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Mr. Hanson: If, at the beginning of my earlier remarks, I said that I would "potentially" listen, I must point out that I meant to say "particularly", and I apologise.

I hope that I will be able to reassure the hon. Members for Eastbourne (Mr. Waterson) and for Bath (Mr. Foster). I said earlier that new clause 6 and amendments Nos. 16 to 18 are unnecessary, and I meant that in a positive way. Local authorities can already make proposals to the Secretary of State; indeed, as I have said, we actively encourage them to do so, and both hon. Gentlemen recognised that.

We shall discuss with the Local Government Association and, perhaps, the Welsh Local Government Association, formal arrangements for regular consideration of the use of the powers through the central-local partnership. It is important to highlight the availability of clauses 5 and 6 powers in the statutory guidance on the use of the well-being power and community strategies. That would provide a clear and permanent reminder to local authorities that they can apply to the Secretary of State at any time. I say to the hon. Member for Bath that there is nothing to stop an individual council making proposals to the Secretary of State at any time. I am sure that my hon. Friends will welcome that positive provision for England.

On amendment No. 18 in the name of the hon. Member for Eastbourne, clause 8 already requires the Secretary of State to consult local authorities and local government on proposals to use his clauses 5 and 6 powers. The amendment is therefore otiose. I hope that the hon. Gentleman accepts that explanation.

6.15 pm

The discussion has been interesting and I accept the point made by the hon. Member for Ceredigion (Mr. Thomas). I welcome his positive approach to the Government new clause and amendment. As part of my duties, I watched the statement being made in the National Assembly this afternoon, and I watched with interest the important debate that followed.

Understandably, the Assembly seeks the greatest possible scope to exercise secondary legislation powers. It is the Government's job to propose how the Assembly's wishes can be reconciled with the role of Parliament in introducing primary legislation, and that is what our amendments seek to do. I say to the hon. Gentleman that the door is not closed. The Assembly Secretary, Peter Law, confirmed in his statement that he is and will continue to be in dialogue with my right hon. Friend the

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Secretary of State for Wales, myself and colleagues in DETR and other Departments with potential involvement in the powers.

Mr. Llew Smith (Blaenau Gwent): My hon. Friend said that he understood why the Assembly wanted more powers. Does he think that before it pushes for more powers, it should consider those that it already has, such as the power to make a bonfire of quangos, as it promised to do? Will my hon. Friend confirm whether there has been a bonfire of quangos? If so, when and where did it happen? If not, why has the Assembly not used the powers at its disposal to democratise government in Wales and to increase the power of local government?

Mr. Hanson: My hon. Friend raises an interesting point. In passing the Government of Wales Act 1998, there was a desire, which I share, to ensure that we democratise quangos in Wales. He and I, and the House, will have to judge in due course the extent to which the National Assembly has achieved that objective. In response to the Assembly Secretary's statement this afternoon, my hon. Friend the Member for Wrexham (Dr. Marek), who is also an Assembly Member, made the same point as my hon. Friend the Member for Blaenau Gwent (Mr. Smith), and said that the Assembly should make good use of its existing powers before taking on new ones.

I hope that hon. Members can accept the new clause, and that I have been able to reassure the hon. Members for Bath and for Eastbourne that the Government are willing to listen to them. I thank the hon. Member for Ceredigion for his welcome for the Government's steps to date. Obviously, we may return to this matter in future.

Question put and agreed to.

Clause read a Second time, and added to the Bill.

Clause 2

Promotion of well-being

Mr. Don Foster: I beg to move amendment No. 95, in page 1, line 18, after "anything", insert--

'including, subject to section 3(2), the raising of money.'.

Mr. Deputy Speaker (Mr. Michael J. Martin): With this it will be convenient to discuss the following amendments: No. 8, in page 2, line 6, leave out "or present".

No. 9, in page 2, line 8, at end insert--

'( ) A charge may be imposed in respect of anything which is done in the course of exercising the power under section 2(1).'.

No. 55, in page 2, line 21, at end insert--

'( ) Action taken by a local authority outside its own boundaries shall only be undertaken with the consent of the authority within whose boundaries the action is proposed to be taken.'.

No. 11, in page 2, line 23, at end insert--

'(7) Nothing in this part shall empower a local authority to engage in trade otherwise than is provided for by the Local Authority (Goods and Services) Act 1970'.

No. 10, in clause 3, page 2, line 28, leave out subsection 2 and insert--

'( ) The expenditure of a local authority under this Part in any financial year shall not exceed the amount obtained by applying the relevant provisions of subsections (4), (4AA), (4AB), (4A), (4B) and (4C) of section 137 of the Local Government Act 1972.

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( ) All expenditure under this Part shall be subject to the accounting and inspection requirements set out in subsection (7) of section 137 of the Local Government Act 1972.'.

No. 212, in page 2, line 28, leave out subsection (2).

No. 96, in page 2, line 29, leave out "or otherwise".

No. 15, in clause 4, page 3, line 17, at end insert--

'(4) A local authority may require other public bodies, whether statutory or voluntary, in its area to comply with and to participate in its strategy for promoting or improving the economic social or environmental well-being of their area.'.

No. 97, in page 3, line 20, at end insert--

'( ) No requirement imposed by this section restricts the exercise of the power under section 2.'.

Mr. Foster: I said earlier that Liberal Democrat Members, at least, welcome the new power to promote well-being which the Bill gives councils. There is, however, concern in many quarters about the financial arrangements for exercising that new power. The Government, rightly, are anxious to ensure that councils cannot, under the power, introduce new forms of taxation or other ways of raising money. That is covered explicitly in clause 3(2).

That subsection says, however:

There is concern that the words "or otherwise" provide the Government with a catch-all arrangement whereby any possible means of raising funds to pay for activities introduced under the power of well-being may be proscribed.

The general view is that it would be far better if the Government stated explicitly in the Bill which fund-raising activities they wish to proscribe and allowed local councils to use any other approach that they may deem appropriate. The problem is compounded by the fact that the Government are undertaking a major review of local government finance. At present, there is still considerable uncertainty about the outcome of that review and widespread concern that, although local authorities may be given a new power of well-being, they may find it difficult to raise the funds needed to carry out some of the activities that they believe are important.

Local councils might engage in activities in partnership with other bodies in their areas. Indeed, the Government rightly wish to encourage such activities, but there is confusion about the financial implications if such a partnership were to raise money and produce a surplus. Perhaps the Minister will consider the specific example of a partnership involving a local authority and other bodies that chose to establish a shop in a rural community. Would that shop be permitted to generate a surplus under the phrase "or otherwise" in clause 3(2)?

The purpose of amendments Nos. 95 and 96 is allow the Minister to provide greater clarification of the arrangements. She drew the Committee's attention to the powers under section 150 of the Local Government and Housing Act 1989 and suggested that section could represent the vehicle by which councils could use such powers. It is important that she clarify precisely how she believes that section could be used to deal with the problem.

Amendment No. 97 raises a separate point. Under the Bill, councils will be required to develop community strategies and to have regard to them subsequently in any

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activity that they undertake. That makes perfect sense. However, the concern, which is best illustrated by the problems that occurred at the Rover plant in Birmingham, is that a council may wish to propose several activities that it believes are the right ones to undertake in response to a particularly difficult problem, but that they might not be covered in the strategy that the council has developed. Will the council have acted correctly if it develops activities that are not contained in the community strategy? Such activities may lead to legal challenges.

The purpose, therefore, of amendment No. 97 is to provide some comfort to councils that propose activities that are outside the community strategy, but which they believe are in the best interests of the people whom they serve. The Minister gave an assurance in Committee that

She accepted that the Government had

The problem is that councils may act in the best interests of the local community, but legal action may be taken against them for so doing. Amendment No. 97 would therefore provide some comfort for councils that attempt to act in the best interests of the people whom they serve.

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