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Mr. Bernard Jenkin (North Essex): Part of the temptation on Report is to agree to every Government new clause and amendment as an admission of guilt that they have strayed and have grievously omitted vital provisions. We do not intend to treat today's debate in that way. We recognise that it is a complex Bill and that some of the issues on which we did not receive satisfactory answers in Committee are addressed in the Government amendments. By the same token, it is also legitimate for the Opposition to raise new issues.
My hon. Friend the Member for Mole Valley(Sir P. Beresford) spoke to amendment No. 95, which is a case in point. In Committee, we discussed at some length how fees to the Audit Commission should be determined and controlled. As with much of the Bill, the fate of local councils is in the hands of the Secretary of State as guidance issued by the Secretary of State will determine the fee scales.
My hon. Friend expressed a simple concern--that the Audit Commission does not provide a service that local authorities can choose to buy, but one similar to that of the liquidator of a business. On the dissolution of a business, the liquidator charges his fees, come what may. It is a monopolistic situation, as most local councils will not have the option of looking for a cheaper quote elsewhere. In most circumstances, my hon. Friend is quite right to insist that the Bill should not write blank cheques to bureaucrats--and that is what they are--allowing them to go about their business at somebody else's expense without any heed to the consequences. That is a great danger.
My hon. Friend's amendment is entirely justified: as soon as the fees hit a certain level, the Audit Commission would effectively be making a loss on the services
provided to a local council and would not recoup their full cost. That dovetails with the Minister's proposal that the Audit Commission should receive a grant from central Government to cover some of the costs. Central Government would then have a role in limiting the activities of the Audit Commission so that it could not do what it wanted willy-nilly, but would be under an obligation to carry out its function efficiently and effectively and to do no more than was required by the Bill.
Sir Paul Beresford:
I accept what my hon. Friend is saying, which is interesting. The difficulty is that the taxpayer would fund a central Government grant. During our debate on the money resolution, the Minister of State gave us no indication as to whether there was a ceiling. She said that there would be discussions, but at the end of the day there may need to be a ceiling. We are considering only the local government aspect of the issue, but there is more to come.
Mr. Jenkin:
I am sure that the Minister who will be replying to the debate heard my hon. Friend's point; I hope that he will address it.
New clause 4 gives the Secretary of State another new power. The Bill already provides a huge number of new powers--on Second Reading we counted 27. The 28th is to issue guidance to co-ordinate
In Committee, we explored the danger that the Audit Commission would be inspecting the same matters as the benefit fraud inspectorate, Ofsted or other bodies involved in inspecting various aspects of local government. Although there are already memorandums of understanding between, for example, the Audit Commission and the benefit fraud inspectorate on how local authorities deal with council tax benefit and housing benefit, we always thought it a little optimistic to expect that system to suffice across the board for eight or nine bodies dealing with complex issues. We drew attention to the risk that authorities could indulge in what might be described as inspectorate arbitrage--similar to regulatory arbitrage--whereby different authorities would play off various inspectorates against each other rather than ensure that there was a seamless web.
Mr. John Hayes (South Holland and The Deepings):
My hon. Friend the Member for Mole Valley
(Sir P. Beresford) drew attention to the costs involved. Will my hon. Friend comment on the effect on the confidence and morale of those in local government who will find a new inspector in every corridor? That is hardly in the spirit of local democracy.
Mr. Jenkin:
I entirely agree with my hon. Friend about the all-embracing nature of the intervention powers in
Mr. Andrew Hunter (Basingstoke):
My hon. Friend has been a little over-generous, even in his qualified welcome for the new clause. Surely it undermines, and is incompatible with, the Government's objective of breathing new life into local government.
Mr. Jenkin:
That remains one of our fundamental objections to the Bill. However, the Bill is likely to become law, and we are in favour of the objectives of best value; it is the methods about which we have expressed distaste. If the Bill becomes law and the all-embracing methodology of inspection, audit and control is to be imposed on local authorities, there must be a framework.
In Committee, we were assured that there would not be a risk of different inspectorates playing off each other. The inspectorate forum, which the Minister mentioned, is meant to ensure reasonable co-operation. The Government have admitted despair about the capabilities of such a forum on its own, and they recognise that some guidance will be necessary.
Mr. Jon Owen Jones:
I am grateful to the hon. Gentleman for trying to address the Bill constructively. However, when he and some of his colleagues criticise the amount of inspection under the Bill, their criticism must be of other parts of the Bill. New clause 4 does not increase inspection; it simply attempts to co-ordinate that inspection so that it proceeds sensibly. I cannot seewhy Opposition Members would wish to have an unco-ordinated series of inspections, rather than a co-ordinated one.
Mr. Jenkin:
The Minister's sensitivity speaks volumes about what he might feel in his heart about the intrusive nature of the Bill. However, I accept what he says. If we are not to have different inspectorates overlapping or missing things out--which is not the intention of the Bill--some co-ordination will be necessary. What was envisaged in Committee was clearly inadequate, so we give the new clause a qualified welcome.
What does the Minister expect the guidance to say? Will it be voluminous, or general? Will it be particular to particular authorities? Another Government amendment widens the scope of the guidance that the Secretary of State can issue in other circumstances. Is that guidance intended to be for different authorities in different circumstances, or is it purely general guidance to deal with all kinds of local authority in all circumstances?
Does the new clause treat the Secretary of State as meaning also the National Assembly for Wales?
Mr. Jenkin:
That point has been dealt with, then, but I hope that the Minister will address the previous point.
Government amendment No. 7 does not require the Audit Commission to publish a report--and that is the burden of my complaint. Clause 13(3) says that the Commission
One can imagine circumstances in which there might be pressure on the Audit Commission--possibly from the Secretary of State in a political capacity, or possibly from an affected council. We know plenty of councils that might want to hide things that the Audit Commission might want to put in a report. I am worried that the Audit Commission might come under pressure and that, in cases of real corruption, individuals within it might be caught up in underworld pressure involving threats to life and limb.
Would it not be safer to specify an obligation to publish, but to provide for the specific circumstances and material that should not be published? A general enabling provision, so that the Audit Commission may publish what it considers to be appropriate, could leave the Audit Commission holding a rather hot coal. It would also put it in a political situation--something we should not ask of public servants. The amendment, as tabled, is not satisfactory.
"different kinds of inspection, inquiry and investigation".
We welcome the new clause. The Minister said that it would cover matters that are not currently inspected. I would be grateful for examples. In my opinion, the new clause has more to do with the collision between various inspecting bodies that would occur under best value. Until now, the different inspection bodies have had fairly segmented tasks. However the all-embracing scope of best value gives the Audit Commission itself all-embracing scope.
"shall send a copy of the report to the authority concerned."
The amendment proposes to add that it
"may publish a report and any information in respect of a report."
The Minister was expansive about the flexibility that the measure would give to the Audit Commission. However, I have a rather different point from that raised by my hon. Friend the Member for Mole Valley. Obviously, there must be some way of protecting confidential information, particularly that which relates to personal or distressing circumstances.
6.15 pm
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