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Delegated Legislation Committee Debates

Draft Scotland Act 1998 (Cross-Border Public Authorities) (Forestry Commissioners) Order 2000

Second Standing Committee on Delegated Legislation

Monday 13 March 2000

[Mr. Bill O'Brien in the Chair]

Draft Scotland Act 1998 (Cross-Border Public Authorities) (Forestry Commissioners) Order 2000

4.30 pm

The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Elliot Morley): I beg to move,

    That the Committee has considered the draft Scotland Act 1998 (Cross-Border Public Authorities) (Forestry Commissioners) Order 2000.

I am pleased to serve on a Committee under your chairmanship, Mr. O'Brien. I welcome the hon. Member for Hexham (Mr. Atkinson). We have not served on a Committee together since his appointment as an Opposition Front-Bench spokesman.

The purpose of the order is to correct a technical point that has arisen on the funding of forestry in England and Wales. I am grateful to the Committee for agreeing to take the order at such short notice. The matter in question is financial, and it would be helpful to have the provisions in force by the end of the financial year.

The background lies in the devolution legislation covering forestry. As the Committee may know, the Forestry Commission was designated a cross-border public authority and will continue to exercise its functions throughout Great Britain. However, since devolution, the commissioners have been subject to separate direction by Scottish Ministers, the National Assembly for Wales and my right hon. Friend the Minister of Agriculture, Fisheries and Food (Mr. Brown).

In many ways, that outcome provides the best of both worlds. We continue to benefit throughout Great Britain from the Forestry Commission's expertise and from economies of scale, and we are free to introduce policies, such as the English forestry strategy, which are tailored to meet the needs of each country. However, when introducing the necessary legislation to implement that settlement, we unwittingly created a few difficulties in respect of finances for England and Wales.

In June last year, Parliament agreed an order adapting the functions of cross-border public authorities. Among other things, the Scotland Act 1998 (Cross-Border Public Authorities) (Adaptation of Functions etc.) Order 1999 amended certain functions relevant to the Forestry Commission to ensure that it was accountable to Scottish Ministers and, therefore, to the Scottish Parliament for its activities concerning Scotland, while remaining accountable to Parliament for its activities concerning England.

The 1999 order also abolished the forestry fund, which had been made redundant by more modern accounting legislation. In doing so, it replicated those funding and accounting arrangements for public bodies whereby receipts are paid into the Consolidated Fund. In other words, the funding provision was a gross regime in terms of funding. That oversight was counter to the agreed intention that the commission should continue to be net funded.

In Scotland, that will be done in 1999-2000 by reference to the Scotland Act 1998 (Transitory and Transitional Provisions) (Finance) Order 1999 and thereafter under each year's Finance Act. That is reflected in article 3 of the order before us and in the new subsection 41(10) of the Forestry Act 1967 as inserted by paragraph 5(5) of the schedule to the present order. For England and Wales, the net funding regime is set out in the order.

The key provision of the order is paragraph 5(5) of the schedule, which introduces into the Forestry Act 1967 a new subsection 41(6), which allows commissioners to retain timber and other receipts for the purposes of defraying forestry expenditure. The new subsection 41(8) allows Ministers, with the approval of the Treasury, to direct that some or all of those receipts should go direct to the Consolidated Fund. While it is our intention to continue with the present net regime, subsection 41(8) will allow funding on a gross basis at a later stage if that is thought desirable.

The devolution settlement on forestry provided for the commissioners' activities in England, Scotland and Wales to be funded respectively by Westminster, the Scottish Parliament and the National Assembly for Wales, with provision for some activities to be funded on a GB-wide basis by Westminster. The provisions for the National Assembly for Wales have still to be brought into force. In most areas, it is clear how expenditure should be allocated between the different sources of funding. In areas where it is less clear, the order provides a mechanism for Forestry Ministers to reach agreement on the appropriate split. I would expect the split to be set out in a forestry concordat, the text of which I hope to publish soon. Of course, I shall make that text available to the House.

The principal changes in the order are to the Forestry Act 1967. However, there are a number of other Acts under which commissioners have powers, and the order makes consequential changes to those Acts. I thank the Committee for considering this technical matter. The order, which has been approved by the Scottish Parliament, will allow us to put right an anomaly in the devolution legislation. I commend it to the Committee.

4.35 pm

Mr. Peter Atkinson (Hexham): I do not intend to detain the Committee for more than a few seconds, as this is a technical order, which we shall not oppose. Will the Parliamentary Secretary explain how a disagreement between Westminster and Scottish Ministers on a future split would be resolved? Would the judicial committee of the Privy Council become involved?

Mr. David Heath (Somerton and Frome): The hon. Member for Hexham put his finger on the one unclear part of the order-the mechanism for determining by agreement any dispute on the apportionment of expenses or receipts. The Parliamentary Secretary said that that was clear, but it is not. The concordat that he mentioned will assist in that regard, and, I hope, include conflict resolution. If the three Ministers were unable to reach agreement, a mechanism would exist to resolve the difficulty.

Will the Parliamentary Secretary provide reassurances on three other minor areas of concern? First, will he assure the Committee that the control of Ministers, and accountability to the Parliaments or to the Assembly on matters such as general policy on forestry grants, will be undiminished by the order's proposals? That has been controversial in the past, and is not a matter for direction at ministerial or parliamentary level. However, it is a matter of accountability.

Secondly, will the Parliamentary Secretary reassure me on the trail of audit under the new arrangements? There should be no gap between the provisions for the National Audit Office and for the Scottish audit authorities. No area should be able to lie undiscovered, either by the National Audit Office or by the Scottish audit authorities. There should be a clear demarcation between the two authorities in the Forestry Commission's accounts.

Lastly, will the Parliamentary Secretary assure me that there will be no need for consequential amendments to the schedule in the Freedom of Information Bill as a result of the changes? There should not be any change in the nature of the Forestry Commission as a public body.

4.38 pm

Mr. David Wilshire (Spelthorne): I apologise for arriving late to the Committee. If it were in order, Mr. O'Brien, I would explain my views of Government policy on London transport. That, however, is another matter.

Unlike my hon. Friend the Member for Hexham, I am always tempted to delay Government Back Benchers on these occasions. As I have been given a steer not to do so, the Committee will be relieved that I will not delay it for long. I want to make some points on matters about which the Minister has spoken since my arrival.

First, I want to deal with the dispute mechanism. My hon. Friend the Member for Hexham and the hon. Member for Somerton and Frome (Mr. David Heath) have already touched on the matter. It is important to know the nature of the mechanism. As I understand it, this is a matter for Great Britain. However, the arrangements have arisen from devolution. Can the Parliamentary Secretary throw any light on whether, if the Northern Ireland Assembly were to be re-established, it would be necessary to return to the arrangements so as to include the entire United Kingdom?

How will any benefits that arise from the measure be divided up? I must press the Parliamentary Secretary on that, because the equitable division of finance and benefit between the three parts of Great Britain is a touchy subject. Those of us who represent English constituencies often feel strongly about the unfair extra benefit that is given to Wales and, particularly, to Scotland, to the disadvantage of England Will the Parliamentary Secretary assure us that the guidelines will not be yet another example of pandering to Labour's heartlands at England's expense?

What criteria will be used for the division? Will the division be based on the population of the three parts of Great Britain, or on the areas that are covered by forest or woodland? I appreciate that some areas have more woodland than those that are deep in the south-east of England-although Surrey, where I come from, has more trees than any other English county.

I would be grateful if the Parliamentary Secretary would address those matters before we decide whether we want to vote on the order.

4.41 pm

Mr. Morley: I shall deal with the points raised by the hon. Member for Spelthorne (Mr. Wilshire) in a moment.

The concordat deals with many of the matters that the hon. Member for Hexham mentioned. In respect of potential disputes about how the arrangements work, it should be borne in mind that the order does not deal with the splitting of the bulk of forestry expenditure. That is clear from the way in which it is allocated to the individual countries. The order covers only a small amount of expenditure relating to UK functions, such as plant health, research and development and funding for the forestry commissioners. Those areas do not involve huge sums of money and are unlikely to cause significant disagreements. If a disagreement arose, the concordat-as is often the case-would allow for it to be resolved by a joint ministerial committee.

I confirm to the hon. Member for Somerton and Frome that the order will not affect matters such as the level of forestry grants, which are decided separately, or accountability to individual Ministers. Given the way in which the order is drafted, I do not believe that consequential amendments to the Freedom of Information Bill will be necessary. If I am wrong about that, I shall write to the hon. Gentleman.

Northern Ireland forestry, which the hon. Member for Spelthorne mentioned, is a separate issue because it is not covered by the Forestry Commission and has always been funded separately. It is therefore beyond the scope of the order, and the points that he raised are irrelevant. I was taken with the idea that, by dealing with issues in the Scottish highlands and the Welsh mountains, we were pandering to Labour's heartlands. Apparently, our influence has spread further than I had thought.

The hon. Member for Spelthorne asked how the funding formula operates between the three countries. The formula takes into account the traditional levels of spending in Wales, Scotland and England and matters such as the different kinds of estates that are involved. For example, while there is much more commercial forestry in Scotland, there is also a far higher level of visits to forests than in England, which has an impact in terms of the provision of forest information services, visitor centres and forest wardens. That has already been taken into account in relation to the way in which forestry expenditure has been equitably split between the three countries. The order has no bearing on the allocation of funding.

 
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