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Mr. Edward Davey (Kingston and Surbiton): The hon. Member for Mole Valley (Sir P. Beresford) has a point. The Secretary of State is mentioned more than 250 times in the Bill, and he will retain a fair degree of power. The mayor is to hold public debates with the people of London, but will the Secretary of State attend those debates?
Mr. Prescott: We are referring substantial powers to the mayor and the assembly--powers that people have
wanted for a long time. The Secretary of State's role in respect of new city government will be as it is in respect of local authorities: it will extend to the balance of powers and resources and to determining whether overall policy is achieved, which are matters proper to the balance between central and local government. The same is true of the relationship between central and regional government: central Government cannot afford to opt out of strategic decisions, so we reserve our rights in respect of such decisions. As the Bill shows, tremendous powers and resources are being given to the mayor and the assembly--billions of pounds will be under their immediate control.
Mr. Harry Cohen (Leyton and Wanstead): Where does my right hon. Friend think the Greater London authority will meet? Newspapers carried the picture of the giant car light on its side near Tower bridge, which seemed pretty average to me. What does my right hon. Friend think about this matter?
Mr. Prescott: My hon. Friends who have been dealing with the issue say that they have shortlisted two sites, and I must inform my hon. Friend that one of them is not Leyton.
Mr. Prescott: Good. I am delighted to please another hon. Member.
The assembly's scrutiny role underlies most of the work to which we have referred, and it will be consulted about the strategies and powers of Bills.
The third part of the Bill involves finance--a crucial area in any relationship between central Government and local government. The GLA budget will be placed firmly within the existing financial framework for local authorities, as I have just said. The GLA will set budgets for itself, for the Transport for London body, the Metropolitan police authority, the London Fire and Emergency Planning Authority, and the London development agency.
Two new Government grants will be established. The first is a new general grant to cover most of the annual costs of the mayor and assembly, estimated at about £20 million. London council tax payers will contribute approximately 20 per cent. of that sum--about 3p a week on a Band D council tax bill, raising approximately £4 million. That is a very small price to pay for giving London the strong directly elected Government it needs.
Mrs. Gwyneth Dunwoody (Crewe and Nantwich)
rose--
Mr. Paul Burstow (Sutton and Cheam)
rose--
Mr. Prescott:
I give way to the hon. Gentleman.
Mr. Burstow:
I am grateful to the Secretary of State for giving way on that point. He said that the new authority will have the same financial control regime as local government generally. Does he accept that the Bill goes further in controlling the authority's ability to decide what it can and cannot do with its finances, by imposing not only spending ceilings but spending floors?
Mr. Prescott:
It is true that, in giving grants to this new type of city governance or to local authorities, the
Mr. Edward Davey:
What about the floors?
Mr. Prescott:
There are floors regarding what we expect the authority to spend in certain areas. That is a matter for negotiation with the London authority, as it is with local authorities. We may explore the details of differing levels of expenditure a little more in Committee. The essential relationship between central Government and the London authority is clear: it does not differ greatly from that between central Government and local government as far as the powers defined in the Bill and the raising of resources are concerned.
The second grant is a new GLA transport grant, which consolidates existing transport grants. There will be three key safeguards. First, the mayor must comply with statutory duties imposed upon him or her. Secondly, the mayor will be required to spend earmarked funds on the services for which they are given--which confirms that point that I made earlier to the hon. Member for Kingston and Surbiton (Mr. Davey). Thirdly, the Home Secretary will have a reserve power to set a minimum budget for the Metropolitan police, and powers to ensure that national standards of fire services are maintained. When moneys are given, we will make expenditure levels absolutely clear--particularly with regard to the Metropolitan police and fire services.
Part IV deals with transport, one of the key issues for London and Londoners. The mayor will provide integration of London's transport, ensuring that transport, environment and planning policies fit together. Borough councils manage much of the transport people use today, and they will continue to play a key role. However, they will do so within the context of an integrated transport strategy, and they will be required to draw up local plans to implement that strategy.
Transport for London is a new body that will be directly responsible to the mayor. It will help to implement the integrated transport strategy and deliver many key services. The mayor will appoint the members of its board--and perhaps its chair--and will have wide powers of direction over all its activities. Transport for London will take over London Transport's responsibilities for buses and the underground. It will take on responsibility for the Croydon tramlink, new piers and riverbus services, Victoria coach station and the docklands light railway. It will also regulate taxis and minicabs.
Transport for London will take on the management of traffic and road maintenance on London's strategic roads, which is currently the responsibility of the Highways Agency and London boroughs. It will take on the work of the traffic director for London, the traffic control systems unit and the Public Carriage Office.
I shall say a few words about the public-private partnership for the London Underground, which I announced to the House in March. London Transport has
now consulted a cross-section of potential bidders, lenders and other transport interests. There was a very positive response, although the trade unions raised a number of concerns that London Transport will be addressing with them.
Further work has also been done to develop the details of the public-private partnership structure. As a result, London Transport will take the following step towards establishing a publicly owned and publicly accountable underground system: London Underground will be restructured during the first half of next year into an operating division, which will remain in the public sector, and three infrastructure divisions based on groupings of lines.
The aim will be to invite expressions of interest from potential infrastructure bidders early next year. I want the public-private partnership to be implemented as quickly as possible, so that passengers can begin to enjoy the real benefits that a modernised underground can bring, but I shall not rush that timetable.
In particular, I do not want to commit London Transport to a date by which the PPP must be completed. Negotiating against a self-imposed deadline would clearly compromise value for money. The Public Accounts Committee has warned against such an approach, to ensure that the taxpayer is protected. The previous Administration ignored such advice in their rush to privatise the railways and their assets, and we now know the full price for not taking due consideration of taxpayers' interests. We do not intend to repeat that mistake, or to have to go before the Public Accounts Committee to justify it.
Mr. Richard Ottaway (Croydon, South):
If the Deputy Prime Minister is paying attention to Select Committees' views, will he pay attention to the Transport Sub-Committee, which described his proposals as a convoluted compromise?
Mr. Prescott:
It is difficult for me to know how the Committee came to that conclusion until I am aware of the results of its work. I am delighted that my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) is here, and I am sorry that I did not give way to her earlier.
Mrs. Dunwoody:
Will my right hon. Friend give way to me now?
Mrs. Dunwoody:
My right hon. Friend will be delighted to hear that that is all the Sub-Committee called his proposals, and I can assure him that its comment was based on precisely the sort of arguments that he is making now. Will he make it clear that any incoming local government will face the enormous problem of capital costs for the underground system? I hope that the authority will have sufficient flexibility to consider all sorts of partnerships, because, as he said, the Public Accounts Committee has pointed out that, as a result of the sale of the railways, he and I and the rest of the taxpayers ended up with the worst deal and the largest bill.
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