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8.7 pm

Mr. James Wallace (Orkney and Shetland): I agreed with the Secretary of State when he expressed a view probably shared by the whole House--that there is a danger in such debates that the efforts of honest, decent, hard-working councillors will be undermined and tarnished because of problems that arise in a few councils. That is especially important as we move forwards towards a Scottish Parliament; one of the critical relationships that will have to be established is that between the Parliament and local government. Local government is concerned that the Scottish Parliament will attempt to suck powers into the centre. I know that that is not what any party in this House wishes to see, but it becomes easier to do that if local government has been undermined and given a bad name.

The hon. Member for Woodspring (Dr. Fox) said that a prescription for valium might be required during the Scotland-Norway match this afternoon, but I wonder whether he needs a prescription to treat partial amnesia.

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Reading the motion leads one to suspect that he has forgotten everything in local government for which the Conservative party was responsible. It is hard to believe that the words

    "Scotland requires financial stability and ethically sound local government"

were written by the party that presided over Westminster council in the period when some of the greatest abuses ever in local government were perpetrated. The Conservative motion demands "an independent inquiry", but many of us argued that there should be such an inquiry before the unwanted Conservative reforms of local government went ahead.

The hon. Gentleman admitted that perhaps it was too late now and that the independent inquiry should have taken place earlier--it is always welcome when a sinner repents. The hon. Member for Glasgow, Shettleston (Mr. Marshall) was right to point out that some of the problems facing local government arose from that reorganisation. The Conservative Government deliberately underestimated the costs of that reorganisation and today's local government and council tax payers are having to pick up that bill. In addition, I am informed that Strathclyde region left a debt of £79 million, which is also having to be paid by council tax payers. The Secretary of State has said that those responsible for running up the debt must accept that serious responsibility.

It is undoubtedly true that there is a problem in local government. The Secretary of State was frank in saying that there was inefficient management and that there had been a lack of scrutiny; he even conceded that there had been complacency. He concentrated on two councils--East Ayrshire and North Lanarkshire--but never once acknowledged that they were councils on which the Labour majority was overwhelming. No doubt, Labour Members had been happy to go out campaigning for individual councillors in local elections and to claim great credit and triumph on the nights Labour swept to power in those councils. If there has been inefficient management, lack of scrutiny and complacency, it is Labour inefficient management, Labour lack of scrutiny and Labour complacency, because on councils with such overwhelming Labour majorities, there is no one else to blame.

It is not just those two councils, as the hon. Member for Woodspring said. In Dunbartonshire, the Convention of Scottish Local Authorities had to be called in to arbitrate; in Glasgow, there was the case of votes for trips in the cause of municipal tourism--"Glasgow's miles better", but Barcelona's miles further; and in Renfrewshire, as we heard, the police have to be on standby at council meetings. I sat with the Liberal Democrat candidate in the Paisley, South by-election, Mrs. Eileen McCartin, who is a councillor on Renfrewshire council, when she described some of the things that went on there; it was a real eye-opener to the journalists who heard the full extent of the trouble. The problems are not confined to two councils, but let me repeat: not every councillor should be tarred with that brush.

Dr. Fox: Does the hon. and learned Gentleman accept that there is a fear that what the Secretary of State

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wants--bad councillors brought to account--has been undermined by the fiasco of the Labour party's internal disciplinary action in Glasgow? That makes it hard to believe that the Labour party can tackle the problem effectively.

Mr. Wallace: It is fair to say that a series of inquiries have been set up which never quite come to a conclusion. As long as that hiatus or state of limbo persists, the problems, the suspicions and the general undermining of local government will likewise persist. My own party got into serious trouble when there were allegations of racism in Tower Hamlets. We set up an inquiry under an independent chairman and we as a party were prepared to follow the recommendations in the report. The report was produced promptly and we responded decisively, but we received an awful lot of political flak--perhaps rightly so--into the bargain. However, we have not seen the same decisiveness when the Labour party has set up its inquiries.

It is easy to use local government and direct labour organisations as scapegoats for what is, in fact, underfunding disguised as council inefficiency. The current Government must take some responsibility for the underfunding of services. It is also easy, when things go wrong, to say that the Secretary of State must act. The Secretary of State has, rightly, taken powers to act, but the tendency to centralise power must be guarded against. We recall that, not long ago, the Secretary of State was only too anxious to tell the Grampian police force what action to take in respect of its chief constable, and politicians and pundits on all sides were clamouring for the Secretary of State to be given more powers. It is easy to fall into the trap of centralisation, even in matters such as the democratic local control of police, which is strongly rooted in our traditions and should not be so easily given up. We must always be wary of the trap of wanting more power to be drawn to the centre, whether here at Westminster or, eventually, in the Scottish Parliament at Holyrood.

Like the Secretary of State, I am greatly concerned about the increased cronyism of Cabinet-style local government and elected provosts, because it could lead to greater lack of accountability. It can be argued that a Cabinet style of government already exists on East Dunbartonshire council. The Labour administration there strives to conceal as much information as it can from opposition groups. Budgets have been allowed to escalate, without anyone keeping an objective eye on what is going on. The council set up a budget monitoring group--very laudable, one might think, until one discovers that it is comprised solely of Labour councillors. The efforts of opposition councillors to be involved in that group have been thwarted and cast aside by the ruling Labour group. Councillors have been able to take it for granted for too long that they will continue to be re-elected even if the affairs of the council do not run smoothly. The solutions must lie in setting up mechanisms for effective scrutiny, whereby councillors from all parties are involved in monitoring council performance, in addition to the sometimes highly effective external monitoring from the Accounts Commission.

I make no apology for mentioning the importance of proportional representation. I do not object when a party that receives more than 50 per cent. of the vote gets a majority on the council, as happened in North

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Lanarkshire, East Ayrshire and Glasgow; however, no party should have more than 90 per cent. of the seats on 60 per cent. of the votes, as happened in Glasgow. That makes accountability near impossible and makes extremely feeble the opposition's ability to keep the administration up to the mark. Under a system of proportional representation, there would be a greater opportunity for opposition councillors to hold the administration properly to account and to restore credibility.

Without proportional representation for local government, there is a serious danger that a Scottish Parliament elected by proportional representation will not treat local government, if it is still elected under a distorting first-past-the-post system, with the respect that it should receive. Indeed, Scottish local government could be diminished vis-a-vis the Scottish Parliament if it does not change its electoral system. I also believe that, under a system of proportional representation in which there is voter choice, there will be no hiding place for the lazy and incompetent councillor, which is why we favour the single transferable vote system. Councillors who are simply not up to the job will soon find that the greatest indignity of all is to lose a seat to a member of their own party. At the last two sets of Scottish local elections, the Liberal Democrats have polled votes in roughly the same proportion that we have gained seats, so I can say without fear of being accused of seeking party advantage that the introduction of proportional representation would be to the advantage of democracy.

It might seem strange when, in a debate that has focused on the mismanagement of local government finance, I say that local authorities and councillors should be given more responsibility for raising their own finance, but that will be essential if local government is to restore in any meaningful sense the concepts of local democracy and local accountability. The Secretary of State talked about low turnouts, which are of concern to us all, but I do not believe that the strength of local government or the re-creation of local democracy will be advanced by elected provosts or committees. What will be of considerable influence is the relationship between local government and central Government. If local authorities are dependent on central Government for 80 per cent. or more of their funding, the relation will always be unbalanced, so we must look for ways to shift that balance.

That is why it is almost inconceivable that the independent committee set up under Neil McIntosh to consider the relationship between the Scottish Parliament and local government has specifically excluded from its remit the opportunity to consider the financial relationship between the Scottish Parliament and local government. If the Government do not change their minds about referral of the question of local government finance to the McIntosh committee between now and the establishment of the Scottish Parliament, one of the first things that the Scottish Parliament should do is to ask the committee to consider that important financial relationship--indeed, it is almost inevitable that the Parliament will do so.

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Without that, an important link will be missing from the effort to ensure that local government in Scotland becomes more robust than it is.

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