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Mr. Lansley: Does my hon. Friend agree that, in our culture of continuous improvement, there comes a point in every type of business where the marginal cost of improving the service offered no longer yields value for money? The acid test of whether the duty in this part of the Bill will deliver value for money will be when a local authority seeks constantly to improve its service but gets diminishing returns. I suspect that that is what will happen.
Mr. Jenkin: I agree with my hon. Friend, but the point that he has neglected is that the Government want local authorities, as the providers of services, to aspire to best value, but the ultimate control comes from the council tax capping powers and the council tax benefit subsidy limitation. The control on cost ultimately comes from the other provisions in the Bill. I find it extraordinary that the Minister can use such extravagant language when to talk about which approach is better--a combination of economy and efficiency, or the need for an equal regard for economy, efficiency and economy--is to count the angels on a pin head.
We have exposed this part of the Bill as complete nonsense and the Minister, in her heart of hearts, knows that. The important provisions in the Bill are the powers of intervention that the Secretary of State will exercise over local authorities. Unfortunately, the Bill lacks any prescription over how the Secretary of State should exercise those powers, which is why it is such a dangerous Bill. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Mr. Waterson:
I beg to move amendment No. 60, in page 3, leave out lines 28 to 30.
Mr. Deputy Speaker:
With this, it will be convenient to discuss the following amendments: No. 61, in page 3, line 31, leave out 'or standards'.
Government amendment No. 6.
No. 62, in page 3, line 35, leave out 'and standards'.
No. 46, in page 3, line 39, leave out from 'and' to end of line 41 and insert
No. 64, in page 3, line 41, after 'Commission', insert
No. 47, in page 3, line 41, at end insert--
No. 77, in clause 14, page 9, line 37, leave out from 'if' to end of line 39 and insert
No. 78, in page 10, line 3, after 'opinion', insert
No. 79, in page 10, line 5, after 'Part', insert
No. 80, in page 10, line 17, leave out
No. 48, in page 10, line 22, at end insert--
No. 81, in page 10, line 26, leave out '(if any)'.
No. 5, in page 10, leave out lines 33 to 43 and insert--
No. 49, in page 10, line 33, leave out subsections (8) and (9) and insert--
No. 86, in page 10, line 33, leave out subsection (8).
No. 87, in page 10, line 34, leave out 'he' and insert
No. 88, in page 10, line 39, at end insert--
Mr. Waterson:
The first amendments in this important group alter clause 4. Amendments 60 to 62 would reduce the Secretary of State's discretionary power to set standards for local authorities. The key theme of the Bill is the Secretary of State's gathering to himself of some extraordinary powers over whose exercise there will be little control. Clause 4 is another example of that.
Performance indicators should be set centrally, but performance standards could profitably and sensibly be decided by local people, through their elected representatives. The amendments provide a litmus test of whether the Government mean what their rhetoric says about returning power to, and trying to rejuvenate, local government, and of whether they are willing to trust local government to make such decisions.
If local government is to mean anything, it must recognise that different people in different parts of the country have different needs, aspirations and approaches. We want a looser rein than the Bill allows, and an explanation from the Minister of why the Secretary of State needs such tight controls. Why do the Government not trust local government?
Government amendment No. 6 relates to consultation by the Secretary of State on performance standards and indicators. The reference to consultation is a welcome gesture from the Government, but imposes no terribly heavy burden on the Secretary of State, mentioning
Clause 14 deals with the Secretary of State's powers. There can be few precedents, at least in peacetime, for the panoply of powers that the Secretary of State seeks in order to enforce his will on local government. Amendment Nos. 77 to 79 would remove from the Secretary of State the decision as to whether the local authority is failing to comply with the best value regime. We say that the criteria should be measured and established by the Audit Commission, which would remove the temptation for political interference and make sure that the best value regime operated objectively.
No one will argue with the proposition that a lot of faith and confidence from both sides of the House reposes in the Audit Commission because of the expertise that it has built up over many years. It seems sensible to have the commission monitor that part of the Bill.
Clause 14(5) allows the Secretary of State to take over the running of a local authority service, an extraordinary power to be proposed by a Government who pose as the champion of local democracy and accountability. The Government want the power, and they will certainly be able to drive the measure through under the guillotine and by use of their majority. However, amendments Nos. 80 and 42 would oblige the Secretary of State to announce in advance a time limit to his function, or to seek a new order before he continues in this role. They would also require him to say in advance how he would go about remedying the failure that he felt had required his intervention.
That is no more than the Secretary of State requires of the authorities under the Bill. If they must show that they are tackling issues in a clear and structured way, it is much more necessary for central Government, who are not accountable in quite the same way to local people, to do precisely the same.
The Bill would allow the Secretary of State to issue a direction without having received a report from the Audit Commission to the effect that remedial action was necessary. He would require no external evidence or sanction before intervening in a draconian fashion in local affairs. Amendment No. 81 would prevent such arbitrary action.
I shall deal only briefly with amendment No. 5, as it was tabled by the Liberal Democrats, one of whom may wish to deal with it in detail. It appears to make the Secretary of State accountable to the Select Committee on the Environment, Transport and Regional Affairs.
Clause 14(8) enables the Secretary of State to issue direction without reference to the constraints imposed by earlier subsections. That would give him unprecedented power to intervene in matters that are properly the affair of local authorities without reference to Parliament or the Audit Commission as impartial arbiters of best value. Amendments Nos. 49, 86 and 87 rein in the Secretary of State to ensure that he is guided by the Audit Commission.
'shall do so in the terms recommended to him by the Audit Commission.'.
'and any other statutory body specified by order.'.
'( ) in any instance when he specifies a performance indicator or standard in terms contrary to any recommendations made to him by the Audit Commission, shall publish with the order an explanation of his reasons for doing so.'.
'a report under section 13 recommends that the Secretary of State give a direction under this section.'.
', having regard to the report issued under section 13 and any recommendations therein,'.
'and is proportionate to the degree of failure identified in the report issued under section 13.'.
'or for so long as the Secretary of State considers appropriate'.
'( ) where the Secretary of State exercises any function of the authority, he shall publish a statement of the way in which he will exercise that function, how this will remedy any failings set out in the Audit Commission's report, and the period of time over which he expects to exercise this function.'.
'(8) No direction under this section shall be given unless a resolution in support has been approved by the Select Committee on the Environment, Transport and Regional Affairs.'.
'( ) The Secretary of State may give a direction before the expiry of one month as specified in (7) above, if he considers the direction sufficiently urgent.'.
'the report issued under section 13'.
'c) representatives as required under section 3(2).'.
"such persons as he thinks fit."
24 Mar 1999 : Column 461
He may choose as few or as many as he wishes. It is a pretty puny requirement, which bears comparison--although there is no direct read-across--with how clause 3 sets out in graphic detail the sort of people that best value authorities must consult. Clause 3 creates detailed obligations for authorities setting out who they must consult, and, perhaps, implying those they should not or need not consult. Will the Minister explain the philosophy behind the rather wishy-washy consultation requirement? If the Government really believe in consultation, why do they not spell out that belief in the Bill?
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