Local Democracy, Economic Development and Construction Bill [HL]

The snow brought many blessings, but clearly it brought its downsides as well. I am sorry that the noble Lord, Lord Smith, is not here to answer those questions, but I shall do my best to say what he might have said. I do not want to spend too long on this, but it is important that I contextualise this debate because many issues have been raised. I genuinely think that noble Lords opposite are struggling with some misapprehensions about what might happen and what is, and was always, intended. This takes us forward from the brief debate that we had on the previous group. The problem with which we are struggling—in a way, it was described by the noble Lord when he asked whether we are imposing a conflict between the people who design the strategy and those who implement it—is that quite simply huge challenges face the regions in which the architecture is not sufficiently joined up. I shall go on to talk about how the spatial strategy and spatial dimensions will inform the regional strategy. In essence, we all know that we have very different regions in this country. They proceed at different paces on all sorts of different things, and they are rich in diversity. For the future, we have to ensure that we address inequalities as well as strengths and that we give every region the best chance to get the investment, the skills for jobs, the business and the sustainable environment that they need. A false dichotomy between growth and development has surfaced in some of these amendments. There is also an unnecessary fear that economic development will somehow triumph over and destroy our ability to protect, enhance, preserve and make the most of our environment, which we are trying to do in this country in many ways, not only in policy and legislation but in behaviour. The growth that we are now talking about has to be driven to meet the challenge of globalisation, which we have seen so graphically in the past six months, and has to be sustained within environmental limits. We have said so in all our documents and arguments. But growth also enhances the environment and social welfare, and avoids catastrophic extremes in future economic cycles. Frankly, the economic health of our economy will be dependent on how proactive our regional authorities’ capacity for accommodating and promoting sustainable economic development is. However, it is not growth at all costs; this is about sustainable growth. The noble Lord, Lord Hanningfield, described in his inimitable way what was wrong with the present system. One way of addressing this issue is to recognise that, yes, we have in the past few years had the development of a challenging and different notion of planning—spatial planning. This has certainly taken us forward. The regional spatial strategies, many of which are now nearing completion, have done extraordinary service in bringing forward understanding and a view of future development that is different from anything we have ever done before. It has been a struggle. Part of the response has been to try to reduce the opportunity for confusion and contention in the next stage of the regional economic strategy by building a much better process into the Bill. The noble Baroness asked whether this meant that the spatial strategy is somehow lost or diminished. The answer is absolutely not. We have been developing our spatial strategies, taking into account such intelligence as we have had at our disposal in the regions. I say ““our spatial strategies””, but of course the regions have been doing that. At the same time, RDAs’ regional economic strategies for skills, investment, business support, manufacturing support and the observatories for people applying for skills and work have been developed separately. Many of these strategies are related to spatial planning but they have not been sufficiently joined up. People who are trying to deal with this problem have said to me that, despite the successes at regional level, we could be more effective. Previously, organisations in each region have had to deal with a muddled set of strategic plans: one for economics planning, one for spatial planning, and one for housing. This has meant that businesses, individuals and communities have often been confused about who was responsible for what and what the priorities were. Duplication of effort, endless consultation and inefficiencies have led to us being diverted from delivering change. So when the noble Lord asks what this is about, it is about a better capacity to deliver the social change that will really benefit our communities no matter where they are. That can now only be done through a single and integrated strategy where we bring the spatial dimensions and spatial plans to work on and with the economic, intelligence, expectations and investment plans. At the moment, when we consider integrating spatial and economic elements, for example, in relation to land-use planning, we might allocate housing numbers in a particular region. But in a spatial regional strategy we would make sure that housing allocations were underpinned by other sound strategies—for example, in the areas of transport, skills and jobs for settlements, the provision of public services and so on. We have done as much as we can in the spatial strategies to make sure that they are informed, but they are not strong enough or close enough to make a real difference to outcomes. We have to get greater synergy and greater alignment. The benefits of this will be the creation of a less complex, less divergent and less time consuming system for everyone. The noble Lord is not right to describe this as more bureaucracy. The benefits will be greater co-operation and synergy between local government and the regional agency, instead of how the assemblies were not able to get purchases on those processes. They will have an opportunity to do so now because they will have to work together to produce a coherent plan for the development of the region. They will have to relate to the spatial elements of the strategy for economic development, housing, planning, energy supplies and transport in the context of generating sustainable development and growth. That will focus the funding for infrastructure regeneration. The regional strategy will map out the kind of skills that are needed and the things that we will need to anticipate and plan ahead for. All this will help with managing climate change and mitigating it. It strengthens our ability to plan effectively and collectively for the future; it helps us to be more strategic and makes for a clearer framework, which everyone can recognise, of where the conversation takes place. It also means that we will have the benefits of transparency. This is an important point. At the moment, the examination in public of the spatial strategy kicks in at the final stages of the process. The examination in public in the process of making the RES will be at the formative stage, at the start of the drafting of the strategy, so that it can advise on the evidence base and issues of principle, and can flag up where the contentious issues are likely to arise. It will not all come at the end in a cliff-edge finale. There will also be benefits—these will be driven in part through the assessment duty—of a common evidence base: one contestation and testing process and a single sustainability process. The examination in public panel report goes to the leaders’ board and the RDA, enabling them to make any required changes. The aim will be to ensure that they agree as far as they can but, where they cannot agree, points of contention can be negotiated. There should be little or no need for central government to add any other changes and add to the time taken. We want to work out a process which keeps central government out of the picture. There will be a stronger democratic accountability throughout the process of preparing the regional strategy. It is a genuinely collaborative approach with local authorities which have sufficient authority to act on behalf of all having a joint responsibility for the regional strategy, including drafting, implementation and monitoring. There will be greater public engagement because we have drawn not only on the experience of the RSS but also on the consultative arrangements that were built in to the local development framework process. There will be crucial requirements to consult and engage on the formulae that we have worked out for the local development frameworks and statements of community interest. However, this is not prescriptive, because regions are different; they will have to develop their own arrangements to suit their own circumstances. We are not interested in blanket policies. These proposals have been widely supported. We have held consultations over the past two years and found a strong endorsement for a single, integrated regional strategy as a way of prioritising a region’s needs and aspirations, driving forward economic development and regeneration. The joint duty on RDAs and local authorities has wide support from the LGA and the other RDAs. Since publishing our proposals the regions have taken the initiative and have made remarkable progress in putting these new arrangements in place. The noble Lord, Lord Greaves, has pointed out what is happening in the north-west. Many regions have gone a long way towards producing and agreeing the strategy, establishing the leaders’ boards and agreeing how they will work. The drafting of the regional strategy will be jointly undertaken by the RDA and the leaders’ board in collaboration. They will work to a project plan which, through regulations, will become the agreed timetable for the strategy revision. Working with local authorities, they will develop a shared evidence base, engage with stakeholders and appraise the key issues and the options through a robust sustainability appraisal. Once it is drafted there will be rigorous testing through a full statutory public consultation and the EiP. That is important to build confidence. Any modification to the strategy following the panel will be undertaken collaboratively between the responsible regional authorities and the Secretary of State. The responsible regional authorities will be able to refine their strategy in the light of EiP and submit it to the Secretary of State for sign-off. Currently in the regional spatial strategy, the legislation provides for the Secretary of State to make further changes, if needed, to ensure that the strategy reflects the imperatives of national policy and principles. However, such changes would be subject to further consultation, after which the Secretary of State will publish the agreed regional strategy that then becomes part of the single statutory development plan. That is what we aim to achieve and those are the purposes for which we have brought the Bill forward. I hope that that will help to clarify some of the key issues. I am very sorry that the noble Baroness, Lady Whitaker, is not here. I do not know whether that is because of snow again, but she would be pleased by the way in which the noble Lord, Lord Best, introduced her amendments. In essence, her Amendment 166A would require each regional strategy to make specific provision for meeting housing need in the region, making explicit an element of what is already implied by Clause 65 and Clause 71(1)(a). It is therefore a duplication. It would give prominence to one topic in primary legislation over others, which would be rather unfortunate. I reassure her that Clause 71(1)(a) requires the responsible regional authorities to take into account national policy that includes Planning Policy Statement 3 on housing and the housing Green Paper and all other statements that are relevant to housing. Significantly, housing was one of the three key areas where government will set clear expectations of outcomes, alongside the economy and climate change. That was set out in our policy document in January. Amendments 175A and 176A would require the responsible regional authorities to consult housing interests when drawing up the strategy. Again, our policy document makes clear the importance of involving housing interests, and we expect to designate the Homes and Communities Agency as a statutory consultee. We have made it abundantly clear in successive policy statements that the regional strategy is a vital mechanism for addressing the long-term housing supply and affordability across the regions. The Bill’s approach is similar to the Planning and Compulsory Purchase Act 2004, which established regional spatial strategies. The term ““housing”” does not appear in that Act, but housing is obviously a key element of the spatial strategy. With that on the record, I hope that the noble Baroness will be satisfied. The amendments proposed by the noble Lord, Lord Hanningfield, refer to the definition of sustainable development, which is the subject of many amendments by the noble Baroness, Lady Hamwee, to which I shall turn in a moment. Sustainable development is at the heart of this policy and part of the architecture of our planning policy. It is set out in PPS1, ““Delivering Sustainable Development””, and is the cornerstone of all our planning policies. The basic idea is that sustainable development is the only way of ensuring a better quality of life. Spatial planning, which is what we expect the regional strategy to deliver, is vital in bringing together and integrating policies for the development and use of land with other policies and programmes that influence the nature of places and how they function. This spatial planning approach provides the framework for delivering sustainable development. As I have said, that means not only protecting the environment but providing access to jobs and services, reducing the need to travel and enhancing biodiversity and natural resources. Clause 65 provides that each region is to have a regional strategy with policies on sustainable economic growth and the development and use of land. Clause 78 explicitly requires regional authorities and the Secretary of State to exercise their functions in relation to the regional strategy with the objective of contributing to the achievement of sustainable development. Amendment 166ZA would replace ““development”” with ““sustainable development””. However, it should be clear from what I am saying that the regional strategies contribute to sustainable development in a way that meets the noble Lord’s main concerns. I am not minded to accept the amendment because Clause 78 already requires such a strategy to be produced in a way that contributes to sustainable development. We have to be very careful about the language, because ““development”” has a specific meaning in planning law. Under Section 55 of the Town and Country Planning Act 1990, it means building, engineering, making a material change in the use of any buildings or other land, and so on. We cannot simply replace ““development”” with ““sustainable development”” in that context. But I reassure the noble Lord that his concerns about this issue are very well taken. Regional strategies, like all other planning strategies, must be geared to sustainable development. On Amendment 166ZB and the green belt, Planning Policy Guidance note 2 sets out strong national policies about the protection of the green belt. The Government continue to attach great importance to the green belt, the fundamental aim of which is to prevent urban sprawl. It has a positive role to play in the future in shaping patterns of urban development at sub-regional and regional level and we are firm in our determination to protect it. Clause 71 requires the responsible regional authorities, the RDAs and the leaders’ boards, to have regard, when preparing a regional strategy, to national policy and to guidance. We have published policy on the green belt. That means that the criteria have to be observed and sustained. As with the amendment of the noble Baroness, Lady Whitaker, on housing, if we elevate the concept of the green belt as one issue, we do a disservice to other elements of policy and open up the prospect of adding renewable energy and transport to the list. I understand the concern to promote sustainable development and to protect green-belt land; they are fundamental to our policies on plan making and development management, and I hope that I have provided reassurance. On the broad grouping of amendments proposed by the noble Baroness, Lady Hamwee, and the noble Lord, Lord Tope, I hope that I have reassured them about the importance we attach to the spatial plan—we propose no diminution, no loss or compromise in that regard—and that we have our priorities right in terms of sustainable development, which sits as an envelope around growth. I believe that I have dealt with the spatial strategy. The relevant amendment would add little because our policy document made clear the need for high-quality assessment of the spatial characteristics and needs of the region against which the overview of the key regional and sub-regional opportunities and challenges can be assessed. Amendment 166B seeks to change the scope of the requirement for regional strategy policy to deal with climate change by replacing ““contribute to”” with ““further””, thereby making the relevant phrase read, "““further the mitigation of, and adaptation to, climate change””." I understand that in most of the Bills that we have introduced recently, the noble Baroness has been a great champion of our belief in the need to adopt an aggressive policy towards mitigating climate change. I do not think that in this context the proposed change of wording will make any difference. I argue that to contribute to the mitigation of and adaptation to climate change is, indeed, to further the mitigation of and adaptation to climate change. However, she may have identified an additional problem—namely, that the wording would be inconsistent with the provisions of the Planning Act 2008, of blessed memory, which amended the 2004 Act. Section 182 of the 2008 Act said that regional spatial strategies must include policies that, "““contribute to the mitigation of, and adaptation to, climate change””." It would also be inconsistent with the way local authorities address these important issues because the LDFs have to follow the planning framework. I am afraid that if we were to change the wording, we might add considerable confusion. Amendment 182ZB sought to institute a requirement for the responsible regional authorities and the Secretary of State to further the achievement of sustainable development rather than contribute to it. This change would make the legislation inconsistent with Section 39(2) of the planning Act 2004 and would add to confusion about the duties in this regard in connection with regional strategy and local development documents. As regards Amendment 182ZA and the general arguments about sustainability, although I understand the concern here I am afraid that the amendment is not needed because Section 4(1)(e) of the relevant legislation already gives the RDAs a duty to contribute to the achievement of sustainable development alongside their economic development duty. Our Bill also provides in Clause 78 for the RDAs to exercise their functions in relation to the regional strategy with the objective of contributing to sustainable development, and it requires regional strategies to have policies in relation to sustainable economic development. We are very clear about that. That is in Clause 65. The amendment also removes, "““where it is relevant to do so””," in Section 41E of the RDA Act. That would increase the scope of the RDA’s sustainable development purpose, but in such a way that the purpose would be to contribute to sustainable development everywhere else in the UK, as well as in the RDA areas. This is not the first time that Parliament has debated the issue, but if we remove that phrase, each RDA would end up having a duty to take actions contributing to sustainable development that would not be relevant to the area. The complication enables sustainable development to be relevant to an RDA area, but not restricted geographically to it. That is the best legal ground to capture what we want the RDAs to do; it is a difficult balance, but the right one. On Amendment 165E, as I said in my opening remarks, sustainable economic growth means economic growth that can be sustained and is within environmental limits, but which also enhances environmental and social welfare. Sustainability is a key factor to apply when planning for growth. Therefore, I obviously cannot accept the amendment. We have set clear objectives through the regional economic performance PSA which requires regions to increase prosperity and enhance competitiveness. We want to ensure that we get the right economic outcomes for regional strategy. Watering down the economic outcomes of the strategy is not the solution; making sure that they are consistent with sustainable economic development is. On design considerations, I take the point that it is proposed to change Clause 78(2), which relates to the need to have regard to the desirability of achieving good design, by removing the words ““in particular””. This would make the legislation incompatible with the 2008 Planning Act which includes ““in particular””. I remember that we had a major debate on that during the passage of that legislation, and again the amendment would cause confusion and alter the scope. As the noble Baroness said, good design is about social, environmental and economic considerations, not just aesthetics. Finally, I turn to the specific amendments of the noble Lord, Lord Greaves. In Amendment 177A he proposes to remove the requirement for responsible regional authorities to take into account national policy, and available resources, in relation to Amendment 177B, when preparing a regional strategy. In Amendment 177E he proposes additional wording to Clause 71(2)(a), whereby a sustainability appraisal should deal with "““economic, social and environmental issues””." Such a clarification, although well intentioned, is unnecessary, as policy, regulations and European law already require sustainability appraisals to consider economic, social and environmental issues. Amendment 177F changes Clause 71(2)(b) so that regional authorities must publish the sustainability report. Again, this is unnecessary as regulations and European law already require this. I am very conscious that this debate has lasted almost an hour, but it has touched on many fundamental points about why we have constructed the Bill in this way and the intentions behind it. I hope that noble Lords will feel reassured by the way that I have approached this and the detail that I have provided, and that they will think more kindly in terms of the intentions and the benefits.