Local Democracy, Economic Development and Construction Bill [HL]

I have given examples of the kinds of things we can legitimately expect—for example, new skills funding. I shall come back to the noble Lord on that. This is very much work in progress and a lot will depend on what the EPBs themselves feel they want, whether it is in relation to negotiations with the DWP, for example, unemployment strategies, benefit strategies and so on. These bodies must be able to show that they are resilient, capable of handling investment, working across all the functions which make up our economic prosperity in critical areas of policy, and that they are serious enough about this new opportunity to commit to working to a long-term statutory arrangement. They need to be confident that the EPB will not be expanded or reduced, or have its functions or constitutional arrangements changed, without following a clear process which includes the possibility and opportunity for stakeholders to be consulted. It is not sensible to allow a public body such as this to be able to change its operating arrangements on a whim. I hope that explains why I cannot accept Amendments 183F, 193A, 194, 194T, 194VA and 194ZA. We also recognise that it may be necessary to make changes in some circumstances so we have provided a process for this to happen in Clauses 95 to 97 and in Clauses 106 to 108 for the combined authorities. These clauses will allow any one or more authorities to initiate a request for a change to be made to an EPB. Amendments 193B, 194M, 194W and 194AM in the names of the noble Baroness, Lady Hamwee, and the noble Lord, Lord Tope, seek to alter that and to require that the EPB itself, or a majority of the members of the EPB, request or agree to these changes. But that could put a single council which wished to make changes, including removing itself from the EPB, in a difficult position. We hope that it will always be possible for authorities to reach a consensus on what is best for the area, but allowing a minority of councils to submit a revised scheme to the Secretary of State in the case of a disagreement provides a fall-back option if a consensus cannot be reached. I know another concern is that EPBs will accrue powers over time and whittle away the role of individual authorities. Again I hope to provide some reassurance. Any change in an EPB’s function will need to be confirmed through an order made by the Secretary of State, informed by consultation with local authorities. I hope that noble Lords will agree that adequate safeguards are in place to prevent an EPB acting unreasonably in this respect. We are not doing much that is new; the process for establishing an EPB is deliberately very similar to the process already set out in the Local Transport Act 2008 for establishing integrated transport authorities, which have replaced the PTAs, for example. It is also possible for such authorities to be set up across other sub-regional areas where local authorities wish to strengthen governance arrangements in relation to transport. Our legislation is similar to the LTA, whereby it will be possible for the functions of an EPB to be brought together with the functions of an ITA, streamlining sub-regional arrangements and allowing transport and other economic development decisions to be taken in a co-ordinated way. Provision for such combined authorities is set out in the second half of Part 6. The principles behind EPBs also apply to combined authorities. Such arrangements will be voluntary for local authorities, they will be initiated by local authorities and they will be established by the participating councils. I turn to the remainder of the amendments in this group, including Amendment 192D, tabled by the noble Baroness, Lady Hamwee, and the noble Lord, Lord Tope. This set of amendments would change the requirements in Clause 89 for an EPB to have to pass a resolution by at least a two-thirds majority to change the name by which it is known. Clause 89 is lifted directly from the provision made in the Local Transport Act 2008 for integrated transport authorities, and it makes sense for there to be similar arrangements. Amendment 194AQ, tabled by the noble Baroness, Lady Hamwee, addresses the Secretary of State’s powers under Clause 109 to make incidental, consequential, transitional or supplementary provisions that are necessary because of an order confirming an EPB. I understand why noble Lords may have concerns about this power. However, I believe that it is necessary to ensure the effective functioning of EPBs and combined authorities. This legislation provides a framework for EPBs and combined authorities and does not set out any of the detail. This is because different places will have different requirements and will wish to pursue different objectives. We must give authorities as much flexibility as possible when it comes to preparing their schemes. Therefore, we cannot cover every eventuality and instead we have provided a reserve power in Clause 109 whereby the Secretary of State can make changes that would allow local authorities to design and establish an EPB that meets their reasonable requirements. There is nothing more sinister than that; it is a very benign, but necessary power, and there is similar precedent in the Local Transport Act 2008 in relation to ITAs. The Delegated Powers and Regulatory Reform Committee was content with Clause 109. I hope that that will satisfy noble Lords. With regard to the remainder of the amendments in this group—Amendments 195, 195A, 195B, 193C, 193D, 194X and 194XA—I believe that I addressed all the points raised in those amendments in the letter that I wrote to noble Lords. I will double-check Hansard tomorrow. If I have not addressed those points, I will come back and make sure that the noble Baroness receives a proper response. Finally, on the matter that the noble Lord, Lord Greaves, raised with me, I reiterate that essentially a local authority which chooses to go down the route of creating an EPB will do so in the full knowledge of what that involves. It will be certain about what it has to provide by way of evidence to satisfy the argument that this extra legal personality and power is what is needed to achieve what the authority wants to achieve for the region. There will be other choices—this is one of several—but the powers that could be given to EPBs include, as discussed in the PBR, greater powers over employment, skills, housing and transport, greater responsibility over funding streams, and the city-regions process allows us to try to test that. All this will be driven by what partnerships ask for—what they seek to achieve—and the powers will have to be tested in that context. I am conscious that I have spoken at great length. I thought that the debate deserved a full explanation because the Bill is about the main architecture. Clearly, there is an argument about which I hope noble Lords feel more reassured.