included the powers in Clauses 5 and 6 for the Secretary of State to do so. We are already engaged in a raft of initiatives to identify suitable candidates for removal from the statute book. We believe that it is only right that any proposals to legislate in this way to remove those restrictions must be scrutinised by Parliament rather than, as the amendment of the noble Baroness would do, simply wipe out all previous legislation and start from day zero.
On reflection I think the noble Baroness, Lady Hamwee, may feel she does not wish to pursue this amendment and will recognise the importance of retaining this cross-reference to existing legislation.
Baroness Hamwee: I am sure the Minister will understand that one has to find a device to ask the
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question, even if one does not have particular faith in one's own drafting. It is not an amendment that I would wish seriously to see incorporated in the final form of the Bill. However, it has enabled me to make the point that this might be an occasion for guidance. No doubt there will be occasions when local authorities will be unclear as to whether or not they are already prohibited by existing legislation from pursuing the power which they were so happy to have received a few lines earlier in the Bill. I am not sure whether I have taken the argument further, but I have only taken four minutes over it. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (Baroness Serota): In calling Amendment No. 22, I should point out that, if the amendment is agreed to, I cannot call Amendments Nos. 23 or 24.
Baroness Hamwee Baroness Hamwee moved Amendment No. 22:
Page 2, line 30, leave out subsection (2).
The noble Baroness said: Amendment No. 22 is grouped with Amendments Nos. 23, 24 and 25. I shall speak also to Amendment No. 24. Amendments Nos. 23 and 25 stand in the name of the noble Baroness, Lady Hanham. At some point during the proceedings on the Bill I am sure that someone will mix up our names.
Amendment No. 22 deals with Clause 3(2), which provides that the power of well-being does not enable a local authority to raise money, whether by precepts, borrowing or otherwise. We on these Benches have objections in principle and indeed in detail to this subsection. Our objection in principle is the tight grip which central government keeps on local government expenditure, a degree of control which we think is wrong, unnecessary and not appropriate for good government. I recognise that the clause, if less formal language was being used, might say that the power under Clause 2(1) does not of itself enable a local authority to raise money, or something similar. What the subsection says is that it does not actually alter the situation one way or the other. To that extent it is neutral. If I am right in saying that it is neutral, my objection in principle is to raise a concern about what it might add to Clause 3(1). For instance, does it stop a local authority charging at its discretion to cover its costs for activities to promote well-being, or is a local authority perhaps to be in the position of having to operate such activities at a loss?
This point has been made to me by those who are far more expert than I am in the local government world. They point out that discretionary initiatives, particularly those developed in partnership-working, may well depend on recovering costs. Charging is the most effective way to recover costs. One of the examples given is the village shop initiative which rural authorities may seek to pursue—the type of, as it is described, "social handyman service" that councils have wanted to provide to assist elderly people and others in need who would not otherwise be entitled to this type of service.
Are local authorities to be restricted by this provision from generating a surplus? I think that clarity in this matter would be helpful. There is a real anxiety that the subsection will prevent councils from raising partnership contributions to activities and could undo the good that the earlier part of the Bill will undoubtedly do. I beg to move.
Lord Dixon-Smith: I must congratulate the noble Baroness, Lady Hamwee, on getting to the Public Bill Office with this amendment before we did. As a result, her name appears, quite properly, to lead on the amendment. Nonetheless, it is an amendment which we too have tabled for precisely similar reasons, although I shall hope to use somewhat different arguments to support the case for removing subsection (2) of Clause 3 from the Bill.
We are back in the position that we were in on the Greater London Authority Bill. That Bill gave the Greater London Authority powers and then the Government immediately prescribed what I described as an "anti-power". Here we are again. The Bill gives local authorities the power to promote well-being—it is not an absolute power of general competence but it goes a long way towards that—and then in the next clause it says, "Well, you have this power but you cannot spend anything on this matter". One might think that that is what the clause means, but that is not what it says. It says that a local authority may not raise money, whether by precept, borrowing or otherwise.
The noble Bareness, Lady Hamwee, referred to one or two benefits which local authorities in rural areas might wish to provide, such as community shops. A local authority might well wish to provide community buses under the power. The ones that I know are run by parish councils, which operate under a different remit. With this power I can see local authorities wishing to undertake a number of such actions. We would wish them to undertake such actions.
It occurred to me that in subsection (2) the Government are somewhat cynically seeking to control what will happen. It is an easy presumption to make that if an authority cannot raise money, whether by precept, borrowing or otherwise, and cannot spend anything, it cannot do very much at all. However, on reflection, I came to the conclusion that that is not so, which gives me even more reason to believe that the clause should not be in the Bill.
A cynic might say that with this power the Government are seeking to control what is spent by local authorities, by trickling money down to them through the revenue support grant. That may be what is in the Government's mind. But the revenue support grant is, largely speaking, a general grant. A local authority has the power to do with a large chunk of the revenue support grant what it chooses to do with it. It could very well choose to spend some of the general part of the revenue support grant on exercising the power under Clause 2. If that caused it to have marginally to raise its precept to deal with its normal line of business, that would be perfectly proper. I see nods of agreement coming from one or two noble
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Lords who are members of local authorities. One or two of them are already thinking that that is how they will have to operate.
During the proceedings on the Greater London Authority Bill we debated this issue almost to the point of exhaustion. The Government were not inclined to give way then and so I am not hopeful that they will give way now. But I think that they should. They have plenty of other powers by which they can constrain local government expenditure if that is required. In the previous Session we passed a Bill specifically to give them that power. We resisted it then and I think that we should resist it again on this occasion. I cannot see that subsection (2) adds anything useful or constructive to the Bill. The worst aspect of it is that it will treat councils and councillors as if they are babes, as if they are irresponsible and as if they are not to be trusted. Worse than that, it treats their electorates with the same contempt. Councillors are responsible to their electorates for their actions. Their electorates can discriminate; they are discriminating; and they know how to take action if local authorities do not behave responsibly.
The worst aspect of subsection (2) is that it destroys the amour propre of local government and local communities. If one wants people to behave responsibly, one must make them responsible. If one wants to make them responsible, one must take Clause 3(2) out of the Bill and let them make their own judgment. I am happy to support the noble Baroness, Lady Hamwee.
6 p.m.
Baroness Hanham: Perhaps I may speak to my amendment, Amendment No. 23, which is in the same group. My amendment expands on what has already been proposed by the noble Baroness, Lady Hamwee, and on some of what has been said by the noble Lord, Lord Dixon-Smith. Where one has a power of well-being, the power to charge must be a sine qua non of that. My amendment would address as well the problems which have occurred since the House of Lords' decision in 1992 in the case of R v. London Borough Richmond-upon-Thames ex parte McCarthy and Stone—I am sure that all noble Lords will be familiar with it—that it was unlawful for a local authority to charge for planning advice. Although there is a power for local authorities to give planning advice, in relation to which they make take a substantial amount of time and have detailed discussion, they may not charge for that time. That example could be relevant to any aspect of what has been included in Clause 2(1) and the powers of competence and well-being.
The decision in that case has resulted in doubts as to whether local authorities can charge for other matters, such as commercial filming in their streets—something which they may want to do—inspection of works by statutory undertakers and supervision of parking bays; for example, the suspension of parking bays for contractors. My amendment would enable councils to

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collect reasonable payments, as the noble Baroness, Lady Hamwee, suggested, for work done under these clauses.
It is reasonable to give local authorities the opportunity to charge for what they do. Although under statute they are able to charge for some services, they cannot charge for all. I have cited some of those services to the Committee. Although what I have suggested may stretch what is proposed just a trifle, I wonder whether it could be taken into account.
Lord Smith of Leigh: I have some sympathy with what has been said by the noble Baroness, Lady Hamwee, and the noble Lord, Lord Dixon-Smith. The noble Baroness referred to the tight grip on local government. I should remind the Committee that the tight grip is loosening a little, but it is perhaps not quite loose enough yet. It is not the purpose of the Bill to review the arrangements for local government finance. I am confident that my noble friend the Minister and his colleagues in the Department of the Environment, Transport and the Regions are considering that matter and will report at the end of the three-year period.
In seeking what are proper restrictions on the use of the powers of local authorities, we should ensure that we are not too prescriptive. I share the concern of the noble Lord, Lord Dixon-Smith, when he says that local authorities are acting democratically and in public. I am particularly concerned by the words "or otherwise". If the Government seek to restrain the raising of money by precepts or borrowing, I think it is proper to do so. There may be other areas which the Government seek to restrict, but rather than adding the words "or otherwise", they should come clean now and list what those restrictions will be.
In recent years, when the party opposite was in government, local authorities were forced to get used to a certain amount of creativity as regards funding. But there are concerns, particularly given the function of well-being, that additional services that we begin to provide should be charged on a proper basis. We already charge for certain services that we provide, and we need to understand to what extent the restriction will apply. If there is joint activity with another partner, to what extent will partners be able to fund into that? Is that raising money? What about European funding, and so on? The phrase is rather too much of a catch-all. I should welcome the Minister's assurance that there could be greater precision in the limitation.
Lord Hanningfield: I support my noble friend Lord Dixon-Smith. In a recent debate, the noble Lord, Lord Harris of Haringey, talked about developing a small industrial site, which could be an important issue in this area of development and promoting the economic well-being of an area. The inclusion of "otherwise" could mean that rents could not even be charged for the building of the properties. The whole area is of great concern.
Earlier today, we debated the extra powers being given to local government. I feel, as most speakers have said, that the provision constrains our powers so
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much that perhaps the power might not be worth having. I support my noble friend Lord Dixon-Smith in his call for the removal of the subsection.
Baroness Farrington of Ribbleton: There is no limit on what local authorities can spend under the well-being power, but the point of the power is to give them discretion. In answer to the noble Baroness, Lady Hamwee, the proposals are neutral; all we are saying is that authorities may not use the power itself to raise money.
The noble Lord, Lord Dixon-Smith, raised the question of whether this was a kind of "anti-power". It certainly is not. Local authorities have plenty of specific powers which allow them to raise money, and there is nothing to stop them using those powers in tandem with the well-being power.
The noble Lord is very effective in putting across the case of someone who was not a gamekeeper and has not become a poacher. All I can say is that he walked, talked, lived, supported and encouraged others to support the gamekeepers during his time. I pay tribute to the fact that the noble Lord challenged his own government on parts of their policy relating to expenditure and local authorities. However, he cannot deny that there is at least a little of the gamekeeper in his history, as I believe the noble Lord, Lord Hanningfield, too, would readily accept.
The limitation in subsection (2) merely stops local authorities using the well-being power to raise money, whether by precepts, borrowing or otherwise. There are good reasons for that, which mean that the Government cannot accept Amendment No. 22 or Amendments Nos. 23, 24 and 25. We do not believe that authorities should be able to use the well-being power to impose new taxes on individuals or business. The power to tax should be subject to the specific approval of Parliament. Arguably, Amendment No. 22 would place that decision in the hands of local authorities.
Nor do we see merit in allowing authorities to use the well-being power in itself as a means of borrowing. There are specific terms and conditions around local government's power to borrow. There are two clear reasons for such controls, as my noble friend Lord Smith generously indicated. First, they ensure that authorities act prudently, so that local communities are not faced with an excessive burden of debt charges in future years; secondly, they help to ensure that the Chancellor's objectives for the national economy are achieved—both the "golden rule" that borrowing should only be for investment, not for day-to-day spending, and the rule that public sector debt should be kept at a prudent and stable level over the years.
However, we are keen to look for alternatives to the present system of controls on local government capital finance, which would continue to meet the same broad prudential and macro-economic objectives but in a simpler and less restrictive way. We are exploring that with the LGA as part of our wider review of local government and it will be included in this summer's Green Paper.

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My noble friend Lord Smith, the noble Lord, Lord Hanningfield, and the noble Baroness, Lady Hanham, rightly emphasised the difficult issues and complexities that surround the issue of charging. We accept that the current basis on which authorities can or cannot charge for the services that they provide is confused and unduly restrictive. The problems were clearly highlighted in the recent report of the Audit Commission, The Price is Right: charges for council services.
In response to the noble Lord, Lord Dixon-Smith, and the noble Baroness, Lady Hamwee, the Government are determined to place charging on a more rational footing. To that end we are looking at the issues as part of the wider review of local government finance that is under way. As I said, local government is fully involved in the process. I believe that representatives of the LGA are meeting tomorrow with the department as part of a joint task group examining the issues around local authority charging. In response to my noble friend Lord Smith, we are determined to make rapid progress on this issue and to bring forward proposals in the local government finance review Green Paper this summer.
In response to the noble Baroness, Lady Hamwee, let me make it absolutely clear that the well-being power does not prevent local authorities from charging for services. They simply cannot use the power itself as a means for doing so. Under Section 150 of the Local Government and Housing Act 1989 the Government can make regulations to allow authorities to charge for services that they provide, although that power cannot be used in respect of some specified functions, including education in schools and fire-fighting. Local authorities can continue to use their powers under the Local Authorities (Goods and Services) Act 1970 to charge for services that they provide to other public sector bodies.
I apologise for responding at length. I hope that it has been helpful to set out the way in which the Government intend to tackle as a matter of urgency some of the issues raised in the debate. I hope that, with the assurances that I have given, the noble Baroness will be persuaded to withdraw Amendment No. 22 and that Amendments Nos. 23, 24 and 25 will not be moved.
6.15 p.m.
Lord Dixon-Smith: Before the noble Baroness sits down, perhaps she will accept that we are stepping on thin ice when we get into the business of metaphors. "Poacher turned gamekeeper" is all very well, but I prefer "pots" and "kettles". If I have a touch of the gamekeeper in my history, the noble Baroness has a considerable amount of the poacher in hers. I have tried very hard to see whether I can add a fourth metaphor so as to have real mixture, but I cannot.
Baroness Farrington of Ribbleton: I feared for a moment that the noble Lord was going to look at me and in all innocence say, "Set a thief to catch a thief".
Lord Hanningfield: I am grateful to the noble Baroness for her response. As vice-chairman of the
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Local Government Association I am involved in some of the discussions that are taking place. My understanding is that some of these matters will take some years to deal with, and that there will even be legislation before there is any new kind of local government finance Act. Is the noble Baroness saying that it may take that long to sort out the charging policy? If so, the wording in the clause as presently drafted needs to be examined. We want this Local Government Bill to be actionable before very long. Can the noble Baroness give a possible timetable on the local government finance review?
Baroness Farrington of Ribbleton: I informed the Committee earlier that the Government hoped to bring forward proposals in the summer.
Baroness Hamwee: I cannot think of any suitable metaphors. I am sure that comments can be made about choosing friends but not relations, but I cannot work out what they are. As to charging, I am very familiar with R v. LB Richmond-upon-Thames ex parte McCarthy and Stone. I believe that the charge was only £25 per hour. I always understood the former Department of the Environment, now the DETR, to be very sympathetic to the problems that faced local authorities as a result of the restrictions on charging. Like the noble Lord, Lord Hanningfield, I believe that it would be sad if the opportunity was not taken to correct the position. There appears to be little opposition to the underlying proposal.
The Minister has confirmed that Clause 3(2) does not make any difference either way, and that is the assurance that I seek. However, having listened to the debate, doubt has been cast on it—I am sure the Minister understands that I do not attack her integrityߞby the words in parenthesis. If the position is neutral and Clause 2 does not of itself allow a local authority to raise money or restrict it so doing, why is it necessary to say,
"whether by precepts, borrowing or otherwise"?
Clearly, those words trouble Members of the Committee who have sought to understand the thrust of the provision. I do not ask the noble Baroness to comment further on that matter, but at a later stage I shall seek to table an amendment to remove the words in parenthesis. If the provision is neutral, those words appear to be unnecessary. At this stage, I beg leave to withdraw the amendment.
The Deputy Chairman of Committees: Is it the Committee's pleasure that the amendment be withdrawn?
Lord Dixon-Smith: Not-Content.
6.21 p.m.
On Question, Whether the said amendment (No. 22) shall be agreed to?
Their Lordships divided: Contents, 84; Not-Contents, 108.

Division No. 2

CONTENTS

Allenby of Megiddo, V.

Kimball, L.

Alton of Liverpool, L.

Lamont of Lerwick, L.

Beaumont of Whitley, L.

Lang of Monkton, L.

Belstead, L.

Lawson of Blaby, L.

Biffen, L.

Luke, L.

Blatch, B.

Mackay of Ardbrecknish, L.

Boardman, L.

Mackay of Drumadoon, L.

Bowness, L.

Montrose, D.

Brabazon of Tara, L.

Moynihan, L.

Bridgeman, V.

Newton of Braintree, L.

Buscombe, B.

Norfolk, D.

Byford, B.

Northbrook, L.

Carnarvon, E.

Northesk, E.

Carr of Hadley.L.

Norton of Louth, L.

Cavendish of Furness, L.

O'Cathain, B.

Colwyn, L.

Onslow, E.

Cope of Berkeley, L.

Onslow of Woking, L.

Courtown, E.

Palmer, L.

Cox, B.

Park of Monmouth, B.

Crickhowell, L.

Peel, E.

Dacre of Glanton, L.

Pilkington of Oxenford, L.

Denham, L.

Plumb, L.

Dixon-Smith, L.

Plummer of St. Marylebone, L

Elton, L.

Rawlings, B.

Feldman, L.

Rees, L.

Fookes, B.

Renfrew of Kaimsthorn, L.

Forsyth of Drumlean, L.

Renton, L.

Fraser of Carmyllie, L.

Roberts of Conwy, L.

Gardner of Parkes, B.

Rotherwick, L.

Glentoran, L.

Saltoun of Abernethy, Ly.

Gray of Contin, L.

Seccombe, B.[Teller]

Greenway, L.

Selsdon, L.

Hanham, B

Shaw of Northstead, L.

Hanningfield, L.

Stewartby, L.

Henley, L.[Teller]

Stodart of Leaston, L.

Hogg, B.

Strathclyde, L.

Hooper, B.

Swinfen, L.

Howe, E.

Taylor of Warwick, L.

Hunt of Tanworth, L.

Thomas of Gwydir, L.

Hunt ofWirral, L.

Tugendhat, L.

Hurd ofWestwell, L.

Wakeham, L.

Jopling, L.

Young, B.

NOT-CONTENTS

Ahmed, L.

Dormand of Easington, L.

Alli, L.

Dubs, L.

Amos, B.

Elder, L.

Archer of Sandwell, L.

Evans of Parkside, L.

Ashley of Stoke, L.

Evans of Watford, L.

Ashton of Upholland, B.

Farrington of Ribbleton, B

Bach, L.

Faulkner of Worcester, L.

Barnett, L.

Filkin, L.

Bassam of Brighton, L.

Gale, B.

Blackstone, B.

Gavron, L.

Borrie, L.

Gould of Potternewton, B.

Bragg, L.

Graham of Edmonton, L.

Brooke of Alverthorpe, L.

Gregson, L.

Brookman, L.

Hardy of Wath, L.

Brooks of Tremorfa, L.

Harris of Haringey, L.

Burlison, L.

Harrison, L.

Carter, L. [Teller]

Hayman, B.

Clarke of Hampstead, L.

Hilton of Eggardon, B.

Cocks of Hartcliffe, L.

Hogg of Cumbernauld, L.

Crawley, B.

Hollis of Heigham, B.

Currie of Marylebone, L.

Howells of St Davids, B.

Davies of Coity, L.

Howie of Troon, L.

Davies of Oldham, L.

Hoyle, L.

Dean of Thomton-le-Fylde, B.

Hughes of Woodside, L.

Desai, L.

Hunt of Kings Heath, L.

Dixon, L.

Irvine of Lairg, L. (Lord chancellor)

Donoughue, L.

1470

Jeger, B.

Rea, L.

Kennedy of The Shaws, B.

Rendell of Babergh, B.

King of West Bromwich, L.

Renwick of Clifton, L.

Laird, L.

Rogers of Riverside, L.

Lea of Crondall, L.

Sawyer, L.

Lincoln, Bp.

Scotland of Asthal, B.

Lipsey, L.

Serota, B.

Lockwood, B.

Shepherd, L.

Lofthouse of Pontefract, L.

Simon, V.

McCarthy, L.

Smith of Gilmorehill, B.

Mclntosh of Haringey, L.

Smith of Leigh, L.

[Teller]

Stoddart of Swindon, L.

MacKenzie of Culkein, L.

Stone of Blackheath, L.

Mackenzie of Framwellgate, L.

Strange, B.

Mason of Barnsley, L.

Taylor of Blackburn, L.

Massey of Darwen, B.

Thornton, B.

Merlyn-Rees, L.

Tomlinson, L.

Milner of Leeds, L.

Turner of Camden, B.

Molloy, L.

Varley, L.

Nicol, B.

Walker of Doncaster, L.

Orme, L.

Warwick of Undercliffe, B

Patel, L.

Whitaker, B.

Peston, L.

Whitty, L.

Pitkeathley, B.

Wilkins, B.

Plant of Highfield, L.

Williams of Elvel, L.

Prys-Davies, L.

Williams of Mostyn, L.

Ramsay of Cartvale, B.

Woolmer of Leeds, L.

Randall of St. Budeaux, L.

Young of Old Scone, B.

Resolved in the negative, and amendment disagreed to accordingly.
6.32 p.m.
[Amendments Nos. 23 to 26 not moved.]
Baroness Hamwee Baroness Hamwee moved Amendment No. 27:
Page 2, line 32, leave out subsection (3).
The noble Baroness said: The amendment seeks to leave out subsection (3) of Clause 3 which states:
"The Secretary of State may by order make provision preventing local authorities from doing, by virtue of section 2(1)"—
the well-being power—
"anything which is specified, or is of a description specified, in the order".
I feel strongly about the extensive powers that the Government reserve to themselves—they are clear and obvious—by giving with one hand and reserving the right to take away with the other through secondary legislation. I accept that the Government have tabled an amendment which provides that that is to be by affirmative resolution.
What happened to trust by central government of local government, and confidence of central government in themselves? Government will claim the credit for allowing local authorities to exercise new powers. They will claim the credit, and rightly, for addressing the issue of the extent of local authority powers and for assisting local authorities to act in a community leadership role. But they cannot help but retain to themselves the control provided by this clause.
I am not alone in tabling the amendment. I do not suggest that the Conservative Front Bench has the same thoughts as me; I am sure it has better thoughts. However, the effect is the same. By this amendment, I

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seek to ask what the Government have in mind. During the passage of the Bill, are we likely to see draft orders; or is there some general reserve power that the Government feel they had better have in case they have made a mistake in Clause 2? It might be a long debate but it need be only a short debate. As we have said on many occasions previously, the issue comes back to the question of trust. I beg to move.
Lord Dixon-Smith: As with the previous amendment, the noble Baroness got to the Government Public Bill Office before us with the amendment. She covered much of what I wish to say. However, I shall take the time of the Committee to say it slightly differently.
It is depressing to find such a provision in a Bill because it reveals a sad fact: that Government have no faith in local government. If they had such faith, the provision would not be in the Bill. I sometimes wonder whether, by their actions, Government have faith in anything. I suppose that in the nature of politics, politicians become cynical and governments are probably the most cynical of all. That is regrettable and sad, and I think that the country would be a happier, more con tented place if we did not see this kind of provision in legislation, and if local authorities, which are constituted to undertake certain functions, that we seek to extend, were permitted to get on quietly with their business and to behave as adults. Subsection (3) takes away that status from local government. I find that very sad.
We do not know what the Secretary of State will order under the clause. We have the huge volumes of information in the book which deals with Part II and Clauses 66 and 67. But we have nothing on Part I and most of the other parts of the Bill. We have no guidance as to what the Secretary of State may do. By some freak of good fortune, one could hope that he might do nothing. He has that option. If so, I am sure we should all be content.
Unfortunately, people who have served in local government find that after a time they become cynical. Even worse, they become cynical about government and their motives. I am careful not to ascribe any political connotation to those motivations. This is one of the facts of life. In reality, it is sad that that is so because it is an area where Government and local government have a community of interest. They should be able to work together amicably. Just as local government would prefer not to see this provision on the face of the statute, central government should feel, equally, that it was not necessary to have it there. I suspect that it will take a great change of attitudes by both sides before that somewhat Utopian situation arises. In the meantime, the cynics have it. I support the amendment. I hope that the Government will listen with care to what we have said, and agree with us.
Baroness Maddock: As one who served in local government under the previous government, it takes my breath away to hear protestations about the powers of Ministers. Can the noble Lord say whether the Secretary of State will have the power to repeal
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previous legislation as regards the power of local government and the requirement to produce reports and so forth? It is important to know whether that is the case. If the noble Lord cannot answer today, perhaps he can provide a list of measures that the Secretary of State can repeal.
Lord Whitty: It is the case that under this clause the Minister can repeal existing legislation if he is convinced that it is inhibiting the proper exercise of powers of well-being. However, the amendment does not address that power; it addresses a power to restrict in extremis the role of local authorities in pursuing the power. Clearly, there are some restrictions, which are the areas of legislation that have not been removed by the Secretary of State. This is a reserve power.
I slightly resent the noble Lord, Lord Dixon-Smith, calling my noble friend Lady Farrington and myself cynics. We may be worldly wise, but we are not cynics. Indeed, I maintain that the whole Bill is a leap of faith in relation to local authorities and a big indication of the Government's confidence that they can rise to the challenge. But even a leap of faith requires the occasional emergency parachute.
On this occasion, it is this power. It is a reserve power and not one that should be used frequently, if ever. It provides for an unforeseen situation that is not covered by the restrictions in the Bill. Despite all the confidence that the noble Lord, Lord Dixon-Smith, and Members on all sides of the Committee have in the common sense of local government, it provides for a decision conceivably taken at some time in the future, exercised under the well-being power, but patently against the interests of either the inhabitants of the locality or the nation as a whole. Therefore, the Secretary of State requires a reserve power.
I must say that for the life of me I cannot give an example. Indeed, this morning I asked my advisers to do so and they looked at me patiently and said, "How can we possibly give you an example of an unforeseen circumstance?". Nevertheless—
Lord Dixon-Smith: Would the Minister consider Ken Livingstone to be an unforeseen circumstance?
Lord Whitty: I must be careful about how I respond to that, but I do not believe that Ken Livingstone could conceivably be an unforeseen circumstance. The way in which people view that circumstance may vary.
To underline the fact that this is a reserve power, the Government have put forward an amendment to make it clear that it will be exercised only through the specific or affirmative resolution procedure. That indicates to the Committee the rarity with which we would use it and the safeguards which Parliament has on its use. I hope that in the light of that explanation the noble Baroness will not pursue her amendment.
Baroness Hamwee: I should be happier if the Government could come up not only with proposals for affirmative resolutions, but also with a way of saying that, despite the extreme power they propose to

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give to the Secretary of State—perhaps one less enamoured of local government than the current one—this is just a parachute; it is to provide for an extreme position, or in extremis, as the Minister said. There is nothing in the clause or in reserve powers written into other legislation which can give the cynical tendency of the Committee—and I admit to being a member—the confidence that it is to be exercised only in extremis. That is why I find a provision such as subsection (3) offensive.
I shall not seek to press the matter now. I hope that the Government will find language to express the fact that it is a reserve power. We might have to return to the issue, but I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
6.45 p.m.
Baroness Hamwee Baroness Hamwee moved Amendment No. 28:
Page 2, line 32, after ("order") insert ("laid in draft before, and approved by a resolution of, each House of Parliament").
The noble Baroness said: This amendment will be overtaken by the Government's Amendment No. 368, which I shall be happy to support. However, it is worth saying a few words about Amendment No. 29. I tabled it as an alternative, but it deals with an important point. Before an order is made, the Secretary of State will consult in particular representatives of local government. I hope that the Minister will take this opportunity to give the Committee assurances about that. I beg to move Amendment No. 28 as a curtain raiser to Amendment No. 368.
Lord Whitty: I am grateful to the noble Baroness for giving me a curtain raiser. I hope that during the previous debate and in our memorandum to the Delegated Powers and Deregulation Committee the Government indicated their belief that Parliament should have the opportunity to debate and scrutinise any proposal made under Clause 3(3). Amendment No. 368 gives effect to this, providing that any order made under the clause will not take effect until it has been approved by resolution of both Houses of Parliament. I am grateful to the noble Baroness for indicating that in the light of that she will withdraw her amendment.
I turn to Amendment No. 29. The Government would expect as a matter of course to consult local government and any other bodies likely to be affected by regulations brought forward under Clause 3(3). I recognise that elsewhere in Part I we have spelt out the requirement to consult and I therefore have some sympathy with Amendment No. 29 and the intentions behind it. If the noble Baroness is amenable to the suggestion, I should like to reflect on the matter and consider how best the intention can be worded. I hope that on that basis she will not move the amendment.
Baroness Hamwee: I am happy to proceed on that basis. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 29 not moved.]
The Deputy Chairman of Committees: I should point out to the Committee that if Amendment No. 30 is agreed to I cannot call Amendment No. 31.
Baroness Hanham Baroness Hanham moved Amendment No. 30:
Page 2, line 35, leave out subsections (4) and (5).
The noble Baroness said: In moving Amendment No. 30 I shall speak also to Amendment No. 40 which deals with the same issue. When I saw the guidance for Part II of the Bill this morning, I thought that without doubt the Government would accept my amendment on the basis that that was all the guidance that would appear. However, I fear that it may not be the beginning and the end of the guidance which may fall on the heads of local authorities. It is therefore to try to prevent too much guidance from being dished out on this part of the Bill that I seek to remove the powers which enable the Government to provide guidance on it.
If we have now given the power relating to well-being to local authorities, we must trust local authorities to carry out that power without telling them in minute detail how to do so or what to do. I therefore hope that no guidance will be issued on that power and that there will be no nannying of local authorities. As was said about a previous provision, I hope that the Government will trust local authorities to carry out their power relating to well-being. I hope that we shall delete subsections (4) and (5) of Clause 3 and subsections (2)(b) and (3) of Clause 4. I beg to move.
Lord Dixon-Smith: My Amendments Nos. 32 and 41 are grouped with this amendment. They are two small amendments which will not take up the Committee's time for more than a few moments. The first seeks to state that guidance under this section will be regarded as advisory. Guidance is in my view perforce advisory and I suspect that that is what the Minister will say. If one has to deal with planning guidance, so many issues are involved that a planning authority has to strike the best balance it can between them. The guidance cannot be in any way mandatory.
That said, there is a tendency for local authorities to regard guidance as the tablets of stone come down from Mount Sinai. In the days when those tablets were written, life was rather more simple; there were not so many people about and not so many conflicting interests. Some fairly straight precepts of behaviour were perfectly practical. Without knowing in what state the Israelites lived and their ethical standards as they left Egypt on their long trek, I have no doubt that those tablets of stone had validity at the time, as indeed they still do today. But government guidance is another matter. It is not in quite the same category, despite the tendency of some local authorities to believe that it might be.
Amendment No. 41 seeks to change the word "must" to "may", simply to provide flexibility. Instead of using the word "must", which is mandatory, we

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suggest changing it to "may", which is optional. Local authorities may then listen and consider carefully what the guidance says but they will have a little more responsibility for what they do with it. That is one of the provisions for which I have been pressing for a long time and for which I shall no doubt continue to press. We may have this debate on many occasions in the future.
Lord Whitty: I am afraid that I take a different view on guidance. The noble Lord, Lord Dixon-Smith, referred to the tablets of stone; for a moment he probably thought that we were in the Moses Room.
If I remember my scriptures rightly, the tribes of Israel then took 40 years to reach the promised land on the basis of the information on the tablets of stone. I believe that we need to guide local authorities a little more gently and in a little more detail for them to be able to exercise their powers in relation to community planning and well-being. We therefore need to have some greater certainty and clarity about what we are after; not only for local authorities themselves but also for their partners in the public and private sectors with which the powers give them greater scope to work. They need to have some degree of certainty as to which powers are available and we should do better to spell it out in guidance rather than have a colossal amount of information on the face of the Bill.
We have in mind two distinct areas where there should be further guidance in respect of the well-being power. The first relates to the fact that the closest approximation to the new broad power under pre-existing legislation is the power under Section 137 of the Local Government Act 1972. A number of difficult decisions and a certain amount of confusion have ensued over whether or not local authorities actually have that power. That particularly applies to partner bodies. We need to ensure that people are clear about that. It is therefore the Government's intention that authorities should be able to use their new broad powers to engage in a range of activities, but also that they and others should be clear which powers they have and which they do not.
Secondly, it is important to note that local authorities have a key role to play in delivering many of the Government's objectives on issues such as social exclusion, neighbourhood renewal and supporting vulnerable groups, where a wide range of bodies are involved. It is important that the statutory guidance sets out the priorities for action and the general principles which should underpin action in those areas. With regard to community planning, the Government may want also to set out in guidance some of the principles which should underpin the preparation of community strategies.
I recognise a degree of irritation in local authorities at the length and detail of some of the guidance they receive. Nevertheless, I feel that in that new area some degree of greater clarity than we may possibly prescribe on the face of the Bill or in the schedules to the Bill would be helpful to local authorities and others. Therefore, I should resist moves by the noble Baroness and the noble Lord to remove the
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requirement on issuing guidance under those provisions. I hope that they will not pursue the amendments.
Baroness Hanham: I am grateful to the Minister for what he has said. I shall consider it and hope that his brevity will be apparent in the guidance notes which are published on this provision, if not on Part II. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 31:
Page 2, line 39, leave out first ("such").
The noble Lord said: I regret that I have managed to lose myself because I have two amendments tabled adjacently.
The Bill as drafted gives the Secretary of State power to consult only those whom he chooses. We have had this debate before. It does not require him to consult local government at large, but such local authorities as he chooses. At this stage, he should in fact be consulting local government at large. The word "such" makes matters too selective. That is why we have tabled Amendment No. 31. It is grouped with Amendment No. 42 which deals with exactly the same point; they are identical amendments. I beg to move.
Baroness Farrington of Ribbleton: I understand the desire of the noble Lord, Lord Dixon-Smith, to ensure that all relevant local government bodies are consulted on any draft guidance on the use of the well-being power and the production of community strategies. There has never been any suggestion that the Government would do otherwise. Indeed, our memorandum to the Select Committee on Delegated Powers and Deregulation made clear our commitment to consulting local authority representatives and others likely to be affected by regulations or guidance issued under Part I of the Bill.
The only practical effect of Amendments Nos. 31 and 42 would be to confuse an otherwise simple issue. It could leave the Secretary of State open to legal challenge for failure to consult certain people who claimed to be representative of a sectional interest or grouping. There is a well-established legal precedent for this formulation—most recently in the Local Government Act 1999—which for practical purposes merely retains a sensible level of discretion for the Secretary of State.
I hope that, with those reassurances, the noble Lord will feel able to withdraw Amendment No. 31 and not move Amendment No. 42, when we reach it.
7 p.m.
Lord Dixon-Smith: I apologise to the House for my confusion. Because we had been dealing with Amendments Nos. 40 and 41, I had got ahead of myself. I am grateful to the noble Baroness for her response, which I shall study with care. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 32 not moved.]
Clause 3 agreed to.
[Amendment No. 33 not moved.]
Clause 4 [Strategies for promoting well-being]:
[Amendment No. 34 not moved.]
Baroness Hamwee Baroness Hamwee moved Amendment No. 35:
Page 3, line 1, leave out ("is to have power to prepare") and insert ("shall prepare and keep under review").
The noble Baroness said: Clause 4 takes us to the part of the Bill which deals with strategies for promoting well-being. In this amendment I propose that, rather than merely giving local authorities the power to prepare such a strategy, we should require them to do so and, indeed, to keep the strategy under review. I would not normally seek to impose duties on local authorities. As your Lordships know, I argue frequently that they should be allowed to take decisions for themselves. However, as with the case of equalities, it seems to me that this strategy is so central to the purpose of the Bill that it is an exception.
The Local Government Association makes the point that a statutory basis is an essential prerequisite for establishing the community planning process across the country and, importantly, for ensuring that other partners have due regard to the process. Therefore, as I say, unusually I seek to impose a duty. I believe that that is not very far away from what the Government themselves propose. After all, I believe that the community strategy is intended to replace a number of other strategies which currently are required. I propose, too, that the strategy should be kept under review. It should be implicit in the word "prepare" that in this situation one does not simply write a document, agree it and then put it on a shelf. It would be sad if such an important document were treated in that way.
As with best value, it seems to me that strategies for promoting well-being must be treated as something of a rolling process. The very process itself is important to the value of the strategy. It must involve a range of different partners, and life does not stand still. Therefore, without wishing to suggest that it should be so formulaic as to be prepared in one year and reviewed on every third anniversary or anything of that kind, nevertheless I believe that, having created the strategy, it is appropriate for local authorities to keep it fresh in their minds and in the minds of their communities.
With regard to the regulations, in my notes I have written down "paragraph 11/", but that may not be sufficient to identify them. Therefore, I apologise to the Minister. I shall not shuffle through my papers
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now to look for them. However, I have written myself a note to ask him whether it is the community strategy that is referred to in paragraph 11.7 of the draft regulations. In any event, that is perhaps a side issue. I beg to move.
Baroness Miller of Chilthorne Domer: Will the Minister tell the Committee how many statutory duties the Government currently expect local authorities to prepare? Are there any additional duties which may not be statutory but which none the less the Government expect to see from good local authorities? Although this amendment may be criticised for imposing an extra duty, I believe that in the longer term it will have the effect of removing an extremely onerous duty of producing dozens—something in the order of three dozen—different strategies, which may not be joined up in a coherent way.
If local authorities have the powers that they will have if the Bill is passed, how will a community see and influence the way in which those powers are applied? How will it comment on them? In real life, even the most interested members of a community do not usually gather together 36 strategies and go through them laboriously. Thirty-six strategies would pile up by their beds to well beyond the height of the bedside table. If members of a community had one coherent document, perhaps available on CD, they might go through that. I believe that that is the way forward. It is very confusing to have many different strategies. I know that I do not usually want to burden local authorities with extra duties. However, I believe that, if they have been given those powers, they should be obliged to make it plain to their communities exactly what they are doing with them.
Baroness Farrington of Ribbleton: I am shocked that the noble Baroness, Lady Miller of Chilthorne Domer, does not read piled-up strategies late at night!
Baroness Hamwee: In defence of my noble friend, she did not say that she did not; she said that members of the community might not.
Baroness Farrington of Ribbleton: Perhaps I should set the record straight and say that for relaxation very late at night I prefer the books of my noble friend Lady Rendell rather than community strategies.
Amendment No. 35 would turn the power of community planning into a duty. We do not believe that such a duty would lead to better community planning. It would raise questions about how exactly that function was to be discharged. Inevitably, the Government would be drawn into prescribing minimum requirements for such strategies. That approach would run counter to the genuinely inclusive process that we want to see. If community planning is to operate effectively, local authorities must have real flexibility over the precise nature of the strategy, the level of detailed action which it contains, and how they should go about preparing it in partnership with others. They should be able to demonstrate to their communities and partners that there are real benefits

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for them in taking part in the preparation of those strategies. The discussions around community strategies will be important in establishing a consensus around what is a local priority and for mapping the action that each body will take to address those priorities and to improve local well-being.
Authorities are already required by central government to produce approximately 40 different plans or strategies. We agree that those requirements need rationalising. Clause 6 provides some opportunity to do that.
The discussions will be important. It is extremely important that community strategies are the vehicle for ensuring that all public bodies pull together. The guidance to local authorities under Clause 4(2)(b) will enable the Government to set out very broad parameters for community strategies.
In answer to the noble Baroness, Lady Hamwee, I should say that, of course, we expect local authorities to keep their strategies under review and we shall make that point in the guidance. But the 1998 local government White Paper made clear that the Government do not intend to impose upon councils any particular approach to that task. Councils will have flexibility as to the precise nature, scope and coverage of the strategy, the level of detailed actions it contains and how they go about preparing it in partnership with other organisations. The new regional development agencies and local people are clearly involved. Community strategies are required under Clause 4 and are listed in the regulations as a plan that must be adopted by the full council. I hope that that answers one of the points raised.
The noble Baroness, Lady Miller of Chilthorne Domer, drew attention to the fact that a number of authorities are involved with local strategic partnerships which bring together councils, the public sector, local businesses, voluntary organisations and local communities to tackle neighbourhood problems. We believe that the, new commitment to regeneration pathfinders is just one example. As I know the noble Baroness, Lady Miller of Chilthorne Domer, recognises, the nature of those partnerships varies from place to place, reflecting local circumstances and needs. We want to encourage local authorities and their partners to build on those arrangements. We believe that such an enabling approach is more likely to lead to worthwhile community planning than would the imposition of a further duty. We do not believe that that would aid the sort of co-operation and consensus that good and deep community planning needs if it is to succeed.
The noble Baroness, Lady Hamwee, asked about another paragraph. If she will permit me, I shall write to her about that.
Baroness Hamwee: I wonder which of the noble Baronesses sleeps the more soundly with her chosen bed-time reading material. It is probably my noble friend!
Perhaps I am becoming poacher turned gamekeeper. It seems to me rather odd that the Minister is allowing local authorities to be in a position
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where, with merely a permissive power, they can choose not to exercise it which will mean that they need not have regard to the guidance which applies when they exercise the power. In other words, by exempting themselves by choice from Clause 4(1), they also set themselves free from Clause 4(2)(b) which refers to having regard to the Secretary of State's guidance. I shall reflect on that.
The Minister suggested that my amendment imposed a level of detail on local authorities. That was certainly not the intention and I do not believe that that is the effect of the amendment. The level of detail is contained in Clause 4(2). That is the "how". My amendment does not seek to alter that in any way. We shall reflect on this matter and we may want to return to it. For the moment, I beg leave to withdraw the amendment.
Amendment, by leave; withdrawn.
The Deputy Chairman of Committees (Baroness Gardner of Parkes): I should inform the Committee that if Amendment No. 36 is agreed to, I cannot call Amendment No. 37.
7.15 p.m.
Baroness Hamwee Baroness Hamwee: moved Amendment No. 36:
Page 3 leave out line 2 and insert ("the sustainable development").
The noble Baroness said: This amendment seeks in particular to understand and perhaps to develop what is meant by the well-being strategy but also to put on the agenda the issue of sustainable development.
It seems to me that the sum total of these aspects of well-being and, indeed, the process of achieving them amount to sustainable development. Perhaps I may put the matter in another way and ask how those three aspects of well-being differ from sustainable development in Clause 2(3). Perhaps I may add to that mix and ask what is the relationship between the provisions of this Bill and the Government of Wales Act which, under Section 121, requires the Assembly to make a scheme setting out how it proposes to promote sustainable development. Incidentally, that is not sustainable development in Wales, or of Wales, or in the UK; it is sustainable development period.
The question of sustainable development has exercised Parliament and many others for some time. It was suggested earlier today that we do not know what is meant by sustainable development. I believe that the debate has moved on and that there is quite a consensus around what it means. If the noble Baroness, Lady Young of Old Scone, were here, she would describe to the Committee the importance of the various aspects of it far more eloquently than I can do.
If this strategy is not the sustainable development strategy, then where do we have sustainable development in relation to those powers of well-being? It is important in many areas, not least that of planning.
I said earlier that I am beginning to move to a view where I believe that the principal purpose of local government is to achieve sustainable development. Perhaps I may take planning as an example. If one were to write this onto the face of the Bill as the strategy, it would be much easier for planning decisions to take account of social and environmental impacts along with economic impacts. It would be easier to judge them as a package, which is the direction in which planning should be going. It is not just a matter of the environment; it relates to all aspects of society.
I hope that the Government will at least explain the distinction between this piece of legislation and the Government of Wales Act. If my amendment achieves no more than that, it will have been worth floating. I beg to move.
Lord Whitty: Whether we can describe such strategies as being for the purposes of well-being or for sustainable development is, to some extent, a matter of judgment. I have some sympathy with the noble Baroness and those who are attempting to establish the term "sustainable development" in its widest sense.
However, in the context of this Bill and, indeed, probably in relation to the Government of Wales Act, there is no distinction. They amount to much the same thing. The guidance on community strategies will emphasise that point. But there are strong reasons for retaining the clause as currently drafted. By using the words "economic, social and environmental", it is immediately clear that the strategy is to encompass all of those three dimensions in all an authority's functions, whether in relation to the local economy, social welfare or the environment.
Regrettably, the connection is less clear if one refers only to sustainable development. That is the case, as I am sure those in local government who are trying to set up and develop Local Agenda 21 will bear witness. It is true also that in the drafting structure of the Bill, the wording here reflects the wording of Clause 2(1), which is the key clause, whereas the noble Baroness referred to Clause 2(3) which comes later. Therefore, it is important that in the earlier clause we reflect the objectives in this part of the Bill as well. The point is reinforced that the new well-being will be an important tool in ensuring that local authorities can deliver sustainable growth.
Although I am slightly torn—I understand why the amendment was moved—for the sake of consistency throughout the Bill, we are not in favour of this. Therefore, I ask the noble Baroness not to press her amendment.
Baroness Miller of Chilthorne Domer: Before my noble friend replies, will the Minister define for me a matter that is not apparent? On Amendment No. 11 we proposed specifying the health of people as well as sustainable development. The Minister reassured us—tomorrow I shall check his exact words in Hansard—that the reference to sustainable development
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subsumed the need for explicit references to health and social inclusion, thereby accepting that sustainable development neatly encompasses many aspects and allows them to be balanced.
If that applied on Amendment No. 11, I do not understand why it is now better to specify all three different areas of work and not subsume them in that all-encompassing phrase which allows for the three to be balanced. As drafted, I am not sure how the Government can prevent an authority from pursuing one of those areas through its community plan, should it choose to, at the expense of the other two.
Lord Whitty: The subsuming of social inclusion and health applies equally to both social well-being and sustainable development. Clearly, therefore, those dimensions to community planning apply whichever phraseology is used. Sustainable development is, as yet, not as widely understood as the noble Baroness and I would like. The three-pronged strategy is one that is reflected in other legislation and in the key subsection of this legislation. We want consistency through the Bill. I should have hoped that sustainable development would be understood more clearly and more comprehensively than, regrettably, it is. For the purposes of this legislation I believe that some clarity is achieved by making reference to all three. Of course, there is no differentiation in terms of priority between the three. There has to be a balance, as there will have to be a balance within a single sustainable development framework.
Baroness Hamwee: I am sorry that the Government do not feel confident enough to lead the way by including that terminology. This is an interesting and important area. In my mind I do not separate the issue of sustainable development strategy from what I would prefer to see as a mandatory requirement. I shall not pursue the matter now, although I shall reflect on it. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 37:
Page 3, line 2, leave out ("promoting or").
The noble Lord said: On Amendment No. 37 I shall not detain the House for long. It covers ground that we debated on Amendments Nos. 3, 6 and 7 standing in my name. I see no point in reiterating those arguments to the extreme boredom of the Committee. Therefore, I beg to move.
Lord Whitty: I am sure that the noble Lord, Lord Dixon-Smith, never bores the Committee, particularly when he speaks as briefly as he has on this amendment. I shall try to be as brief.
The amendment seeks to remove from local authorities the ability to plan for actions that merely maintain the existing levels of well-being within their areas. If a local authority identified actions that prevented a deterioration in the current state of its

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community well-being when preparing its community strategy it would be preparing to promote, but not improve, the well-being of the local area.
By removing the word "promote" local authorities would be prevented from taking any action which maintained current levels of well-being, or prevent a slide in the current levels of well-being. Clearly, we would not want to exclude such actions. Therefore, the amendment of the noble Lord would have a perverse effect. I hope that he will not press it
Lord Dixon-Smith: I am grateful to the Minister for his explanation, which I shall study. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 38:
Page 3, line 5, leave out ("may") and insert ("shall").
The noble Lord said: Amendment No. 38 strikes out the word "may" and inserts the word "shall". As drafted, the Bill provides that local authorities may consult people in their area. Unusually for me, I feel that that is not strong enough. All noble Lords know that all good local authorities consult and they do not need telling nor do they need legislation to tell them to consult. However, I do not believe that we should give the impression that there may be circumstances in which it may not be necessary to consult. Using the word "may" could lead to misinterpretation. Therefore, I believe that the word "shall" has some merit. I beg to move.
Baroness Farrington of Ribbleton: I entirely agree with the intention behind Amendment No. 38. Many times the Government have said that effective community planning depends on engaging local people in an assessment of local needs and bringing together local authorities, other public sector bodies and the private and voluntary sectors, to determine what needs to be done to secure the economic, social and environmental well-being of local communities.
As the legislation makes clear, these are not strategies for the local authority but for the whole community. Without the participation of the community and local bodies, they are merely more bits of paper. We want to see local strategic partnerships preparing community strategies that are inclusive, reflect local aspirations and recognise the potential for all sections of the community to contribute ideas and resources.
The process of community planning should lead naturally to authorities and others working closely together to ensure better delivery of local services. Issues such as social exclusion faced by many of our communities can be tackled only in this way. Those are all points that we intend to cover in guidance.
We do not believe that legislating in the way that the noble Lord proposes is the right way to achieve the outcome that both he and the Government wish to see. That sort of compulsion would go against the grain of the legislation, which is based on encouraging and facilitating action at the local community level.
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However, we want to ensure that the message to local authorities from the debate and from Government will be one of encouraging the sort of good practice that we seek to achieve. In the light of that, I hope that the noble Lord will feel able to withdraw his amendment.
Lord Dixon-Smith: I am grateful to the noble Baroness for her response. I shall study it with care. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 39 to 42 not moved.]
Clause 4 agreed to.
7.30 p.m.
Clause 5 [Power to amend or repeal enactments]:
Lord Whitty Lord Whitty moved Amendment No.43:
Page 3, line 14, leave out ("or").
The noble Lord said: In moving Amendment No. 43, I shall speak also to Amendments Nos. 44 and 45.
Subsection 5(1) gives the Secretary of State the power to amend or repeal any enactment, whenever passed or made, which prevents or obstructs local authorities from exercising their power under subsection 2(1). Clause 6 works similarly in respect of statutory requirements on local authorities to produce or publish plans or strategies. Amendment No. 43 and the others grouped with it aim to align those two powers so that they can be used in similar ways. The Government want local authorities to be able to act in, and react to, the interests and needs of their communities without unnecessary obstructions. These amendments are designed to bring into line the two parts of the Bill. By this means, the Government will be able to facilitate the innovative approaches necessary to tackle some of the worst problems of social exclusion and neighbourhood deprivation. Where modern local councils wish to test new ideas on a small scale before rolling such ideas out more widely, the Government are keen that they should be able to do so.
In various contexts, local authorities are working closely with other bodies to pilot innovative new approaches to service delivery as part of the Health Action Zones and as part of the LGA's New Commitment to Regeneration Pathfinders. As these partnerships develop, they are discovering legislative obstacles to effective joint working. Those obstacles are sometimes the same; more often they are different, reflecting differences in objectives and approaches between different local authorities. There is considerable merit in being able to use the powers in Clauses 5 and 6 to tailor a response to individual problems and to remove the particular legislative obstacles that are inhibiting effective working. That would allow us to try out different approaches and see how they work in practice before extending them to authorities more generally.
These amendments will allow enactments to be amended, revoked or disapplied for all authorities, particular authorities, or particular descriptions of authority if it is decided that it would be more beneficial to pilot new ideas with certain authorities before removing restrictions from all authorities. Amendment No. 45 will specifically allow enactments to be amended or disapplied for specific time limits.
Amendment No. 50 is a minor technical amendment to bring the wording of subsection 6(1) into line with that in subsection 5(1). I beg to move.
Lord Dixon-Smith: Amendment No. 52 is grouped with these amendments. It seeks to remove "particular" authorities so as to prevent the Secretary of State having the power to make regulations in respect of a single authority. It seemed to me, when I first thought about this, that the Minister's amendment was too discriminatory. However, I do not intend to move my amendment because I then had another thought; that is, that perhaps local authorities will find the shoe pinching and it would be useful if they had the right to apply to the Secretary of State to have the point being pinched relaxed. If I were to move Amendment No. 52, the Minister would quite properly be able to accuse me of all sorts of inconsistencies.
Baroness Hamwee: I intended to ask the Minister for some further explanation with regard to this list of hierarchical local authorities and the exercise of power in relation to all or some of them. Can the Minister give the Committee some indication of the circumstances which would prompt the Secretary of State to exercise the power either in respect of "particular local authorities"—I assume that that could mean one or two local authorities—and,
"particular descriptions of local authority"?
For instance, would this be the basis on which provisions were disapplied to enable beacon authorities to do things which other authorities might not be allowed to do? It would be helpful to have a little more detail on the matter.
Perhaps I may ask also about the terminology. Amendment No. 52 and Clause 6 talk of,
"particular descriptions of local authority".
In other legislation with which I have been concerned, I have been accustomed to seeing the word "category". Is that what "description" means in this case, or does it mean authorities which are very good or very bad, as distinct from all unitary authorities or all London boroughs? A little explanation would be welcome, despite the fact that I appreciate we are all keen to allow our colleagues to go on with the next debate.
Lord Whitty: As I understand it, had we used the term "class of authority", it would have restricted the term to those which are described as district authorities or shire authorities. Whereas,
"particular descriptions of authority",
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could mean authorities which have rivers or repairing responsibilities, if I think of the environmental legislation. We can think of other groups of authorities which are not necessarily designated by the level of authority but by their geographical or economic position.
While the amendment would of itself facilitate moves towards beacon authorities, I understand that it would not mean that we could describe authorities as "beacon authorities". It would be one aspect of a clause relating to "particular local authorities" where, in order to promote a scheme facilitating an innovative way of meeting some of the objectives—particularly that of well-being—we would need to remove the restrictions from those authorities, effectively as a pilot, to see if that worked in those authorities. It could be subsequently rolled out, or not rolled out, to other authorities.
Clearly, the provision relating to time limits also facilitates using a pilot approach to this. Therefore some discrimination is required under this legislation. I am grateful that the noble Lord, Lord Dixon-Smith, recognised that by saying he would not move his amendment though we shall come back to the consequences of his not doing that at a later stage. We consider that we need these powers in order to facilitate innovative approaches and in particular pilot studies. I hope the Committee understands that.
On Question, amendment agreed to.
Lord Whitty Lord Whitty moved Amendments Nos. 44 and 45:
Page 3, line 14, after ("revoke") insert ("or disapply").
Page 3, line 15, at end insert—
("(1 A) The power under subsection (1) may be exercised in relation to—

(a) all local authorities,

(b) particular local authorities, or

(c) particular descriptions of local authority.

(1B) The power under subsection (1) to amend or disapply an enactment includes a power to amend or disapply an enactment for a particular period.").
The noble Lord said: With the leave of the Committee, I shall move Amendments Nos. 44 and 45 en bloc.
On Question, amendments agreed to.
Lord Bach: I beg to move that the House do now resume. In moving this Motion, I suggest that the Committee stage on this Bill begin again not before 8.40 p.m.
Moved accordingly and, on Question, Motion agreed to.
House resumed.

Betting on Horse Racing
7.38 p.m.
Viscount Falklandrose to ask Her Majesty's Government what plans they have to improve and

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increase the control and regulation of betting on horse racing in order to combat any increase in criminal activity.
The noble Viscount said: My Lords, this is a debate about racing and betting. I readily acknowledge that it is not an easy subject for the Minister who has the difficult task of replying to the debate. I can encourage him only to the extent that the small group of speakers tonight—I am grateful to all of them for contributing to this debate—will give various areas of expertise. No doubt he will have a full brief.
I do not know whether the Minister is a racing man, although part of his title is taken from the excellent town of Brighton which has a racecourse which is well known to me. I have had many enjoyable, if not desperately comfortable, days there. It was infamous at one time—no doubt we shall touch on these matters in a moment—principally just after the war years when the betting arrangements in this country were in some disarray and race gangs were found to be operating in London and elsewhere. Whether because of the sea air or the attractions of that town, their presence in Brighton was immortalised by Graham Greene, Patrick Hamilton and other writers.
My debate this evening was really prompted by the remarks of the chief senior steward of the Jockey Club in his speech at the Gimcrack Dinner—an important annual speech—in which he made a particular point of talking about the changes facing racing and the way in which gambling will be organising itself, not just nationally but globally. He drew attention to the need for proper legislation and control of those activities. I carry that thought into the debate tonight.
However, because of the time limit, perhaps I may briefly run through a not entirely unsuccessful story for Britain as regards the legislation pertaining to racing and the organising of gambling, which has become increasingly the engine of the financing of racing over the years. Those who received a very helpful brief from the British Horseracing Board setting out the background to racing and its importance to our culture and to British life will know that racing in this country and the way that it has been run, together with the operation of gambling, have had a great influence on what has happened in the rest of the world.
Racing as we know it in this country began in the 18th century. It started with friends of owners and owners and their relations racing their horses against one another, often in matches. The prosperity which came in the 18th century led to a wider interest in racing and gambling and, as we shall develop later on, attracted a good deal of sinister activity by way of people striking bets, welchers, other confidence tricksters, and so on. They are always evident where there are large sums of money, especially as concerns gambling. Indeed, the situation is no different today from what it was in the 18th century.
However, in the 19th century it seemed to be a good idea to bring in some legislation to govern the unsatisfactory elements involved. The ironic thing about that is that the experiences before the 1853 Act
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(which, by setting up a structure for betting, made it extremely difficult for those tricksters, fraudsters and others to operate in the way that they had been) meant that those concerned went across and plied their trade in France. The French took steps to deal with that by creating a Tote monopoly at the end of the 19th century, known as the Pari-mutuel that operates to this day. It is actually a very simple and effective way of operating through a monopoly the money that is bet on race horses.
We did not opt for that course of action. As a result of orderly behaviour by regulated bookmakers—and there was an element of reward for bookmakers for the way that they conducted themselves in a relatively peaceful period—we decided in 1928 for various reasons to introduce for them a competition status with the Tote. I have to say that the Tote was introduced with the major purpose of offering to poorer people the opportunity to bet on horses, and to offer people who were not acquainted with the rather more obscure and complicated ways of betting through bookmakers the opportunity to partake in a pool, which still exists. That pool has run on through the years and was given statutory status. Indeed, in 1928, which was really the key period of legislation, we had the Racehorse Betting Control Board with bookmakers set up in competition with the Tote, and the National Association of Bookmakers was founded.
This went on until the war years, which caused some disruption. However, the whole situation changed in 1963 when we had the legalisation of off-course betting. Before that time, off-course betting was illegal. Various reasons, some spurious and others logical, led to the decision. Such betting resulted in the growth of betting shops and the multiples that we know today; for example, the famous high street names, such as Ladbrokes, Coral and now the bookmaking side of the Tote operation. The levy board was set up to take money from gambling in an organised way for the improvement of the breed and for contributions to veterinary science. It was given the job of arriving at a decision as to what bookmakers would pay, as well as the Tote, for the privilege of betting.
In 1979 Lord Rothchild's commission on gambling took a good look at all gambling. It produced a very interesting report. Various comments were made in that report. I do not propose to quote widely from it. However, I underlined one comment, which came about as a result of the Gaming Board's evidence:
"There must be constant vigilance to ensure that any legalised gambling activity is not penetrated by criminal interests. who in this connection comprise sophisticated, intelligent, highly organised, well briefed and clever operators with enormous money resources which enable them to hire the best brains in the legal, accountancy, managerial, catering and show business world".
I am not quite sure about the last two; nevertheless, that is as true now as it was then.
I was prompted to table this Unstarred Question because things have accelerated to such an extent over the past few years that the future of betting looks

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extremely different. With the arrival of new technologies on the Internet and the introduction of digital communications, we shall see developments in this field that will allow interactive betting through television channels, and so on. All of these will be extremely difficult to control and, at present, they are set against a background where we have a tax rate of 6.75 per cent, which is levied and forms part of the amount that goes to the Treasury each year, along with corporation tax and other things. That gives the Treasury an income of about £½ billion a year.
The recent trend is very worrying and was the subject of a debate in the other place only last week when important points were made. In a way, government and other bodies in the Civil Service will be behind the game because bookmakers are now having to compete rapidly in areas where the tax rate is much less. In fact, the bookmakers have been pushed to the position where they are now having to go abroad in order to profit from all the new technologies that are available to them in a tax-free environment.
The recent Irish experience has been illuminating. The Irish have taken the view that they should cut their rate of duty. As a result of cutting their tax rate from 10 per cent to 5 per cent, they have had an increase of 30 per cent on their turnover in one year. Unless that example is followed here, the situation is likely to lead to bookmakers going abroad and looking into new opportunities there. Indeed, they may move into areas which it would be extremely difficult for the Government to control. That may also lead to possible operations where there is no control, leading to criminal activity. There will be temptations for the weak, and opportunities for criminals. In fact, we shall really be going back to the 18th century when the legislation was produced to allow people to escape from, as it was then put,
"the injury and demoralisation of improvident persons through irregulated gambling on horses".
My 10 minutes or so have now come to an end, but that is the nub of the matter. In my view, it is essential for the Government to catch up with the new technologies and to take decisions quickly. That applies not only to the privatisation—if that is what is to happen to the Tote and the future of the levy board—but also to other matters that are pressing. I note that they plan a gambling review body, but I do not know whether the chairman or members have yet been appointed. Perhaps the Minister will be able to tell us something in that regard. Can he tell us the reaction of his department to the fears which I have expressed this evening, which no doubt other noble Lords will express also?
7.49 p.m.
Lord Donoughue: My Lords, I thank the noble Viscount, Lord Falkland, for raising this important issue. It is a matter of great concern to the racing industry and it gives me a nice opportunity to speak for the first time out of office and from the Back Benches.
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There could not be an issue closer to my heart. It is even closer to my heart than BSE and the 30-month scheme.
The noble Viscount spoke mainly about betting. This matter concerns strictly the integrity of betting rather than the integrity of racing, but in Britain the two are totally interrelated. They are almost like Siamese twins. Therefore, blemishes on horse betting inevitably damage the integrity of our horse racing. Therefore I support everything that the noble Viscount said. I also support the calls of the BHB and the Jockey Club for maximum government action on this matter and giving the Jockey Club maximum information on which it might act.
Race betting is becoming a most intricate area. As the noble Viscount said, government regulation was successful for 70 years but that applied mainly to a fairly static betting, gambling and racing landscape. Now dynamic change is affecting the industry. I refer to routine changes in the ring and to the technological revolution with interactive betting via TV and the Internet. Ultimately, betting can, and will to a large extent, be conducted in the home, making betting shops—which are an excellent vehicle and environment for regulation—less used. National boundaries will become irrelevant. The whole environment for government to regulate and control will become diluted. As the noble Viscount suggested, the process has profound implications both as regards the policing of illegalities and the potential for raising revenues.
We note that every week credit betting is moving offshore to avoid tax. If all our private bookmakers move offshore, the Treasury may start to argue for an on course Tote monopoly. For those betting reasons and for regulatory and revenue reasons, the Government must remain involved with racing. I wish to discuss broader aspects of the matter in my firm belief that there is a strong public and governmental interest in having healthy racing, which includes a healthy related betting industry.
Government are not always fully aware of the importance of the racing industry. They are not always fully aware of its economic importance and of the fact that it is a great rural employer. Government are being asked to show greater concern for the rural economy. That should focus their attention on the contribution of racing in particular and of the wider horse industry in general. I refer to the contribution of horse breeding to exports. That industry is experiencing difficulties due to a heavy tax burden. At present the whole industry generates huge tax and duty revenue for the Treasury, although, as I have suggested, technology could change that.
I also stress a matter that is harder to pin down, although in my view it is extremely important; namely, the social and cultural contributions made by the racing industry. Racing provides leisure and pleasure to millions. Historically, our racing industry has been the world's leader. Yet now, I believe, we have problems in terms of international competitiveness. Our prizemoney and our facilities are inferior to those

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of some others. In the past two months I have attended races in Dubai and in Japan. One cannot avoid noticing the trend for top horses to be sent elsewhere than the United Kingdom to race and to breed. Our racing must improve; we cannot rest on our past reputation.
Most of the improvements must be introduced by the racing industry itself. It needs radical management and a united approach. It is not enough to talk of what government should do for it. However, there is an important role for government. At present the Government are heavily involved in two major issues. I refer to the Tote. I hope that the Government will transfer the Tote to a racing trust and will do so cheaply to enable the Tote to invest and not be crippled by great debt. I refer also to the review of the levy. I support its phasing out—I have beer saying so for a long time—but rot too abruptly. We need more deregulation, moving towards commercial viability. I hope that the handling of media rights will encourage that. I believe that racecourses and race meetings should constitute a big show and that the media should be able to transmit the fixtures they wish to transmit when they like within certain constraints.
However, those two big issues before the Government also imply withdrawal; namely, the Government getting rid of the Tote and perhaps getting rid of the levy. That is worrying as part of a general trend because I believe that spectators, punters and owners are losing out and big finance and the criminals whom the noble Viscount mentioned are starting to dominate the industry. The industry needs continuing government involvement not as regards the day-to-day finance, such as the levy, but to ensure the integrity and the health of racing.
That leads me to my final point on which my views are well known. For some time I have been concerned about who in government is responsible for the health of racing. We know that the Home Office is responsible for the integrity of gambling. I believe that on the whole it has done a pretty good job. However, the matter goes wider than that. It is quite wrong that there is no Minister or department responsible for racing.
When Sheikh Mohammed expressed concern about British racing and said he was contemplating moving some of his horses, it was noticeable that the French immediately sent someone from the department with responsibility for that matter to negotiate with the sheikh and to offer him racing facilities. I held government office at that time but no one in this country's Government had the responsibility of persuading the sheikh not to move his horses out of this country.
I note that the Home Office has made a bid for responsibility in this area. It has set up a designated unit which I welcome. Not for the first time I note that civil servants are animated by territorial concerns. When they perceived a threat to their territory they took action. A department must take responsibility as regards the disposal of the Tote and as regards the levy and for dealing with money laundering and other matters.
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I suspect that racing needs to be controlled by a different department. Sport is different from gambling. I do not believe that the Home Office culture is attuned to sport. The DTI could take responsibility for racing but I think that it would always be lowest on its list of priorities. The Department for Culture has "squeaked" about racing, but it has little clout and no historic interest. MAFF has been advocated. I advocated MAFF when I was a Minister in the department. It also has insufficient clout, resources or interest in the industry but, faute de mieux, would be the best department in this regard. Should we get a new Ministry of rural affairs—I hope that we do get such a Ministry—that might prove a suitable location for this responsibility. After all, as I have said, racing is a great rural industry. A new department might give it a fresh push. It is most important that the Prime Minister should take a decision so that we know which department and which Minister are responsible for racing.
8 p.m.
Lord Cavendish of Furness: My Lords. I am grateful for the opportunity to participate in this short debate. I thank the noble Viscount, Lord Falkland, for making it possible and for his extremely authoritative speech. It encapsulated in a very short time all aspects of the problem.
I do not suppose that anyone can remember a time when so few Members of your Lordships' House can speak from experience in support of horse racing. This is especially sad as horse racing is part of a much larger picture in which horses generally occupy an important position in our national life. I warmly support the suggestion of the noble Lord, Lord Donoughue, that the time has come for a "Minister of the British Horse". I hope that that suggestion will be taken forward.
I must declare some personal interests in National Hunt racing. First, for some years I have owned or had a share in one or more horses in training; and, secondly, for a great number of generations Cartmel races in Cumbria have been run on my family's land. For some 20 years I was a director and subsequently I have taken over the running of that racecourse.
In 1974 Cartmel was the venue of a famous betting coup, which attracted huge media attention and was dramatised—not to say glamorised—in a television film. Ironically, the episode only enhanced Cartmel's attendance figures. I suppose it is human nature always to tend to rally to the likeable rogue, especially if he is from Ireland, who takes the bookies to the cleaners.
Having said that, I am second to no one in the belief that we must eliminate crime in all its forms on the racecourse and in the racing industry. It is in the interests of the taxpayer, in the interests of the punter and in the interests of the sport. The sport has no future unless it commands the respect of the public and the public believe in its integrity.
As has been said, horse racing is vulnerable to crime through betting. The chief executive of William Hill estimates illegal betting at £1 billion per annum off

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course. If that is true, it represents a significant degree of corruption. Both the taxpayer and racing generally pay a heavy price for that kind of crime.
I understand that both the Jockey Club and the British Horseracing Board are asking the Government to accept that betting is under-regulated as compared to gaming, whereas betting faces exactly the same challenges as gaming. When such eminent bodies call attention to a problem and actually invite regulation, I think we must conclude that there is a real problem to be faced.
However, I have a reservation. We are talking here about the regulation of betting; I hope that that will never be interpreted as a suggestion that the Government should regulate racing itself. I think they would get into deep water. I should like the Minister to confirm that he will resist any temptation to go down that path. When the Minister replies, I, too, shall be interested to know the stage that the Government's review of betting and gaming has reached.
Turning to a related aspect, every administration of this country that I can remember has had a goodly number of racing enthusiasts among its members. Some administrations carry their statutory responsibilities towards racing more cheerfully than others. All seek, I think, to be benign. But it takes more than an enthusiasm for racing to better the Treasury. In the matter of racing the Treasury's appetite is insatiable.
The hard facts bear repetition. They are these. Through tax revenue and the general betting duty from racing and breeding, the Government recover, as has been said, annually around £450 million. But British racing receives a tiny 1.1 per cent from horse race betting turnover back into the sport. Compare that with the lower levels of sophisticated racing countries elsewhere. In Australia the proportion is 4.4 per cent and, at a higher level, it is 15 per cent in Germany.
British racehorse owners receive from prize money on average only 22 per cent of the cost of keeping a horse in training. Again to make comparisons, in Australia the owner, through prize money, will receive 43 per cent; in the United States, 47 per cent; in France, 54 per cent; and in Japan, 87 per cent. I do not suggest that we go to some of those higher numbers—I do not know whether that would be in the best interests of bloodstock or of British racing—but we should advance on 22 per cent. On the present basis, British horse racing is going nowhere very fast.
There is a common misconception that racecourses are subsidised by the levy board or that only the top 12 racecourses generate levy. That is not so. Each day's racing, each fixture at every racecourse, makes a net contribution to racing's finances.
Over the years repeated requests to the Government to be less rapacious with the revenues we generate have gone unheeded, but now it looks as though the widow's cruse has run dry with the arrival of global, offshore and Internet betting.
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The BHB has come up with a solution which, it seems to me, could solve everyone's problems. It suggests a reduction in general betting duty from 6.75 per cent to 5 per cent and a simultaneous cut in punter deductions from the present 9 per cent again down to 5 per cent. As the BHB chairman Peter Savill said,
"The proposal recognises the legitimate interests of all 4 groups concerned. It would be good for racing and good for punters. It offers a practical means of protecting government revenues and it would protect bookmaker profitability".
Some commentators go so far as to say that such a reform would inject such confidence into racing that government revenues would increase.
In the time allowed I do not wish to dwell too much on the Tote, except to say that I hope the Minister can assure us of an early decision about the Tote and that I hope it stays in racing. I read with interest the adjournment debate in another place. I noticed that the Minister has given up the attempt to say that the Government own the Tote. However, I do not think that the taxpayer has much of a stake in the Tote—he never put anything into it in the first place, he has never supported it and he does not back it even today.
The big contributors to racing are the racehorse owners. They pay out the most and get in return the least. They do it simply because they enjoy it. The industry would cease to exist without racing enthusiasts. There are currently too many uncertainties for the sport to look forward with confidence. As a racecourse operator, I believe that it is possible to make profits—but it is a high risk venture and, more to the point, it requires a high level of re-investment.
I should be hesitant to say that National Hunt horse racing could survive a serious downturn in the economic cycle. Some certainty and some revenue reforms along the lines suggested by the BHB would go a long way to restoring confidence.
8.8 p.m.
Lord Sandberg: My Lords, I am sad to say that I have no interest to declare. To my wife's relief, I have no more horses in training. But it is important that we debate the problems facing horseracing, some of which have been mentioned. I think the most serious problem is money laundering. We need to congratulate my noble friend Lord Falkland for raising the matter here.
I shall, if I may, without boring the House, occasionally refer to my experience as chairman of the Hong Kong Jockey Club—in those days it was called the Royal Hong Kong Jockey Club—with its almost obscene turnover because of the controls placed on it and the help given to horse owners. The noble Lord, Lord Cavendish, may be interested to know that owners get back in total—of course, they do not all get it back—100 per cent of what their expenses are likely to be.
As a result, in the old days we might have had a horse whose breeding was announced as, "Out of Black Bess, by unknown". Nowadays in Hong Kong we have group one racing. As I said, the turnover is enormous, and so is the reward for the internal

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revenue. Indeed, it has a direct effect on income tax which might otherwise be higher. It also has an effect on turnkey operations such as the entire financing of a third university. I do not suggest that we should do so much in this country, but it proves that the more one gives to the punter, the more one is going to get back.
It has been said in previous debates, and it is a truism, that where there is a great deal of cash, criminals will be lurking around. The racecourse has always had to face such problems. I well recall the amount of time that I, as chairman of the stewards, had to spend seeking to keep one step ahead of those who were trying to make a dishonest living out of racing. It would be naïve to pretend that we were always successful, but we did achieve a good deal. Most important, the public were aware that we were trying hard. It is vital that both the public and the punters realise that the authorities are trying to defend them.
However, it is one thing to try to thwart a nobbled jockey or trainer; it is quite another to attempt to overcome a form of organised crime. When one considers the amount of money now sloshing around in the sport, it cannot be doubted that organised crime has found it to be a good hunting ground. Perhaps I may once again cite Hong Kong. A person who had acquired money from a corrupt deal—be he a government servant or a private individual—might attempt to buy a winning lottery ticket or betting slip in order to justify a recent large credit in his bank account. However, I think we have moved on from that kind of crime over here. It is not only Mr X who is trying to conceal his criminally earned income in horse racing. Organised crime is also attempting to do it. The figures involved can be very large indeed. Furthermore, there is the threat of far more vicious retaliation if someone tries to report or obstruct such activities. These people are not gentle.
In previous debates I have said that I am in favour of making changes to the structure of racing. I support changes in the Tote. However, as was mentioned by the noble Lord, Lord Donoughue, I am against any suggestion that the Government should distance themselves from the racing industry, especially as regards the Tote. Those involved in the industry do not want the Government even to attempt to say that this matter is no longer anything to do with them. Horse racing must be a matter for government. We need a representative in government who is directly responsible. Furthermore, the industry should not be seen as a secondary duty of a Minister. It has become too important to be hidden away in the Ministry of Agriculture, for example.
I have suggested that the sums of money involved can be large, attracting people who wield great power and who can be violent. It is necessary that bookies on the racecourse, who can find themselves in a most vulnerable position, should feel that there is someone to whom they can turn. It is not good enough to report an incident to the local security people if their only reward is a physical attack on them or their families.
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Horse racing is always a fascinating subject, but I think we must accept that it is a new ball game today. Nowadays people can bet through the Internet and important bookies travel to places like Gibraltar. I do not believe that the public expect to pay no tax: indeed most people are prepared to pay a small tax because, if they wish to bet legitimately, they need to know that they will be protected. Government may need to take a cut in their return, but, as I said, I have found that the less the punters have to pay, the bigger the turnover. In the end, the income evens out.
Finally, I reiterate my hope that the Government will take an active part in this matter. I should like the Minister to confirm that the Government plan to keep a close eye on racing and that they will consider the difficult new problem of money laundering at the racecourse. Plans should be put in place to recognise the difficulties and to combat them.
8.16 p.m.
Viscount Bridgeman: My Lords, I am sure we are all grateful to the noble Viscount, Lord Falkland, for initiating this debate. It is with considerable diffidence that I follow such a distinguished and expert group of speakers.
In his Question, the noble Viscount referred to the threat of criminal activity in racing in this country. Indeed, that has formed the main theme of our debate. Let it be repeated again, as several speakers have made the point, that racing in the United Kingdom is overwhelmingly carried out with an integrity that is the envy of the world. Racing and betting are so closely inter-related that it occurred to me, when the noble Lord, Lord Donoughue, referred to prize money, to recall that that money comes from the betting levy. There we see but one of many connections.
However, we have to face the fact that betting malpractice is as old as racing itself. The urgent problem facing us today is the huge sums involved, the increasing sophistication on the part of criminals, advances in technology—the Internet and so forth—and, behind it all, the insidious onset of the drugs trade. Money laundering hasbeen referred to as a considerable danger. The noble Lord, Lord Sandberg, gave us a chilling reminder of what this can involve in another environment.
Turning to the racing element for a moment, the Jockey Club, as the regulator of racing, has a demanding job. One of the problems in the—it is hoped—rare criminal activities in racing is that it may well involve jockeys, trainers, bookmakers, the racecourse and the underworld, each of whom could be in different police jurisdictions. Use is now made of the National Criminal Intelligence Service, but what is really required here is a specialised racing unit formed along the lines of the drugs unit.
A further problem is that many of racing's malpractices are not in fact criminal offences. Among those are doping and attempting to influence the result of a race, or corrupting a racecourse official. I understand that there is an important submission by the British Horse Racing Board and the Jockey Club

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that the criminal law should be amended to correct this handicap, under which the regulator suffers. There is also the more contentious issue of seeking exemption for the racing industry from the Rehabilitation of Offenders Act. It will be interesting to see whether the Minister has anything to say on that.
Another point that the Government should address is the under-regulation of the racehorse betting industry. This is in marked contrast to the gaming industry, to which my noble friend Lord Cavendish referred. With the current menace of organised crime, the Government would do well to be aware of the very prompt steps that were necessary some 25 years ago to prevent the London casinos being taken over by organised crime.
There is a recent welcome initiative by the recently formed National Joint Pitch Council, which reports to the levy board. Its important functions include checking that large bets are hedged with licensed, not illegal, operators. Also, to expose recent moves, of which there is more than anecdotal evidence, for organised crime to buy bookmakers to operate pitches on their behalf—a tidy either way option where the backers get the money, win or lose.
I also welcome the role of the NJPC in monitoring unusual betting activity, which over the years has alerted racing to many potential betting coups. I was hesitant about referring to Cartmel Racecourse, and was very relieved that mynoble friend, Lord Cavendish, enlightened us on that.
I now turn to the question of the general betting duty and the move to betting offshore to avoid it. In this respect Gibraltar has become a substantial centre. However, only this morning William Hill announced that it was offering a facility in Ireland. These developments are, of course, serious for the Treasury. They are also of concern to the racing industry levy board in that it can, and almost certainly does, attract considerable illegal betting by this route.
I very much support the British Horseracing Board in its submission to the Government that general betting duty should be reduced from 6.5 per cent to 5 per cent. That has been mentioned. I should very much welcome the views of the Minister on that. If that had the effect of bringing offshore betting back to this country there could be a number of winners: racing through the levy board, the bookmakers, the punters, and even the Treasury would not be as big a loser as it might appear.
The Irish experience has been referred to. If my arithmetic is correct, the increase in betting volume would need to be 100 per cent to mitigate the loss of revenue to the Irish Treasury. It is in fact 30 per cent. That is not the whole story. The reductions should be seen in the light of the regularisation of hitherto illegal betting and other indirect benefits to racing.
Perhaps I may refer briefly to the review of gambling legislation which was announced by the Home Secretary on 8th December 1999. I would welcome from the Minister any information he can give us as to the composition of the committee, its terms of
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reference and when it will commence its hearings. I remind the Minister that the practice of bookmakers offering hospitality to jockeys and trainers is widely accepted. The comparison with croupiers may not be an exact one. However, for the record, croupiers are forbidden to have any social contact with clients. I also suggest to the Minister that bookmakers' hospitality, were it put in a commercial context, might well be seen as insider trading. I hope that that will be addressed by the Committee.
Finally, perhaps I may revert to a point made by the noble Lord, Lord Donoughue, on the question of a government department which would have overall responsibility for supervision of matters relating to horses. That matter was very well covered in an excellent brief from the British Horseracing Board. Whether that was MAFF or whether a proposed department of rural affairs, it is important that thatsubject is addressed by one body. I very much look forward to the Minister's reply.
8.23 p.m.
The Earl of Carnarvon: My Lords, I must declare an interest as an owner and manager of racehorses and a member of the Jockey Club. I speak in the gap to underline two points. As a member of the Joint Bloodstock and Racing Committee of both Houses, I can say that both these points are unanimously supported. They have been referred to today. One is a request from the Jockey Club, which is responsible for the rules of racing, for access to criminal records by exemption from certain provisions of the Rehabilitation of Offenders Act referred to by the noble Viscount, Lord Bridgeman. Of course, a government department or Minister responsible for the horse is necessary. I think that mention has been made not only of a Minister for the horse, but also of a Minister for racing. However, it is very much a ministry for the horse right across the equine world that is wanted, and not one isolated for racing alone.
The Minister will know, I am sure, that I have been in touch with his colleague the noble and learned Lord the Attorney-General on the subject of criminal records, and no doubt he will have had access to the letters that have been written to the Home Office from the Jockey Club.
8.25 p.m.
The Parliamentary Under-Secretary of State, Home Office (Lord Bassam of Brighton): My Lords, I feel very humble and a novice in entering this debate this evening. I thought that when I ceased being the leader of Brighton and Hove Council towards the end of last summer, I had probably ceased my direct hands-on experience of horse racing. The noble Viscount, Lord Falkland, made reference to Brighton racecourse. For 13 long years I was very involved with it through our racecourse ownership, the famous "racecourse lessees". I think that we made a good contribution to improving a municipal racecourse. Ultimately, we went into private partnership to secure long-term benefits, and those have been profound indeed. So I

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speak from some experience, but not with the breadth of experience expressed in your Lordships' House this evening.
Important issues have been raised in the debate, which has come at a useful moment. It is important for us to pause, reflect and take stock of matters. I say this not to make a bid to be the Minister for the horse, interesting though that might be; but perhaps given my past interests it is something in which I ought to take a greater interest. The question raised in today's debate iswhether the Government's general approach with regard to the regulation of betting on horse racing is right and what more we might need to do to combat any increase in criminal activity.
There are currently a range of mechanisms in place, as your Lordships well understand, to control and regulate betting on horse racing. Off-course betting is regulated through the issue of bookmakers' permits, by licensing justices under the provisions of the Betting, Gaming and Lotteries Act 1963. On-course bookmakers also require such permits. In addition, the activities of bookmakers operating in on-course betting rings are subject to regulations and controls operated by the National Joint Pitch Council. The Jockey Club in its role as the industry's own regulator has a very key part to play. Any criminal activity relating to betting on horse racing is a matter for the police and the criminal law. That much is clear. That much is obvious.
The Government have, as has been recognised in the debate this evening, recently announced an independent review of gambling. I shall say a little more about that later. The terms of reference will be published shortly, and the review body will have a wide-ranging remit.
The noble Viscount, Lord Falkland, made a very interesting and valuable contribution to the debate. I was particularly taken by his points about the changes in technology and the way in which that will increase the difficulties of controlling criminal activity in the racing field. He was absolutely right to point to the problems of technology, offshore betting and the way in which interactive media, the Internet and so on, will force us to take stock of those matters and look for a way forward.
The noble Viscount also raised a number of other questions. With regard to offshore betting and the level of UK betting duty, what has happened thus far is that the Treasury has consulted very widely with the major bookmaking trade associations. The Treasury is alert to the very profound impact on UK bookmakers of offshore betting and is considering what other measures might be used to safeguard bookmakers here and the important revenue streams to both the racing industry and the Exchequer. The Chancellor has already announced that he will be tightening the legislation on advertising offshore betting services. I am sure that that will be widely welcomed.
The noble Viscount also asked about the review of gambling. Its members have not yet been announced; that much is clear. We hope to announce shortly the name of the chair of the gambling review and the terms
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of reference. The names of other members will follow. We want the review to start in the spring and we would expect the review to take about a year. We see no sense in hanging around. The review will need to be thorough and it will need to be conscious of the need to modernise our system of regulation for gambling. That much will be welcomed.
The noble Lord, Lord Donoughue, the noble Viscount, Lord Bridgeman, the noble Earl, Lord Carnarvon, and others referred to the Jockey Club's request to have access to criminal information. Access to criminal records is a sensitive area. We think that the application has some merit and it will be considered by the Home Office this year. But the matter will certainly have to be resolved before the new criminal records bureau becomes operational in 2001. We are keeping the matter under serious review.
The noble Lord, Lord Donoughue, and the noble Viscount, Lord Bridgeman, raised the issue of a Minister for racing. We do not have any plans currently to appoint a Minister for the horse industry. I have noted the powerful arguments made in that context. Although the Home Office has an important co-ordinating role, there are issues which need to be taken up more widely across Whitehall. Given the contribution racing makes and betting contributes to the Exchequer, these are important concerns.
The noble Lord, Lord Donoughue, referred to the phasing out of the levy and to more emphasis being needed on media rights and other forms of funding. Again, the noble Lord put forward a compelling set of arguments. They are certainly not ones with which we would take great issue. We note the noble Lord's reference to changes to the levy system. We intend to announce soon the outcome of the Home Office review of the levy board together with our proposals for the sale of the Tote. We recognise the importance of both to the financial health of racing. These issues need to be taken together. They need to be considered strategically. They are very important to the future of the industry.
The noble Lord, Lord Cavendish, asked about the regulation of racing. The Government have no plans to take over the regulation of horse racing. I trust that the noble Lord is reassured on that issue. The noble Lord raised the question of the timing of the sale of the Tote and the taxpayers' interest. We expect to make an announcement soon. We recognise racing's legitimate stake in the Tote. But it has also to be said that the Tote is a public body and it is therefore not unreasonable that taxpayers should obtain some benefit from its sale.
The noble Viscount, Lord Bridgeman, raised the issue of the impact of current criminal law on the ability of the Jockey Club to do its regulatory job. We recognise that. We would be happy to receive proposals from the Jockey Club or any other contributor to this debate. Those will be important matters in what is a difficult area.
As I said earlier, this has been an interesting and stimulating debate. It has provided ample evidence of the breadth of knowledge in this House on horse

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racing matters and a most welcome opportunity to air many of the important issues that are of current concern to the racing industry.
As my honourable friend the Parliamentary Under-Secretary of State for the Home Department, Mike O'Brien, said in an other place only last week, British horse racing is an industry, and a sport, of major national and international importance. We want it to retain that international importance. After all, the industry employs, directly and indirectly, some 60,000 people and makes a £600 million contribution to the Treasury. In our rural areas, one in eight agricultural workers are employed in horse racing. In 1999, some 5.1 million people attended race meetings, the largest attendance at race meetings since 1965. Horse racing clearly has an important financial impact on our country and it is an important part of our culture.
The variety and diversity of our 59 racecourses are without equal anywhere in the world, and British racing continues to set the standards by which others measure the quality of their racing product, not only in terms of the ability of our horses, but also our jockeys, our trainers and the many other dedicated and very professional people who work within or support the industry.
Equally important to the success of British racing have been its integrity and its credibility, not only in the eyes of those who see it as a uniquely exciting sporting spectacle, but also to those millions of people, both in this country and overseas, who look upon it as an honest and safe sport on which to bet.
Racing and betting are inextricably linked, a point made by several noble Lords, and we must remain alert to the very real and continuing threat that this represents to the honesty and integrity of the sport. Your Lordships have, quite rightly, drawn attention to the concerns that have been expressed by the Jockey Club and others within the industry about the vulnerability of racing to criminal activity and corruption. I am totally aware of that. Brighton Rock is very much a legend in racing circles. We accept that the statutory framework within which horse race betting takes place has remained largely unaltered for several decades. In many respects, it has stood the test of time, and our racing and bookmaking industries continue to enjoy an enviable reputation, both at home and overseas, for their honesty and integrity.
But we cannot afford to be complacent. Race fixing, in any form, strikes at the very fabric of the sport. Illegal betting is an ever-present threat, as the sums mentioned in the debate indicate, to the viability of the industry. It has the potential to undermine our gambling policy objectives. It also reduces the financial returns to the taxpayer, racing and the legitimate bookmaking industry.
As I have indicated, the Government have decided that the time has come for a thorough and wide-ranging review of all forms of gambling in this country. This independent review will provide us with an opportunity to consider whether the current regulatory framework for horse race betting is the
1502
right one in today's world. It will enable interested industries and groups to put forward their own views and proposals for change. We welcome those. The prevention of criminal activity is fundamental to government policy on the regulation of gambling. If there are arguments for strengthening controls in a particular area, now is the time to consider them.
Individual cases of criminal activity must continue to be dealt by the police who, I know, have a close and important working relationship with racing's regulators. Thankfully, such cases are few and far between, but if investigations throw up evidence of wider and more systematic problems, they must be addressed. Alarmist speculation about the level of criminal infiltration into the racing and bookmaking industries is unhelpful and counterproductive. It does both industries an enormous disservice.
The Government are committed to maintaining a close and constructive dialogue with both racing and bookmaking representatives on these and other matters. Only by working together can we be confident that British racing will continue to enjoy its well deserved and much envied reputation for sporting excellence and integrity. That must be our objective; it must be one that we share; and it must surely be one that all Members of your Lordships' House will endorse.

Local Government Bill [H.L.]
8.39 p.m.
House again in Committee on Clause 5.
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 46:
Page3, line 15, at end insert—
("( ) Before exercising the power under this section the Secretary of State shall consult representatives of local government and such other persons as he considers appropriate.").
The noble Lord said: I note that we are all in a hurry this evening. Amendment No. 46 requires the Secretary of State to consult local government representatives and appropriate people so that the consultation is open and wide.
Clause 5 states that,
"if the Secretary of State thinks that an enactment … prevents or obstructs local authorities from exercising their power … he may by order"—
here we enter once again into the business of ministerial orders—
"amend, repeal or revoke that enactment".
The amendment simply requires the Secretary of State to consult with representatives of local government. Proper consultation is a two-way stream of information, and that is always helpful. It is very useful if local government is able to make a contribution before the Secretary of State begins exercising his power.
If we have joined-up government, we must recognise the reality that local government is a part of government. Whatever the politics of the situation,

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local government is in many ways the executive arm of government at local level. That has long been the situation. The amendment would strengthen the ability of the Secretary of State in making these regulations.
The amendment is grouped with Amendment No. 54. The Secretary of State is enabled to consult people who "appear to him to be likely" to be able to make a contribution. But such phrases as "appear to him to be likely" would seem to make the question of consultation optional. We do not believe that consultation should be optional: the Secretary of State should be obliged to consult. That being so, we have tabled Amendment No. 54. These proposals are in the interest of good governance.
Whether the Minister is prepared to accept the amendments is a moot point. He may assure me that the Government would, as good governments do, always consult and that they do not need telling, just as good local government does not need telling to consult its neighbours, and so on. But the trouble with legislation is that it invites people like myself to think about motivations and about the reasons behind the wording on the face of the Bill, and to think how the content of the Bill might be improved. We believe that both these amendments would strengthen the Bill and that there is therefore a case for the Minister to answer. I have no doubt that he will attempt to explain away my doubts and concerns, and I shall listen with care to his reply. However, we believe that the two amendments would improve the Bill. I beg to move.
Lord Whitty: I agree that the Secretary of State should consult such representatives of local authorities and such other persons as appear likely to be affected by any of the actions that he takes under the powers in Clause 5. That is why the Government have already made provision for such consultation to take place as part of the detailed scrutiny procedures set out in Clause 8. Clause 8(1) specifically requires the Secretary of State, before bringing forward an order under either this clause or Clause 6, to consult local authorities, local government bodies and any other persons likely to be affected.
We have already debated in the context of earlier clauses the issues raised by the noble Lord's second amendment. I reiterate that we want to ensure that all relevant bodies are consulted on any proposals that are likely to affect them. Clause 8(1) will indeed ensure that that happens, while for practical purposes maintaining a sensible level of discretion for the Secretary of State.
I would add that Amendment No. 54 would have the effect of reducing the range of bodies that the Secretary of State would be required to consult. It would exclude all bodies other than those clearly affected by the proposals; whereas Clause 8(1) goes further, in that it includes also those bodies that are "likely to be affected". That being the case, I am sure
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the noble Lord will agree that his objective is already covered in the Bill and that he will not press the amendments.
Lord Dixon-Smith: I am pleased to hear the Minister's explanation, which I shall study with care. If I need to return to the matter, there are two remaining stages of the Bill when I shall have the opportunity to do so. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
8.45 p.m.
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 47:
Page 3, line 15, at end insert—
("( ) If local authorities consider that an enactment (whenever passed or made) prevents or obstructs them from exercising their power under section 2(1) they may apply to the Secretary of State for that enactment to he amended, repealed or revoked.").
The noble Lord said: this amendment is slightly different. It is the amendment I referred to earlier and is the reason why I withdrew a previous amendment.
The Bill appears to assume that the initiative is all on one side. However, local authorities have to deal with the consequences of all government legislation. They may well find that a point of existing legislation causes them some difficulties in relation to the operation of Clause 2(1). The purpose of the amendment is to enable authorities in that particular situation to apply to the Secretary of State in order to have the point that causes them difficulty at any rate considered for amendment or repeal.
This is a worthwhile provision. The Minister may say in his response that that is what he intends shall happen. But if it is what he intends shall happen, there is no reason why it should not be on the face of the Bill. If it is not what he intends shall happen, we may see something different.
Amendment No. 47 raises a point which I hope the Minister will consider seriously. If he does not like the wording, he might consider whether some other wording is suitable or whether he would choose to deal with the matter in the huge compendium of regulations that we are not yet in a position to consider.
Amendment No. 53 follows exactly the same line. It seeks to insert a new sub-paragraph, (c), stating that the Secretary of State may act upon the application of, and justification by, a particular authority. Again, from the point of view of local government such a provision would be worth while. It would also be worth while from the point of view of governance generally. Respect for local authorities would be considerably enhanced if it was felt that they were in a position to take the initiative in this way.
These two amendments raise a very serious issue. It would give me the greatest pleasure if the Minister could at least utter some conciliatory words, even if he was unable to accept the wording of this amendment. The Government are immensely wise but not infinitely

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wise. If they were infinitely wise I should not need to table these amendments. While I recognise the general proposition as to the wisdom of government, the principle behind these two amendments is worth serious consideration by the Government. I hope that in his response the Minister can give some encouragement, even if he does not like the precise way we have attempted to deal with the point. I beg to move.
Lord Whitty: I accept at least half of the noble Lord's observations about the wisdom of government. The Government intend that something similar to what the noble Lord indicates in the amendment should happen. In no way do we intend this to be a one-way process. We envisage that there will be initiatives within the framework set by local government itself both individually and collectively. The initiatives which already exist in this form—health action zones, the Local Government Association's commitment to regeneration and so forth—are examples of those cases where effectively local authorities already trigger these arrangements or propose that they join. A broad range of authorities, both urban and rural, will be involved in the process, and it is important that we make provision for such authorities to take the initiative. However, as the noble Lord anticipated, I am not convinced that we need to do so in precisely this way or that this is appropriate for the face of the Bill. Nevertheless, I shall consider what the noble Lord has said.
We envisage a rather different procedure whereby more informal arrangements are put in place so that, once the powers are in place, central and local government representatives can assess possible barriers on a regular basis. We have in mind making this matter a regular agenda item at central/local partnership meetings between senior local government people and Ministers. That will give local government collectively a way of looking at these measures. There is nothing in the legislation to prevent local authorities individually or as a group putting forward proposals that the Secretary of State should regulate or alter barriers under the powers in Clauses 5 and 6; indeed, we actively encourage them to do so.
In those circumstances, since there are a number of practical and slightly more informal ways to trigger this mechanism—we do not want to close any avenue—we see no great advantage in legislating in the way that the noble Lord proposes, although we fully accept the objective that he has spelt out.
Lord Dixon-Smith: I am delighted to hear the Minister's response to these two amendments, and I shall study his words with care. I note that he makes reference to informal arrangements. When considering legislation one is dealing with matters formally. It may be that what he says is satisfactory, but there is nothing like having something on the face of a Bill to ensure that it happens. However, I put aside my cynical tendency for the moment and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 5, as amended, agreed to.
Baroness Hamwee Baroness Hamwee moved Amendment No. 48:
After Clause 5, insert the following new clause—
POWER TO AMEND OR REPEAL ENACTMENTS IN CONSEQUENCE OF SECTION 4 POWERS
(" .—(1) If the Secretary of State thinks that an enactment (whenever passed or made) or a requirement (whenever imposed) is unnecessary following the enactment of section 4, he shall by order amend, repeal, revoke or withdraw it.
(2) In this section "enactment" has the same meaning as in section 5(2) and "requirement" includes guidance and directions.").
The noble Baroness said: In moving Amendment No. 48, I should like to speak also to Amendment No. 51. As we have already discussed this evening, it is anticipated that the Clause 4 strategy will supersede a number of other plans and strategies. I hope that that will turn out to be the case, that the decks can be cleared and that there will be fewer detailed obligations on local authorities. Amendment No. 48 attempts to build on Clause 5. That clause enables the Secretary of State to amend, repeal or revoke enactments. Amendment No. 48 seeks to provide that, if he has addressed his mind to it and comes to the view that an enactment is unnecessary, he shall amend, repeal or revoke it, or, in the case of a requirement, withdraw it. This is the positive side of the coin whose reverse is the permissive provision in Clause 5.
Clause 6, which Amendment No. 51 seeks to amend, deals with the modification of enactments which apply to local authorities. I may well be told by the Minister that it is outside the scope of the Long Title to extend this provision to public bodies. Nevertheless, I believe that it is worth floating. The power of community planning is based on a partnership of all the relevant entities or, to adopt jargon less often used these days, stakeholders. The exercise of the powers in Clause 6(1) could be a great incentive for a range of entities to join a partnership. The prospect of bureaucratic requirements for the production of plans being removed is a powerful incentive. It has been suggested to me that this provision should extend to other public bodies such as health authorities as well as to local authorities to improve the process and thereby, it is hoped, the strategy. I beg to move Amendment No. 48.
Lord Whitty: I understand the reasoning that the noble Baroness has explained. I am, however, slightly bemused by the fact that the noble Baroness, on behalf of the Liberal Democrat Benches, proposes two amendments which greatly widen the scope of the Secretary of State's powers in respect of all kinds of public bodies and require him always to exercise them. That seems to be slightly contrary to the tone of some of the contributions from both Front Benches opposite.
The noble Baroness is right in relation to Amendment No. 48, in that it would allow the Secretary of State to repeal or amend any unnecessary

1507
enactment. That seems to us to go beyond the scope of the Long Title of the Bill. Technically, since other statutory bodies may be party to community strategies—I understand the reasoning behind it—it would allow us to deal with legislation that related to them as well as to local authorities. The proposal greatly extends the Secretary of State's powers.
Similarly, I understand why the noble Baroness regards Amendment No. 51 as desirable. Certainly, we want local authorities to work with other statutory bodies, but this takes us into wider territory than we would wish to enter. It would be improper to make such amendments without first engaging in the kind of detailed consultation with those bodies that we have had with representatives of local government about the powers in Clauses 5 and 6.
We have not yet considered the implications of such a wide power. That does not mean that we are necessarily unsympathetic to aspects of this issue. Indeed, we have already consulted quite widely on amendments to the Deregulation and Contracting Out Act 1994 with particular reference to public authorities. We hope to bring forward. legislation later this Session which may deal with aspects of this matter.
However, the noble Baroness is too ambitious on the part of the Secretary of State. I suspect that in that regard she will not wish to pursue the amendment.
9 p.m
Baroness Hamwee: My ambition on the part of the Secretary of State was to revoke legislation. That is rather different from providing for the Secretary of State to make more impositions. I defend myself in that way.
I am glad to hear the Minister's remarks about considering extending the approach to other public bodies. The suggestion for the amendment came from the local government world. It is because of the experience of working with other public bodies in the partnership which the Government are promoting that the amendment appears desirable.
The Minister did not say that it was cheeky to seek to extend the provision, but I accept that it is somewhat cheeky to read over the provision to other public bodies. However, given that the amendment arises from experience in local government, it has relevance. To hear at later stages of the Bill about enabling other public bodies to work more easily with local government would be good.
I shall read what was said about Clauses 4 and 5 with regard to requiring the Secretary of State to revoke enactments, and so on. One has to consider those clauses together. I hope that we can look forward to the Government clearing the decks a good deal and reducing the amount of legislation which will apply to community leadership. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 6 [Power to modify enactments concerning plans etc.]:
[Amendment No. 49 not moved.]
Lord Whitty Lord Whitty moved Amendment No. 50:
Page3, line 20, after ("repeal") insert (", revoke").
On Question, amendment agreed to.
[Amendments Nos. 51 to 53 not moved.]
Clause 6, as amended, agreed to.
Clause 7 agreed to.
Clause 8 [Procedure for orders under section 5 or 6]:
[Amendment No. 54 not moved.]
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 55:
Page 4, line 26, at end insert ("working").
The noble Lord said: This amendment deals with the period for which an order lies before Parliament before it may be approved. It requires that the order may not be approved until the expiry of a period of 60 days beginning with the day on which the document was laid. I understand that in the context of legislation of this kind, 60 days excludes periods when Parliament is in recess or public holidays.
Amendment No. 55 requires the period to be 60 working days. We think that the slightly longer period would not sacrifice a great deal of time and might give more opportunity for proper, mature consideration of any orders brought forward under this part of the Bill.
Amendment No. 56 requires the Government not only to state what they have received as a consequence of consultation but also to give their decisions. In other words, if there are serious objections, they have to spell out why they have rejected those objections. There is less of a problem if the consultation reveals happy and universal agreement. That may happen on occasion; and I think that we would all be delighted and surprised if that were the case.
These two minor amendments are intended to be helpful to the Government, local government and anyone interested. I beg to move.
Baroness Farrington of Ribbleton: Clause 8 provides for the procedures to be followed by the Secretary of State in making orders under Clauses 5 and 6. Those powers are very wide-ranging and it is right that Parliament should properly scrutinise their use. The procedures to be followed are designed to ensure that. Parliament is provided with sufficient information about the purpose of the orders and the reaction of those who will be affected by them; and to allow Parliament time for proper consideration. They are modelled closely on the procedures adopted in the Local Government Act 1999 and the Deregulation and Contracting Out Act 1994.
Following consultation with local authorities, representatives of local government and other persons likely to be affected by the proposals, the Secretary of State is required to lay before Parliament a document explaining his proposals and setting them out in the form of a draft order. He must also provide details of

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the consultation exercise. Parliament has 60 days in which to consider this document after which the Secretary of State may formally lay an order.
Amendment No. 55 would change the period to "60 working days". Clause 8(4) makes clear that the period of 60 days does not include any time during which Parliament is dissolved, prorogued or adjourned for more than four days. The amendment would extend that period by effectively excluding weekends.
I have to say that it might have been easier to achieve the same effect by simply extending the period to 75 days. But the real point at issue is whether 60 days represents sufficient time for Parliament properly to scrutinise such proposals as are likely to be brought forward under Clauses 5 and 6. In the Government's view, it is. This House previously thought that 60 days was sufficient for orders brought forward under the Deregulation and Contracting Out Act and for orders that might in future be brought forward under Section 16 of the Local Government Act 1999. Like Clauses 5 and 6 of the Bill, those Acts allow for primary legislation to be amended by means of order. If 60 days were sufficient in those cases, we are not convinced that they should not be sufficient in this.
Amendment No. 56 would also require the Secretary of State to provide a response to any representations received during the 60-day period when he lays the final order. I can understand the noble Lord's concern to ensure that Parliament has as much information as possible when it is considering the final order. However, I believe that on this occasion his concerns are misplaced. I cannot conceive of a situation in which the Secretary of State, in providing details of the representations and any changes to the draft order, would not also explain why he had accepted or rejected those representations.
I hope that as I have been able to clarify the position the noble Lord will withdraw his Amendment No. 55 and not move Amendment No. 56.
Lord Dixon-Smith: I am grateful to the noble Baroness for her explanation, which goes a long way towards setting my mind at rest. I shall study what she said and hope that I need not return to the matter at a later stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 56 not moved.]
Clause 8 agreed to.
[Amendment No. 57 not moved.]
Clause 9 [Executive arrangements]
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 58:
Page 5, line 4, at beginning insert—
("( ) A local authority may make executive arrangements for the discharge of certain of its functions.").
The noble Lord said: With Clause 9 we move to a different part of the Bill which contains fundamental problems. It deals with arrangements with respect to executives. Clause 9 and those following require local
1510
authorities to change their system of management to one which complies with the systems established in Clause 10.
The European convention on local self-government, to which the Government signed up, also states that authorities shall be free to decide their own administrative arrangements. The convention requires something which this Bill denies. That is a serious point.
Amendment No. 58 is grouped with Amendments Nos. 61, 168 to 170, 177, 190 and 191. It suggests as a preamble to the clause:
"A local authority may make executive arrangements for the discharge of certain of its functions".
It is not the Government's intention that all local government functions shall be dealt with by executive arrangements. They acknowledge that that would not be appropriate, which at least is the beginnings of progress. Our amendment specifically gives local authorities a power rather than a duty to comply with Clause 10.
If the amendment is agreed to, a local authority not putting in place executive arrangements would still be able to continue to discharge its functions and take its decisions in accordance with the relevant provisions of the Local Government Act 1972 and later legislation which has refined and defined that Act and which the Government do not propose to repeal.
In Clause 11 of the Bill, the Secretary of State is empowered to exclude certain functions from executive arrangements and to specify functions which at the discretion of the local authority could be subject to traditional arrangements. The amendment we propose provides further flexibility and discretion and is not a complete departure from the spirit of the Bill, although it is fundamentally important because the Bill as drafted makes the change to executive arrangements virtually compulsory. We submit that, particularly under the European convention, that should be a matter for local authorities to decide.
The Joint Committee which sat in consultation on the draft Bill was of the same view and was concerned about the over-prescriptive arrangements which the Bill makes. Curiously, the amendment is in line with the views of the Labour campaign for open local government, reported in the minutes of evidence of the Joint Committee at Appendix 27. This is therefore a fairly fundamental and important matter. I must say that if one reads what one receives from the Local Government Association, it certainly approves the principle behind the amendment.
We are back to issues that cover ground we have already debated. Are local authorities to be trusted and respected to do their job as they should? Do they have a view which has merit and deserves respect? Do their electorates have views which deserve merit and respect? Are electorates to be trusted? Maybe not, because they are local electorates. However, I remind the Minister that local electorates are also part of the national electorate. If they are not trusted in one regard, how can they be trusted in any other? There are

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serious implications in Part II of the Bill which merit the deepest consideration of all their aspects before we give way to what appears before us.
I do not believe that the Bill as drafted, which makes it virtually compulsory for local authorities to change their internal administrative arrangements, is a proper way of proceeding. I remember numerous occasions during my career in local government when government wished to see changes in local authorities' procedures and arrangements. They were not handled in this way. One of my first jobs in local government, way back in the late 1960s was to consider the implications of a Royal Commission on management services in local government. A small group of us worked in my authority as a result of that commission to see how we could streamline the authority's business and affairs. At the end of it, the chairman of the study group and I looked at each other and said, "We're a pair of asses—we've done ourselves out of a job!" And we had. The fact of the matter is that most local government members, given a task to do, will look at that task and study it objectively. If there is merit in it, they will do what is required.
It must be said that some local authorities see merit in the proposals suggested in Clause 10 and are already on the way to putting in place the structures required. That is as it should be. If those structures and procedures are so superior, it will not be long before the vast majority of local authorities follow. One does not need compulsory legislation to bring that about; still less does one need all the mechanisms of petitions, referenda and all the rest of it. That is simply not necessary.
I happen to believe that local government and local people are sensible. There are some merits in proposing a more streamlined executive system in local government, but I well remember that in my own authority, if the chips were down, there was a small group of six members, including members of all opposition parties, who could do almost anything on behalf of that authority. They could do it because they had the trust of the members of their groups and the general trust of the members of the council. And if they had to act in such a way, they could be confident that the council would back them. That is right. We did not call it a "cabinet"; we did not call it "executive arrangements" or anything else. But it worked, and that is in the structure of many years ago.
I remember occasions when that structure was able to act so quickly that, when necessary, it could do so considerably more rapidly than private industry. Some people criticise local government as being hidebound, committee-bound and always waiting for excuses not to do things. It is true that in an element of local government that attitude is not only the appearance but the reality. However, the truth is that good local government works, and works extremely well and extremely efficiently.
We tabled Amendment No. 58 because we do not believe that it is right that "executive arrangements" should be compelled on local government. We do not believe that that is the appropriate way to proceed. As
1512
I said, the other amendments flow from, and reinforce, this amendment, which makes the provision a power rather than a duty. I commend them to the Committee.
I believe that we are at a crux point with the difference in approach between this side of the Chamber now—I use the word "now" because unfortunately it was not always so with regard to local government—and the views of the Government. It is rather sad that this clause of the Bill is in this form. I wish that it were not. I believe that I have said everything that it is essential to say on this group of amendments. I beg to move.
Baroness Hamwee: I have tabled a similar amendment which is not grouped with these amendments but is to the same effect; that is, to allow local authorities to take the decision for themselves as to how they should best perform their functions. I shall consider later whether I wish to move that amendment. However, I support the thrust of what the noble Lord, Lord Dixon-Smith, said.
Later in the Bill we shall come to the effect of the particular executive arrangements which are on offer. It is quite a short menu. However, our particular objection to this narrow part of the Bill is the complete refusal—apparently almost a closed mind—on the part of the Government to listen to debate at local authority level and to heed the very real objections being made to the proposals which are to be imposed. I can understand the Government saying to themselves, "Well, if it's members and councillors who are objecting, they are just thinking about their own positions. They are not really concerned about the wider good or the real outcomes." I would not say that that is how most councillors approach matters, but I can see that a government, looking at an interest group, would say that that was the attitude. However that does not seem to me the end of the story. Local authorities have been talking—not every local authority but many local authorities—to their communities and reviewing how they should go about conducting their business. Camden is one recent example. That is not an authority of which I should expect the Government to say that they disapprove. They have recently awarded it Beacon status in two service areas—housing benefit administration and schools.
Ten days ago Camden passed a resolution, part of which referred to the major consultation exercise which it has conducted with the people of Camden,
"which showed that there was no majority for any of the Government's models, rejects the Government's proposals relating to the 'executive/scrutiny split' as set out in the Bill, on the grounds that they will reduce democracy, lessen effective decision-making and seriously weaken accountability".
That was one of two resolutions passed that night to the same effect.
I am sad that we seem not to have a programme of piloting, of incremental change, of seeing how things work out other than that some authorities have—within the extent that it is possible under the law as it currently stands—put new arrangements into effect. It does not seem to me that other local authorities are yet

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in a position to assess the effect of those pilots, if they can be called that. The Government are seeking to leap straight into a narrow selection of possibilities because they know that those are the only possibilities which can be appropriate for the most enormous range of local authorities. Those local authorities have very different characteristics not only in terms of functions but also in relation to size, geographic and socio-economic demographic matters.
It is a great pity that having done such good work in Part I, the Government have now divided Members of this Chamber who wish the best for local government.
Lord Filkin: I agree strongly with the noble Lord, Lord Dixon-Smith, that this amendment is absolutely central to the debate about the Bill, although I differ from him as to the conclusion to be reached.
What is being proposed is a major opt-out clause for those local authorities which do not think it appropriate or necessary to change their structures. Perhaps I may touch on one or two reasons why I think that we cannot and should not support that.
First, it is a slight misinterpretation of the Council of Europe's charter of local self-government to imply that local authorities in the rest of Europe can choose the fundamental structures of their political arrangements. They cannot. They are either set within their constitutions or determined by federal or national governments. The local authorities in the different Lander in Germany cannot decide how they structure themselves. That is set by a higher authority for obvious reasons.
Secondly, the argument that is put that many local authorities are already embracing the need for change is true. It is impressively true on a cross-party basis. Authorities of all political complexions can be found to demonstrate acceptance of the need for change that emerged slowly following publication of the White Paper on local government modernisation and developed through the Bill piloted in the summer.
One cannot grossly generalise but there is a sign that many of the better authorities—I think of Herefordshire, Sutton, Kent and Hertfordshire—are already moving positively towards recognising that they want to, and will make, those changes. The thrust of the argument is that those not wishing to do so should be allowed that freedom. That is flawed. We are not talking about a situation where local government in England is seen as being in sound health, having strong public confidence and the confidence of the government of the day, whether the current Government or previous ones. That is not the case. There has been a major failure of confidence and leadership.
In the late 1980s, the Audit Commission pointed out that the way local authorities conducted their business through the committee system was long-winded and often a sham because decisions had been made elsewhere, led to virtually no scrutiny in practice, and was due for reform. That was revisited some six years later, and it found that nothing whatever had changed.
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I do not want to imply that all the local authorities that would opt out if the amendment of the noble Lord, Lord Dixon-Smith, were carried, are necessarily the most sleepy of hollows and the most in need of reform, but neither, from my direct experience, would I guarantee that the reverse is true.
It is not as if this is an unannounced form of change. A lot of preparation has taken place in relation to this change and, as we shall debate later, there is considerable scope for variation. The current law only allows one option. The legislation, if passed, will allow for a substantial increase in the number of options that, in practice, will be available to local authorities. Therefore, if we as a Committee are in favour of a strengthened system of local government, with stronger scrutiny and no longer having decision-making taking place in a sham system but in one in which decisions are properly challenged through a vigorous process, we must not allow opt-outs to take place in the way proposed.
Lord Hanningfield: I speak in support of the amendment tabled by my noble friend Lord Dixon-Smith and in support of what the noble Baroness, Lady Hamwee, has said. Come this May I shall have been in local government for 30 years—in a large authority, Essex County Council, as was my noble friend Lord Dixon-Smith, so we have something in common.
During that time, the situation has changed immensely. The structure or the processes in Essex are nothing like they were 30 years ago. Every two or three years we have changed our structures and we have looked at our committee system. We have tried to speed up our decision-making. I would be one of the first to admit that sometimes in local government we are not quick enough in coming to conclusions or decisions. Often that is because we want to discuss matters and to consult the public further. In local democracy there is nothing wrong with that.
I am concerned about the executive arrangements. Since the White Paper was published, I have looked at several other systems throughout the world. There are several such executive models. I have looked at New Zealand and the United States and I know a lot about what happens in Europe. Where there is an executive system, there are fewer councillors. In Essex we have 79 councillors, all with large electorates. My own electorate comprises nearly 20,000 people which is almost as big as some parliamentary electorates. To have an executive of 10 would perhaps mean that the other 69 could have a scrutiny role, but they would not have an effective role in running the county council. That is just not on!
The United States has executive arrangements. Fairfax County, south of Washington, is similar to Essex. It has over 1 million people and a budget similar to that of Essex County Council. It has an executive, but only 11 elected members form the executive. That system works well for that county in the United States.
New Zealand has elected mayors. There is an elected mayor in Auckland which is a city of over 1 million people, but there are 18 elected members. The system

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works well in that kind of area. To say that 10 members will form the executive will not work in a large local authority like Essex County Council where 79 members, with large constituencies, play a prominent role in making decisions in the county.
As the noble Baroness, Lady Hamwee, said the geographical situations of councils can be so different. Essex has an elect orate of 1.5 million, but large rural districts in Northumberland have far fewer people. How can it be said that there should be one or two systems for those different situations? It would be most restrictive. I disagree totally with the noble Lord, Lord Filkin, that there would be more options. We have many options now. We have, as we should have, a diverse system of focal government.
I support elected mayors. I am in favour of elected mayors—if people want them—as I believe that they provide a good system. I also support an executive where appropriate. However, in certain places it is just not appropriate, so we need another option.
As vice-chairman of the LGA, which is all-party, I travel around the country all the time, and I have never found as much unhappiness and unease as I have about the description of the executive system—the cabinet system—in authorities that do not want it. The Government have to give a bit. They should not alienate all local government members. I urge the Government to think again and to accept the amendment.
Baroness Hanham: I support my noble friend's amendment. I have a number of major concerns about what is proposed for the executive system, but the one that is most relevant—it follows on even after I look at the guidance produced—is the fact that most of the decisions made in local government under the executive system will be made by one party, and made in secret. There is no way of getting round that. The power is there for the executive—indeed, it is almost a diktat—to allow decisions to be taken by individual members, in private, and those views will only be able to be scrutinised by the scrutiny committee if it is able to call in those decisions before they have been implemented.
There have been suggestions that in the current system councillors are not really making decisions at all. But is that correct? At the moment we have a committee system 'whereby all councillors are involved in some way or another in making—some would say in rubber-stamping in some councils—decisions in the open. If the public decide to come to those meetings, they can do so and see how and when those decisions are made and what is said. That will not happen. It does not happen everywhere. It does not happen now where those executive arrangements have already been implemented. I believe it was Widdicombe who changed the system whereby decisions could be taken in secret and said that they had to be taken as far as possible in the open. We have all followed that advice ever since.
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This is a major problem in relation to the executive system. As my noble friend Lord Hanningfield said, to leave a small number of councillors, perhaps only one-fifth of those on the council, doing all the major work and taking all the major decisions, is not an option that we should allow to be carried through without thinking about alternatives. No system will be perfect. Indeed, the Government said that this system is not perfect, and that is why these amendments are being put forward. But let us not throw the baby out with the bath water; do not let us end up with a system of local government that people do not want to join.
Baroness Miller of Chilthorne Domer: Members of the Committee have spoken eloquently as to why this Bill is a divisive Bill in relation to local councils. It is divisive because what is being proposed is a false split. The noble Lord, Lord Hanningfield, said that few councillors will be taking decisions. But in authorities that presently work well, councillors sometimes play a senior role and take the chair in one matter and in another play a more back-bench role.
The amendment will preclude an easy movement for any councillor between those roles. Though we have heard a great deal as to how the system will increase the representational role, there is not yet any evidence of that happening. I am an optimist and believe it may happen. But it is extremely regrettable that we have been presented with a model which will place those representational councillors in what may be seen as a second-class role, though the Government are promoting the matter in a different way.
The noble Lord, Lord Filkin, said the fact that many local authorities have already gone down this road is an indication that they are keen on this model. I think it is more likely that they are keen on embracing change and that they do not want to be seen to be stagnating. However, until this Bill is passed, they are able to experiment with change in a way that they want; indeed, they may do so in an incremental way, as my noble friend Lady Hamwee said.
As the noble Baroness, Lady Hanham, pointed out, unless we have PR for local government, this will encourage the one-party state that can meet in secret, behind closed doors. It seems incomprehensible to me that we could be moving from something that was supposed to open up local government and to allow more consultation to a model that allows a one-party cabinet to meet behind closed doors.
We have talked a good deal about councillors in this debate. Many worries have been expressed by officers about this model. They feel that they will be put under a similar strain and that they will be asked to fulfil the almost impossible task of supporting both the executive and the scrutiny roles at the same time. Therefore, because no council will be able to afford or want to employ a duplicate staff, it is likely that those officers will one day have to wear one hat and the next day wear another.
It is true that the best of officers have always maintained a scrupulous ability to be impartial and offer the appropriate advice in each position. But

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because of the way that this model so starkly divides councillors, I believe that more and more of a strain is likely to be imposed on officers working within the system. It is regrettable that models have been laid down in so very precise a form. As we move into some of the detail and begin to look at the regulations controlling the way in which scrutiny and executive will work with area committees, we shall begin to see some of the great difficulties that these particularly strict proposals will produce.
The Earl of Carnarvon: I should like to pick up the point in relation to the independence of local authorities which will find this a very difficult situation. There are a large number of them—two borough councils, eight district councils and two county councils, as well as the City of London. They are not at all happy with the idea of an executive, especially one comprising 10 people. I wonder about this astonishing view of the Government that it has to be 10 people when there are authorities like Birmingham with 117 councillors, Bradford with 90, Leeds with 99, Liverpool with 100 and Manchester with 100, which is well known to the noble Lord, Lord Smith. It will not allow the other parties to be represented at the centre of things, and that is something which I believe has been very important in the whole of my life in local government. There might have been a majority of the majority party, but Liberal, Labour, Conservative and independents were all members of the executive of Hampshire County Council.
I am talking about Hampshire County Council when it had well over 100 members and was even bigger than Essex. We always had a situation where all parties were represented on what in those days we would have called "executive committees" such as are now envisaged. Ten members is much too small. I have tabled two amendments but I do not know whether we shall reach that stage this evening. I want to underline the worry that has been expressed to me by the county councils that are independent. They are extremely worried about being made to have an executive in the way outlined in the Bill.
Lord Woolmer of Leeds: In expressing some disagreement with the amendment as moved, perhaps I may reflect a little upon my experience, which is not entirely the same as that of noble Lords opposite. In Leeds they have already moved to the system that is now being put forward in a legislative manner. The executive was established with members of the opposition within it. The legislation as formulated entirely permits that. It simply is not the case that there must be a one-party executive.
If anything is demonstrated by the experience to date, it is that in different circumstances people still have a lot to learn. It is difficult for opposition members to stop acting as opposition members and to form a collective executive. Therefore there are problems in these areas. Leeds, which is one of the larger cities in this country, has demonstrated its
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willingness to experiment and not to be dogmatic or ideological in this matter but to seek the best outcome for its inhabitants.
The impression has been given that the mayors or executives that we are discussing would be extremely strong and dictatorial. In the guidance notes that the Government have provided, Members of the Committee will have noted that a distinction—this is not phrased in language that I would have chosen to use—is made between a strong leader and a weak leader. That is not an entirely fortunate use of words, as the so-called "weak leader" would be a leader determined by the council as a whole. The executive membership can be determined by the council as a whole and can be removed by the council as a whole. In other words, the formats that are possible under the legislation are much more varied than may have been indicated.
Like many others who are present this evening, I have had many years' experience of large city politics. I see a richness of provision in this area which is capable of dealing with a variety of situations. When the noble Lord reflects on whether to test the opinion of the Committee on the amendment, I ask him to recognise that there is far more richness of provision in this area than may appear to be the case.
9.45 p.m.
Lord Whitty: The noble Lord, Lord Dixon-Smith, is right to say that this is an important part of the Bill. We have heard a variety of views expressed in this Chamber and have heard a variety of experiences of Members of the Committee and of local government as a whole. That highlights the importance of the revolution in local government which this Bill hopes to bring about.
The aim of all the amendments in this group is to make the move to executive arrangements optional; in other words—as my noble friend Lord Filkin said—to provide an opt-out so that local authorities could opt for the status quo.The noble Lord, Lord Dixon-Smith, said that that was contrary to the European charter of local self-government. We do not believe that to be the case. Indeed, as my noble friend Lord Filkin also said, it is clear that the constitutional structure of local authorities is determined by statute or constitution in all countries. The administrative arrangements are another matter.
The constitutional arrangements that we propose here provide not only three different models but many varieties within those different models. That contrasts dramatically with the previous situation that had existed for many decades; namely, a single system, constitutionally speaking, with no option. We are therefore providing a wider option than exists at present. We are also providing an option which we believe allows local authorities to tackle the kind of difficult modern problems that confront them.
The noble Lord, Lord Dixon-Smith, is correct to say that even under the old system many councils moved towards a system which constituted, de facto, pretty much an executive council well before they were

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stimulated to do so by the knowledge that this Bill was to be produced. Far more have done so since they learnt that this Bill was to be produced. However, they have done so despite the constraints of the old system. I was interested to hear the noble Lord, Lord Dixon-Smith, say that in many councils the committee system and the old structure inhibited change and the reaching of decisions and inhibited their—although he did not quite use the term—modernisation to cope with the problems of the modern world.
The Government in no way believe that one form of executive decision making will be necessarily appropriate or desired across the board. That is the current situation and clearly the lack of choice is imperfect. The committee system—which may well have had its merits 100 years ago—was established to involve all interests in decision making, all on an equal basis. That has in the end, in effect, become a fairly opaque system and a constraint cm clear decision making.
The noble Baroness, Lady Hanham, suggests that the reality is that under this system we shall have one party making decisions in private. I believe that in many parts of the country—and, frankly, in parties on all sides of the House—that has been very much the situation in the past. The public have not had a clear, transparent and accountable system of government and it is not correct to pretend that they have. Councillors have not all been equal. Many of them have spent a lot of time on committees dealing with decisions which have already been taken elsewhere. Even councillors in a majority group may have little influence over decisions, and yet they are required to explain the actions of the council to the people they represent as if they were effectively executively responsible for them.
Nor has there been much of a push within councils to provide for clear political leadership within their structures. That is not a reflection on the quality of council members or of council leaders—to return to an earlier discussion which was picked up by the noble Baroness, Lady Miller of Chilthorne Domer—but is caused by the structures under which they operate. The current system does not serve to provide accountability; it does not serve to provide innovation; it does not serve to provide speed and effectiveness of decision making; arid it does not serve to provide the transparency necessary for the real exercise of democracy.
That is why we do not wish to maintain the status quo.. We believe that we need to move away from the status quo to a new form of government which rests on transparency; where it is clear where the decisions are taken, who takes them and who is accountable for them; and which, at the same time, allows the electorate, the population of the local authority, to be represented by councillors in questioning and in effective scrutiny of that executive system.
The Government have brought forward the Bill because we believe that all councils have to face up to this change. We do not believe that the status quo is serving the populations whom those councils
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represent. To be fair to the noble Lord, Lord Dixon-Smith, it was implicit in some of his comments that those councils which are least inclined to change the status quo under the old system, and which are least inclined to move on a voluntary basis, would fairly obviously be the same councils which would choose the status quo option were there to be one.
These arrangements are designed to enable councils to adopt the executive arrangements they wish within the overall structure. That structure is not—as was alleged—a false split. It is a division of the council which indicates where responsibility lies. We want to see local government which is responsive to its people and to produce councils which will do—and will be seen to be doing—what the local community wishes.
A key feature of our proposals is that authorities, in reaching their choice of structures, will consult widely with the local people and other stakeholders on their proposals. It is clearly not true that the options are narrow. Councils, even if they choose one of the three options, do not have a tight and structured option to which they have to stick absolutely. My noble friend Lord Woolmer spelled out the way in which Leeds, for example, is choosing to interpret the models we have presented. In that particular case—and in any other case—there is a possibility of involving members of more than one party in the structure of decision making. Under the present system where there is a majority in the council, that very rarely, if ever, happens.
I understand the genuine anxieties which have been expressed that opposition parties, independents or particular parts of the local authority would not be effectively represented in the decision-making structure. But that ignores the fact that the roles we are giving to non-executive councillors are much enhanced; they have a higher status and the provisions for scrutiny are much more effective than the present committee structure, where, in effect, all councillors on committees are party to the executive decisions and share the responsibility and accountability for those executive decisions.
In our approach there are two key differences and benefits. First, because of the provisions we propose in relation to consultation, involving the detailed provisions in the Bill relating to petitions and referendums, councils will know that they are governing through structures and constitutions that will, clearly and recently, have received public support. Secondly, whatever form the executive arrangements take, people will also know, from that point, who is taking decisions. Those decision takers will be subject to rigorous arrangements for the overview and scrutiny of the executive, providing greater transparency and accountability.
I repeat, it is a fallacy to say that those councillors who are outside the executive will have no role. Indeed, under the new structure, all councillors will have an enhanced role.
I shall not go into detail on the range of amendments tabled by the noble Lord, Lord Dixon-Smith. I recognise that he has raised a fundamental point, but

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I hope that he will consider the arguments that I have put to him and also consider the experience of my noble friend Lord Filkin, who has long experience of local government from a somewhat different perspective from that of many other noble Lords. The noble Lord should also consider the fact that the range of options within the three options has been and is being considered by local councils. Those provisions give enormous flexibility as to exactly how an individual council can implement its decisions so that they are appropriate to that particular form of council, whether it be a county council, a district council, an urban or a rural area. Clearly, many different patterns will emerge from this structure.
However, it would be wrong for the Government to allow councils that have failed to modernise themselves to take a further option of opting out of this process. It is important that every council and the electorates of every council have the opportunity to move to the new structure and to be able to comment and consult upon the exact form a local council will take.
No doubt as the Bill progresses through the House we shall return to the matters that have been raised tonight. However, having aired many of our differences, I hope that the amendments will not be pressed. Should noble Lords wish to take my words into account, no doubt they will wish to return to these issues at later stages. A difference of option exists here, but I hope that I have convinced at least some Members of the Committee that our proposals to avoid the option of a status quo have some merit.
Lord Hunt of Tanworth: Before the Minister sits down, perhaps I may ask him one question. I very much agree with the words of the noble Lord, Lord Filkin, concerning the right of the Government to prescribe the form of local government. After all, in the committee system itself the requirements for political balance and so forth are enshrined in legislation. Furthermore, I cannot join the school of thought that says, "Let all the flowers bloom" and allow a council to set up any arrangement that it thinks best. Powerful arguments have been advanced that the executive/scrutiny split will probably provide, in most cases, the best balance of transparency, efficiency and accountability.
However, what appears to worry many people is the fact that in a relatively few cases—whether because councils are of an independent composition or they are small—it may well not suit their circumstances. The Bill provides that the Secretary of State can approve other models. However, as I understand it—although this is not in the Bill—the intention is not to approve any model which does not involve that split. Can the Minister say whether my understanding is correct and whether there is a measure of flexibility on this? I believe that it is crucial to say explicitly that the three
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models are in place, that it is possible to look at others, but not if it does not involve the executive split, which might not be suitable for some councils.
Lord Whitty: The noble Lord, Lord Hunt, has given a correct exposition of the case. The Government believe that there is wide scope for different balances within the executive structures that we have proposed. As the noble Lord said, we are prepared to consider further models and we shall be open-minded towards proposals for further categories, but with a structure of executives. We do believe that that is the sine qua non of the kind of structures that are necessary for local authorities in the 21st century. Therefore, we are open to other proposals within and outside the three models, but the executive structure is important to us and we believe that it is important to local government.
10 p.m.
Lord Dixon-Smith: We have had a most interesting debate. I am grateful to those who have taken part in it. I shall run through what seem to me to be some of the salient points, because this is truly one of the crunch points in our debate on the Bill.
The noble Baroness, Lady Hamwee, was generous in her support for the principle of the amendments. I suspect that she and I could debate the detail for some time. The fact of the matter is that we come down on the same side of the fence—that is, essentially against the Government. The noble Baroness said that there have been some particularly successful pilot schemes. It is good to acknowledge that, but pilot schemes of volunteers have been moving in this direction anyway. I am grateful to the noble Baroness for all the points that she made.
The noble Lord, Lord Filkin, rightly said that local government is not in particularly sound health; nor does it enjoy strong public confidence. That is an immensely sad fact. I regret it, but it is something we all have to live with. I have to say—I say it with immense regret—that those who have done most to erode public confidence in local government have been in central Government. Again I ascribe no political blame for that; but nothing in the Bill will remove that. That is sad.
My noble friend Lord Hanningfield mentioned the changes that are already taking place. Indeed, authorities of all political persuasions are moving in the direction in which the Government would like to see local government move. They do not need legislation if there is merit in the proposals. That is a reality. When you come to compare what we do in this country with what is done in other countries, it is as well to remember that that comparison must include the totality of the systems that exist abroad. The fact of the matter is that in other countries there are far fewer members in all major authorities. I once went to Essex County in Massachusetts. It was a very interesting experience. There were five county commissioners. In order to be a county commissioner in Essex, Massachusetts, you had to have 10,000 signatures on your nomination paper. That was a little political device by the Democratic Party to keep out the

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Republicans. I had some very interesting discussions with the first Republican Member who managed to achieve that target and be elected. But the systems are not always what they appear to be.
The noble Baroness, Lady Miller of Chilthorne Domer, mentioned two points. She referred to councillors' fear of this enforced change. She may well be right to suggest that it is a disincentive to stand for election. She is also right to mention the possibility, not to say probability, that this will impose considerable strain on the allegiance, loyalty and, indeed, enthusiasm of officers. That is particularly so in smaller authorities where the staff is not sufficiently large to permit the easy building of "Chinese walls" between the executive function and the function of oversight and supervision.
The noble Earl, Lord Carnarvon, mentioned the views of independents who, likewise, are concerned about their prospects. Unlike national government, with the exception of this House, they are a rare and special commodity. If the independents are concerned, we should be concerned.
My noble friend Lady Hanham gave me general support. My noble friend is concerned about the impact the provision will have on both the members and staff of authorities. The noble Lord, Lord Woolmer of Leeds, made a most interesting point. He said that opposition members are always opposition members. That is sad but true. I remember impassioned argument with the previous government behind closed doors—trying to tell them that that was a fact of life. Noble Lords sitting opposite would do well to remember that. There was a time when all three local government associations, as they then existed, were under Conservative control. If one looks at the pattern of results in local government elections, we are moving in that direction. That is a political reality. The political reality is that this country deals in participative democracy.
The noble Lord, Lord Hunt of Tanworth, expressed concern about the Government's approach, which appears to be that one size fits all—or all three sizes fit all. I am not sure whether that is appropriate. In his remarks the Minister acknowledged that there is room for tweaking at the edges as long as it is within an executive system so that there will perhaps be a number of variations on a theme. Of course, the criticisms of the existing system are valid. They are valid because local authorities vary immensely across the country. Some are good; some are less good; some are not good; and some are probably something worse than that. But we are talking about human organisations. We are talking about people. If we in this Chamber are all good, we are extremely fortunate. Some of us are good; some of us will be less good; and some of us will certainly be less good than that. That is the nature of mankind.
What concerns me about the Minister's remarks is that he did not say why we need to compel this revolution. There was a revolution in 1917 in another country. It had painful effects both in the short-term and in the long-term. That, of course, has nothing to
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do with the Bill. However, when one sets about compelling change, the law of unforeseen consequences usually comes into play. We do not know what the law of unforeseen consequences will do as a result of this part of the Bill. Evolution would be better than revolution. The Minister hinted at it in his response, but he did not say that he would accept the theory of evolution, even though it may receive general scientific acceptance nowadays in a somewhat different context.
We have had an interesting debate. I do not intend to take up the Committee's time further except to say that this is a matter to which we shall undoubtedly have to return. I do not think that there will be any ducking of the issue. I am grateful to the Minister for his reply. It helps us to be informed in our response to the debate. I am sure that there will he a further response. However, the Minister will be glad to hear that it will not come tonight. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Whitty Lord Whitty moved Amendment No. 59:
Page 5, line 6, leave out from ("authority") to end of line 7 and insert (", and
(b) under which certain functions of the authority are the responsibility of the executive.
(2) Executive arrangements by a local authority must conform with any provisions made by or under this Part which relate to such arrangements.").
The noble Lord said: In moving this amendment, I shall refer to the large number of other amendments in my name in this group. The amendments make provision on the definition, construction and detailed operation of the executive arrangements and the public availability of the details as part of the council's constitution.
Amendment No. 59 clarifies the meaning of "executive arrangements". Amendment No. 237 introduces a new clause requiring an authority that is operating executive arrangements to maintain a copy of its constitution available for inspection. Amendments Nos. 62, 63, 66, 76, 153, 157 and 158 are intended to improve the Bill by providing clearer labels for the different types of executive provided for in Clause 10 and using those labels in later provisions of this part of the Bill for the sake of consistency.
Amendment No. 82 provides that only the full council may discharge certain functions. These are: the election of the leader of the authority in the leader and cabinet form of constitution; the appointment of the other members of the executive in those authorities where these appointments are made by the council rather than the leader in that form of constitution; and the appointment of the council manager in the mayor and council manager form of constitution. Amendments Nos. 261 and 262 are technical.
Amendments Nos. 154, 155, 156, 159, 160, 161 and 162 provide for an elected mayor to appoint a deputy mayor who must be (and continue to be) a member of the authority. The mayor may bring to an end the appointment of a deputy mayor and appoint a

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replacement at any time. The deputy mayor will act in the place of the elected mayor if that post becomes vacant. In the case where the mayor and the cabinet form an executive, the whole executive will act in their place and arrange for representation in the mayor's place or on any bodies on which he or she was a member on behalf of the authority. In the case of the mayor and council manager form of executive, the council manager will act in the mayor's place.
Amendment No. 242 provides that where an elected mayor is a councillor of his or her authority, the circumstances of his absence will be short-lived. If the post of elected mayor is vacant, there should, under the existing law as it relates to councillors, be a by-election unless the next normal election is due within the next six months. Amendment No. 242 also has the wider effect of bringing elected mayors within the legislation on allowances.
Amendment No. 165 makes provision for a political assistant for a directly elected mayor. Amendments Nos. 163 and 164 clarify the rights of the council manager to attend and speak at meetings.
Amendment No. 238 makes it clear that the statutory guidance that may be issued by the Secretary of State under Clause 24 can apply to any provision in, or made under, Part II of the Bill.
All of these amendments spell out the Bill's general approach and do not raise many new issues. If noble Lords have any questions on the amendments I hope that I can respond to them. There are a number of other amendments to which I shall refer when I wind up the debate. I beg to move.
10.15 p.m.
Baroness Hamwee: I have a lone amendment in this group, Amendment No. 240, which seeks clarification of a point that I have raised already this evening. Clause 24 provides for guidance—what a surprise!—and under subsection (3) that guidance
"may make different provision for different cases or descriptions of local authority".
Amendment No. 240 seeks to replace "cases or descriptions" with "categories" for reasons that I have already given; namely, that for the purposes of parliamentary drafting "categories" is accepted as a clear term in this situation. I wondered what a different case of local authority might be.
I should like to put to the Minister a question the answer to which I should perhaps know already. In Amendment No. 242 provision is made for the elected mayor to be treated as a member and councillor of the authority. Can the noble Lord explain to the Committee the difference between a member and a councillor? I have used those terms interchangeably and I must have been wrong all these years.
Lord Dixon-Smith: I apologise for not rising earlier. I thought that the Minister would rise to answer the question just put. My Amendment No. 239 is in this group and deals with a very small point in Clause 24, which provides that:
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"(1) A local authority must have regard to any guidance for the time being issued by the Secretary of State …
(2) The provision which may be included in guidance under this section includes, in particular, provision with respect to—
(a) the time within which local authorities must draw up proposals under section 18".
We believe that "must" should be "may" and that we are back in the business of compulsion versus responsible optional action.
This is a very simple little amendment. I shall not take up any further time other than to state what the amendment seeks to do and why it is there. I hope that the amendment will attract the Minister's attention and sympathy, although on current form he is not in the most sympathetic mood this evening.
Lord Whitty: If the noble Lord finds me unsympathetic towards this little amendment it is because Amendment No. 238 in this group would, if accepted by the Committee, delete the subsection to which his amendment applies. Therefore, there would be a certain illogicality in my accepting it. However, if Amendment No. 238 were to be rejected by the Committee I would oppose the noble Lord's amendment. As the noble Lord implies, effectively this is a return to a degree of voluntarism which ensures that there is a method by which local authorities may not draw up proposals after a certain date; in other words, if the deadline is removed they do not have to comply with the legislation. We are not prepared to allow that loophole.
In relation to Amendment No. 240 tabled by the noble Baroness, Lady Hamwee, Clause 24(3) gives the Secretary of State power to include different provisions for the different circumstances of authorities. As I explained in relation to an earlier group of amendments, "categories of authorities" tends to imply kinds of authorities, for example district authorities, county authorities and so on. We may wish to differentiate between different classes of authority, if I may use the more normal term, to define districts, counties, London boroughs and so on. We also want to differentiate in some cases between authorities which are operating different kinds of executive systems. We might wish to distinguish between authorities of different populations or different geographical size—rural, urban or riparian. Such flexibility is important because certain details of an authority's constitution may well be different because of the size, nature or geographical location of the authority. That is why we have used the formulation "cases or descriptions" which is fairly commonly used in local government legislation to provide such flexibility. There is no more sinister reason for it than that.
As regards why Amendment No. 242 refers to the mayor being a member and a councillor, I am told that for historic reasons legislation sometimes talks about members and sometimes about councillors. We wish to ensure that both references would apply to the mayor in those circumstances. There is nothing more sinister or complex in it than that. I commend the amendment.
On Question, amendment agreed to.
Clause 9, as amended, agreed to.
Clause 10 [Local authority executives]:
[Amendments Nos. 60 and 61 not moved.]
Lord Whitty Lord Whitty moved Amendments Nos. 62 and 63:
Page 5, line 14, at end insert—
("Such an executive is referred to in this Part as a mayor and cabinet executive.").
Page 5, line 21, at end insert—
("Such an executive is referred to in this Part as a leader and cabinet executive.").
On Question, amendments agreed to.
Lord Hardy of Wath Lord Hardy of Wath moved Amendment No. 64:
Pages, line 25, at end insert (", and
(c) one or more councillors of the authority").
The noble Lord said: I do not wish to detain the Committee. I tabled the amendment because it reflects serious anxieties and fears held by a number of councillors. The fears may be misguided but they are serious. There is anxiety about the risk of continued centralised power; the power of the cabinets within councils; and the nature of the mayor's executive.
I believe that to a large extent the fears are misplaced, but they exist. Perhaps the Minister can say more on the amendment in response to my comments. I think that the fears are misplaced because I do not believe that we shall have from this Government the kind of legislation that was inflicted upon local administration in Britain over the previous 20 or 30 years, largely by the party opposite I cannot envisage this Government reorganising local government in the inflationary way that occurred in 1974. I do not envisage this Government introducing legislation of the kind which gave us the poll tax—one of the most expensive exercises in British history. I do not believe that most councillors would be prepared to allow a cabinet in their authority to conduct itself with disregard for good sense or to allow unbridled error or excess. There has to be the structure and arrangement within each council which ensures that sanity is served. I note that the Government issue appropriate advice to local authorities.
I am a little concerned about the possibility that an executive role might be filled by a mayor and an officer. I do not criticise many of the devoted people who serve in senior positions in local government. But there must be a democratic base. I do not think it wise to have an executive of two: t he mayor and, presumably, the chief officer of the local authority. I do not believe that that would help to meet the basic need of local government today: to restore public regard and respect.
I have no direct modern or recent experience of local government but I recall with some affection my own service as a young man. Between 1947 and 1974, in an authority with five wards and annual elections, our local council had over 140 elections, or possible elections, in that period; and my friends and I won every single one. That is quite a good record.
We won because we conducted our affairs responsibly and openly and were ever mindful of the democratic basis of our existence as local authority representatives. We must ensure that that democratic base is well served. If it is, not only can we ensure that standards remain high and that, where they do not, more prompt attention is given, but that public respect and regard for local government, which has diminished, is strengthened. In the areas which I know best, regard has fallen, as is illustrated by the decline in election turn-out, which is a disgrace. If we are to counter that tendency, we need to ensure that the democratic base is fully served. There should be no democratic deficit in the structure of executives in British local government. I beg to move.
Baroness Hamwee: I rise to speak to my Amendments Nos. 65 and 69. The first seeks to extend the number of possible forms of executive and builds on terminology used by the Local Government Association in giving evidence to the Joint Select Committee which considered the draft legislation. It provides for,
"a form of executive which meets prescribed requirements of transparency, accountability and efficiency".
I readily accept that I am going down the route of enabling the Secretary of State to prescribe matters in regulations, but, if we are to extend the number of forms and have an input into what they might be, I realise that without lengthy amendments that is the way to approach the matter.
I am sure that issues of transparency, accountability and efficiency will not divide the Committee. They are, as has been said tonight, the sine qua non of local government. Although we and many people outside the Chamber are concerned about the forms of executive we may be forced to adopt, I shall be interested to hear the Minister's defence of a system which will not incorporate the approach I have proposed, even if the drafting is incorrect.
Amendment No. 69 provides for a form on which the local authority has consulted its electors and other people in its area. The form enhances the decision-making process and meets the principles which I have set out. I have no doubt that the Committee could extend this debate to the length of our first debate today. I may have tempted it to do so, but I shall not speak longer tonight. However, it is part and parcel of the larger argument with which we began today.
Lord Harris of Haringey: I am slightly perplexed by my noble friend's amendment. Despite the objectives, which he set out cogently, relating to the importance of democratic accountability for any new system, his proposal appears to end up with a messy hybrid which satisfies none of those objectives.
When the Government consulted through their White Paper on the proposals, it was always clear that there was a third model which comprised a directly elected mayor and a city manager who would be responsible for many of the day-to-day executive functions. That is a clear model. I must say that it is not a model in which I am aware that many, if any, local

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authorities around the country have expressed the slightest interest. However, it has a certain purity, although not one I find particularly attractive.
If my noble friend's amendment were passed, one would end up with an executive which consisted both of paid officials appointed by the authority and elected representatives. That seems a hybrid form of government which would lack the clarity of one where there is direct election of an executive or an elected mayor or the executive consists entirely of elected councillors. For those reasons, the amendment is in my view misguided. It does not seem to satisfy the concerns apparently expressed by some people about the way in which executives function.
In any event, it makes the situation more complex, because as far as the public are concerned the executive responsible for decisions is a mixture of a directly elected mayor, some directly elected councilors—not necessarily elected for the function of being on an executive—and an official appointed by the council for that purpose. That seems a messy arrangement and one which does not really satisfy the objectives of transparency to which Members of the Committee have already referred.
10.30 p.m.
Lord Dixon-Smith: My Amendments Nos. 67 and 70 are in this group. I shall not take up the Committee's time for long but they need mentioning in passing, so to speak, although it is in passing in the light of the previous major debate we had.
Amendment No. 67 provides at page 5, line 25, that there should be a fourth option which would give local authorities the opportunity to pick their own form, which they consider, after proper consultation with their electorate, to be appropriate to their particular circumstances. We have debated the principle behind the amendment and I am in a sense slightly surprised that the amendment survives to this group. I have no intention of going over that ground again.
Amendment No. 70 removes subsections (5) and (6) from the clause. In effect it removes the power of the Secretary of State to make regulations because the regulations,
"may, in particular, provide for"
the form of the executive, and so on and so forth. We have covered that ground extremely well; I do not see any point in covering it in detail again. It is not appropriate that the Secretary of State should have that power. We may have a wonderful volume of draft regulations, but if anyone in the Committee has read them in detail and understood them, they are better men—or ladies, as the case may be—than I. These amendments are significant. I am happy to see them on the Marshalled List and I commend them to the Committee.
The Earl of Carnarvon: The independent councils greatly support Amendment No. 67 in the name of the
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noble Lord, Lord Dixon-Smith, because they feel that it gives them the opportunity to have a slightly different mix of executive and scrutiny functions.
Baroness Hanham: Amendment No. 68 stands in my name. It brings in from further on in the Bill, in Clause 21, the words of the noble Lord, Lord Whitty, as a part of the formal structure. In Clause 21 it appears as a possibility only after a referendum and after regulation. I believe that it should be brought forward in the Bill to provide the fourth option, the fourth way that a local authority might decide to try to structure its arrangements not totally in the executive mode.
We had a long debate on the executive structure earlier. I know that we are—it would be fair to say—not at one over the proposals as to how a council should be structured. However, I should like to leave this amendment as a fourth option—a way forward for those authorities which do not want to embrace totally the three models already produced by the Government—which could be adapted and, indeed, might be adapted, if necessary, within an executive structure. However, I believe that it is right and proper that local authorities should have that other possibility. Therefore, I leave the amendment for further consideration.
Lord Whitty: All the amendments in this group propose or give the facility for providing additional forms of structure beyond those which we have provided. I have already indicated that there is scope for substantial diversity within power structures and scope for other alternatives to come through. I do not believe that those alternative forms of structure would deliver the objectives that the Government have set out.
Amendment No. 65 requires effectively that any form of executive could be acceptable were it to meet the requirements for transparency, accountability and efficiency. However, that may well involve structures that are outside our prescription of executive scrutiny split. For the reasons that I spelt out earlier, that would not be acceptable to the Government.
My noble friend Lord Hardy of Wath wishes to introduce an amendment to what, as my noble friend Lord Harris said, has been the least remarked on of those options; namely, the elected mayor and council manager. Not only has that been the least remarked on, I suspect that it has been one of the most misunderstood. It is based on a separation between policy determination and policy implementation—the first for the council and the latter for the council manager.
However, particularly where councils are not very small, it is becoming increasingly common in many parts of the world for that form of government to include a directly elected mayor to give leadership to the council. That form of government has been adopted quite widely in the United States and also throughout New Zealand. In that sense, the elected mayor does not have an executive role. That is for the council manager. However, he or she is in a position to

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reflect the mandate given to the council as a whole and to the directly elected mayor through the election process.
I rather agree with my noble friend Lord Harris that if one was to add further councillors separately elected into that executive, that would muddy the water yet more. Three classes of person from different perspectives would form a single executive. Members of the Committee may have noticed that the mayor in that form of executive will be under a duty to appoint a deputy mayor, who will take the place of a mayor when the mayor cannot fulfil his duties or when the post becomes vacant. That deputy will not be part of the executive. That is deliberate because, once again, it would muddy the waters were that deputy to become a party to the executive. The same must apply a fortiori to councillors who have a different basis of election than the mayor.
Therefore, I fear that we are not attracted by the proposals of my noble friend Lord Hardy. I understand the motivation behind them; that is, to spread the elected basis of people who are within the executive. It may well be that councils feel that they cannot adopt that structure for that very reason. However, if they do adopt that structure, that is what is intended and that is the clarity of structure that it provides. It may not yet have proved hugely attractive to a large number of councils, but that is what is intended. I believe that the proposition changes the nature of that option.
In relation to Amendment No. 67 in the name of the noble Lord, Lord Dixon-Smith, and, to some extent, Amendment No. 69, if the objectives of those amendments is to promote greater diversity, I fear that they do not achieve that. I wish to add only that many authorities already operate shadow executive arrangements under current legislation. However, effectively the amendment would allow remnants of the previous, or existing, system to be retained and the executive structure would not have the clarity of distinction from the scrutiny structure that we seek.
The same applies to Amendment No. 68 in the name of the noble Baroness, Lady Hanham. In a sense, that is effectively grafting the possibility of an executive role on to something very like the existing committee structure. Again, I do not believe that that has the clarity of accountability and responsibility which we seek under the new arrangements.
The Government's reason for proposing a move away from the traditional committee structure is precisely to provide such identifiable and accountable executive responsibilities. I covered that on the previous group of amendments. I do not believe that any of the proposed alternatives fall in with our objectives as set out under the three options which we have proposed which make the clear distinction between the executive and scrutiny functions which we wish to see in all councils. There may be other options
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which achieve that, but these options do not do so. Therefore, I hope that the amendments will not he pursued this evening.
Baroness Hanham: Before the Minister sits down, perhaps I may draw his attention to Clause 21 where the arrangements which I propose are word for word what is included in government amendments to Clause 21.
Lord Whitty: To which amendment is the noble Baroness referring?
Baroness Hanham: Amendment No. 197.
Lord Whitty: We shall deal with Amendment No. 197 later in our proceedings. The arrangement which we provide there is possible only in the circumstances in which there has been a referendum on the proposition from the authority that there should be an elected mayor and where the executive arrangements have been rejected by the electorate. In that situation, we are allowing some flexibility as regards the models which would apply in those circumstances.
The prime requirement is that all authorities should go through the process of finding a structure which they believe is suitable for them and which makes a clear distinction between the executive and scrutiny functions. If they do so and the electorate rejects it, they are in a somewhat different situation. But we require all authorities to undertake that process.
Baroness Hanham: The point is that if that provision was moved to the position in the Bill to which my Amendment No. 68 applies and the referendum were abandoned, we could have the fourth option.
Lord Hardy of Wath: From the debate that has taken place, it seems clear that the option which I found most offensive is hardly likely to be enthusiastically supported. I certainly hope that it will not be.
I am grateful for the consideration which has been given to this matter. I am happy to have the information from my noble friend that this particular option seems less likely to be popular in London than some people in the north of England may fear. In view of the comments which have been made and the fact that this matter has received serious consideration, I shall withdraw the amendment. But I trust that the Government will in no way push this particular structure down the throats of British local government. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 65 not moved.]
Lord Whitty Lord Whitty moved Amendment No. 66:
Pages, line 25, at end insert—
("Such an executive is referred to in this Part as a mayor and council manager executive.").
On Question, amendment agreed to.
[Amendments Nos. 67 to 70 not moved.]
[Amendment No. 71 had been withdrawn from the Marshalled List.]
10.45 p.m.
Baroness Hamwee Baroness Hamwee moved Amendment No. 71A:
Page 5, line 29, leave out ("each member of which is") and insert ("not more than 60 per cent. of the members of which are").
The noble Baroness said: In moving Amendment No. 71A I shall also speak to Amendments Nos. 72 and 73. On these amendments we look in more detail at the form of cabinet which may be proposed in regulations that the Secretary of State may make under Clause 10(6). The subsection provides for a form of executive, each member of which is elected by the local government electors to a specified post associated with the discharge of particular functions.
I attempt to skin this particular cat in a couple of different ways. The first is to propose that not more than 60 per cent of the executive—I accept that that is a figure plucked out of the air for the purposes of the debate—be elected to specified posts. The second, and the point I want to explore, is to suggest that the executive may be directly elected but not elected to specific posts.
I am concerned about the lack of flexibility if there were direct elections not just of the mayor, but also of members of the cabinet who would not be in a position, if I read the clause correctly, to move between different posts. I do not believe that that would be healthy for local government. Depending on the frequency of elections, cabinet members would be stuck in positions for, say, four years with no career structure. One could go into a cabinet with responsibility for, say, leisure services, but not be able to develop one's interest in transport or environmental matters, thus allowing someone else who has or is developing expertise in leisure services to come into that area.
I do not understand why the Government have seen fit to be so careful not to allow movement. I assume that regulations would provide for a by-election if a member resigned or died. Nevertheless, it seems an odd cabinet where the leader or senior members cannot be part of a discussion about how to reorganise the split of functions and the responsibilities for functions.
Can the Minister give the Committee further explanation of the reasoning behind this model and why the Government spell out on the face of the Bill what is not now permitted but may be proposed under regulation made by the Secretary of State? In other words, a possibility is being dangled in front of us, but it will not happen yet. I would be grateful for such an explanation as I do not fully follow the Government's thinking. I beg to move.
Baroness Farrington of Ribbleton: I am afraid that the Government cannot support Amendments Nos. 71A, 72 or 73. When I explain the reasoning, it is possible that the noble Baroness, Lady Hamwee, will understand our position more clearly.
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I should explain that the Government do not have any particular form of executive in mind based on the provisions of Clause 10(6). It is there to ensure the widest scope for forms of executive which may be requested by local authorities or others which the Secretary of State believes will meet the aims of the Bill. But the amendments would prevent the Secretary of State providing for executives in which all the members were directly elected, or some were elected to specified posts and others elected on a slate basis, for example.
I stress again that we do not have any plans to provide for such forms of executive. If we had a clear idea about further forms of executive which we should like to see in place, we would have placed them on the face of the Bill before the current subsection (5) of this clause. We merely seek to ensure that no potentially valid forms of executive are closed off by unwarranted restrictions to the power in this clause to add further forms of executive in due course. I hope, therefore, that the noble Baroness will feel able to withdraw her amendment.
Baroness Hamwee: It may be the time of night, but I confess that I do not understand the answer.
Clause 10(5) says that the executive,
"may take any such form as may be prescribed in regulations made by the Secretary of State".
Members of the Committee may have objections to that; we voiced them in other contexts. Clause 10(6) says that,
"Regulations … may, in particular, provide for",
a form of executive which the Government may not want to propose. It is suggested that if the provision is amended, it will limit the options under Clause 10(5). Unless Clause 10(6) sets out exclusively the totality of the forms that can be prescribed under Clause 10(5)—clearly it does not if English means anything—I fail to follow how my amendments have narrowed the possibilities. Indeed, I do not understand why Clause 10(6) appears on the face of the Bill at all if the situation remains as open as the noble Baroness said.
I am genuinely concerned that the cabinet that this model appears to be promoting is one which will be so restrictive as to constrain the operation of an authority which adopted it. That is one argument as to the validity and desirability of this model. The wider point is the relationship between subsections (5) and (6) of Clause 10 which, although I shall go back and read the answer, does not appear so far to have been satisfactorily explained.
Baroness Farrington of Ribbleton: I am happy to write to the noble Baroness. My understanding is that part of her proposal deletes some of the variety of options. However, it may be more satisfactory for me to write to her, place a copy in the Library and send a copy to the noble Lord, Lord Dixon-Smith.
Baroness Hamwee: The amendment does delete some of the options. That in part was for the purpose of debate. One has to find some form of words in order

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to explore the principle. My underlying point is the relationship between those two subsections. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 72 to 74 not moved.]
Baroness Hamwee Baroness Hamwee moved Amendment No. 75:
Page 5, line 37, at end insert—
("( ) The authority may determine the title to be used for the position of mayor elected under this Act.").
The noble Baroness said: In case the Government feel that they have, so to speak, "bought" an argument on Amendment No. 74, I can say that it covered the same ground as that spoken to by the noble Lord, Lord Hardy of Wath. That is why I did not move it.
Amendment No. 75 takes us to what I suspect may be a rather vexed question among the little group of people who are concerned about matters of ceremony, and so on. I refer to the possible confusion between the elected mayor and the ceremonial mayor to whom we are all accustomed.
I believe that many members of the public set high value on the work done by ceremonial mayors; indeed, I do. My observation of the activity of mayors is that they are frequently extremely hard working and spend an awful lot of time within the community. I do not think that I have ever heard a former mayor saying, "I didn't actually learn anything during that year". They all tend to say, "I met so many groups of people and learnt so much about my own area that I didn't realise I didn't know". They are valued by members of the public: as representing the council and the government of that area.
Like other noble Lords, I consulted a dictionary to see how the word "mayor" is defined. The Shorter Oxford English Dictionary, the one to which I had access, was not very helpful, because it defines a mayor as being the,
"head or chief officer of the municipal corporation".
So it was ahead of fits time, but not very helpful in this context.
I believe that the Government take the view that there should he flexibility at local level to combine the functions of an elected mayor with the ceremonial role. I am not arguing against that, although I have to say that I am rather doubtful as to whether it would work. They also say that the elected mayor must—and this is where I find some difficulty—be called "mayor". I would prefer to see the continuation of some old traditions and not have our language distorted in this area by the "modernisation" that is being applied through this process. If and when the public is told that it may have two mayors, I believe it will add to the confusion and not assist matters. I beg to move.
Baroness Farrington of Ribbleton: This takes me hack. Indeed, very many years ago I remember a television programme that included Ernest the Policeman and, if my memory serves me correctly, Larry and Mr Mayor.
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We already have this position with regard to London. We debated the point at great length in that respect. Looking carefully round the Committee to see which Members are present, I should like to refer to the time when I was—and the Lancashire terminology was in use—chairman of Lancashire County Council. Many district councils already have more than one mayor, because there is a town council mayor, as well as a borough mayor. Other boroughs have chairmen. So a wide variety of terminology is in use. Before speaking in detail to this amendment, perhaps as I come from Preston I may register the fact that nothing would prevent Preston from being able to opt to have either a charter mayor or a guild mayor.
There are attractions to Amendment No. 75, but we feel that it is important for there to be certainty about what a person operating under that particular title is responsible for and how he or she may be held to account. On balance, we think that there should be clear provision in the Bill as to the type of mayor.
As I said, where an authority is entitled by virtue of borough status to call its chairman a mayor, it will he clear, if there is also a leader in the form of executive under this Bill, that the mayor is the chairman rather than any directly-elected figure. If such an authority were to move to arrangements that included an elected mayor and it wished to retain the title of mayor for the chairman, the Government would either need to find a different title for the elected mayor or let local authorities choose a variety of titles for that figure. We believe that greater certainty would be delivered if there were a clear rule that if there is an elected mayor under this legislation, it is that figure who is known as the mayor and the chairman as the chairman. or the chair as the chair, depending on the wishes of the local authority.
I should therefore be grateful if the noble Baroness, Lady Hamwee, felt able to withdraw her amendment.
11 p.m.
Baroness Hamwee: I cannot say that I am persuaded by that response. In the situation that is to pertain in London there will be a number of mayors. There will be mayors of different authorities. However, I am concerned about confusion within one authority. I cannot readily anticipate the same level of excitement among some groups if they believe that they are to be visited by the chair rather than the mayor as representing the local authority.
I shall not pursue the matter for the moment but I believe that it is a sensitive one. As people outside this building begin to be aware of what is proposed, I shall be surprised if the Government do not receive some emotional lobbying on this matter. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Whitty Lord Whitty moved Amendment No. 76:
Page 5, line 38, leave out ("local authority executive which takes the form specified in subsection (2) or (3)") and insert ("mayor and cabinet executive or a leader and cabinet executive").
On Question, amendment agreed to.
Baroness Hamwee Baroness Hamwee moved Amendment No. 77:
Page 5, line 39, after ("not") insert ("be fewer than 5 nor").
The noble Baroness said: Amendment No. 77 is grouped with Amendments Nos. 78, 79, 80 and 81. In moving Amendment No. 77, I shall speak also to Amendments Nos. 79 and 80.
Here we are discussing the size of the executive and the size of the cabinet. The noble Earl, Lord Carnarvon, has tabled important amendments in this group. His amendments and my Amendment No. 77, and Amendment No. 80, which stands also in the name of the noble Baroness, Lady Hanham, probably share the same concern; namely, a concern about there being a small clique of members who will have inappropriate power.
Amendment No. 77 seeks to include a minimum number of members of a local authority executive. At present the Bill states that the maximum number may not exceed 10. I believe that a cabinet of two or three members should not be permitted. A further amendment in the group in my name seeks to delete a provision with regard to the maximum number. I have strong doubts as the appropriateness of the Secretary of State having the power to prescribe the maximum number. That seems to me to be a great extension of the control that is being imposed.
My Amendment No. 79 seeks to clarify the position with regard to deputies and substitutes. I accept that there may not be much of a distinction as between those terms. It may come as a surprise to the Committee to hear that the amendment is intended for clarification. I was rather surprised by that notion when I reread the amendment. However, I am unclear—I seek an explanation from the Government on this point—as to what scope exists for members of the executive to bring in other people to deputise for them.
I have already expressed my concern about the lack of flexibility that may exist within the tight models that are proposed. I believe that it would be sad if it were not possible for other members of an authority to be brought in to act as deputy to a member of the executive. We shall discuss this at far greater length when we debate the overview and scrutiny committees. Such a provision would permit some experience of executive responsibility and go some way towards furthering the career structure and breadth of experience of councillors. A number of us have concerns about that. I do not think that it is healthy—particularly if there is a very small executive—for there to be no possibility of deputising. As a matter of sheer practicality, I wonder whether the system will work if there can be no deputies. I believe that the Government's thinking at the moment is against the possibility of deputies acting on the executive. I beg to move Amendment No. 77.
Baroness Farrington of Ribbleton: In responding to Amendment No. 77 I shall speak also to Amendments 78 to 81, which are grouped with it.
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As the noble Baroness, Lady Hamwee, said, the joint effect of Amendments Nos. 77 and 80 is to place a firm minimum on the size of cabinet—that is to say, the number of members—but to allow flexibility in either direction on the maximum number of members possible. In practice, the latter flexibility is likely to be used to increase the maximum size of cabinet as many might argue—as have some noble Lords—that restricting cabinet size to a range which is narrower than from five to 10 would be over-prescriptive.
The firm minimum seems undesirable to the Government. It would make impossible any arrangements based on a very small cabinet and very wide delegation to officers, for example. Neither would the Government wish to see executives any larger than 10. This is already a large number in terms of managing meetings and it could be a significant proportion of a medium-sized authority. Given the bar on members of the executive serving on the overview and scrutiny committees, providing for a higher maximum could render proper rigorous scrutiny of the executive impossible, thus losing much of the enhanced accountability that is the objective of the legislation.
The noble Baroness, Lady Hamwee, has referred on several occasions to the issue of flexibility and moving between roles. She seems to imply that the scrutiny role is a subordinate role, that career progression is to be seen as inevitable and that it is desirable for all councillors to be able to move between the two roles. The purpose of the legislation—I am sure all noble Lords who have had experience in local government will be aware of this—is to ensure that those who wish to fulfil a proper scrutiny role on behalf of the people who elect them, but who do not wish to turn their council service into a full-time career and wish to be able to maintain their other life outside local authority service, should be given the opportunity to do so. I hope that the Committee will not see scrutiny as being a lesser role. For this reason Amendments Nos. 78 and 81 cannot be supported either.
Amendment No. 79, which stands in the name of the noble Baroness, Lady Hamwee, deals with deputising for members of the executive. The Government are opposed to any kind of deputisation or substitution because we believe that it is extremely important that there should not be conflicts of interest. It would be very difficult for a genuine scrutiny role to be undertaken by someone who had been a party to the taking of the executive decision and who was then asked to make a judgment on it.
We do not intend that the executive should be some kind of sealed unit. We do not believe that there should be entire separation between the executive and other councillors. The executive will wish to take advice from other councillors, either informally or, for example, in committee meetings, and of course they will all come together in full council to determine the policy of the authority. However, the Government feel that it is important to avoid the possibility of conflict and we would not be in favour of formal arrangements for councillors outside the executive to stand in for executive councillors.

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I realise, from the contribution made by the noble Baroness, that she may find this response neither totally acceptable nor one with which she agrees. Nevertheless, I hope that she will feel able to withdraw her amendment.
The Earl of Carnarvon: I understand that the Government do not wish to move on Amendments Nos. 78 and 81. However, I believe that to have 10 people on the executive is very few on a large authority, such as the City of London with 155 members and Birmingham with 117. Altogether, 13 authorities have over 80 members. In some cases I believe that exceptions must be made. Obviously, I was not aiming for 15, but I wondered whether there was an opportunity to agree a figure somewhere between 10 and 15 if an authority felt that to be necessary. I wished to invite the Government to comment on those suggestions.
Baroness Farrington of Ribbleton: I hope that, on reflection, the noble Earl, Lord Carnarvon, will feel that the earlier reply I gave to the noble Baroness, Lady Hamwee, covers the points that he has raised. However, I should like to make the point that the size of the executive is not directly and proportionately related to the number of elected members on the authority. The point that the noble Earl made did not envisage the executive and strategic roles that would be fulfilled by the executive. If, however, there are further points that the noble Earl wishes to raise, I shall be only too happy to write to him.
Baroness Hamwee: I fear that the practical result of these measures may be that we are heading for authorities which do not comprise 117 or 150 members. Without commenting on whether the executive, overview and scrutiny roles differ in their seniority or worth, I remain concerned that it will not be possible for individuals to swap between the different roles. I accept that it would be awkward for individuals with lobs outside the local authority to take on an executive role. Nevertheless, I say again that I do not think it healthy to preclude the variety of experience that may be brought to bear in the cross-fertilisation of the contribution of different councillors serving on an authority. Their experience in different roles informs each successive role they take on.
The Minister is right to say that I am not entirely happy, but I shall not pursue the matter. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 78 to 81 not moved.]
Lord Whitty Lord Whitty moved Amendment No. 82:
Page 5, line 43, at end insert—
("(10) Section 101 of the Local Government Act 1972 (arrangements for discharge of functions by local authorities) does not apply to the function of electing a leader under subsection (3)(a) or appointing councillors or an officer to the executive under subsection (3)(b)(ii) or (4)(b).'').
On Question, amendment agreed to.
Clause 10, as amended, agreed to.
Clause 11 [Executive functions]:
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 83:
Page 6, line 13, leave out subsections (3) to (5).
The noble Lord said: I must confess to the Committee that I allowed my eye to be seduced by the heading of Clause 11. It states "Executive functions". Indeed, it is repeated with added force in the margin. It seems to me slightly odd that it needs to be repeated in precisely the same terms. Perhaps the amendment was put down without sufficient care and perusal.
I need to say something about this matter because the clause made me think of a grammar exercise I was given at a relatively young age at school. It was handed to all members of the class. It was all in lower case—evenly spaced, no capitals, no nothing. It went like this: that that is is that that is not is not is not that it. We were invited to punctuate it so that it made sense. I see from the nods and laughter around the Committee that other Members were set precisely the same puzzle. It represents a fairly simple philosophy of life, because things that are, are, and things that are not, are not. This amendment actually sets that on its head because it says that that is, is not, and that that is not, is. So I have some difficulty in following it. If it is specified in regulations, it is not susceptible to executive function; and if it is not specified in regulations, then it is. I do wish that the Government could find a more felicitous way of framing these clauses so that one does not have to deal with that illogicality.
The Minister has withdrawn the clause that was originally on the face of the Bill and has replaced it with something that is immediately and immensely longer. I think that his amendment falls into precisely the same trap. I invite him to consider that point.
That said, if I were to press the amendment I would be in danger of putting myself in the position of proposing an illogicality. Therefore, when the time comes, I may well decide that it should not be pursued. However, we need to reach that point before I can do so.
11.15 p.m.
Baroness Miller of Chilthorne Domer: I rise to speak to Amendments Nos. 85, 86, 123 and 127 which are grouped with this amendment. It is regrettable that at 11.15 at night we should be starting on a part of the Bill which deals with a new form of working for local authorities. The amended clause is long and was set down very recently. Earlier today we said that we had not had much chance to look at the amendments and comment on them. That is certainly the case for the local authorities which want to see what these provisions mean for them.
It is in no way satisfactory to introduce amendments on the functions of something that is already new to us and where the guidance provided is very far from clear. I want to concentrate on some of the guidance to see how it relates to the functions explained here. I should like particularly to ask the Minister about the section that concerns area committees. The guidance says that unless area committees are politically balanced they cannot fulfil the scrutiny function. Some Members of

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the Committee may be aware of how area committees work in different parts of the country. The one thing they have is fairly widespread public support. It is perhaps the only form of council committee that has recently enthused the public to attend and take part, even quite frequently. For that reason it is important that the Government are quite sure about what they are doing when they make this kind of statement.
To require that area committees should be politically balanced shows a complete misunderstanding of how they come to be set up. They are directly elected by the electors of their area. Therefore, it is difficult for the council to make them politically balanced unless it ships in councillors from another area. That has happened in some cases, but I would regard it as a discredited model for an area committee.
Will area committees be allowed to scrutinise the area services? Surely they must be allowed to scrutinise those services at a local level. This should not preclude an overview or scrutiny committee taking a wider view of the council's performance in ensuring, for example, that services are consistent throughout the authority. That is an important function for an authority-wide scrutiny committee.
The guidance states that if members are taking part in an overview or scrutiny committee and they are members of an area committee, they must first declare an interest. In some authorities, all members are members of area committees, so they will all have to declare an interest. That will take a good deal of time. The guidance seems to say that, subsequently, they should not vote in the scrutiny committee. It may be that I have misread the guidance, but it is important that the Government are clear about where area committees fit into the system. They should ensure, as Amendment No. 123 attempts to do, that nothing in this part of the Bill or in the guidance adversely affects the way that area committees which are working well can continue to operate.
I turn now to partnership working with other authorities, an issue specifically addressed by our Amendments Nos. 127 and 128. They seek to ensure that the committees which are set up jointly between local authorities are not straitjacketed or disempowered by anything in this part of the Bill or in the regulations. If such a joint committee is to have an executive function, must it consist of executive members of authorities that are putting members on to the joint committee? This is a complicated issue. If eight members of a county council are to form partnerships with all the council's districts and take one district each, only 1.4 members will be available from the county council to serve on that joint executive. If it is a 10-member joint committee, it would not be able to send enough executive members. I hope that the Minister can enlighten me and reassure me that the Government's proposals will not disallow these ways of working. They are new in many places, but are so far working well.
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What is of most interest to all councillors and their constituents is that the budget and level of council tax should not be decided only by the executive but must be a matter for the full council.
Lord Whitty: First, I shall speak to the government amendments in this group which deal with functions which are the responsibility of the executive and with ways in which they can be delegated to area committees. These amendments are necessary to enable more flexibility in how executive functions are discharged and to clarify some of the provisions of the Bill as originally drafted.
Amendment No. 84 would, as the noble Lord, Lord Dixon-Smith, correctly indicated, replace Clause 11, to which his amendment and others relate, with a clause which enables the Secretary of State or the National Assembly to provide for functions which are or may be the responsibility of the executive and for functions which are not. In many ways, the main features of the previous clause would remain but the new clause would also provide for flexibility, enabling powers to allow regulations to specify the extent to which certain functions are the responsibility of the executive, including specifying steps in the course of exercising those functions.
The Government consider these provisions to be necessary so as to define properly the respective roles of the full council and the executive in setting, for example, the council's budget and policy framework, and in particular to ensure that the ultimate responsibility for setting the budget, council tax levels and overall policy lies with the full council following consideration of the proposals from the executive. I think that that probably answers the last point raised by the noble Baroness, Lady Miller. The new clause would also allow local councils greater flexibility in determining similar roles in the discharge of functions specified as "local choice" functions under subsection (2)(b).
Government Amendments Nos. 122, 125 and 126 introduce new powers for the Secretary of State to make regulations enabling an executive to delegate to area committees; delegate to another authority or enter into joint arrangements with other authorities or with area committees for the discharge of executive functions.
The Joint Committee chaired by the noble Lord, Lord Bowness, which considered the draft Bill recommended that the Bill should be capable of accommodating, within executive arrangements, area committees and joint arrangements. These provisions now do that. The other government amendments are consequential on those amendments.
To respond to the noble Baroness, Lady Miller, it is clear that area committees have an important function. I may wish to write to the noble Baroness in more detail. It is not true that the guidance implies that the area committees should in each case themselves be politically balanced, but that the overview and scrutiny of the policy must be politically balanced. There is no requirement for the area committees which

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discharge the functions necessarily to be balanced, although the noble Baroness seemed rather over-keen to approve of one-party states at area level and not at authority level. The guidance does not preclude area committees being of one party, so long as the oversight of the policy under which they operate is politically balanced in reflection of the balance on the council. Area committees are clearly important in that respect. They will have executive functions. Therefore, if a council member is a member of an area committee and of an overview and scrutiny committee, in that situation there would be a conflict of interest and he or she would have to stand aside. Joint committees to discharge executive functions must be drawn from members of the executive. That is important, so that there is a clear line of accountability.
Without going through the syntactical points raised by the noble Lord, Lord Dixon-Smith, at the beginning of the debate, even were the Committee not to accept Amendment No. 84 deleting the appropriate clause, if I interpret the proposal correctly it would cut across the overall objective of these parts of the Bill, which is to provide a clear and visible separate executive. That means that the executive must be clearly responsible for the majority of the council's functions, particularly the major services. The clause is intended to clarify that. Given the noble Lord's expression, it is obvious that it has not entirely succeeded and further clarification may be necessary at later stages of the Bill. I hope, however, that the government amendments are acceptable to the Committee and that noble Lords will not pursue the other amendments at this stage.
11.30 p.m.
Baroness Miller of Chilthorne Domer: I rise briefly to clarify two points. First, certainly I am not in favour of one-party states, which was why earlier this evening I advocated that PR was a much better way to ensure that they never existed in local government. That is something in which I firmly believe. Secondly, I do not believe that the Minister has wholly answered my concern about area and scrutiny committees, and I shall welcome clarification of that matter in writing before Report stage so that we may examine it further.
Baroness Hamnee: I do not know whether the Government have considered the following. New Clause 11 would be more comprehensible to a number of those who have tried to understand it, and have made similar comments to me, if the Government provided something like a flow chart or matrix to show the order in which decisions are to be taken and dealt with. I refer to all the "what ifs" and the sequences.
I have a number of questions related to two of the Government's amendments. First, as to Amendment No. 125, subsection (1) of the new clause provides that,
"The Secretary of State may by regulations make provision for … the discharge of any functions …
"(a) by another local authority (within the meaning of section 101 of the Local Government Act 1972)".
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Can the Minister say to which words the words in parenthesis apply? Do they apply to "local authority" or to the discharge of functions by another authority within the meaning of Section 101? I was temporarily away from my seat and did not hear the whole of the Minister's explanation, but I do not believe that the Committee has as yet had a full explanation of how these provisions relate to Section 101 of the 1972 Act.
My second question is related to Amendment No. 126. Subsection (2)(a) refers to,
"circumstances in which the executive, or a committee or specified member of the executive, is to be a party to the arrangements in place of the authority".
Can the Minister explain what is meant by "party" in that context? Is the executive, individual member, and so on, the agent or principal? In that connection, can the Minister say whether currently there are regulations in place made by the Secretary of State which affect Section 101? If not, why is it necessary to provide for them here?
Finally, subsection (2)(e) provides for,
"the circumstances in which appointments to any such joint committee … need not be made in accordance with the political balance requirements".
Why is that provision necessary in view of Clause 17, which no doubt we shall reach on the next day of the Committee stage?
Lord Whitty: The noble Baroness raises some very good questions. I do not believe that this evening she will receive a full explanation of the cross-relationship between these amendments and Section 101. I should offer the noble Baroness and the noble Lord, Lord Dixon-Smith, an explanation of that relationship. Since I have sought to follow the matter very carefully perhaps I should answer all the questions of the noble Baroness in writing. I apologise for not being able to do so instantaneously. I hope that, nevertheless, the overall objective of the Government's amendments in this group is clear. I shall clarify the position further between now and the next stage of the Bill.
Lord Dixon-Smith: I am grateful to the Minister for his response to my particular amendment. I beg leave to withdraw it.
Amendment, by leave, withdrawn.
Lord Whitty Lord Whitty moved Amendment No. 84:
Leave out Clause 11, and insert the following new clause—
FUNCTIONS WHICH ARE THE RESPONSIBILITY OF AN EXECUTIVE
(".—(1) This section has effect for the purposes of determining the functions of a local authority which are the responsibility of an executive of the authority under executive arrangements.
(2) The Secretary of State may by regulations make provision for any function of a local authority specified in the regulations—

(a) to be a function which is not to be the responsibility of an executive of the authority under executive arrangements,

(b) to be a function which may be the responsibility of such an executive under such arrangements, or

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(c) to be a function which—

(i)to the extent provided by the regulations is to be the responsibility of such an executive under such arrangements, and

(ii)to the extent provided by the regulations is not to be the responsibility of such an executive under such arrangements.

(3) Any functions of a local authority which are not specified in regulations under subsection (2) are to be the responsibility of an executive of the authority under executive arrangements.
(4) Executive arrangements may make provision for any function of a local authority falling within subsection (2)(b)—

(a) to be a function which is to be the responsibility of an executive of the authority, or

(b) to be a function which—

(i) to the extent provided by the arrangements is to be the responsibility of such an executive, and

(ii)to the extent provided by the arrangements is not to be the responsibility of such an executive.

(5) The power under subsection (2)(c) or (4)(b) includes power in relation to any function of a local authority—

(a) to designate any action in connection with the discharge of that function which is to be the responsibility of an executive of a local authority, and

(b) to designate any action in connection with the discharge of that function which is not to be the responsibility of such an executive.

(6) The Secretary of State may by regulations specify cases or circumstances in which any function of a local authority which, by virtue of the preceding provisions of this section, would otherwise be the responsibility of an executive of the authority to any extent is not to be the responsibility of such an executive to that or any particular extent.
(7) A function of a local authority may, by virtue of this section, be the responsibility of an executive of the authority to any extent notwithstanding that section 101 of the Local Government Act 1972, or any provision of that section, does not apply to that function.
(8) Any reference in the following provisions of this Part to any functions which are, or are not, the responsibility of an executive of a local authority under executive arrangements is a reference to the functions of the authority to the extent to which they are or (as the case may be) are not, by virtue of this section, the responsibility of the executive under such arrangements.
(9) Any function which is the responsibility of an executive of a local authority under executive arrangements—

(a) is to be regarded as exercisable by the executive on behalf of the authority, and

(b) is to be discharged in accordance with any provisions made by or under this Part which relate to the discharge of any such function.

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(10) Any function which is the responsibility of an executive of a local authority under executive arrangements—

(a) may not be discharged by the authority,

(b) is not to be a function to which section 101(1) of the Local Government Act 1972 applies, and

(c) may be the subject of arrangements made under section 101(5) of that Act only if permitted by any provision made under section (Joint exercise of functions).

(11) Subject to any provision made under subsection (12), any function which, under executive arrangements, is not the responsibility of an executive of a local authority is to be discharged in any way which would be permitted or required apart from the provisions made by or under this Part.
(12) The Secretary of State may by regulations make provision with respect to the discharge of any function which, under executive arrangements, is not the responsibility of an executive of a local authority (including provision disapplying section 101 of the Local Government Act 1972 or any provision of that section).
(13) In this section—
"action" in relation to any function includes any action (of whatever nature and whether or not separately identified by any enactment) involving—

(a) the taking of any step in the course of, or otherwise for the purposes of or in connection with, the discharge of the function,

(b) the doing of anything incidental or conducive to the discharge of the function, or

(c) the doing of anything expedient in connection with the discharge of the function or any action falling within paragraph (a) or (b),

"function" means a function of any nature, whether conferred or otherwise arising before, on or after the passing of this Act.").
The noble Lord said: I beg to move Amendment No. 84.
[Amendments Nos. 85 and 86, as amendments to Amendment No. 84, not moved.]
On Question, Amendment No. 84 agreed to.
Baroness Farrington of Ribbleton: I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.
House adjourned at twenty-four minutes before midnight.