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5.3 pm

Mr. Edward Davey (Kingston and Surbiton) (LD): The Deputy Prime Minister gave a barnstorming performance today, and I look forward to campaigning with him for a yes vote in the referendums in the three northern regions. I agree with much of what he said. I was also pleased to see him in thoughtful mode today. [Interruption.] That was not meant as a backhanded compliment. He is right that we need to try to find out whether extra powers can be given to regional assemblies, and those powers should be announced before the referendums.

The Deputy Prime Minister knows that Liberal Democrat Members support regional devolution, but want a much deeper, richer form of it. I am afraid that that is why I have to tell him that, because of the careful wording that the Conservatives have proposed today, but for very different reasons from theirs, we will support their motion. [Interruption.] The Deputy Prime Minister should wait because we will support his amendment to it. [Interruption.] Both the motion and the amendment are totally supportable, and say different things. The Conservative motion says that the Government must publish their plans before the referendums. That is what we have argued for, as the Minister for Local Government, Regional Governance and Fire knows, because he and I exchanged letters on that very point. He promised the Liberal Democrats in our negotiations on the paving Bill that the Government would introduce a draft Bill, and we want to ensure that that promise is honoured. That is why we can support the Conservative motion. However, the Government are absolutely right in their amendment, because we need to go much further and ensure that the false arguments that the Conservatives are raising in many other forums are dealt with. The Deputy Prime Minister made a good start on that today.

If we do not get more powers for the assemblies we will be in danger of losing the argument. As the Deputy Prime Minister knows from his discussions in the regions and with his own colleagues—as many Labour Members have made clear today—many people are not convinced by the White Paper "Your Region, Your Choice". That is why the Government need to go further. As the White Paper stands, not enough powers are coming down and too many are going up. Moreover, even the powers that the elected regional assemblies will have are circumscribed by the targets that they must meet, the Secretary of State's ability to override decisions and the absence of any executive powers for the assemblies. The fact that many of the policies and strategies that the regional assemblies will create will have to comply with national policy will circumscribe

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some of the powers and flexibility that they are supposed to have. We are seriously concerned about that point, and the Deputy Prime Minister must move on it.

We shall support the Government in the referendums because the current proposals are a starting point—a building block for future, richer devolution. That is important. We also support the Government because, as the Deputy Prime Minister rightly and powerfully said, we have regional government at the moment; this debate is about accountability and democracy.

Mr. George Osborne: The hon. Gentleman says that the Liberal Democrats support the referendums, but the Liberal Democrat group on Cheshire county council, and therefore the Liberal Democrat county councillors in Cheshire, opposes the referendum and is urging people to vote no.

Mr. Davey: Much of what the hon. Gentleman says is wrong. There are Cheshire Liberal Democrat county councillors who very much support regional devolution.

The Deputy Prime Minister's problem is that he is not enthusing the pro-devolutionists with his proposals. The pro-devolutionists in my party and his are not exactly champing at the bit over these powers. Worse than that, as my right hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith) implied in his comment on the business communities, those people who are agnostic and non-doctrinaire about regional devolution are unconvinced. Worse still, the opponents of regional devolution are being emboldened by the strategy's weakness. The Deputy Prime Minister is in danger of giving the worst possible start to the referendums. He should move on this, and he needs to persuade his colleagues to do far more. Otherwise, we are in danger of missing a major opportunity.

What should the Deputy Prime Minister do? He began to sketch out some thoughts today, which were very helpful, and I am sure that people will want to read the record. He mentioned that the Secretary of State for Transport is beginning to think about the potential for devolution. The Deputy Prime Minister mentioned in his speech in Manchester the possibility that learning and skills councils could be devolved. He has also mentioned the three hearings that are to take place.

The Deputy Prime Minister: On learning and skills councils, I was simply trying to give an idea of how regional thinking is developing and evolving. We made it clear in the White Paper that decisions in that regard were made nationally and locally, and that we would leave that new form of organisation alone. However, it was pointed out to me when I visited one of the regions that its training and skills agency had already appointed civil servants as regional directors who had to make regional decisions. I was just making the point that there had been that development in the field of training and skills.

Mr. Davey: May I encourage the right hon. Gentleman to go even further on that? Just appointing a new civil servant at regional level and making them accountable to the elected regional assembly is not good

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enough. We want powers to come down from Whitehall. We need powers over skills and training to come down from the Department for Education and Skills to the regions, so that they will have real money and real executive powers. If the Deputy Prime Minister adopts that train of thought, and takes that direction, he will get much more support.

Mr. Brady: Has the hon. Gentleman heard the complaints from learning and skills councils around the country that the Government are already reluctant to devolve any power to them? The Government seem determined to hold on to the power centrally in the national Learning and Skills Council and to have no intention of giving power down to the regions.

Mr. Davey: That is right. Some of us who want to encourage the Government in the direction of more localism and regionalism feel that sometimes their moves are too superficial and that the reality does not match up to their rhetoric.

Following the last comprehensive spending review, I was pleased to see the introduction of pilots between the regional development agencies and some of the local learning and skills councils to see how the councils could work at regional level. The proposals need to go much further. The councils are to be asked to develop frameworks for regional employment and skills actions, but that is not sufficient, because they will have no executive powers, and no real thrust. There will be no real money behind the proposals.

If the Government, before they publish the draft Bill, and way before the referendums, were to get the agreement of Ministers at the Department for Education and Skills that the whole budget for the learning and skills councils would go to the regions, they would win huge plaudits. The councils would complement the role of the RDAs and they would get massive support from business. Her Majesty's Treasury has published papers about the productivity gap between the regions, and the Chancellor seems to be thinking along those lines. Given the economic analysis that lies behind a lot of the Deputy Prime Minister's thinking, this would be a logical step for him to take. I would like to encourage him and offer him support towards making that move.

Mr. Dawson: Does the hon. Gentleman understand my impatience with the highly intelligent and extremely able people from business, the universities and various parts of the public sector who seem to be doing exactly what he is doing, namely waiting for the Government to come up with various initiatives? Surely he can see that this is a time for vision and for people with a real idea of the way in which the regions could develop to seize the opportunity that is being made available here, to engage with the yes campaign and to insist on more powers for the regions—

Mr. Deputy Speaker (Sir Alan Haselhurst): Order. The hon. Gentleman must learn the art of making shorter interventions, especially when time is limited for these debates.

Mr. Davey: In answer to the hon. Member for Lancaster and Wyre (Mr. Dawson), I thought that that

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is exactly what I was trying to do. The Deputy Prime Minister keeps saying that things are evolving, but we are arguing for a quicker, more visionary evolution, so that we can establish these powers before the referendum. We want to win the support of the people, but at the moment they are pretty agnostic. They are thinking, "These assemblies could just be talking shops if we aren't careful." The Deputy Prime Minister talked about a whole range of strategies that the elected regional assemblies will be able to develop, but there will be no budgets behind them. The assemblies will not have any executive powers in that regard. The powers that they will have will relate to being consulted and to advising other people, not actually to doing things. I thought that government was about doing things, not just about creating strategies for other people to implement.

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