Local Democracy, Economic Development and Construction Bill [HL]

My Lords, this group of amendments concerns the proposed local authority economic assessment duty. I shall address Amendments 145 and 146 first. The Minister has put her name to the amendments, as the noble Baroness, Lady Warsi, said. We have listened carefully to noble Lords’ concerns that a Secretary of State power to direct an individual local authority to revise its assessment would give the Secretary of State undue control over how the assessments are taken forward. The power of direction was only ever intended as a safeguard and, as we are confident that local authorities will wish to keep their assessments up to date, we are very keen to keep government prescription to a minimum. For that reason, we are happy to support these amendments. Amendment 147, tabled by the noble Baroness, Lady Hamwee, and the noble Lord, Lord Tope, would allow a non-unitary district council to elect to be placed under the duty, so that in two-tier areas both the county council and district council would be under a duty to prepare an assessment for their respective areas. Amendment 151 is a consequential amendment. I understand the fear expressed by noble Lords that district councils would have a peripheral role in the preparation of local economic assessments in two-tier areas and that countywide assessments would fail to take account of the important contribution that district councils make to wider economic development. I assure noble Lords that we do not underestimate the vital role that districts play in supporting local economic development and regeneration. Indeed, we fully intend county councils and district councils to work in partnership in preparing their economic assessments. The Bill, in Clause 65(6), already requires the county and district councils to work in partnership in the preparation of the countywide economic assessment. It includes a requirement on the county council to consult and seek the participation of district councils within its area and to take account of the evidence gathered by the district council in the course of its role as planning authority that may affect the development of the area. It also includes a requirement on the district council to co-operate with the county. We do not believe that the amendment would further strengthen partnership working between the county and districts. The amendment would place a separate duty on the county council and the district to prepare an assessment. As noble Lords are aware, local authorities have general powers to discharge their functions jointly. Thus, the county council and district councils electing to be bound by this duty could decide to prepare a joint county assessment. Although, in the best case, districts and counties might choose to exercise their duties jointly, nothing in the amended provisions would require them to do so. Therefore, we cannot discount the possibility that a district council would want to produce its own assessment rather than work with the county. In such a scenario, the district’s assessment would have the same statutory status as the countywide assessment, which could lead to unnecessary duplication of effort. It could also mean that regional partners would be presented with two potentially conflicting assessments for the same area in preparing the regional strategy. Furthermore, if a district council was to go it alone, Amendment 151 would result in there being no requirement for the county to consult it and seek its participation in preparing the countywide assessment. As I explained in Committee, we believe that it is important that assessments should reflect the local economic geography as much as possible. We do not dispute that district councils have a key role to play in economic development and regeneration. However, economic linkages or economies do not stop at district council boundaries; the solutions to local economic problems can often lie in the wider economy. For example, skills shortages and shortcomings in connectivity often require a county or sub-regional response. Counties provide a better match for real economic markets and are better placed to build a broad strategic understanding of the drivers of the wider economic area. For these reasons, we believe that it is better to prepare the assessment at a county level. Therefore, we believe that the best way to take forward local economic assessments is to place the duty on county councils but with a clear requirement for the county to work with the districts. Counties are particularly well placed to lead on economic assessments, as they have a strategic overview of the economic, social and environmental well-being of the county as a whole. They are already the responsible authority for preparing the local area agreement in two-tier areas and they tend to be better resourced for this type of work than district councils. We consider that the Bill, as drafted, requires both the county and district councils to work in partnership in preparing the local economic assessments and that it provides district councils with a specific role in recognition of their important contribution to the assessment. Such an approach is simple and transparent, provides clear lines of accountability and will, it is hoped, lead to high-quality, consistent assessments. We believe that it strikes the right balance between ensuring that district councils are fully involved and the need to have clear lines of accountability. I hope that I have addressed the noble Baroness’s concerns and that she will understand why I think that the amendment is not necessary. Amendments 152 and 153, also tabled by the noble Baroness, Lady Hamwee, and the noble Lord, Lord Tope, would require a county council to have regard to any material produced by a district council, regardless of whether it relates to the district’s planning functions. Amendment 154 would require the county council and district council to co-operate with each other. The Bill makes specific mention of material held by the district council in the discharge of the district council’s functions under Section 13 of the Planning and Compulsory Purchase Act 2004, because the local economic assessment is expected to inform the preparation of local development frameworks. In view of this, it is important that there is consistency between the evidence assembled at a district council level in preparation of the local development framework and the evidence gathered for the local economic assessment duty. We should also not lose sight of the fact that the material collated under Section 13 is wide-ranging and is not restricted to economic data, as I think the noble Baroness mentioned. Section 13 requires local planning authorities to keep under review any matters that may affect the development of their area. This would include, among other things, principal physical, economic, social and environmental characteristics of the area. Many district council functions relate to economic development and regeneration. Both district councils and counties contribute in different ways in supporting economic development, often working in partnership. For instance, both tiers work together alongside other partners in tackling skills challenges. There is a range of evidence that local authorities can draw from in developing local economic assessments, some of which is held by districts, some by counties and some elsewhere. Local authorities should also, where appropriate, draw on the evidence assembled in developing other key strategies such as local housing strategies, which are assembled by districts, and local transport plans, which are assembled by counties, in putting together their economic assessments. It is important, therefore, that county and districts work together with other partners in agreeing the range of evidence needed to assemble the local economic assessment, aggregating it and disaggregating it where necessary so that it both informs local priorities and gives a broad strategic picture that can properly inform the regional strategy. Our intention is to address these issues clearly in future guidance. We do not, therefore, believe that there should be an open-ended requirement on the county council to have regard to any material that the district council decides to provide. However, there needs to be a genuine dialogue between the county and districts. We believe that the Bill as drafted will help to achieve that. Amendment 154 would place a requirement on both the county council and district council to co-operate with each other in the preparation of a local economic assessment. We do not believe that this amendment is necessary because, as I have explained, the Bill already includes a requirement on the county council to consult and seek the participation of district councils and the district councils to co-operate with the county councils. It is implicit within such a requirement that the county council should work closely and co-operate with district councils within its area. I can assure noble Lords that we will emphasise the need for co-operation in guidance. Amendment 155, tabled by the noble Baroness, Lady Hamwee, would provide for an assessment prepared prior to these provisions coming into force to be able to fulfil a local authority’s statutory duties in relation to Part 4 of the Bill. Noble Lords are understandably keen to ensure that existing work done by local authorities in developing an economic evidence base is not lost. We completely agree that local authorities should, wherever possible, build on existing work in preparing their new assessment. The important point is that the assessments be fit for purpose and give an accurate and up-to-date assessment of local economic conditions. As the policy statement on local economic assessments, which was placed on the Communities and Local Government website in January, makes clear, a local authority that has already carried out an assessment will need to consider it in the context of the new duty and any government guidance. While such local authorities may need to make some changes and will certainly need to ensure that they meet their new statutory obligation to consult, we do not intend that the work that they have already done should go to waste. I hope that noble Lords will, therefore, understand why we believe that these amendments are not necessary. Amendment 145 agreed.