Local Government and Public Involvement in Health Bill

I know that the noble Lord feels passionately about this. I am at one with him about the outcomes he wants to achieve. He brings added value to this House as a result of his experience, and it would be good to have a proper debate rather than a truncated one. I hope that there will be an opportunity for that in the autumn, when we will be talking about contextual differences and the sort of things that the Government are bringing forward through, for example, the sub-national review and the proposed new duty regarding the assessment of economic issues. I hope the noble Lord will not be too disappointed when I say that, although I understand why he feels passionately and we share his commitment to reducing worklessness and creating opportunity, his chosen method is not easy for us to accept. I will explain why. The amendment would make modified sustainable community strategies a means through which local authorities could raise money and circumvent any legislative restrictions on their powers. That would have unwelcome consequences. It would permit local authorities that change their sustainable community strategies in the way he envisaged to vary the conditions by which claimants receive their benefits and to have much greater control over benefits administration. They would also be able to assume the Secretary of State’s role in respect, for example, of Jobcentre Plus and Connexions services. There are even more wide-ranging changes which would not be subject to parliamentary debate or wider consultation. The Secretary of State would be required to fund any transfer of powers or duties to such local authorities. That is the context and part of the response to the amendment. However, the other argument is that the power of well-being, which is quite powerful, is available to local authorities under Section 2 of the 2000 Act. It was there to fill a gap, to become a power of first resort, to incur expenditure, give financial assistance to any person, enter into arrangements or agreements and do anything in relation to, or for the benefit of, any person or area situated outside the area as well as inside it. It is an extensive power but it has been so little used for innovative purposes that we are now going to address it. We plan to launch a publication to help different target audiences in local authorities to move the agenda forward. Some of what the noble Lord wants to achieve could be achieved by the better understanding and use of the well-being power. We have some good local examples of how it could be used. Section 4 of the 2000 Act places on local authorities a related duty to set out a community strategy for improving well-being and they must link together. However, the well-being powers are subject to certain limitations, which are set out in Section 3(1) and (2) of the 2000 Act. Those limitations cover taking actions that are expressly prohibited in legislation and raising money by means of precepts, borrowing or otherwise. Among other things, the noble Lord’s amendment would permit local authorities to circumvent that. That would create a problem. Section 3(1) prevents the exercise of the well-being power where there is a prohibition, restriction or limitation on their powers contained in any enactment. We know that those limitations are in legislation for good reasons. The well-being power framework also contains a power under Section 5 of the Local Government Act 2000 which permits the Secretary of State, by order, to amend legislation that prevents local authorities from exercising the power or obstructs them in doing so. Of necessity, this power is quite bureaucratic because, when it is used, it requires wide consultation with local government and is subject to parliamentary scrutiny and debate. The detail of this procedure is set out in Section 9 of the 2000 Act. We would expect local authorities to draw any such legislation to the attention of the Secretary of State, although it has not occurred very often. The amendment would mean that legislative restrictions on local authority activity, which are there for good reasons, would cease to apply and new proposals would bypass the scrutiny, and potentially the safeguards, of Parliament. Therefore, first, the well-being powers are extensive but are not being used very effectively, and, secondly, the amendment would remove some of the important limitations on the controls over the way that the legislation works. Those are two separate arguments, and there is another subset with regard to limitation. I move on to the restrictions on using the well-being power to raise money. As we all know, the framework for local government finance depends on stable and predictable funding. The amendment would compromise the framework on which local government finance rests and the work that local authorities have done with their partners to deliver services. We are certainly encouraging closer working through local area agreements, but I would be afraid that the safeguards surrounding the ability of local authorities to raise money could be removed. The implication of the amendment is that local authorities could, for example, introduce new means of raising money in an unregulated and inconsistent manner. Again, as the noble Lord knows full well, the local government finance system is firmly bedded down. We have to ensure that it is predictable and secure, and we would not want to open up more opportunities for local authorities to spend randomly. Those are the problems with the amendment. Along with the well-being power, opportunities have recently arisen for local government to use new powers. I do not think that this Bill is the right place to take forward major legislative changes in the way that the noble Lord suggests, although, as I said, I am sympathetic to his reason for wanting local authorities to be able to address these very stubborn and difficult problems locally. However, there is a case to be made for national frameworks and standards, particularly with regard to the administration and terms of benefits. We have had a national benefits system since 1947 and it is an extremely important way of ensuring equity and fairness in the administration of benefits across the country. Nevertheless, we should look at the way in which the well-being power is providing for local authorities to work together, including in the noble Lord’s own county of Kent, for example. Jobcentre Plus is being brought in powerfully in new and innovative ways, and we are also looking at new possibilities through local area agreements. In addition, we have made changes to devolve funding for the delivery of the Learning and Skills Council, and Connexions will pass to all local authorities with effect from April 2008. Funding for school sixth forms and colleges, including the contribution of FE colleges to the 14 to 19 phase, will transfer to local authorities. We are giving local authorities more powers and more scope, particularly in skills and employment. This will not go as far as the noble Lord wants, but it is a start. It will bring skills to the local level and it will also bring opportunities to look at local labour markets. Although I have used a range of arguments, I am conscious that I have given an inadequate reply to a very important issue. I shall be very happy to write to the noble Lord, particularly on the legal implications of the amendment, which are quite complex. I hope he will understand that I have thought about this issue and that I have tried to address it in its broadest form.