Examination of Witnesses (Questions 360
- 379)
TUESDAY 14 SEPTEMBER 2004
MR ALAN
CLARKE, MS
PAT RICHIE,
MR CHRIS
ROBERTS, MR
ROB WYE
AND MR
GEORGE COWCHER
Q360 Mr Betts: Are there any particular
areas, in terms of getting a proper regional economic strategy
up and running and effective, that central government should have
surrendered its responsibility for down to the regional assemblies,
in areas currently where there are not powers being passed down?
Mr Wye: I do not think it is in
relation necessarily to powers but we were surprised in the context
of economic development not to see any mention of higher education.
Higher education is critical to the economic development of the
region, yet it is not mentioned anywhere in the documentation.
Q361 Chairman: What should happen
to higher education?
Mr Wye: I would not want to put
a proposal about what should happen to higher education, but I
do think the regional assemblies should be given the appropriate
steer towards engagement with higher education in developing the
strategy for economic development in the region.
Q362 Mr Betts: Transport—any
comments there?
Mr Clarke: I think in relation
to transport there has been some move recently with DfT taking
a greater role in talking within the regions about flexibilities
and so on, and the Spending Review took that a bit further. I
think that is a move in the right direction, but I think for there
to be a real shift you probably need both quality shift and financial
shift down through the regional level, possibly with the establishment
of regional transport boards, to really decide locally on priorities.
It will be a difficult task to decide within the regions how that
money is allocated as long as national priorities—and there
will always be national priorities on transport—are also
taken into account.
Mr Cowcher: We concur in relation
to transport. Certainly in relation to skills we have some concerns
about the duality of control both by central and LSC in Coventry
and also within the region and how that is actually going to work.
The area which is totally silent at the moment is in relation
to business support, where we believe there could be regional
solutions to business support which could conceivably be delivered
within the region. At the moment there are no powers in relation
to that at all.
Q363 Chairman: Can anyone convince
me that the Regional Skills Partnerships have worked well?
Mr Roberts: It may vary by region,
but certainly in the North East to date we have put a lot of effort
into private sector involvement in that. With joint meetings,
particularly between the RDA, LSC and JobCentre Plus, we are at
the point now of actually determining the regional skills priorities.
We have met at a financial level to look at how we allocate our
resources within the region against those priorities. It is the
first point I have seen where we are trying to broker our policies
and our spending against our priorities. I think it has made a
very, very good start.
Mr Clarke: The RDA has been responsible
for taking the lead in the establishment of a Regional Skills
Partnership. I agree with what Chris has said, I think we have
made a very good start. I think it is different from what is set
out in the document. The link between skills and the rest of economic
development, I believe, is so strong that the responsibility for
the Regional Skills Partnership at the strategic level should
remain with the RDA rather than with an elected regional assembly.
Where I perhaps have a slightly different view from Chris is that
I have had some experience through the Spending Review in trying
to get greater regional flexibility over DfES funding on adult
skills budgets. It is quite difficult to do that. I think the
balance at the moment between national, regional and local within
that part of DfES is too much at the national. I think there could
be greater regional flexibility for the benefit of the region.
That is an area I think we ought to push further on.
Ms Richie: I would add to what
Alan said that one of the biggest issues within the North East
is the low skills levels, particularly around the basic skills.
We have a higher number of people at Levels 1 and 2 and fewer
at degree level. That is a fundamental element of the regional
economic strategy. We see skills as one of the key drivers of
productivity within the region, and we are keen that the Regional
Skills Partnership should be closely aligned with, and in fact
strongly influence, the skills element of the regional strategy.
We feel it is important to keep the two together. The other thing
I should add in relation to skills is that we have had a lot of
structural change around skills, and a lot of focus on partnerships
and developing partnerships. I think it is important that should
settle down for some time in order to focus on actually making
a difference on the ground in relation to skills. Therefore, radical
change around the Regional Skills Partnership would detract from
that focus on action.
Mr Cowcher: One of the strengths
of the Regional Skills Partnership is that it tends to have a
very strong demand-led basis to it in terms of employers being
very much engaged. I would not want to see that in any way weakened
by any change in the status of that organisation.
Mr Roberts: I wanted to endorse
that about private sector involvement. I think one of the strengths
at the moment for us is that we can move money around the country.
We can also move money around the region. One of the key divides
for us will be the divide between adult skills and young people,
which I would not like to see totally divorced in any move here—because
the vocational needs of 14-19 year olds relate very much to the
future economy, and to separate them out from the skills agenda
would be missing from the North East's agenda.
Q364 Chairman: The Department of
Education has fought pretty hard to keep you out of anything meaningful
in the North East. Are you pleased with their efforts?
Mr Roberts: I think we are heavily
involved in the North East and highly committed to the change
that is required in the North East. We have put a huge amount
of effort towards actually aligning our funding to the needs of
the North East. I think we have to also remember that the National
Skills Strategy has within it a high degree of relevance for the
North East. Many of the things it wants to achieve are what we
want to do in the North East.
Chairman: You still prefer to be controlled
by Whitehall than somewhere in the North East? I cannot get a
smile on the record very easily!
Q365 Chris Mole: The assemblies have
got this connection between the Executive and the Review and Monitoring
Committee. Why does ONE North East particularly have a concern
that it is only the Executive that has the role of approving the
Regional Economic Strategy and some of the other key documents,
rather than the assembly as a whole?
Mr Clarke: As an apology I think
the language may be a bit of a problem here. I have been working
in local government, and I think the point we were making is that
at the most strategic level we believe it is the elected members
(in whatever form that they sit) the people with expertise in
economic development who should oversee and agree the regional
economic strategy, and provide the strategic direction for that—rather
than the officers of the organisation without that political input.
That is what we meant by that. I also know there will be a cabinet
or political executive of five to seven individuals, and one of
those would be a portfolio holder for economic development. I
think it would be a very strong working relationship with the
portfolio holder for economic development on the political executive
side. I think at the most strategic level it would be appropriate
for a group of elected members coming together to really have
a big say in what the strategic economic direction of the region
should be. Clearly, there will always be the day-to-day working
relationships between officers and civil servants; but it was
really just to make the distinction that we thought there needed
to be primarily a strategic relationship at that level.
Q366 Chris Mole: Should the answer
be that the elected regional assembly represents the region as
a whole; or should it be the whole assembly that has the ownership
of the economic strategy?
Mr Clarke: I think it would need
to but in reality if there is a social agenda, an environment
agenda, a cultural agenda, a rural agenda and so on there are
bound to be different levels of expertise amongst those members.
Yes, it maybe all of them sitting together in one place will have
to discuss and approve the strategic document; but I think for
it to be more meaningful a smaller number of members with particular
levels of expertise and experience will want to get involved in
a bit more detail, debate and discussion. That is what we had
in mind. You are right, with the overall assembly sitting you
would expect to agree things like the Regional Vision,
which is a new document, the regional economic strategy, transport,
spatial strategy and so on. All I am saying is that they are big,
weighty complex strategies and it is not always the best way to
have the whole of the group sitting to take themselves through
those particular strategies.
Q367 Chris Mole: If you have got
different leaderships within the assembly for those different
areas but they need to be joined up then presumably the way to
join them up is where all those elements come together?
Mr Clarke: It is the same principle
as national government. You are a select committee looking at
a particular area of policy, and someone else will look at another
and it is the job of government to pull that together. It is the
same principle.
Q368 Chairman: So you still want
to actually report to a board rather than directly to an assembly?
Mr Clarke: What I want is almost
irrelevant.
Q369 Chairman: We are here to see
whether the legislation has got it right or not?
Mr Clarke: I think that the idea
of retaining a board for the Regional Development Agency with
a very strong business leadership is absolutely right, because
that is at the heart of what the Regional Development Agency is
about—creating a strong economy based on world-class businesses.
You need to be working pretty well directly with a range of business
people—not exclusively, but significantly. Therefore, I
think there is an important role for the board, but clearly there
will be a reduced role for national government, and there will
be this new role for an elected regional assembly. We are used
to working with a range of different partners, masters and organisations
and we would make it work.
Q370 Chairman: They can have a scrutiny
role. As soon as they start to ask anything about contracts you
are going to say "Commercial confidentiality. Get lost!"
Mr Clarke: I do not say that now.
I would not say that in the future either.
Q371 Chairman: No, you would say
it more politely. You think there would be no problem for providing
the information for the scrutiny of what you are doing?
Mr Clarke: We have had three different
rounds of scrutiny so far with the unelected regional assembly.
It would be true to say that the first one was quite tricky but
over time I think that the process—
Q372 Chairman: You have tamed them?
Mr Clarke: No, I think we have
tamed each other. I think we have concentrated on policy development
that helps the region, rather than negative scrutiny which does
not help.
The Committee observed a minute's silence
in memory of the victims of Beslan
Q373 Mr Betts: Could I come back
to the issue of the skills agenda. What are the advantages of
keeping control over funding of Learning Skills Councils with
central government and not giving any responsibilities generally
to the assemblies?
Mr Roberts: One of the things
at the moment is that this alliance is very, very strong—and
strategy and priorities is something that we need to do. One of
the things about being part of a national organisation is our
ability to move money both within the region and within regions
within the country. I also think, as this is described around
adult skills particularly, that we should be careful not to distinguish
young people's requirements for vocational training from that
entirely of adults. One of the great advantages is considering
the whole needs of the employers from young people right the way
through to adults. That is one advantage of the consideration
of holding it all within a national organisation—not just
financial but in policy drive terms.
Q374 Mr Betts: Really the explanation
of why the regional assembly should have a greater role. Or is
it? It is rather odd that the primary purpose of the regional
assembly, which seems to be coming through, is economic development;
but the problem of skills is crucial to that, particularly in
the North East; yet the regional assembly welcome responsibility
for the distribution of national housing funds down to local level,
but no role in the question of the passing down of the finance
for skills.
Mr Roberts: Not "no role".
Q375 Mr Betts: It has some sort of
role in the general strategy but does not actually get any responsibility
for the distribution of money, does it?
Mr Wye: The point that the powers
in the Bill are with the regional assembly to appoint five members
to each local Learning and Skills Council that is a very significant
change to the current arrangements. It will significantly alter
the balance within the local Learning and Skills Council. It is
at that local Learning and Skills Council level that the strategic
distribution of funds is agreed.
Q376 Mr Betts: There is a regional
level as well, is there not? You have got a regional director
newly appointed in the learning and skills framework not accountable
to anybody at regional level. Would it not be a lot better if
they had some direct responsibility to the regional assembly and
were involved in the distribution of funds for skills at a regional
level in line with the strategy that is going to be developed?
Mr Roberts: I actually think when
we talk about the concordat we have with the RDA what we are actually
trying to do, which I believe is beginning to evolve properly,
is develop a strategy for the North East with key priorities in
it; and we and the other agencies broker the spending against
those priorities; and I believe that can be delivered at a regional
level by a regional director of Learning and Skills Councils within
the national context, as things stand at the moment. The key driver
for us will be that regional skills partnership and private sector
involvement as well.
Mr Cowcher: We think there is
a significant weakness in the fact there is no devolution of finance
or skills in relation to transport. That would have made this
Bill fare more palatable in the North East if those powers were
actually within it.
Q377 Mr Betts: Have you got a slight
disagreement with the British Chairman of Commerce nationally
who has actually said that regions that go for regional assemblies
could be at a disadvantage because they will have to bear the
costs of the administration of the regional assemblies? Do you
take a slightly different view from your national colleagues?
Mr Cowcher: Yes, slightly a different
view in relation to that. Clearly the point that we want to concur
with the British Chamber of Commerce is that we would not want
to see the North East disadvantaged. We do have some concerns
about tax-raising powers actually within the region as a whole
which could actually see business and commerce in the region perhaps
having additional costs by being located in the North East to
their disadvantage elsewhere. That is one of the concerns we do
have.
Q378 Mr Clelland: You might have
heard the discussion this morning about the size of regional assemblies
and how, given there are only 25-35 members, there might be a
democratic deficit there. While I have some sympathy with that
view, I generally put the argument that there will be a lot of
people involved in the regional assemblies with a wide range of
stakeholders. Clause 53 of the Bill would require assemblies to
encourage and facilitate stakeholder participation "to such
extent as the assembly thinks appropriate". Do you think
this ought to be a more definitive statement in the Bill?
Mr Cowcher: We believe that should
be strengthened significantly. From the original White Paper we
think there has been significant movement in relation to stakeholder
involvement and that is very welcome. At the moment it is purely
facilitative and it is not actually set in statute. We believe
that is a significant weakness. It is absolutely vital that there
will be a range of stakeholder involvement in the workings and
in the decision-making in relation to the assembly.
Q379 Mr Clelland: Do you think that
the Bill should prescribe which stakeholders should be involved?
Mr Cowcher: It would be very helpful
if that was the case. Obviously representing the business community
we would hope we would be one of those numbers.
Mr Wye: I think it would be important
that it was not exclusive, and give a range of stakeholders who
must be involved and others as appropriate. I also think it would
be inappropriate if the Bill defined how the assembly engaged
the stakeholders in laying down particular structural arrangements.
Mr Clarke: I think from my point
of view the principle is absolutely right. I do not think it should
be too prescriptive. I think there should be some local flexibility.
Some of the ideas the assembly put forward in their evidence is
quite positive. I think the other thing we ought to bear in mind
is, if this goes ahead, we would have 25-35 elected representatives
who have been elected so that they are there also representing
the views of local communities. That role brings with it obviously
leadership responsibilities. I think there is and has been in
my experience in different regions something of a tension between,
on the one hand, having to make very focussed choices about what
the priorities are and where the resources will be spent, and
almost consultation overload to the point where you end up with
the lowest common denominator. I think that is a real issue.
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