§ 4.30 p.m.
§ Lord Jenkin of Roding
My Lords, I beg to move that this Bill be now read a second time.
Those of your Lordships who watched the Queen's procession to St Paul's will have seen that historic moment when she had to stop at Temple Bar for the ancient ceremony as she entered the City of London. As we consider this Bill to reform the City's electoral system, we would do well to keep that historical perspective in mind.
The City's system of governance goes back to the 14th century and beyond and is unique in the United Kingdom. It will remain unique if the Bill becomes law.
While, happily, it is no longer the policy of any party to abolish the City Corporation, it is widely recognised that the City's franchise has become outdated and in need of reform. If the proposals in the Bill are enacted, and if the other reforms outside its scope are implemented —about which I will comment in a moment—they will provide an electoral system that much better reflects the realities of the City's pre-eminent position as one of the world's leading financial centres.
The Bill comes to us after a long debate in another place. No one knows that better than my noble friend Lord Brooke of Sutton Mandeville, who, as the then right honourable Member for the Cities of London and Westminster, with great skill and much good humour—for which he has already made a reputation in this House—debated the 182 amendments and the 16 new clauses tabled in another place. After he joined us here, that task fell to be completed by my right honourable friend Sir George Young.
We have been accustomed in this House to receive Bills from another place that have had scant, or in some parts, no debate at all. That cannot be said about this Bill. It was deposited as long ago as November 1998, and after nearly 27 hours of debate in the Chamber at the other end and six days in Committee, it finally received its Third Reading in April this year. The Bill's passage in another place took about three and a half years!
392 The present electoral system in the City gives the vote to around 5,700 residents and some 16,000 professional people such as barristers, sole proprietors and traders, and individual partners in professional and trading firms. As everyone knows, the vast majority of the people who work in the City are directors or employees of the thousands of companies based there. The preponderance of the revenues raised by the Corporation comes from the non-domestic rate levied on those companies. Yet only residents, professionals, sole traders and partners may vote in elections to the Common Council.
The main thrust of the Bill is therefore to enable the broadest range of interests represented in the City to participate in the electoral process. That is not to suggest that the City has been remiss in its duties. On the contrary, the Common Council—the body that discharges the local authority functions in the City—is widely credited for its innovative activities, its support for regeneration, particularly in its neighbouring boroughs in east London, and for many other activities. I believe the House would wish to acknowledge the important role of the two people widely credited with introducing and carrying forward those policies: Michael Cassidy, the previous chairman of policy and resources, and Judith Mayhew, the present chairman.
The City is regularly praised for the way in which it runs Epping Forest, part of which lies in my former constituency, and Hampstead Heath. I take some personal pride in the fact that it was when I was Secretary of State for the Environment that we decided that Hampstead Heath should be managed by the City Corporation.
I shall not weary the House with the details of all the reports and inquiries that have led to the present situation and to the decisions that have been made, except to remind the House of the words of the present Government in their 1997 Green Paper, New Leadership for London:We have made it clear that we do not propose to abolish the City Corporation. In recent years the Corporation has sought to play a much more positive role in order to promote inward investment and to fund schemes and studies for the benefit of London as a whole. The Corporation has assured the Government that it will continue to develop this work and has accepted that it must respond to the need to improve its electoral arrangements".That last point is the purpose of the Bill, and it is to the Bill that I now turn.
Clauses 1 and 2 give the Long Title and define the terms used. The new franchise is conferred on "qualifying bodies", which are defined by Clause 2 as including both incorporated and unincorporated bodies, apart from the partnerships already in the franchise. A broad definition has deliberately been taken to embrace the widest range of interests represented in the City community. Thus it includes not only companies and incorporated partnerships, but also charities, the voluntary sector—and, as I am sure the right reverend Prelate will be delighted to hear—the churches.
Clause 3 is the principal provision. It sets out the entitlement of qualifying bodies to appoint individuals for inclusion in the ward lists of electors. Such 393 appointed people will therefore be able to vote in ward elections. The extent of the entitlement to appoint is to be determined by the size of the workforce in the relevant premises, as detailed in subsections (2) and (3).
That is the main change made in another place. When the Bill was originally introduced there, entitlement was linked to rateable values, but after considerable debate, it was agreed that the size of the workforce was a better way of settling voting rights. The basis of entitlement is now to be one person for a workforce of up to five, one further individual for each subsequent five employees up to a workforce of 50, with an additional person for every 50 of any excess.
Clause 4 requires qualifying bodies to reflect, so far as they can, the composition of their workforces in their appointments. Those appointed by qualifying bodies must be able to demonstrate an association with the City. Clause 5 establishes a link with the period of that person's work in the City. There has been a great deal of discussion as to how the process will be achieved. Guidance will be issued in due course to employers as to how they might conduct it. Many employers will of course use their well-established machinery for employee relations.
Clause 6 excludes Crown bodies such as government departments from the extended franchise. That was agreed at an early stage when the draft Bill was discussed with the Government.
Clause 7 requires reports on the new arrangements to be submitted to the Secretary of State, who must lay them before Parliament. The remaining clauses are machinery and mainly technical and transitional.
The question of the Bill's compatibility with human rights legislation was the subject of much debate in another place. We are familiar in dealing with the issue in Public Bills. In this case, the case of a Private Bill, the statement on compatibility was made on behalf of the promoters but I have a copy of a letter signed on behalf of the Government by the noble and learned Lord, Lord Falconer of Thoroton, in which he endorsed that view and that it is not disputed. For completeness, perhaps I may add that the Bill was considered by the Joint Committee on Human Rights.
I want to comment briefly on the accompanying reforms which do not form part of the Bill. Reference was made in the Green Paper, from which I quoted, to the position of aldermen. As most people know, aldermen in the City of London are quite different from those who existed in local government generally and who were abolished some years ago. In local authorities, they were selected by the other members but City aldermen have always been directly elected. Indeed, they were the first elected representatives of the City.
Formerly, election was for life—or at least until the age of 70—but that is no longer the case. The City has enacted in its legislative instrument—in its own area it is a legislative body—an Act of Common Council, by 394 which the term of office for an alderman is set at six years. If he wants to continue and can persuade his electors, he can stand for re-election.
Another reform has been long overdue. There used to be a procedure for a post-election veto on the appointment of an aldermen because all the aldermen sit in the City as magistrates. That function has been taken over by the Lord Chancellor's advisory committee and approval of such appointment will be made or withheld before someone puts himself forward as alderman.
A reform which was discussed in another place, and in which the noble Lord, Lord Avebury, may have a particular interest, is the review of ward boundaries. If there are to be more electors, selected in the manner which I have described, is there not a danger that the voice of the 5,700 residents will be substantially reduced? It has been agreed that that should not be the case and that the ratio of residents' representatives on Common Council should remain approximately the same.
They are preponderant in only four of the City's wards and it is therefore possible to deal with the matter by revising ward boundaries. Indeed, that process has already started by revising the boundaries in order to ensure that the predominantly residential wards will be able to elect the number of members of the Common Council so as to preserve that proportion. Those who study the number of electors in each ward will recognise that they remain extremely uneven and the process of reform, which continues, can deal with that.
My Lords, this is an unusual Bill but the City is an unusual place. The proposals have been subject to long and wide discussions both within the City and outside and with the Government and other interested parties. I believe that after long debate in another place the Bill comes to your Lordships' House in a form which represents an honest, workable and fair way of dealing with the widely acknowledged shortcomings of the present electoral arrangements in the City. I commend the Bill to the House.
Moved, That the Bill be now read a second time.—(Lord Jenkin of Roding.)
§ 4.43 p.m.
§ Lord Avebury
My Lords, as the noble Lord, Lord Jenkin of Roding, began his speech by reference to the ceremony which attends the presence of Her Majesty the Queen on the boundary of the City, perhaps I may take this opportunity of congratulating the residents of another capital city in our kingdom, Cardiff, on the visit by Her Majesty today and on the honour which Her Majesty has bestowed on the College of Music and Drama in Cardiff: that of Royal status. I am sure that that will give great pleasure to all Welsh expatriates living in the City of London.
I thank the noble Lord, Lord Jenkin, for his careful and detailed explanation of the provisions of the Bill. We are not concerned with whether the City should have its own local government, although if we were starting with a blank sheet of paper, we would not 395 make an exception for one particular area simply because of the extensive concentration of business which varies of course within the City. The Isle of Dogs may ultimately have as much office space as the City and I am sure that there would be no demand for it to be run from Tower Hamlets.
The arrangements which have developed in the City over the centuries have made the Corporation not only a successful unitary authority for its own area but also the curator of huge open spaces, the landlord of more than 2,000 houses in the surrounding boroughs and the largest port health authority in the UK. Those arrangements are unique and like many ancient and apparently anomalous English institutions they work amazingly well.
When the Bill was considered in another place, honourable Members agreed on the importance of the Corporation to the well being of the City of London, which is the most important financial centre in the world. They also agreed on the need for reform of the current electoral system, which they felt was flawed to the extent that it could not be addressed within the powers of the Bill as presented.
The promoters suggested that the Bill would form part of a wider set of reforms and the Committee in another place welcomed their assurance that inequalities of distribution would be dealt with by review of the ward boundaries, as explained by the noble Lord, Lord Jenkin. That was said to be within the powers of the Corporation. But there was some uncertainty about the Corporation's powers and this is a good opportunity for setting the record straight, with the benefit of the legal advice which the Committee suggested the Corporation might obtain. Perhaps in winding up the Minister will explain that advice.
According to a letter I have received from the City Remembrancer's Office,The basis of the present ward structure appears to have been established by 1127 or thereabouts. On this assumption the power to alter boundaries could be said to be a custom of London exercisable by the Mayor, Commonalty and Citizens of the City".The noble Lord, Lord Jenkins, was therefore being modest when he spoke of the arrangements being established in the 14th century; they appear to go back considerably further in time.
That was late in the reign of Henry I who had the reputation of being less hands on than most medieval monarchs, so the right moment was chosen to assert those powers. But the City has been a great urban centre for more than 1,000 years, as we were reminded by the opening on Tuesday of the great Roman amphitheatre below Guildhall.
But, the Remembrancer continues, the City also relies on a charter granted by Edward III in 1341—and that may be the charter referred to by the noble Lord, Lord Jenkin—which provides a general power for the City to take corrective action".That charter is cited in Acts of Common Council, though not in the preamble to this Bill. It is said to have been confirmed by Parliament in 1377 and, if that is so, why is the Act of 1377 not cited as the authority, and 396 why has it not been incorporated in a consolidation Bill since then? Or is it argued that the charter of 1341 remains in force as part of the law of the land?
The Committee took the view that both the number of wards and the number of ward representatives should be reduced. There are 25 wards, each represented by one alderman and between four and 12 councillors, There is also an unspecified number of co-opted members, though no doubt the number must have appeared in previous legislation. The Corporation has the power to reduce the number of representatives per ward, but only Parliament can reduce the number of wards. The Corporation indicated its intention to undertake a boundary review and the Committee observed that the opinion of the Boundary Commission for England might be sought on the matter.
The Corporation has reviewed the boundaries of two wards, Aldersgate and Cripplegate, and it was done with the benefit of advice from the Boundary Commission. The number of councillors has been reduced to 112 and there has been an undertaking by the promoters—and I would be grateful if the Minister could confirm it—that the number will he brought down to 100 by the time the Bill comes into effect.
The Corporation has also improved the arrangements for consultation with residents and has reserved seats on the main committees for resident members. It is good that so much has been done ex gratia, but it would have been better if these concessions had been embodied in the Bill. As the noble Lord explained, the Bill has taken a long time to get this far, but perhaps that has provided a useful incentive to the Corporation to get on with some of the reforms which were suggested by the committee in another place. Will it go further and is there any intention ultimately to reduce the number of councillors to correspond with the major local authorities, including the London boroughs, which surround the City?
Has the Corportion explicitly rejected the proposal that the number of wards should be reduced, as suggested by the Committee and, if so, can the noble Lord tell us on what grounds? Does it consider that the aldermen should continue indefinitely? They are appointed automatically as JPs and, as explained, they also act as governors and trustees of schools, hospitals and charitable bodies with ancient City connections. I have no doubt that this is valuable work on behalf of the community. But it is not obvious to me that they are functions which require the holding of elected office. At present, the Lord Mayor has to be an alderman, but if aldermen were abolished, then he or she could be elected by the Common Council.
It was suggested by the honourable Member for the Cities of London and Westminster, when asked about aldermen at Second Reading in another place, that there were historic reasons for the retention of the office; that it was a matter of tradition, the Royal Commission of 1960, and the decision by Parliament to exempt the City when aldermen were abolished everywhere else in the 1970s. He did not attempt to 397 demonstrate that none of their functions could be performed by councillors, or by nominees in the case of the other offices mentioned. If in a particular case someone doing those tasks would be a useful member of a committee then, as I have already mentioned, there is a power of co-option, which is already used extensively.
The promoters have not sought to defend the power of veto which was formerly exercisable by the aldermen against elected councillors. I gather, and the noble Lord confirmed it, that there has been an undertaking that the power will not be used again in the future. Again, would it not have been preferable if this concession had been embodied in the present Bill?
The Bill itself deals only with the franchise in elections to the Common Council. It was a pity that these wider issues were not covered. An undertaking was given by the Corporation that it would report on further reforms proposed by the committee within five years, of which three have already elapsed. It would be good if the noble Lord could tell us the time scale of that report.
However, by focusing narrowly on the electoral roll, the promoters in some ways made life more difficult for themselves because the discussion centred entirely on the existence of the business vote and its extension by 39,000 votes under these proposals, apparently swamping the 8,000 residential voters. I say "apparently" because, as explained by the promoters, the residential and business votes are concentrated in separate wards so that the number of councillors elected by the vastly increased business vote would still be the same. It was said that their equity had been watered down, so to speak.
If I may say so, that was being a little economical with the truth. The noble Lord, Lord Jenkin, was not entirely accurate when he said that the ratios between the business and residential vote had been maintained. It would only be fair to acknowledge that the promoters responded to the views expressed in another place and by the London Labour Party in making the business vote dependent on the number of employees rather than the rateable value, as in the original draft of the Bill. They also excluded the government and bodies exercising statutory powers from the businesses which were entitled to vote. Those amendments came at the end of consideration of the Bill in another place, which is another reason for being fairly relaxed about the long, drawn-out proceedings which, as the noble Lord explained, have taken three-and-a-half years so far.
The honourable Member for the Cities of London and Westminster said that the residents were entirely happy with the proposals in the Bill. They are apparently content to see the percentage of their vote considerably reduced, as shown by the Corporation's conclusions on the review of ward boundaries. I shall give the figures for the two wards which have already been reviewed. In Aldersgate, the effect of the boundary changes together with the extension of the business vote as now proposed in the Bill, is to reduce the residents from 91.9 per cent of the total to 72.8 per 398 cent. In Cripplegate the residents are down from 88.1 per cent to 77 per cent. So the ratios are not maintained, as the noble Lord claimed, even though in these two wards the residents still have quite a substantial majority.
In the wards adjacent—Farringdon Within, Farringdon Without, Coleman Street, Bassishaw and Cheap—residents were already greatly outnumbered by the business voters and after this Bill they will be in an even smaller minority. In no case dealt with under the review is the balance of power between the residents and business voters altered by the new franchise. Only seven out of the 25 wards have been effectively reviewed by being next door to the two which have been completed. That leaves another 18 wards which still have to be reviewed. Can the noble Lord say why all the wards were not reviewed at the same time instead of stringing out the process over several years? Has he any timetable for the rest of the process or do we have to rely on the original undertaking given in May 1999 to complete the review in not more than six years? Will the Corporation undertake to follow any advice given by the Boundary Commission in the remainder of the process and, if not, has it any proposals on how any differences of opinion between itself and the Boundary Commission are to be resolved?
The wards reviewed so far contain 4,614 voters out of a total of 5,700 on the list for 2001–02. If one considers the remaining wards, only two have a resident vote of more than 100 and in the other 16 there is a total of 269 residents who are already heavily outnumbered by the business vote in those wards. In Portsoken and Queenhithe, however, if the boundaries remain unchanged the residents will find themselves in a minority. The Corporation gave an undertaking that,The boundaries of the four residential wards will be adjusted to preserve the residential character of those wards prior to the introduction of the new arrangements".I should be grateful if the noble Lord can confirm that in Portsoken and Queenhithe there will be majorities of residential voters after the boundary changes.
The petitioners have a number of other points which they wish to raise going beyond the Long Title of the Bill. One is greater transparency as regards City cash. It will be for the Select Committee to decide whether to give the latitude to do that. There is one matter on which I believe they are entitled to a better answer than they have been given so far and the noble Lord. Lord Jenkin, touched on it. It is the assertion that the Bill contravenes Article 3 of the First Protocol of the European Convention on Human Rights, which provides that elections must be held,under conditions which will ensure the free expression of the opinion of the people".One of the petitioners wrote to Ms Jean Corston, MP, the chair of the Joint Select Committee on Human Rights, asking her to elucidate the opinion of the Committee expressed in its 14th report of March 2002, that the Bill does not raise significant human rights questions. There is no indication in that report that the Committee heard arguments on the point 399 raised by the petitioner. Your Lordships' Standing Order 38.3 requires the promoter to include a statement of compatibility with convention rights and Standing Order 98A requires a Minister to report on the statement by depositing a statement of his own in the Private Bill Office immediately after First Reading. That has been done, as the noble Lord, Lord Jenkin, explained. But the Minister's statement did not endorse the view of the promoters. He said,I believe the promoters have undertaken a full assessment of the compatibility of their proposals with the European Convention on Human Rights and I see no need to dispute their conclusions.The statement does not say that he, the Minister himself, has made any assessment of compatibility. But surely the corollary of these new procedures, which your Lordships agreed last year, and which came into effect in November 2001, is that if challenged with an assertion of incompatibility with particular articles of the Convention or Protocol, the promoter should then have a duty to respond so that the challenge and the response can be considered together by the Select Committee.
I hope that your Lordships will agree that there is enough substance in this Bill to have made it worth a Second Reading debate, which would not have occurred if I had not put my name down to speak on it. Another place, in its wisdom, has approved the doubling of the business vote in the City, albeit on the basis of a more rational franchise based on the number of workers in qualifying bodies, and with undertakings on the balance of voting strength between residential and business voters. It is not for us to embark on a fundamental review of the powers and composition of the City Corporation, although your Lordships may think that in the longer term, if Parliament is being drastically reformed, the City cannot remain immune from scrutiny. What we can do is to provide a further opportunity for considering matters that have admittedly been canvassed at some length in another place, but where they generated rather more heat than light. I hope that we have been able to do that this afternoon.
§ 5.1 p.m.
§ Lord Jenkin of Roding
My Lords, I am sure that the whole House will be grateful to the noble Lord, Lord Avebury, for the careful consideration that he has given to the Bill in which he has raised points, some of which he frankly admitted had been raised in another place. I tried to deal with some of them in my opening speech but some, clearly, I must do my best to answer.
The legislative powers of the City have a longstanding history. They go back to the charter to which the noble Lord referred. As far as I am aware, no one has ever sought to challenge the common council's right to, as it were, make its own laws within the ambit of that charter. Of course, some things require an Act of Parliament. We have an Act of Parliament before us as the voting system could not be changed under the charter powers. However, the ward boundaries can be changed. That has happened on a number of occasions in the past, notably after the bombing of World War 400 II when it became necessary to change the ward boundaries so as to have some reasonable basis for voting.
I find it difficult to agree with the noble Lord's complaint that matters which can be dealt with outside the Bill ought to have been dealt with in the Bill. It seems to me that if any subordinate authority has powers to deal with certain matters, one does not need to put them in a Bill. I sought to explain—I did not leave it out—that the whole question of boundary reviews and other matters are being dealt with in accordance with the procedures. As regards the boundary reviews, there is a committee of review which consists of senior members of the judiciary and the town clerk. They report to the common council. That is what happened as regards the first two reviews to which the noble Lord made reference, although common council made minor changes. Those boundary changes are now settled.
As regards the timetable for the remaining matters, I cannot give an undertaking on that, but no doubt it can be explored if the Bill proceeds to Committee stage. I believe that there was some confusion between the number of voters and the number of common councillors that they represent. I deal, first, with the number of common councillors. Clear undertakings have been given that the number will be reduced. There were 130—more even than the City of Birmingham! It is widely recognised that that is too many. As I say, a clear undertaking has been given that the number will be progressively reduced. However, as your Lordships will know, reducing the size of an elected assembly is not an easy matter, or, if I may say so, reducing the size of an unelected one. The matter will take time but it is clearly on track. The noble Lord mentioned a figure of 100 by the time the Bill becomes law. That is certainly a target that the City Corporation wishes to reach.
As regards the number of electors, there will be a dilution of the number of residential electors. However, as I made clear in my opening remarks, one of the purposes of the realignment of the ward boundaries is to make sure that, despite the dilution of the residential voters by the addition of the large number of what I might call broadly business voters—the people appointed under the procedure that I described—the number of common councillors who will be elected as the result of the residential voters will be approximately the same proportion as they are now. That is the intention. It will have to be approximate because one cannot determine these matters mathematically and precisely and, of course, they change.
As regards aldermen, the noble Lord said that the matter of the abolition of the veto should have been in the Bill. However, that has already been clone. As it has been done under the City Corporation's own powers, there would be no purpose whatever in putting it in the Bill. I hope that, on reflection, the noble Lord might be prepared to accept that.
On the question of reporting, I draw the noble Lord's attention to Clause 7 which requires the Corporation to submit a report to the Secretary of 401 State on the working of the provisions of the Bill and enables the Secretary of State to call for further such reports to be presented to Parliament.
§ Lord Avebury
My Lords, I am grateful to the noble Lord for giving way. I refer to a report on the set of reforms that were undertaken voluntarily by the Corporation that are outside the scope of the Bill and which are listed in the appendix to the full report on the ward boundaries. That report was supposed to be received within six years of the original undertaking. Can the noble Lord give us some good news about accelerating the report which is to be made under that heading?
§ Lord Jenkin of Roding
My Lords, at this stage I must disappoint the noble Lord. I do not think that I can give him that information. However, if your Lordships agree to a Second Reading, the Bill will proceed to Committee stage and it would seem to me an admirable point for the Committee to want to probe.
I drew the noble Lord's attention to what is in the Bill as regards reporting to Parliament. As regards human rights, if I may say so, I think that the noble Lord was straining at a gnat. I said that the noble and learned Lord, Lord Falconer of Thoroton, had endorsed the view of the promoters that the Bill complies with the European Convention on Human Rights. As the noble Lord, Lord Avebury, said, the noble and learned Lord said that he saw no need to dispute the conclusions of the promoters. I say with the greatest respect that I think that that is as good an endorsement as one would get. There was a great deal of discussion in the other place on the human rights aspect, as my noble friend Lord Brooke will confirm. The statement of the noble and learned Lord, Lord Falconer, was issued after the Bill reached this House, as is required by our Standing Orders.
I hope that I have gone some way to answer the questions posed by the noble Lord, Lord Avebury. I sense that the House may be anxious to proceed with the rest of the business on the Order Paper. Therefore, I shall sit down.
On Question, Bill read a second time, and committed to a Select Committee.