Localism Bill

If, as the right hon. Gentleman says, the reason was that the Hutton committee had not reported, one would have to ask why the Government introduced specifications in the Bill about senior pay. They did so because they want consistently to promote the myth that councils would not have to make front-line cuts if only they would cut top pay. We are pleased that councils will now have to set out details of who they regard as their lower-paid staff and their approach to the pay of those employees. They will also have to include a statement about their policy on pay dispersions—what used to be called differentials when I was negotiating. This is a real and growing issue in this country and people are extremely concerned about it. The amendments represent a very modest step, but at least they will make information available to the public and ensure that councils consider the issue. The publication of details about pay will expose the inequalities that prevail and encourage people to think about how many of the services they rely on are delivered by people on low pay. There are people out there who provide care for the elderly, clean our streets and empty our bins—people whom we take for granted but without whom our towns and cities would quickly cease to function—and they are often very low-paid. I regret that the Government have not seen fit to include the requirement for local government contractors to provide pay transparency if the value of their contract is in excess of £250,000. We argued in Committee for that to be included, because we believe that it is a matter of basic justice. We believe that those who are paid from public money should not be on poverty pay and that the firms that provide public services should demonstrate how they are spending our money. Contracts that are outsourced might seem like better value, but if they depend on low pay that is then topped up by benefits, not only are they an affront to the people who work in those services but they might cost more public money in the long run. The increase in the outsourcing of services has made this step even more important, because we want good companies to compete on quality and efficiency, not by undercutting pay levels and terms of service. The amendments will at least bring more transparency into the system, but it is a pity that the Government could not have extended the duty a little further. Let me address the amendments that remove the details regarding local referendums, which really illustrate what a mess the Government have got themselves into with the Bill. A welter of amendments dealt with this issue in the Lords, although it was dealt with extensively in the Bill Committee both in the evidence it received and during its debates. The late Sir Simon Milton, for example, pointed out that a referendum in London could cost £5 million if held on the same day as local elections, but could cost £11 million if held on a different day. However, it took the Government some time to realise what a huge drain on a local authority's budget that could be. My hon. Friends also raised in Committee the huge costs that would be involved for local authorities, such as that for checking petitions for a referendum and for running the referendums. There was a real fear that the number of petitions and referendums would simply spiral over time. Even the leader of Shropshire council, who is a Conservative, warned that the costs could be ““outrageous””, but it took a long time for the Government to change course. Underlying those provisions was the Government's failure to trust elected councillors to decide how to engage with their electorate. We still hear a lot from Government Front Benchers about devolving powers to local authorities, but it took them some time to realise that imposing this system on local authorities would have been unwise to say the least. Local authorities might want to use petitions, referendums or public meetings—whatever they wish—and, like all of us in elected office, if they do not get it right they pay the penalty at the ballot box. That is as democracy should be. The Under-Secretary was adamant in Committee and would not budge an inch. I felt quite sorry for him, because he suffered the fate of many junior Ministers of being sent like officers on the Somme to defend an indefensible position until those above them finally decide that they ought to give way. Indeed, I am surprised that he is still here, because I understand that at the weekend the Lib Dem leader in Broxtowe called for him to resign following his performance. In Committee, the Under-Secretary would not accept the dangers of what he was proposing. However, there were risks that highly vocal pressure groups that did not necessarily represent the wider community—certainly not the whole authority area—could use the measures, so there was potential for whipping up feeling against necessary, but sometimes unpopular, provision. I recall examples that I have dealt with regarding housing for people with mental health problems in the community. My experience has been that the idea is usually unpopular because of the misconceptions about mental health that many people hold, but that if one talks to neighbours and tries to deal with their fears, that usually works. Once people are settled in their homes, overwhelmingly the community around them is very supportive and helpful. One could not do that sort of work in the face of a polarising referendum, which some people might whip up for their particular ends. No one is saying that a referendum is always a bad idea, but there are many ways of engaging with voters and that is only one of them. If amendment (a) to Lords amendment 112 is put to the vote, we will oppose it for the reasons that have already been stated. We do not believe that imposing binding referendums on local councils is the way forward, because they can be misused, they can have an impact on services elsewhere and, as was said earlier, they may be used by people promoting racial hatred or for other purposes that we would consider inappropriate. In the end, the local council must take a decision and stand by it. We welcome the amendments that remove the mayoral management arrangements from schedule 2 and delete the power of the Secretary of State to order that a specified authority must move to an elected mayor and cabinet system because, again, the original clauses clearly gave the lie to the idea that the Bill was about empowering local communities. On the contrary, it gave yet more power to the Secretary of State. The proposal to order a move to an elected mayor and cabinet was one of the most controversial in the Bill, together with the power to impose shadow mayors. I note that the Government are retaining the power to order an authority to hold a referendum on the subject because clearly they do not trust local councils, but at least we have seen some progress. It is astonishing how many U-turns Ministers have done on this issue. In 2007, the Under-Secretary of State for Communities and Local Government, the hon. Member for Bromley and Chislehurst (Robert Neill) told a Committee of the House:"““I would prefer that the Government did not prescribe the governance system for councils at all.””––[Official Report, Local Government and Public Involvement in Health Public Bill Committee, 25 February 2007; c. 251.]" I expect that, as the former leader of a local authority, he believes that, so I do not know what happened in the meantime, unless he was sat on by his right hon. Friend the Secretary of State for Communities and Local Government. The hon. Member for Hazel Grove (Andrew Stunell), who is now also an Under-Secretary of State for Communities and Local Government, told the same Committee:"““governance should be entirely a matter for local councils””—[Official Report, Local Government and Public Involvement in Health Public Bill Committee, 20 February 2007; c. 269.]" I agree, but he is a Lib Dem, and we have all seen ““Focus”” leaflets which argue different things in different areas. The real point about these proposals is that they were entirely undemocratic—a fact that was recognised clearly in the other place. They would not have given the decision to local people and would have given whoever was made the shadow mayor a huge electoral advantage in any poll that followed. We believe that that was an entirely unacceptable way of going about things. To add to the confusion, the Secretary of State and the Under-Secretary, the hon. Member for Bromley and Chislehurst, have both said on different occasions that a mayor and cabinet system would only follow a referendum of local people. That is typical of the mischief and muddle that have characterised the Bill. So bad were the Government's original proposals that even Tory councillors were speaking out against them. [Interruption.] The hon. Member for Elmet and Rothwell (Alec Shelbrooke) says from a sedentary position, ““You don't want to listen to them.”” I hope his own councillors hear what he says. The most outrageous suggestion from the Government was the proposal to allow an elected mayor also to be the chief executive of a local authority. Goodness knows what put that into their heads. It reflects a degree of confusion between political leadership and administration which is extremely worrying. I well recall in years past, when Labour took control of Lancashire county council, my former hon. Friend the Member for Blackpool North and Fleetwood, Joan Humble, going to the social services offices and saying, ““We are going to implement this manifesto. You are going to tell me how to do it, and I will listen to your advice on how to do it, but make no mistake, we're going to implement it.”” That is the difference between political leadership and administration. One listens to officers about the best way to do things, but one has a political direction. The problem with what the Government were proposing was the muddling of those two, which has huge potential for undermining standards in the governance of local authorities because it removes the system of checks and balances that help local authorities to run properly. Removing the proposal and the introduction of a mandatory requirement to have a code of conduct is a step forward, as are some of the other amendments in the group. I only wish that the Government had listened earlier in Committee to the points that were made by my hon. Friends.