 House of Commons |
Session 2006 - 07 Publications on the internet General Committee Debates Greater London Authority Bill |
Greater London Authority Bill |
The Committee consisted of the following Members:Alan
Sandall, Keith Neary, Committee
Clerks
†
attended the Committee
Public Bill CommitteeTuesday 9 January 2007(Afternoon)[Mr. Edward O'Hara in the Chair]Greater London Authority Bill4
pm
Clauses 7
and 8 ordered to stand part of the
Bill.
Clause 9Monitoring
officer
Question
proposed, That the clause stand part of the
Bill.
The
Minister for Housing and Planning (Yvette Cooper):
I shall
speak very briefly to this clause as the principles are the same as for
clauses 7 and 8. It applies to the monitoring officer who is covered
undersection 73 of the Greater London Authority Act 1999. The
clause amends section 73 to enable the Mayor and the assembly, acting
jointly, to appoint the authority’s monitoring officer and to
set his terms and conditions. In addition, it has parallel arrangements
to those for the head of paid service in clauses 7 and 8 to ensure that
the monitoring officer is not also a member of the authority’s
staff appointed by the
Mayor.
Question put
and agreed
to.
Clause 9
ordered to stand part of the
Bill.
Clause 10Chief
finance
officer
Question
proposed, That the clause stand part of the
Bill.
Yvette
Cooper:
I can again be brief. The clause applies the same
principles to the chief finance
officer.
Question
put and agreed
to.
Clause 10
ordered to stand part of the
Bill.
Clause 11Amendments
consequential on sections 8 to
10
Question
proposed, That the clause stand part of the
Bill.
Yvette
Cooper:
The clause makes a number of minor consequential
amendments to the 1999 Act and these are consequential on the
provisions in clauses 8 to
10.
Question put
and agreed
to.
Clause 11
ordered to stand part of the Bill.
Clause 12Separate
compnonet budgets for Assembly and
Mayor
Question
proposed, That the clause stand part of the
Bill.
The
Parliamentary Under-Secretary of State for Trade and Industry (Jim
Fitzpatrick):
The clause amends section 85 of the 1999 Act
to provide for separate component budget requirements for the Mayor and
assembly. The GLA is a major precepting authority, and requires each
London borough council to raise a certain amount annually from London
council tax payers in its area to help fund GLA services. The 1999 Act
sets out rules which the authority must follow in calculating its
consolidated budget requirement which, in turn, allows the GLA to
calculate the basic amount of its council tax—its precept. The
GLA’s consolidated budget requirement is made up of the
aggregate of the component budget requirements for the GLA itself and
each of the four functional bodies.
The clause
provides that, instead of a single GLA component budget requirement,
there will be separate component budget requirements for the Mayor and
the assembly. The assembly’s component budget requirement is the
requirement in relation to the assembly’s functions: estimates
of expenditure, allowances for contingencies and use of reserves in
respect of assembly members and staff, goods and services procured
solely for the purposes of the assembly, and the London transport users
committee, known as London
TravelWatch.
The
Mayor’s component budget requirement is everything that would
otherwise make up the authority’s component budget requirement.
The clause provides for a transparent and discrete budget for the
assembly’s functions within the existing structures of the
budget-setting process. It gives London council tax payers a
transparent statement of the cost of delivering the assembly’s
functions and it offers the assembly the reassurance of having its own
budget separate from that of the
Mayor.
Michael
Gove (Surrey Heath) (Con): We approve of this clause, but
we have tabled some subsequent amendments that relate precisely to how
the assembly’s part of the budget might be calculated. I shall
try not to stray into that territory now. I shall simply say that we
want our amendments to underpin the reassurance of which the
Under-Secretary spoke. We believe that it is absolutely right for the
purpose of transparency and in the interests of Londoners that it is
perfectly clear what the Mayor is spending on his executive function
and what the assembly is spending to discharge its scrutiny role. For
that reason, we welcome both the terms and the intentions of clause 12,
but we fear that some of the later aspects of the Bill do not live up
to the good intentions that it outlines.
Tom
Brake (Carshalton and Wallington) (LD): I support clause
12. We support the principle of separate component budgets but, as the
spokesman for the official Opposition—the hon. Member for Surrey
Heath—says, we have concerns about the assembly’s budget.
Those concerns
are reflected in the amendments that are associated with clause 13, so I
suspect that we will have a much longer debate on that
clause.
Question
put and agreed
to.
Clause 12
ordered to stand part of the Bill.
Clause 13Procedure
for determining Authority’s consolidated budget
requirement
‘(9A) In issuing
a direction under sub-paragraph (9) above, the chief finance officer
shall have regard to the separate respective statutory functions of the
London Assembly and the London Transport Users’
Committee.’.
The
amendment stands in the names of the hon. Members for Carshalton and
Wallington and for Lewes as well as in those of my colleagues. The
Minister mentioned that, as part of the London assembly’s
component budget, an element exists to fund the London transport users
committee, or TravelWatch. The principal aim of the amendment is to
ensure that, when the budget is set, appropriate regard is taken of the
specific requirements of the London transport users
committee.
We
appreciate that, for a variety of reasons—the consequences of
public-private partnership and the tube, the Mayor’s plans for
the westward extension of the congestion charge, the Mayor’s
strategy on bus usage and the Mayor’s decision to move to Oyster
cards rather than the former system of a payment when it comes to the
use of London’s underground—Transport for London, its
functions and its policies have come under increasing scrutiny since
the Mayor took office, and will come under increasing scrutiny in the
years ahead. It seems appropriate to acknowledge that TravelWatch is
likely to become even more active on behalf of Londoners and their
interests. If, as we expect, that is the case, we want to ensure that
that valuable body receives the funding that it deserves—and
that it does not receive it at the expense of the assembly and the
scrutiny function that it discharges. The amendment would provide
greater clarity and assurance for those who rely on the London
transport users committee. By accepting it, the Government would show
that they were serious about taking account of the views of Londoners
when it comes to important transport matters.
Finally, most of the transport
issues that I have touched on relate to the speed and confidence with
which Londoners can travel around the capital city. However, there is
another area to which the London transport users committee might wish
to pay increasing attention: security and safety. None of us can have
failed to be moved by the resilience and stoicism of the family of Tom
ap Rhys Pryce following his murder in Brent last year. His murder
underlined the growing concern of many that travel round London is less
secure than once it was. We appreciate the part that the Metropolitan
Police Authority, the Metropolitan police and British Transport police
play in trying to ensure the safety of all travellers. However, it is
vital that the body that speaks for London transport users should
have a chance to have an enhanced budget so that its role in trying to
provide increased or enhanced security for London transport users is
respected.
Ms
Dawn Butler (Brent, South) (Lab): The hon. Gentleman
mentions the sad murder of Tom ap Rhys Pryce in my constituency. As the
Member of Parliament who campaigned strongly for safer stations, I can
assure you that the Mayor was fundamental in ensuring not only that we
had extra British Transport police on the stations but that the
Metropolitan police and the rail companies took the issue very
seriously.
It is
beneficial to have a Mayor of London with the total responsibilities
that he has now, so that he can make decisions in the way that he
does—sometimes quickly. As you know, he will take over
responsibility for Silverlink at the end of the year. I am not quite
sure how you are relating that to your argument, because I found the
current structure to be extremely beneficial, as did Tom ap Rhys
Pryce’s
family.
The
Chairman:
Order. Before we proceed, I point out to the
hon. Lady that she should address her remarks through the
Chairman.
Michael
Gove:
I am grateful to the hon. Lady for making that
point. Her stance in support of Tom ap Rhys Pryce’s family and
the support that she has shown to people who use the Tube station in
her constituency are well recognised within and outside the House. I
appreciate the burden of her comments about the Mayor. I do not think
that anyone is taking anything away from the Mayor and the discharge of
his duties in discussing the importance of TravelWatch. The Mayor
reacted with compassion, speed and efficiency to deal with some of the
problems highlighted by that tragic event.
Tom ap Rhys Pryce’s
murder resonated across London because concerns about travel and
transport safety had risen up the political and public agenda. As they
continue to do so, we believe that the body that speaks for Londoners
in that regard is likely to wish to speak more often on such issues. I
suspect that when it does, the Mayor will respond sensitively and
quickly, but we want to ensure that the body that explicitly allows
London transport users to raise their voices has the protected
resources that it
deserves.
When we talk
about safety in travel, it is not just that tragic murder that rests on
our minds; it is also the tragic murder of those killed on 7 July 2005.
A number of bodies, including the London Fire and Emergency Planning
Authority, have played a significant role in ensuring that
London’s resilience is enhanced and that London transport is as
safe as possible in the event of a terrorist attack, but I think that
all of us are concerned to see that the experience of those who use
London transport is reflected in any decisions taken by the Mayor and
functional bodies when it comes to providing security in the event of
such an attack or any other assault on London’s
resilience.
All of us
can see a number of reasons why London transport users might wish their
voices to be amplified. TravelWatch provides a way of doing so, and we
would
like its budget to be secured so that it does not suffer as a result of
any future budget changes reflecting on the work of the
assembly.
Ms
Butler:
Does the hon. Gentleman agree with me on two
points? First, it was a good thing for the Mayor to take
responsibility—it cost each taxpayer about 2p to ensure an extra
89 British Transport police on the railways. Secondly, when the
Opposition were in power and broke up the railways, it hindered the
current safety of our stations.
Michael
Gove:
With her first comment, the hon. Lady is making a
valid point. Particularly now that we are dealing with an increase in
violent crime and attacks from strangers under this Government, and are
also suffering under an increased terrorist threat, for a variety of
reasons with which we are all familiar, it is appropriate to recognise
that increased spending on security and an enhanced police presence in
all our stations is worthwhile. We agree with
that.
In her second
point, the hon. Lady is inviting me to revisit the question of railway
privatisation, which I think sits outside the scope of the Bill. It is
sufficient for me to say that I hope that we can discuss Transport for
London later in greater detail. All that the amendment was intended to
do—I am sure that hon. Members on the Liberal Democrat Front
Bench are inclined to agree with me—was to ensure that as
concern about London Transport rises up the agenda, the voice of
Londoners is amplified appropriately, that money is found to ensure
that their concerns are respected and that it is found in a way that
will not impair the assembly’s scrutiny
function.
Tom
Brake:
I support the amendment. I hope that the Minister
will take it as a constructive one. That is clearly the intention of
the official Opposition and the Liberal Democrats. The amendment is
about greater transparency in funding for the assembly and TravelWatch,
and it is about ensuring that any variation in funding for one
organisation or another is clearly visible, so that one party does not
suffer as a result of another receiving an increase in funding. I hope
that the Minister can take on board this quite simple but constructive
amendment.
4.15
pm
Mr.
Andrew Pelling (Croydon, Central) (Con): The cross-party
interest of London assembly members in the amendment was to ensure both
the best interests of London TravelWatch and the assembly itself, in
providing cognisance for the chief financial officer to ensure that the
demands of London TravelWatch could be accommodated, if required, in
line with how the Bill’s other clauses set a maximum spend on
the assembly—such that its work, and that of London TravelWatch,
should not be compromised. The cross-party approach in the assembly,
which I hope will also be seen in Committee, was that this entirely
constructive approach was intended to be flexible, to ensure the good
work both of the assembly and of London
TravelWatch.
Jim
Fitzpatrick:
I understand and acknowledge the concern
behind this amendment, and the constructive way in which Opposition
Members have moved it. It means that any change to the statutory
functions of the London transport users committee, otherwise known as
London TravelWatch, could lead to a significant increase in the
assembly’s component budget requirement. I fear that the
amendment does not achieve what Opposition Members intend, and in any
event I do not believe there is any need to make the sort of provision
they have in mind.
Hon. Members will know that,
under clause 12, the LTUC budget forms part of the assembly’s
component budget, as we have just agreed. A significant change in
LTUC’s budget requirement could, in turn, have some bearing on
the amount of the assembly’s component budget requirement.
Clause 13 allows the GLA’s chief finance officer to direct that
specific amounts should be left out of the calculation for determining
this limit in order to deal with unusual, one-off expenditure items.
However, that power relates amounts to include or exclude from the
Mayor’s budget in order to calculate its percentage change
between the current and previous years, and therefore the limit by
which the assembly can increase its own budget. The chief finance
officer’s power of direction is intended to deal with unusual,
one-off items in the Mayoral budget, such as the Olympic
precept.
Placing a
duty on the chief finance officer to have regard to the functions of
the assembly and of LTUC in issuing a direction will have no bearing on
the content. In any event, we see no need to draw a distinction between
LTUC and the assembly component budget as a whole. LTUC’s budget
forms only a proportion—less than 20 per cent., as I am sure
hon. Members are well aware—of the assembly’s overall
budget. Any changes to LTUC’s functions, and therefore to its
budget requirement, is unlikely to have a significant bearing on the
total budget requirement of the assembly. Any change in LTUC's
statutory duties would need primary legislation to have effect. It
would be appropriate to consider any funding issues resulting from such
changes at the same time as any legislation is taken forward.
I do not therefore believe that
this amendment would serve the desired purpose. I hope that, with these
reassurances, the Opposition Members will withdraw their
amendment.
Michael
Gove:
I appreciate the generous words with which the
Minister began his comments, but as he went on I became progressively
disappointed. All that we thought to do was to ensure that the LTUC and
assembly budgets were both amply protected. I recognise the
Minister’s point that no new functions have been given to LTUC
as a result of the statute, but I will outline various reasons
why—as a result of decisions taken by the Mayor, other factors
occurring in London and, indeed, globally—concerns about
Transport for London, plus the anxieties and security of London
transport users, needed to be respected. My belief is that the body
speaking for London transport users is likely to need more resources in
the future, to ensure that those anxieties are effectively voiced and
that the security of transport users is effectively
respected.
Nothing that the Minister said
suggested that that is unlikely to happen or that any of my worries
were ill founded, but if it were likely we would inevitably see LTUC
doing more and, given the way in which the component budget is
calculated, it means that the resources for the assembly and its
scrutiny function would be less. Given how the budget is constructed,
Peter will have to be robbed to pay Paul. Our amendment is an
opportunity to ensure that both Peter and Paul have their views
respected.
Jim
Fitzpatrick:
I fully understand the points that the hon.
Gentleman is making. Given the nature of LTUC’s
constitution—in that it is an animal of the assembly and thus is
accountable to the assembly and appointed by it—does he not
believe that, were LTUC to require additional financing that was
acknowledged by the assembly, it could make the appropriate bid to the
Mayor and it would be accepted? Moreover, because of the Mayor’s
personal interest in transport, would it not recognise that there might
indeed be an increased budget requirement for LTUC? Why does the hon.
Gentleman think that, when it comes to the assembly asserting itself
with the majority and showing a common purpose—a two thirds
majority could be achievable in certain circumstances—the
assembly might not be able to achieve the objective of an increased
budget for LTUC, were that to be
desired?
Michael
Gove:
I am grateful to the Minister for that intervention.
If the amendment were not accepted, the assembly might make the case to
the Mayor for an increase in its own budget to make sure that
LTUC’s functions could be enhanced effectively. However, that
inevitably takes us into the territory that we shall be covering under
the next group of amendments, when we shall discuss how the
assembly’s budget can be protected overall and the powers that
it has to amend the
budget.
If the
assembly wished to amend the budget specifically to achieve that
particular goal, it would not be able to do so under the cumbersome and
limited powers that it has to amend the budget at present. Without
having to pre-empt that process, acceptance of the amendment would deal
with that problem. I hope that the Minister will think again about such
matters, even at this late
hour.
I also hope that
Labour Back Benchers will reflect on the amendment. It is clear from
what he said that the Minister was outlining the Government’s
position and that he was doing so with his customary attention to duty.
However, I appeal to Labour Back Benchers to think about the worries of
their constituents about London transport. Whether or not they voted
for the Mayor, I am sure that they would want the body that speaks for
them to have its finances protected
effectively.
Mr.
Pelling:
Does my hon. Friend agree that the Minister has
conceded that the assembly should have the ability on a two-thirds vote
to have a line-by-line amendment on the budgets within the GLA family?
Surely the fact that the assembly should have the ability to impose its
will through the budgetary process on spending on a particular line
within the budget lies behind his
suggestion.
Michael
Gove:
I thank my hon. Friend very much for that
intervention. His comments are not a legitimate inference, but the only
logical conclusion of the Minister’s remarks. The hon. Gentleman
was referring in particular to the opportunity that the assembly might
have to request a specific amendment to the budget to ensure that it
was increased and that LTUC was adequately funded. That is a specific
example of a line item change. We are proposing a line item change on
the two-thirds majority vote, so I should be interested to see the
Minister carry through the logic of his previous intervention in later
proceedings. If he does not, I would be interested to know why. I am
grateful to my hon. Friend for making such a valuable
point.
I return to the
broader point that I wish to put to Labour Back Benchers. If they vote
with the Government on the matter, they will have to ask themselves why
they are denying their constituents effective funding for the voice
that speaks up for them on travel issues. We have heard from the hon.
Member for Brent, South about a case in her constituency and we know
how effectively she championed the relatives of the victim. There is no
question but that Labour Members have a proud tradition when it comes
to championing the interests of their constituents on matters of
security and personal safety. Therefore, it would be all too great a
shame if they were to troop loyally behind the Government on this vote,
rather than siding with their constituents’ interests at a time
of growing concern about safety on road and
rail.
Jim
Fitzpatrick:
The hon. Gentleman clearly indicates that we
are not going to agree on the principle and I am not sure that we agree
about what I was trying to convey a few moments
ago.
My secondary
point, which the hon. Gentleman has not addressed, is that the chief
finance officer’s power of direction is only intended to deal
with the Mayor’s aspect of the budget; therefore, the amendment
does not produce the desired effect and is technically
flawed.
Michael
Gove:
I take the Minister’s point, but we are
seeking to give the chief finance officer a new, specific power to deal
with a new, specific situation. The chief finance officer should not
intervene in the disposition of the assembly’s budget. My hon.
Friend the Member for Croydon, Central tabled an amendment to protect
the assembly’s disbursal of its own budget, but sadly it was not
selected. Nevertheless, because this situation is unique—we are
talking about the one body in the assembly that has its own specific,
discrete budget—we wish to deal with it by means of a specific
amendment that will, if agreed, have specific force. The chief
finance officer will then have to take account of the will of the House
and, in so doing, he will give more effective protection to London
transport users. I hope that Labour Back Benchers will, on this
occasion, side with the interests of their constituents against
the Government and administrative
convenience.
Question
put, That the amendment be
made:—
The
Committee divided: Ayes 6, Noes
10.
Division
No.
5
]
AYESNOES
Question
accordingly negatived.
‘(5A) After
paragraph 5A
insert—
“Limit on the Mayor’s powers to prepare a draft budget for the Assembly5B (1) In exercising
his powers to prepare a draft component budget for the Assembly under
paragraph 2 above, the Mayor must not prepare a draft component budget
for the Assembly that is less than the minimum draft component budget
requirement for the
Assembly.
(2) Find the minimum
draft component budget requirement for the Assembly as
follows.
(3) If NM is greater
than OM (as calculated under paragraph 5A(5) above) the minimum draft
component budget requirement for the Assembly is as if NM equals
OM.
(4) If NM is less than OM
(as calculated under paragraph 5A(5) above) find the percentage by
which NM is less than OM, and reduce the amount of the component budget
requirement for the Assembly for the previous financial year by the
same percentage.
The result is
the minimum draft component budget requirement for the
Assembly.
(5) If NM equals OM
(as calculated under paragraph 5A(5) above) the minimum draft component
budget requirement for the Assembly equals the amount of the component
budget requirement for the Assembly for the previous
year.
(6) Subsections (9) to
(11) of paragraph 5A above shall have effect for the purposes of this
paragraph.”.’.
Amendment
No. 60, in
clause 13, page 13, line 12, at
end insert—
‘(5A) After
paragraph 5A
insert—
“Limit on the Mayor’s powers to prepare a draft budget for the Assembly5B (1) In exercising
his powers to prepare a draft component budget for the Assembly under
paragraph 2 of Schedule 6 above, the Mayor must not prepare a draft
component budget for the Assembly if the draft component budget
contravenes sub-paragraph (2)
below.
(2) The Mayor’s
draft component budget contravenes this sub-paragraph
if—
(a) the draft
component budget for the Assembly is less
than
(b) the minimum draft
component budget requirement for the Assembly.
(3) Find the minimum draft component budget
requirement for the Assembly as
follows.
(4) If NM is greater
than OM (as calculated under sub-paragraph (5) of paragraph 5A of
Schedule 6 to this
Act)—
(a) find the
percentage by which NM is greater than OM,
and
(b) reduce the amount of
the component budget requirement for the Assembly for the previous
financial year by the same
percentage.
The result is the
minimum draft component budget requirement for the
Assembly.
(5) If NM is less
than OM (as calculated under sub-paragraph (5) of paragraph 5A of
Schedule 6 to this
Act)—
(a) find the
percentage by which NM is less than OM,
and
(b) reduce the amount of
the component budget requirement for the Assembly for the previous
financial year by the same
percentage.
The result is the
minimum draft component budget requirement for the
Assembly.
(6) If NM equals OM
(as calculated under sub-paragraph (5) of paragraph 5A of Schedule 6 to
this Act) the minimum draft component budget requirement for the
Assembly equals the amount of the component budget requirement for the
Assembly for the previous
year.
(7) Sub-paragraphs (9) to
(11) of paragraph 5A of Schedule 6 to this Act (power of chief finance
officer to direct amounts to be left out of account) also have effect
for the purposes of this
paragraph.’.
Amendment
No. 33, in
clause 13, page 13, line 16, at
end insert—
‘(6A) In
paragraph 8 in sub-paragraph (4) for “at least
two-thirds” substitute “a simple
majority”.’.
Amendment
No. 41, in
clause 13, page 13, line 16, at
end insert—
‘(6A) For
sub-paragraph (4) of paragraph 8
substitute—
“(4)
For the purposes of sub-paragraph (3) above, the only amendments which
are to be made—
(a) to
the final draft component budget for the Mayor are those agreed to by
at least two-thirds of the Assembly members voting,
and
(b) to the final draft
component budget for the Assembly are those agreed to by at least a
simple majority of the Assembly members
voting.”.’.
Amendment
No. 44, in
clause 13, page 14, line 24, at
end insert—
‘(8) After
paragraph 8A
insert—
“Limit on the Mayor’s powers to prepare a draft budget for the Assembly8B (1) In exercising
his powers to prepare a final draft component budget for the Assembly
under paragraph 2 above, the Mayor must not prepare a draft component
budget for the Assembly that is less than the minimum final draft
component budget requirement for the
Assembly.
(2) Find the minimum
final draft component budget requirement for the Assembly as
follows.
(3) If NM is greater
than OM (as calculated under paragraph 5A(5) above) the minimum draft
component budget requirement for the Assembly is as if NM equals
OM.
(4) If NM is less than OM
(as calculated under paragraph 5A(5) above) find the percentage by
which NM is less than OM, and reduce the amount of the component budget
requirement for the Assembly for the previous financial year by the
same percentage. The result is the minimum final draft component budget
requirement for the
Assembly.
(5) If NM equals OM
(as calculated under paragraph 5A(5) above) the minimum final draft
component budget requirement for the Assembly equals the amount of the
component budget requirement for the Assembly for the previous
year.
(6) Subsections (9) to (11) of paragraph 5A above
shall have effect for the purposes of this
paragraph.”.’.
Clause
stand part.
Amendment
No. 34, in
clause 14, page 15, line 44, at
end insert—
‘(2A) In
paragraph 7 in sub-paragraph (4) for “at least
two-thirds” substitute “a simple
majority”.’.
Amendment
No. 42, in
clause 14, page 15, line 44, at
end insert—
‘(2A) For
sub-paragraph (4) of paragraph 7
substitute—
“(4)
For the purposes of sub-paragraph (3) above, the only amendments which
are to be made—
(a) to
the final draft component budget for the Mayor are those agreed by at
least two-thirds of the Assembly members voting,
and
(b) to the final draft
component budget for the Assembly are those agreed to by a simple
majority of the Assembly members
voting.”.’.
Amendment
No. 45, in
clause 14, page 15, line 44, at
end insert—
‘(2A) After
paragraph 4A
insert—
“Limit on the Mayor’s powers to prepare first draft budget for the Assembly4B (1) In exercising
his powers to prepare a first draft component budget for the Assembly,
the Mayor must not prepare a first draft component budget for the
Assembly that is less than the adjusted minimum first draft component
budget requirement for the
Assembly.
(2) Find the adjusted
minimum first draft component budget requirement for the Assembly as
follows.
(3) If NM is greater
than OM (as calculated under paragraph 5A(5) above) the minimum draft
component budget requirement for the Assembly is as if NM equals
OM.
(4) If NM is less than OM
(as calculated under paragraph 5A(5) above) find the percentage by
which NM is less than OM, and reduce the amount of the component budget
requirement for the Assembly for the previous financial year by the
same percentage.
The result is
the adjusted minimum first draft component budget requirement for the
Assembly.
(5) If NM equals OM
(as calculated under paragraph 5A(5) above) the adjusted minimum first
draft component budget requirement for the Assembly equals the amount
of the component budget requirement for the Assembly for the previous
year.
(6) Subsections (9) to
(11) of paragraph 5A above shall have effect for the purposes of this
paragraph.”.’.
Amendment
No. 46, in
clause 14, page 17, line 8, at
end insert—
‘(4) After
paragraph 7A
insert—
“Limit on the Mayor’s powers to prepare final draft budget for the Assembly7B (1) In exercising
his powers to prepare a final draft component budget for the Assembly
under paragraph 2 above, the Mayor must not prepare an adjusted draft
component budget for the Assembly that is less than the adjusted
minimum final draft component budget requirement for the
Assembly.
(2) Find the adjusted
minimum draft component budget requirement for the Assembly as
follows.
(3) If NM is greater
than OM (as calculated under paragraph 5A(5) above) the minimum draft
component budget requirement for the Assembly is as if NM equals
OM.
(4) If NM is less than OM
(as calculated under paragraph 5A(5) above) find the percentage by
which NM is less than OM, and reduce the amount of the component budget
requirement for the Assembly for the previous financial year by the
same percentage.
The result is the adjusted minimum final draft
component budget requirement for the
Assembly.
(5) If NM equals OM
(as calculated under paragraph 5A(5) above) the adjusted minimum final
draft component budget requirement for the Assembly equals the amount
of the component budget requirement for the Assembly for the previous
year.
(6) Subsections (9) to
(11) of paragraph 5A above shall have effect for the purposes of this
paragraph.”.’.
Clause
14 stand part.
New
clause 4—Approval of Mayor’s final draft budget by
Assembly
‘In Schedule 6 to the
GLA Act 1999 (procedure for determining the Authority’s
consolidated budget requirement), paragraph 8(4) is
omitted.’.
New
clause 16—Assembly consideration of Mayor’s draft
budget
‘In Schedule 6 to the
GLA Act 1999 (Procedure for determining the Authority’s
consolidated budget requirement), leave out paragraph 5(4) and
insert—
“(4) For
the purposes of sub-paragraph (3) above, amendments which are to be
made must be agreed to by a simple majority of the Assembly members
voting.”.’.
New
clause 17—Assembly consideration of Mayor’s draft
budget (No. 2)
‘In Schedule 6
to the GLA Act 1999 (Procedure for determining the Authority’s
consolidated budget requirement), leave out paragraph 5(4) and
insert—
“(4) For
the purposes of sub-paragraph (3) above, amendments including those
which amend the aggregates calculated in subsections (4) to (7) of
section 85 are to be agreed by a two-thirds majority of the Assembly
members
voting.”.’.
New
clause 18—Calculation of component and consolidated budget
requirements
‘In section 85 of
the GLA Act 1999 (calculation of the component and consolidated budget
requirements), after subsection (4)
add—
“(4A) For
the purposes of subsection (4) above, the aggregates must be calculated
to include amendments agreed to by a two-thirds majority of the
Assembly members
voting.”.’.
New
clause 19—Assembly’s power to allocate its
budget
‘(1) Schedule 6 to the
GLA Act 1999 (procedure for determining the Authority’s
consolidated budget requirement) is amended as
follows.
(2) After paragraph 9
insert—
“Assembly’s power to allocate its budget9A
The Assembly may, following consultation with the head of the
Authority’s paid service, the Authority’s monitoring
officer and the Authority’s chief finance officer, allocate
monies which it receives under the component budget for the Assembly in
such a manner as it sees
fit.”.’.
Michael
Gove:
This group of amendments, and the debate on the
various clauses, relates to the budget functions of the Mayor and the
assembly. The Minister has already acknowledged, in his discussion on
clause 12, that we should have a clearer and more transparent division
of the budget for the Mayor and the budget for the assembly. I do not
need to rehearse at length the arguments about why that should be so.
The Mayor’s functions are relatively clear. We have heard Labour
Back Benchers talking about the importance of preserving the
Mayor’s executive functions and heard from all parties about the
importance of recognising the assembly’s specific scrutiny
functions. At various
points, we have sought—and will seek—to enhance the
assembly’s scrutiny functions. So far, of course, every attempt
to do so has been beaten back by the Government, but we will carry on
regardless.
If the
assembly is to ensure that its scrutiny functions are effectively
safeguarded, it has to ensure that its budget for those functions is
effectively safeguarded. We are concerned that the Bill gives the Mayor
the potential power to pillage or ransack the budget for scrutiny. We
are not suggesting that the current Mayor wishes to exercise it, but a
future Mayor
might.
4.30
pm
The complex
formula in the Bill will allow the assembly to permit its budget and
the Mayor’s budget to expand in tandem. If the Mayor’s
budget increases, the assembly’s budget can increase, but not by
an amount greater than the Mayor’s. It seems broadly sensible
that there should be a ceiling to the assembly’s budget. The
assembly can never grow like Topsy, and its budget can grow only in
proportion to the growth in the Mayor’s budget and in the
functions that the Mayor and assembly bodies discharge.
So far, so good, but although
there is a ceiling, there is no floor. The formula does not prevent the
Mayor from reducing the assembly’s budget and paring it to the
bone. It is entirely possible that a future Mayor, tiring of the effect
of the scrutiny to which the assembly is subjecting his policies,
might—with the help of lackeys in the assembly—seek to
introduce a budget that would deprive the assembly of the necessary
funding to discharge its
duties.
Two
different amendments seek to deal with that point—one in the
names of myself and my hon. Friends and one in the names of the hon.
Members for Carshalton and Wallington and for Lewes. My party’s
amendment seeks to ensure that the assembly can effectively control
where the floor is set. The amendment in the names of the hon. Members
for Carshalton and Wallington and for Lewes proposes what I believe is
called an envelope, such that the assembly’s budget cannot be
reduced by more than any increase in the Mayor’s
budget—you pays your money and you takes your choice. Naturally,
we believe that our system would be superior, but I look forward to
hearing the arguments of the hon. Member for Carshalton and Wallington
in favour of his system—his logic can sometimes be seductive.
Both amendments are intended to ensure that the assembly’s
budget is protected. Interested as I am in the Liberal Democrat
arguments, I am even more interested in the Minister’s arguments
as to why that protection should not exist. If one accepts the logic of
having a ceiling, as we do, why not accept the logic of having a
floor?
In the previous
debate, one of our aims was to ensure that the assembly’s
scrutiny functions should not be impaired by the devolving on to the
LTUC of any additional responsibilities. In the same way, we believe
that those functions should not be impaired by a future Mayor who might
seek to ravage the assembly
budget.
I turn now to
another issue—how the budget can or should be amended. At
present, there is provision for amendment of the total budget by a
two-thirds vote of the assembly. Given the particular arithmetic of
the
GLA, that means in effect that the Mayor and potentially one other
party, or one other party and one or two other assembly members, could
ram through a budget that suits their interests. That would be
particularly likely if the Mayor and his party were to have a
successful run at the polls. We seek to safeguard the majority of
Londoners from such a minority siding with the Mayor to pass a budget
that would not be in the interests of all London. We want the overall
budget to be amendable by simple
majority.
I mentioned
earlier something that it is importantto recognise. The
proportional representation and additional member system in the
assembly means that a simple majority requires an alliance involving
more than one party. Under the current system, the Mayor could get his
budget through with the adherence of potentially just one party,
whereas our proposal would require the consent of two parties. In
effect, that would be a majority of all voting Londoners who had cast
votes in GLA elections.
Martin
Linton (Battersea) (Lab): Will the hon. Gentleman confirm
that the only election in the British isles in which the winner is
required to have more than 50 per cent. of the vote to win is that for
Mayor of
London?
Michael
Gove:
I have more than 50 per cent. of the vote in Surrey
Heath and the Minister for Housing and Planning had considerably more
than 50 per cent. of the vote in her constituency. Many of us enjoy a
mandate that would allow us to sit in this House under any voting
system. I take the hon. Gentleman’s point that by dint of the
voting system by which he or she is elected the Mayor enjoys, in
effect, the confidence of50 per cent. of those voting, but no
Mayor has won outright on the first ballot, and I suspect that no Mayor
will do so in the future. The system that we have chosen for the
election of the Mayor allows someone to cast a second or even a third
vote for whoever they consider to be second or third among all the
evils.
I appreciate
that the freedom that the voting system gives to people to express a
second or third preference means that in some respects the Mayor has a
better mandate than some other elected representatives in this country,
but the GLA was set up to recognise that the Mayor has a strong
mandate, but so does the London assembly. They have mandates of equal
validity.
The changes
that we seek to make will ensure that the assembly’s voice in
shaping the budget is enhanced; it will not be just one party in the
assembly that can exercise disproportionate power, if it happens to be
in alliance with the Mayor, over the shape of the budget, but at least
two parties representing a majority of London
voters.
Mr.
Pelling:
As we have started to debate
percentages of votes, does my hon. Friend think that this Parliament
would have much credibility if the Government could pass their budget
on a third of the
votes?
Michael
Gove:
Thank you, Mr. O’Hara. My hon.
Friend has made an extravagant analogy, but it was very much Ã
point. He is absolutely right to point out that many people will
question how a budget can be passed by the Mayor and just a third of
the assembly, when nearly two thirds of that assembly are unhappy with
the budget proposal. People will ask how effective is the scrutiny role
of the GLA when more than a majority in the GLA—more than 60 per
cent.—are opposed to what the Mayor wishes to do, yet the Mayor
can carry on willy-nilly. People think that the scrutiny function of
the GLA is weaker than it needs to be.
To move from the theoretical to
the practical, we are all aware that the GLA precept has increased
significantly. We will come later to subsequent amendments that will
allow the people of London to discover just how much that precept is
increasing and will make more transparent the additional costs imposed
on them by the Mayor. Given the rise in the Mayor’s budget, it
seems appropriate that the scrutiny function should be enhanced,
too.
Ms
Karen Buck (Regent's Park and Kensington, North) (Lab): Is
it not also the case that Londoners would be confused about why a Mayor
with executive powers and a clear mandate should be stymied in
effectively carrying out those powers by political parties that do not
have the same mandate and which are working together merely to make
political points and to prevent the Mayor from carrying out the duties
for which they were
elected?
Michael
Gove:
The hon. Lady has referred to the executive role of
the Mayor, which she understandably wishes to protect. We recognise
that the Mayor and the GLA are unique in this case, but we should
consider other examples of executive authority. For example, let us
look across the Atlantic, as we have done already in our debates.
Budgets are set by the Executive in the United States of America, but
when it comes to the exercise of scrutiny by Congress, a majority there
can prevent the exercise of executive functions. We recognise that a
majority in any scrutinising body can, when appropriate, hold the
executive to account and say, “I’m terribly sorry, but on
this occasion you are
mistaken.”
Martin
Linton:
Is this not rather a bad time to quote the example
of the United States? As it does from time to time, the doctrine of the
separation of powers has thrown up the constitutional nonsense by which
the Executive is from one party and the legislature has a majority from
the other party. Whatever one’s views, one must agree that that
is a bad thing, which will lead to complete gridlock in the United
States for the next two years. Is that what the hon. Gentleman wishes
on the people of
London?
Michael
Gove:
I am tempted to say, on the basis of my efforts to
drive on the streets of London, that gridlock is what we already
have.
On the
specific case mentioned by the hon. Gentleman, one of the interesting
things about the American system, and about the system of cohabitation
in France, is that
when it occurs, people often say “Quelle horreur”, or
“Dang nabbit, blow me down”, depending on which country
one hears it from. The truth is that the check on the power of the
Executive that comes from cohabitation, or from the situation in
America, can be more beneficial than total executive control of all
branches of government. It was during a period when there was a
Republican Congress and a Democrat President that welfare reforms,
which contributed to a lower level of unemployment and to budget
deficit reductions, were
introduced.
I mention
that because, in principle, forcing an Executive to engage more closely
with a scrutinising body compels the former to make a stronger and
better case for their proposals. We all know that bad laws tend to come
about when an Executive can count on a massive majority in a
legislative body. We all knew—the Prime Minister has
acknowledged this—that better legislation might come about when
the Government’s majority was reduced. We recognise that when an
Executive is compelled to treat with those who have the power of
scrutiny, we get enhanced legislation as a result.
I fear that the hon.
Gentleman’s argument is flawed. The only thing that I will say
in conclusion about the hon. Gentleman’s argument is that he
must be the only member of the Labour party who is disappointed that
the Democrats took control of Congress last
year.
Mr.
Andrew Slaughter (Ealing, Acton and Shepherd's Bush)
(Lab): This is an interesting debate. I was sitting here being
seduced by the hon. Gentleman’s argument. Admittedly, I was
drifting in and out of sleep while doing so. None the less, I was
brought up short by my hon. Friends, who have brought me back to the
real world.
The hon.
Gentleman has said that the assembly and the Mayor have equal mandates.
That is true, but it is a little bit of a sophistry, because there is
the question what the mandates are for. As my hon. Friend the Member
for Regent’s Park and Kensington, North has said, the Mayor has
an executive mandate and the assembly has a scrutiny mandate. It may
frustrate some members of the assembly that that is all that they get,
although they are handsomely rewarded for sitting on a rather
ineffectual scrutiny body. However, that is how the body was envisaged.
Is the hon. Gentleman saying that he wishes to change the whole format
and purpose of the Greater London authority, and to turn the assembly
from a scrutiny body into what will effectively be a second-guessing
executive
body?
Michael
Gove:
I am grateful to the hon. Gentleman for that
intervention. However, he misunderstands not only the Bill but the
legislation that has already been
enacted.
The assembly
can already change the Mayor’s budget, if it manages to get the
two-thirds majority required. Far from being an ineffectual scrutiny
body, the GLA can be a powerful one, if it can command the votes
required. The amendment would ensure that the power of the GLA to be a
powerful scrutiny body is exercised more often. The principle has been
conceded, and we are simply discussing numbers.
I am reminded of the off-colour
joke about the lady who, when she was asked whether she would sleep
with
someone for £100, said no. When she was asked whether she would
do it for £1 million, she said yes and asked, “What do
you take me
for?”
Stephen
Pound (Ealing, North) (Lab): I am sure that the Committee
wants to know that that is not an off-colour joke. It was a discussion
between Mrs. Patrick Campbell and George Bernard Shaw on a
train.
Michael
Gove:
I am grateful to the hon. Gentleman for sparing me
any more blushes and embarrassment, but we all know what we are talking
about. The principle has been conceded, and we are simply discussing
numbers. It seems entirely appropriate that we should give the assembly
the power to scrutinise effectively—I believe that most
Londoners imagine that it has that power—rather than allowing
its scrutiny functions to be impaired by the actions of just one
party.
4.45
pm
Martin
Linton:
I cannot let the hon. Gentleman leave the
Committee with the impression that the mandate of the minority parties
at city hall is as valid as, or equivalent to, that of the Mayor. Not
only does the Mayor have more than 50 per cent.
support—including second-choice votes, as there is no third
choice in London, which the hon. Gentleman might not know as a Member
from outer Surrey—but when people vote for the Mayor they know
that they are voting for the executive. When they are voting for GLA
members, they know that they are voting for scrutineers. They make the
choice with that knowledge, so it is completely wrong to suggest that
the Mayor has no better a mandate than the assembly. He has a clear
mandate as the executive, and members of the GLA, whether they are on
the list or represent constituencies, have mandates from their
constituents as scrutineers of the
GLA.
Michael
Gove:
I am grateful to the hon. Gentleman for his
intervention. Before I was lucky enough to be selected as the candidate
for Surrey Heath, I voted in a mayoral election. I hasten to add that I
did not vote for the
incumbent.
Michael
Gove:
And not, indeed, for the Labour party candidate,
Mr. Dobson, tempting though it was. One reason for voting
for Mr. Dobson would have been that our party leader at the
time, my right hon. Friend the Member for Chingford and Woodford Green
(Mr. Duncan Smith), was leading a campaign to help the
vulnerable, and I can think of no more effective way to have done that.
There was also Steve Norris, who, as I remember, was the Daily
Mirror candidate for the post. [Interruption.] Enormously to
his credit. My memory might be playing me false—it often
does—but I remember thinking at the time about who to place as
my second, third and other preferences. I am grateful to the hon.
Member for Battersea for stressing that one has only a first and a
second preference.
The hon. Gentleman’s more
substantial point was that Londoners cast their votes knowing that they
are voting for an executive Mayor and a group of scrutineers. As my
hon. Friend the Member for Bromley and Chislehurst said from a
sedentary position, that fine constitutional distinction is, of course,
the talk of London’s pubs and, I imagine, of the stand at Craven
Cottage. However, I imagine that most of those who appreciate that the
GLA assembly exists with a scrutiny role would want to see that role
enhanced rather than diminished. That is the point of the
amendment.
Mr.
Pelling:
As one who admits to having voted for Livingstone
as my second preference, may I ask my hon. Friend to help me to
understand the debate? The hon. Member for Battersea put special magic
on the figure of 50 per cent. Why cannot that figure apply to the
assembly?
Michael
Gove:
Once again, my hon. Friend makes an immensely
valuable point. The hon. Member for Battersea talked about the
Mayor’s mandate and said that 50 per cent., or cresting over it,
is the magical total. If so, why cannot the assembly amend the budget
if it manages to get 50 per cent. of the votes plus one? If the logic
applies to the power of the Mayor, it must apply a fortiori to the
assembly because, as we know, no Mayor has yet secured 50 per cent. of
the vote on the first ballot. He relies on votes transferred from other
parties.
As we have
acknowledged, the voting system for the assembly means that reaching 50
per cent. would require more than one party to unite to secure an
amendment, whereas, given the arithmetic of the assembly, it is
perfectly possible for the Mayor, relying on the votes of one party, to
block
amendments.
Martin
Linton:
If the hon. Gentleman and the hon. Member for
Croydon, Central want an answer, I am quite happy to give it. The
latter is the only member of the Committee whom I can look down on,
because my majority of 163 is twice as big as his, which is 75. We are
both familiar with the importance of majorities. The Mayor has an even
stronger mandate than 50 per cent. of the assembly because when the
voters of London were asked who they wanted to have executive power
over the budget in London—they were choosing between
Mr. Norris, Mr. Livingstone and many
others—their answer was Ken Livingstone. They were not asked a
similar question about the parties standing for the assembly and they
did not give a similar
answer.
Michael
Gove:
The hon. Gentleman, like the hon. Member for
Regent’s Park and Kensington, North, appears to be attached to
the strong executive powers of the Mayor. It will be interesting to see
how attached he remains to those powers after the next election, when,
of course, the boot will be on the other foot.
However vigorously the Mayor
discharges his executive powers, we are entirely consistent in
recognising that when the legislation was introduced, it was perfectly
clear that the assembly would have an equally valid mandate. As my hon.
Friend the Member for Croydon, Central, asked, if the hon. Member for
Battersea is attached to the majoritarian principle, why should it not
apply to the assembly as well in one of its few scrutinising functions?
Throughout the debate, we have been trying to enhance the role of the
assembly, and will continue to try later in the consideration of the
Bill. We have been rejected at every turn, however. In the one area in
which the assembly clearly has a role that has been acknowledge by the
Government, why should it not be enhanced in an appropriate way that is
in line with the logic that was outlined
earlier?
We are
anxious to see one other element accepted: as well as the principle of
a simple majority accepting or rejecting the total budget, we should
introduce a line-item veto, to borrow a term from across the Atlantic.
A number of members of the assembly and others have expressed the view
that under the current budget-setting process, it is simply a case of
taking or leaving the whole pot. When it comes to a Finance Bill in the
House, for example, or the budget-setting process in the United States,
we all know that it is possible to seek to amend individual parts of
that budget. It would be valuable for the assembly be able to do so,
because that would help to make transparent its priorities and the
distinct priorities of the Mayor. It would be appropriate to say that
there are certain aspects of the budget, such as pet projects of the
Mayor for which he may not have sought a mandate when he was elected,
that the assembly wishes to highlight and either delete or amend, or
perhaps even enhance.
A key aspect of the line-item
veto that we propose is that it should require a two-thirds majority.
We recognise that the specific ability to alter the budget in that way
should be used only if an overwhelming majority of the GLA is convinced
of the rightness of the change. The amendment respects the executive
power of the Mayor. We are not seeking to deprive him of his key
leadership role, but we are seeking to institute a safeguard to ensure
that if he proposes items in his budget for which he has no mandate,
which may be eccentric, capricious or brazenly ideological, or which he
proposes for partisan reasons, the GLA will be able to draw them to
wider attention or delete them if there is a requirement to do
so.
Stephen
Pound:
The hon. Gentleman has been extraordinarily
generous, if not over-discriminatory, in accepting interventions. With
my hon. Friends the Members for Regent’s Park and Kensington,
North, and for Mitcham and Morden, and the then Member for Brent, East,
I spent night after night after night on the GLA Bill Committee. We
discussed the matter at great length. I am concerned, if not entirely
seduced, by what the hon. Member for Surrey Heath says because many
London assembly members share the concerns that he articulated, which
alone gives me pause for
thought.
In the
Committee that considered what became the 1999 Act, we debated whether
a simple-majority process would be the answer, as applies in most other
legislatures in the UK. We came to the conclusion that the subtlety of
the GLA structure, with its internal checks and balances, made a simple
majoritarian process impossible, because it was an election not of
equals but of separate mandates. Is the hon. Gentleman saying that a
simple majoritarian principle should apply to the budget, which seems
to be the logic,
rather than building a matching floor to the ceiling? Does he support
that idea? Although I appreciate that he was not a Member of the House
at the time, his party did not take that view in the Committee that
dealt with that
Bill.
Michael
Gove:
We do not take a crude majoritarian view on this
matter. We believe that, in considering the acceptance or rejection of
the budget, a majority of those serving on the Greater London assembly
should have the right to accept or reject if they manage to garner a
majority of votes. The proportional representation system that results
in their election will ensure that a majority of GLA members represent,
at the very least, a majority of those who cast their votes at the last
election. In that respect, their majority will be built on surer
foundations than, say, a parliamentary majority. We are seeking to add
to the Bill the principle that the freedom to alter specific items in
the budget should be extended and that scrutiny power should be given
to the GLA, but only when two thirds can agree. We are asking not for a
sweeping extension of powers to the GLA, but for an incremental
improvement in its scrutiny
powers.
I shall bring
my remarks to a close, with thanks to the hon. Gentleman for his
intervention, because he is inviting me to return to the philosophy
behind our proposal, which acknowledges that, overall, the Bill will
enhance and extend the Mayor’s powers. When powers for the
Greater London authority were first conceived, it was acknowledged that
the Mayor and the assembly would have an equal mandate. As the
Mayor’s powers grow, the assembly’s scrutiny role should
grow as well. That is implicit in the acknowledgement in clause 12 of a
separate budget for the
assembly.
We want to
ensure that the separate scrutiny budget is used effectively in
scrutinising the budget overall by giving the assembly the power to
amend or reject it by a simple majority and giving it a line-item veto
on a two-thirds majority. Needless to say, that power is welcomed by
the majority of members of the Greater London assembly. I hope that the
Minister will look favourably on this, our latest attempt to improve
and enhance the scrutiny powers of the GLA and to give Londoners a more
effective voice in their own
governance.
5
pm
Tom
Brake:
The debate on the amendments could be a lot simpler
than the amendments suggest. The amendments to the formula are complex,
as are the formulae in the Bill. It all boils down to delivering a
pledge made by the Government in a policy statement from the Department
for Communities and Local Government issued in July 2006, after the
consultation exercise, which says, in paragraph
3.14.4:
“The
Assembly will...Be able to set its own
budget”.
The
amendments are about assisting that process. It is worth highlighting
the fact that the Government’s other proposals, on which they
have delivered, include the assembly publishing an annual report and
its being
“able to hold
non-binding confirmation
hearings”.
The amendments
are about assisting the Government in delivering their own
pledge.
The Government are spoilt for
choice in terms of which amendment they might like to support. They
could go for a proposal that we have debated at some length: that the
assembly members should be allowed by simple majority to vote in favour
of the Mayor’s budget, which feels like the appropriate,
democratic thing to do. A number of Government Members have questioned
whether that is right and whether we should stick to the two-thirds
majority that is required now to overturn the budget. However, one must
ask, why two thirds? What is the secret behind
it?
A majority is
something that we all recognise; it is the way that we operate in the
House. I was tempted to stray and ask how we as Members would feel if
the Government’s Budget could be overturned only by a two-thirds
majority, although you have blocked that particular avenue,
Mr. O’Hara. We would find it
frustrating.
It is
proposed that the assembly should be allowed to approve by a simple
majority a draft component of the budget. There are complicated
formulae, depending on whether a formula provides a floor or an
envelope. All of them are proposals that the Government could adopt to
allow the assembly much greater scrutiny over the budget and a greater
sense of security about its own budget. It is entirely possible that a
future Mayor, or indeed the current one, could decide that although he
wants to continue increasing his budget, he feels that it is to his
advantage to reduce the assembly’s budget, because he finds the
scrutiny that it undertakes embarrassing or unsettling. Nothing in the
Bill would prevent that from happening. At present, there is a ceiling
on the assembly’s budget, but nothing that would safeguard it
should the current or a future Mayor decide to restrict severely the
assembly’s spending and budget year after
year.
Mr.
Hands:
I am slightly unclear whether the hon.
Gentleman’s party supports the proposal to reduce the threshold
from two thirds to 50 per
cent.
Tom
Brake:
We support it entirely. I have tabled an amendment
that would allow the assembly to reject the Mayor’s budget by a
simple majority. It is our view that that is the democratic way of
doing things. However, I am saying that there are a range of
amendments, all of which address the budget in slightly different ways.
Some address the overall budget and some its components. Some would
ensure an envelope within which the Mayor could not adjust the
assembly’s budget. Some would ensure that if the Mayor increased
his own budget, the assembly could make a similar increase, or should
not be restricted by his plans.
I hope that the Government will
consider the amendments and find that they would strengthen democracy
and provide the greater scrutiny needed to offset the increase in the
Mayor’s powers that will result from the Bill. I shall listen
carefully to the Minister’s response. I hope, because of the way
he cheered up the Committee by suggesting a draft amendment to
amendment No. 38, that he might be willing to suggest a draft amendment
relating to the Mayor’s
budget.
Mr.
Pelling:
First, I shall approach some of the amendments
that have found their way to the
Committee in the context of support either from a majority or from all
members of the London assembly. This afternoon, we have already secured
the passage of clause 12, which will provide the assembly with the
ability to set its own budget, bringing it in line with other devolved
assemblies.
In the
context of the two-thirds majority rule, there is the danger that the
assembly will in practice be left unable to divine upon its own budget.
The proposed process confuses the assembly’s role in respect of
the Mayor’s budget for the entire GLA family, which comes from
expenditure of more than £10 billion and will obviously be
higher after the reforms in the Bill come in, with its role in
determining its own requirements and
resources.
The power
to amend the Mayor’s proposed budget for the assembly by a
two-thirds majority will enable nine members out of 25 to decide
whether the Mayor’s proposed budget for the assembly should be
amended. Thus, the assembly itself will not be in control of its own
destiny in progressing its own budget on its own decision. That does
not serve the Government’s good policy intentions of allowing
the assembly to set, or even to protect, its own budget.
When the Mayor was quizzed at
the London assembly on 13 December, he said that he did not consider he
should have anything to do with the assembly’s budget. The Bill
includes complex formulae that set an upper limit—a
ceiling—on the Mayor’s ability to amend his proposed
budget for the assembly, but it does not set a floor, or lower limit.
To theorise for Labour Members, a Conservative Mayor might cut a very
large part of the assembly’s budget because there is no
protection, or floor. Effectively, there is no meaningful protection
should the Mayor propose unreasonable cuts to his budget, either in one
year or cumulatively over
time.
The Bill
contains no provision for the assembly to determine the allocation of
resources within its overall budget. Instead, the Mayor could decide to
transfer significant resources within the assembly’s budget,
perhaps to the disadvantage of the assembly’s individual party
groups or, if he or she were feeling the heat, to take away resources
that would give attention to areas of scrutiny that he felt were giving
him too much
trouble.
Amendment No.
43 would put in place a floor below which the Mayor could not reduce
the assembly’s budget in any one year by ensuring that the Mayor
could propose to reduce the budget requirement for the London assembly
only when he was proposing to reduce the Mayor’s component
budget requirement, and then only by as much as the Mayor was reducing
his own mayoral component budget. Thus, if the Mayor were proposing to
reduce his budget by 2 per cent. on the current year’s figure,
he could propose to reduce the assembly’s budget only by a
maximum of2 per
cent.
I recognise that
the Government were very conscientious in their original consultation,
but during that consultation the assembly sought a means of protecting
its resources from a Mayor who might seek to cut them if it was
particularly effective in holding that future Mayor to account. The
Bill proposes that that protection be provided by giving the assembly
the
ability to set its own budget in certain circumstances by amending the
proposed assembly component budget put forward by the Mayor.
As the hon.
Member for Carshalton and Wallington said, large sections of the Bill
contain complex formulae, the sole purpose of which is to impose a
ceiling on the amount by which the elected members of the London
assembly could, if they were able to achieve the support of two thirds
of members of the London assembly, amend the budget for the assembly
proposed by the Mayor. However, while a ceiling is proposed for the
assembly, there is no such limit on the amount by which the Mayor might
seek to reduce the assembly’s
budget.
The amendments
would not prevent the Mayor from proposing any reduction in the
Mayor’s budget. It must be right that where there is a general
reduction in the GLA’s spending, the assembly should have to
bear its proportion of any such reduction.
Stephen
Pound:
The hon. Gentleman has a great deal of credibility
with Labour Members based on the assumption that he is related to the
author of histories of the Labour party and British trade unions. He
may not be, but he still has credibility. Does he not accept that there
would be a fundamental recasting of the twin-pillar roles of executive
and scrutiny were his amendment to be carried? Does he not accept that
the 1999 Act enshrined those different responsibilities and strengths
in legislation precisely to differentiate between the executive and
scrutiny roles? Does he further accept that his amendment would recast
that in a way that the drafters of the Bill and those who voted for it
did not
intend?
Mr.
Pelling:
I have enjoyed reading the Pelling books, even if
these days they are rather ancient history in view of what the new
Labour party stands for. Obviously, I must take guidance from the
debate on the 1999 Act, but we should also take cognisance of the
response of Londoners to the assembly over the last seven years. We
often hear the question, “What are you doing to stop that Mayor
increasing our
tax?”.
Mr.
Pelling:
Well, the Mayor does say that if people want to
vote for an old-fashioned socialist, they should “vote for
me”. However, it is difficult to explain to voters who made the
effort to turn up at the polling station, and perhaps also voted in the
London assembly elections, as well as voting for the Mayor, that they
have to bring together a coalition of the far right—in the form
of UKIP—and of Conservatives, Liberals and Greens to be able to
cap that increase in demand on London taxpayers. That is far too
Quixotic a target to be set for the London assembly if it is to retain
credibility with the London
electorate.
Mr.
Hands:
Does my hon. Friend agree that
one problem with the current system is that the swing votes on the
assembly are held by the Green party? If there were a Conservative
Mayor, the swing votes might well be held by UKIP and by One London, or
whatever it calls itself. Having a much more mainstream requirement of
50 per cent. would help to give the balance of power to more centrist
parties such as our own.
Mr.
Pelling:
My hon. Friend makes a good point. The London
assembly’s credibility with the electorate will be at issue if
it is never able to deliver any change to the mayoral budget through
the budgetary process. I had the pleasure of being the chairman of the
budget committee when we came closest to securing the two-thirds
majority required. It was a great pleasure to get the Greens, UKIP,
Liberals and Conservatives voting together on one of the two
occasions—a two-thirds majority has to be obtained twice within
a month to apply the legislation—and I know that it made the
Greens physically sick to find themselves voting with Conservatives on
such a proposal. But the reality is that there is no credibility left
in the process. The assembly’s ability to hold the Mayor to
account is damaged if its ability to change the mayoral budget has no
credibility.
5.15
pm
Stephen
Pound:
I am sorry to keep revisiting the past, but in
modern politics only the future is certain—the past is changing
all the time. One thing that did not change was the
Conservatives’ opposition to there being an assembly at all.
Their original proposal was to have just a Mayor; they did not want an
assembly because they felt that that would be an unnecessary
duplication. How can the hon. Gentleman persuade me, and others who are
wobbling under the torrent of his oratory, that his comments are not
predicated more on the personality of the current incumbent at City
hall than on the general principle, as they are at such wild variance
with the view that the Conservative party held not many years
ago?
Mr.
Pelling:
My recollection is that when my hon. Friend the
Member for Croydon, South (Richard Ottaway) spoke in the debates on the
assembly, he made some interesting and valid points about the
attractions of the assembly being made up of leaders of local
authorities. That proposal had many merits, and it would have bound
together the two separate layers of local government in London.
However, the hon. Member for Ealing, North has misrepresented our
approach to the Bill in that we are far more enthusiastic than his
party about devolving power to the Mayor and giving him extra powers in
areas such as NHS London and learning and skills councils. I do not
think that I have to take any lectures from him on that
point.
On the
budgetary process, we have seen that there are real difficulties in
relation to the budget committee and London assembly members taking
advice from officers who serve both as GLA members and on the London
assembly. Tony Travers has come up with the extremely interesting idea
of copying the New York City assembly, which has a separate finance and
performance office. If the assembly were to do that, it would secure
much more effective scrutiny of the budget in terms of independent
advice.
Having been
drawn into the more controversial discussion on the two thirds rather
than 50 per cent. rule, I hope that consideration will be given to the
way in which the London assembly has been made toothless as a result of
the application of the two-thirds rule for looking at the overall
budget. There are strong arguments, in terms of the effectiveness of
the assembly, for providing for line-by-line amendments.
The Mayor, supported by legal advice, has been able to interpret the
previous legislation as enabling himto move moneys from any
part of the GLA family to another. Had the assembly successfully voted
against a particular budget, it would have found that the Mayor was
able to get round its proposals very
readily.
Moving to a
situation in which the assembly has line-by-line powers would allow for
more effective scrutiny and give a more effective voice to the assembly
that London voters have chosen. There is another way, and it is a
matter of practical politics. In the first year, the Conservative group
suggested some mild reductions in expenditure on the substantial number
of press officers in the Metropolitan Police Authority, which was
misrepresented as an appalling assault on the police service in London.
As a result of that experience, all political parties on the London
assembly have stood back from debating the budget of the Metropolitan
Police Authority for fear of being so misrepresented. However, if there
were line-by-line powers, restricted by the constraint of needing to
secure the high target of a two-thirds majority, London assembly
members might well be empowered to be more robust in debating
efficiencies within the MPA.
I would like to return to areas
of somewhat greater consensus, which there was on some other proposals
that my hon. Friends and I have made today. My amendments propose that
the assembly should be in a position to amend its own budget by a
simple majority. Amendments to the budgets of the other five component
bodies would still require a two-thirds majority. The Government intend
the assembly to have the ability to set its own budget. Given that
large parts of the Bill are given over to complex formulae designed to
impose strict ceilings on the amount by which the assembly could
increase the budget, the requirement to obtain a two-thirds majority in
this case is unnecessary and counter-productive.
Under the arrangements proposed
in the Bill, the Mayor will propose a budget for the assembly
andthe five other component bodies. Giving the assembly the
ability to amend the Mayor’s proposed budget by achieving a
two-thirds majority would, in effect, enable nine out of 25 members to
prevent changes to that budget. As a result, the Mayor and a minority
of assembly members could set the assembly’s budget together,
which would not serve the Government’s policy intention of
enabling the assembly to set or protect its own
budget.
Finally, I
want to refer to new clause 19, on the assembly allocating its own
resources, which is being taken in this group. The Bill proposes
separate component budgets for the assembly and the Mayor. New clause
19 would enable the assembly to determine the allocation of resources
within its own budget. Under the current arrangements, the Mayor
proposes the budget for the GLA, and whereas the assembly can amend the
figures for the five component budgets and the overall figure, it
cannot change the line-by-line budget heads that make up the individual
components. The new clause does not seek to change the situation, as it
applies to the existing five component budgets, but if there is to be a
separate budget for the assembly, it would be nonsensical if the
assembly were unable to decide how that budget should be spent to
support it in carrying out its functions as set out in the 1999
Act.
Unless such provision is made,
it would be possible for the assembly to set its own budget but find
itself in the bizarre situation that the Mayor could subsequently
decide how that budget spent, because of how the previous legislation
has been interpreted to allowthe Mayor to move moneys around
from one part of the GLA family to
another.
I hope that
cognisance can be given to the importance of ensuring that the London
assembly has credibility with London electors. I appreciate that it is
important for London assembly members to be able to create that
credibility themselves, but the overall policy of setting a two-thirds
majority to build a secure budget leaves electors confused. They do not
understand why the people whom they elected cannot secure change to
London policy by simple majority voting—that is what people
understand by democracy when they turn up and vote for politicians at
elections—or why the two-thirds rule has to be continually
enforced.
Robert
Neill (Bromley and Chislehurst) (Con): I agree with
everything that my hon. Friend the Member for Croydon, Central has
said, and I shall not seek to repeat it. He speaks with particular
authority, having served on the assembly’s budget committee for
the whole seven years of its existence and having chaired it for two
years. I doubt that anyone has greater practical knowledge of the
implications of the budget process than my hon. Friend, and I hope that
the Government will take his points on board, given that he has not put
them forward in a particularly partisan
manner.
I hope that I
will be forgiven for straying a little by saying that it is ironic that
Government Back Benchers have contrasted the view that we took some
years ago with the argument put from this side of the Committee now.
Those on this side appear to be showing greater faith in the assembly
and a greater willingness to enhance its role than some Government Back
Benchers. That is ironic, but time moves on and some of us are prepared
to learn from
experience.
Stephen
Pound:
May I move us forward to 8 January 2007,
when, under the headline, “Bulletproof in Bromley”, an
interview with the hon. Gentleman was spread across many a page of
The House Magazine? It included the
sentence:
“It
can be quite frustrating as an Assembly member, as it is there simply
to scrutinise.”
May I say
that the hon. Gentleman is absolutely correct in that analysis? He is
perhaps straying away from that veracity in his words in
Committee.
Robert
Neill:
First, I compliment the hon. Gentleman on his taste
in reading material. I am sure that he found it far more enlightening
than the Fulham souvenir programme that he got last Saturday. I was
stating the current situation. Many of us do not think that it is the
best way forward and many distinguished independent academics, such as
Tony Travers, whose
grasp of London government issues is probably greater than that of any
of us in this Room, also take the view that it would be have been
desirable to take the opportunity presented by the Bill to effect a new
and more mature devolution settlement in London. That might have given
even greater powers to the Mayor than are proposed, but with
concomitant additional scrutiny power for the assembly. Nothing that I
am saying here contradicts anything that I have said recently in any
publication, but I am grateful for the
plug.
I wish to
reinforce the point by saying that if London’s devolved system
is to work, there must be a sensible partnership between Mayor,
assembly and boroughs. We will go into that matter at later points in
our consideration of the Bill. The 1999 Act gave the assembly a
particular role in relation to the budget. The Government have said
that some things should be re-examined in the light of experience, and
we are saying that some elements of the budget should be re-examined in
the light of experience, which is an intellectually coherent and
responsible stance for us to
take.
Mr.
Slaughter:
A coherent intellectual stance? I am genuinely
confused now. When I attempted earlier—unwisely, no
doubt—to debate with the hon. Member for Surrey Heath and said
that the assembly was a scrutiny body, he pulled me up short and got
into some chat about prostitution. Now the hon. Member for Bromley and
Chislehurst seems to be saying that the assembly is a scrutiny body.
Indeed, he stands by his comments in The House Magazine and is
now talking about partnership. Which is it, and what is the
Conservative policy? Is it scrutiny, is it executive or is partnership?
What do they
want?
Robert
Neill:
If the hon. Gentleman does not recognise that
effective scrutiny can sometimes best be done by partnership and on the
basis of mutual respect between two bodies, he is always going to be
confused about the matter and I suspect that I shall be unable to help
him. Of course there is no contradiction, and if he were to give the
matter more thought, he would realise that. We are interested in making
the assembly’s role in the scrutiny and approval of the budget,
which is its statutory function, more effective. The two things are not
contradictory.
One
argument that Government Members seem to deploy against enhancing the
assembly’s role, and indeed against all our amendments, is the
suggestion that they run up against the strong-Mayor model. We do not
have a problem with that model, and the argument is factually
inaccurate. Such a model does not mean that the assembly should not,
for example, have the power to amend the budget by simple majority. The
most obvious strong-Mayor model is in the city of New York, where I led
a delegation of assembly members representing all the principal parties
during the summer recess to talk to those involved in the
budget-setting process. We met the mayor and his representatives and
the chairman of the budget committee and its representatives and
advisers.
The city
council in New York, the equivalent to the assembly, has the ability to
amend the budget by a simple majority. On several occasions in the
recent
history of New York, the mayor and the city council have been of
different political persuasions, but the phrase used was that such a
position has “never caused any gridlock in the New York
political process”. The fact that the mayor has to have a
majority for his budget prepares him to take into account the worries
of the parties in the city council at an early stage in the
budget-setting process, which makes for a fairly mature development of
the
process.
5.30
pm
If Rudy
Giuliani and Michael Bloomberg can operate on a strong-Mayor model with
a city council that could overturn their budgets by a simple majority,
I cannot for the life of me think why any Mayor of London, present or
future, could not also do so. Moreover, I doubt that any of my
constituents could think of a good reason either. The argument that the
Mayor’s executive role is clearly appreciated and so on is
rather academic. When I talk to constituents in either role and explain
as factually and in an unbiased fashion as I can—I am sure that
hon. Members appreciate that I always take that approach—that
the Mayor’s budget was debated, that 16 members voted against it
and nine members voted for it and that it was passed and has come into
law, their description of that process is generally to use a term that
was yesterday ruled in the Chamber as parliamentary, but one
thatI will not repeat here today. They find such circumstances
inconceivable. It is not healthy to have a budget-setting process that
the ordinary London resident and voter finds
inconceivable.
Martin
Linton:
The hon. Gentleman led Conservative members of the
GLA to vote against money for the safer neighbourhood teams, but does
he now wish that he had prevailed by a simple majority and that the
safer neighbourhood teams had never been
created?
Robert
Neill:
If the hon. Gentleman wants to use specific
examples, he should at least have the decency to get them right. The
Conservative group on the assembly never voted to reduce money for the
safer neighbourhood teams. In fact, when I proposed that alternative
budget, the Conservative group sought to put more money into the budget
for more police officers and more safer neighbourhood teams. If the
hon. Gentleman intends to make a bad point, will he at least try to
make an accurate bad point not an inaccurate
one?
In reality, the
best possible international comparator of the strong-Mayor model is,
because of its size and complexity, recognised overwhelmingly to be New
York. It is not prejudiced by the ability of the city council—in
our case, the assembly—to be able to amend the budget by a
simple majority. We must knock on the head the idea that the
strong-Mayor model must have that extra
protection.
The
line-by-line veto has been well argued, and I need not restate the
case. Given the two-thirds protection, it is not something that offends
against a strong-Mayor model. I think that I have now dealt with the
incomprehension experienced by most ordinary Londoners about the
present process.
Amendment No. 33 would give the
assembly the power to set its own budget by a simple majority, which
follows on more logically from the Government’s own thinking
than does the current situation. The Government are right to say that
it is sensible and desirable in the interests of greater transparency
that the Mayor should set his part of the budget and that the assembly
should set its part. There is good constitutional and political sense
in that proposal. At the end of the day, the Mayor is accountable to
the electorate for his budget. If Londoners think that his budgets have
been too high—I hope they do that sooner rather than
later—they will take a view and vote
accordingly.
Similarly,
if an assembly were to be ludicrously profligate, it would run the risk
of paying a political price for spending its budget badly or taking too
much in its budget. That is the point of flagging up the different
roles and the different amounts that are spent. That is fine, and I
have no problem with it. I have no problem either with the idea of the
ceiling. It could be argued theoretically that there should not be a
ceiling and that people could take their chance, but my hon. Friend the
Member for Surrey Heath, on behalf of our party, has been realistic and
practical about saying that, in the circumstances we are in, we will
depart from that theoretically attractive proposition and settle for a
ceiling, and not argue with the Government on that. There is nothing
between
us.
There
is a point in that if there is a ceiling it is perfectly reasonable to
have a floor, for the reasons that have been advanced. It would be
interesting to know by what logic there can be one and not the other. I
make just this one important point in relation to the floor, which has
been advanced by the London assembly: it might be said, “Oh
well, other bodies such as local councils do not have the protection of
a floor.” That is true, but the assembly’s situation is
unique, in view of the Greater London authority. Other councils, after
all, meet as a single corporate body and determine their budget by a
simple majority. The Scottish Parliament, the Welsh Assembly and the
other devolved bodies are in the same position. Due to the split of
responsibilities, the assembly does not have that safeguard. Uniquely,
it could have a budget foisted on it against its will. That is the
difference and why it is appropriate to have a floor. I hope that no
Mayor will go down that route, but we ought to be cautious about
it.
5.37
pm
Sitting
suspended for a Division in the
House.
5.52
pm
On
resuming—
Robert
Neill:
I was coming to my last point—I see a big
grin on the Minister’s face—which will cheer him up as
much as would the third or fourth goal going past the other side. That
might happen at some point this year.
We accept the logic, in terms
of accountability, of having the assembly and the Mayor setting
separate budgets, albeit within the constraints of ceilings—and,
I would argue, floors as well. That is a sensible way forward; it
involves both the Mayor and the assembly
in being prepared to pay a political price if they get it wrong. We
accept that that is right and proper in a democracy. My point is that
the assembly needs the protection of a floor because it is in a unique
position, in that it can have a budget imposed on it. I cannot believe
that it was the Government’s intention to leave it like that.
The amendment is important because if we are going to say that the
assembly should separately flag up its budget to the world and be
politically accountable for that, then the assembly should be sovereign
in deciding that bit of its budget. That is wholly separate from any
argument about what power it has to amend the Mayor’s budget,
and on what basis.
I
have already said that, for the reasons that have been set out, I agree
with the arguments made elsewhere about the other powers to amend.
However, if we are going to let the assembly have a separate budget
component, which is going to be flagged up, the logic is that the
assembly should decide that, not the assembly plus somebody else. If
the Bill is not amended, the practical effect will be that the Mayor
plus nine assembly members—a minority of the
assembly—will be able to set the budget for the whole of the
assembly. That is not logical. It is not necessary for the purposes of
adhering to a strong Mayor model. If one is going to have the strong
Mayor model, I can see the argument that one should only overturn his
budget by a two-thirds majority. I might disagree, but I can see the
point. However, if one says that in the strong Mayor model the assembly
should none the less have the power to set its own separate budget
component, surely it should have the power to do so without
interference. It has been pointed out, however, that there could be a
situation in which the Mayor came to a deal with a minority of the
assembly to propose an assembly budget level that the majority of the
assembly did not believe to be acceptable. Having secured that minority
support, the Mayor might impose it on the majority.
The residents that I mentioned
from my part of the world think that the basic budget-setting process
is a bit convoluted, but the proposal would make things even worse.
Surely the logical position is that, if one lets the assembly have its
own budget component, it should choose that by a majority of its own
members and sink or swim with the consequences. The electorate may
think, “Fair enough,” or they may think, “No, I
don’t agree with the amount they are spending, I’ll turf
’em out next time.” That is fine. If I were still an
assembly member and were seeking re-election, which of course is not
the case, I would be happy to live with the consequences. But why
should I be liable in theory to be turfed out as a result of a budget
that I could not set myself, because my wishes were overridden, not by
a majority—I could live with that—but by a minority in
cahoots with the
Mayor?
That could
happen regardless of who the Mayor was. The point was made that we
should not make policy on the basis of personalities, and that is
right, but I can conceive of scenarios in which the Mayor would be of a
very different stamp from the current one, and might want to impose
swingeing budget reductions. He might want to make major cuts in the
assembly budget. In my judgment, it would not be democratic for such a
Mayor to be able to push that on to a majority of the assembly whose
views were different, just because the Mayor got
nine of the 25 members to agree. Whatever the politics and ideologies of
the Mayor, it works the same way—it is plain wrong. I cannot
believe that the Government actually think it would be right to leave
things like that and I hope that it was just an oversight in the Bill
preparation. A simple majority is more
transparent.
Finally,
Mr. Travers, the academic to whom we have all referred, has
said that, whatever its faults, the GLA budget process gives the
opportunity of transparency. All of us would say that we should always
seek greater transparency in amendments to the budgetary process. If we
enabled the Mayor to cook up a deal behind the scenes with a minority
of the assembly, and to impose a budget against the wishes of the
majority, it would be the very antithesis of transparency. It would
encourage behind-the-scenes dealing which would otherwise not be
necessary. A simple majority means that the argument takes place on the
floor of the assembly, and if the Mayor of London thought that the
assembly had got its budget wrong, he would be entitled, as is the case
for the Mayor of New York, to say, “That lot got their budget
wrong , they are not to be trusted with their budget-setting powers.
Electors, turf ’em out at the next election!” If it is
good enough there, why not here? That is the thinking behind the
amendment. I hope that even now the Government will think
again.
Jim
Fitzpatrick:
I think that interventions
by my hon. Friends—especially those by my hon. Friend the Member
for Ealing, North—have helped clarify several of the fundamental
issues that are at stake. One is whether a two-thirds budgetary
requirement should exist. Another is whether there should be a strong
executive Mayor or a stronger assembly. A further point is whether it
is conceivable that, having separated out the assembly budget as a
separate component, assembly members would not be able to vote
collectively to protect their own separated and transparent budget. The
Government certainly believe that assembly members can and would work
in concert in that
situation.
6
pm
Before making
some general comments on the amendments and new clauses, let me deal
with the New York examples quoted by the hon. Member for Bromley and
Chislehurst. I said earlier that we could benefit from his expertise,
and, clearly, this is a case in
hand.
I
am advised that, although it is true that council members in New York
city can block the Mayor’s budget and develop their own
policies, in practice what happens is that because New York city
council members are numerous—there are 62 of them—and are
all elected by local constituencies, they do not have the strategic
city-wide mandate that our assembly has and therefore tend only to
threaten to block the Mayor’s budget when they are seeking
support on local issues. They threaten to block early on in the
process, given that the effect of blocking would be to hold up city
services and investment beyond their constituencies. They seek
accommodations with the Mayor, and there will always be some horse
trading, negotiations and accommodations being sought with any mayor.
In their case, perhaps it is to gain additional resources for local
budgets. They act as advocates of local agendas, not necessarily as
sources of alternative city-wide policies.
In short, although council
members can block the budget, they almost always do so only on a
local-issue basis because of their local mandate. The model is quite
different, although the hon. Gentleman has the benefit of having
visited New York on a fact-finding mission, which I have not done, and
studied it
himself.
Robert
Neill:
That point has been made to me in the past, and it
was made when I visited New York. It is also in some of the academic
literature. Interestingly, that is exactly why, when the right hon.
Member for Greenwich and Woolwich (Mr. Raynsford) took the
Bill through the Committee process, he argued, first, that there should
be a proportional system with London-wide members and, secondly, that
the assembly constituencies should be much larger than the council
districts in New York. There are safeguards in our system against the
risk that a mayor, by resorting, in effect, to pork-barrel politics,
which none of us would wish to encourage, would be able to overturn a
city council’s legal power to intervene. In fact, our system
meets the Minister’s concern because that is safeguarded against
in our system through our London-wide proportional element and the
larger constituencies. It means that the London assembly is better to
be trusted with such a power than
not.
Jim
Fitzpatrick:
If I may, I shall turn to the clauses before
I respond specifically to some of the amendments and new clauses.
Clause 13 amends schedule 6 to the Greater London Authority Act 1999 to
include separate component budget requirementsfor the Mayor
and the assembly in the procedurefor determining the
GLA’s consolidated budget requirement. Schedule 6, as amended,
requires the Mayor to prepare six component budgets: one for himself,
one for the assembly and one for each of the four functional bodies. He
is required to consult the assembly before preparing the Mayor’s
and assembly’s draft
budgets.
After the
Mayor has prepared the draft component budgets, he must prepare a draft
consolidated GLA budget and present it to the assembly. He must do so
on or before 1 February in the financial year preceding that to which
the draft consolidated budget relates. The assembly must approve the
draft consolidated budget and the six draft component budgets it
comprises, with or without amendment, by simple majority. However, the
assembly’s powers to increase its own draft component budget by
amendment is limited: its annual percentage increase must not be more
than the annual percentage increase in the Mayor’s component
budget. For example, if the Mayor proposes to increase his own budget
by 5 per cent. compared with the previous year and proposes only a 1
per cent. increase in the assembly budget, the assembly may amend its
budget by up to5 per
cent.
The limit will
ensure that the assembly cannot award excessive increases to its budget
but can protect its resources. The Mayor, informed by the
assembly’s consideration, must then prepare a final draft of the
proposed consolidated budget which the assembly may either approve or
amend by at least a two-thirds majority, as we discussed, before the
last day of February in the financial year preceding that to which the
budget relates.
Again, the assembly cannot
increase its own final draft budget by amendment by a percentage
increase greater than the percentage increase in the Mayor’s
final draft budget. In order to deal with unusual one-off payments such
as the Olympic precept, which was mentioned earlier, the
authority’s chief finance officer may direct that specified
amounts are left out of the budget requirement calculations for the
purpose of
determining the
limit. The Secretary of State may give guidance to the chief finance
officer in respect of the exercise of that
power.
Clause 14 makes
similar provision to that which I have already set out for any
substitute calculations that the authority is required to make. The GLA
has similar powers to make substitute calculations to those of local
authorities. The effect is that normally it is able to increase its
precept only where previous calculations of its consolidated budget or
component budgets are quashed by court proceedings or where the
Secretary of State directs that the MPA budget should be
increased.
The
GLA’s budget setting process is now tried and tested. It
allocates some £9 billion in funding per year and it has been
shown to work. The changes will ensure that the new component budgets
for the Mayor and assembly fit into that process smoothly and provide a
clear and robust mechanism for determining the assembly’s
budget.
I want to
turn now to the amendments. First, let me make it clear that we do not
accept them. I want to try to explain why. The current budget setting
process for the GLA group works well and aside from allowing the
assembly its own budget, which is set out in clauses 12 to 15, there is
no need to make further fundamental change to the process. The
two-thirds majority requirement on assembly amendments to the
Mayor’s final budget in particular remains
appropriate.
Mr.
Hands:
Does the Minister share my concern that the swing
votes on the assembly belong to the Green party in determining whether
the Mayor’s budget goes
through?
Jim
Fitzpatrick:
I am not sure that I agree that the swing
votes are necessarily those of the Greens. The Mayor certainly has to
win the support of a party other than his own in order to secure a
majority, so I am sure that there will always be some discussions in
the course of budget setting.
It is also sensible, as I was
saying, to allow the assembly the right to amend the Mayor’s
proposals in order to act as an important check on the Mayor. That is
why the assembly can amend the Mayor’s draft budget by a simple
majority. It is important, however, for the assembly to form a clear
view on the merit of amending the Mayor’s final budget and for a
broad cross-section of assembly members to be in favour of doing so.
The requirement for a two-thirds majority accordingly ensures broad
support in the assembly for any amendment to the final budget.
Otherwise, allowing the assembly to amend the final budget—like
the draft budget—by a simple majority would alter the balance of
power at the GLA radically. It would weaken the position of the Mayor,
and it could be a recipe for confusion. For that fundamental reason, we
cannot accept amendments Nos. 33 and 34 and new
clause 4. Nor can we accept amendments Nos. 41 and 42, which allow the
assembly to amend specifically the final draft assembly budget by
simple majority.
It
would be inconsistent to allow the assembly to amend one part of the
final budget through a simple majority while the rest of the budget
requires a two-thirds majority for amendment, even if that part
specifically concerns the assembly’s own budget. We are also
unconvinced that new clause 16, which would explicitly require a simple
majority for successful assembly amendments to the Mayor’s draft
budget, is necessary. The requirement for a simple majority to amend
the Mayor’s draft budget is already implicit in paragraph 5 of
schedule 6, as the assembly have to agree an amendment under
sub-paragraph (4). Accordingly, the amendment would only reinforce and
clarify the existing legal position and it is therefore not
necessary.
I know that
Conservative Members are concerned that the assembly could not achieve
the two-thirds majority needed to amend the Mayor’s proposed
budget. That is a concern that we do not share. I cannot envisage the
assembly being unable to muster a two-thirds majority to amend the
final draft component budget for the assembly in the event of any Mayor
proposing a difficult budget for the assembly, as all assembly members
would have a strong common interest in ensuring that the assembly had
the resources necessary to fulfil its functions effectively. That is
why we strongly resist amendments Nos. 43 to 46 and amendment No. 60,
which seek to set a minimum amount below which the Mayor could not
propose draft and final draft budgets for the assembly. Such floors can
confuse and can be difficult to understand. In this case, we do not
believe that they are
necessary.
As I have
explained, there is a mechanism to enable the assembly to amend an
excessively low assembly budget proposed by the Mayor by a two-thirds
majority. We do not accept new clauses 17 and 18, which would extend
the assembly’s power to amend component budgets to a much more
detailed level. The amendments cut across the Bill’s policy
aims, which are to allow the assembly to set its own budget but not
otherwise to change a system proven to work well. They risk making a
complicated system even more complex, and would set in stone subtotals
in the budget calculations that must remain flexible within the amounts
agreed as component budget requirementsfor the Mayor, assembly
and functional bodies. The GLA’s functional bodies and the GLA
itself must have flexibility to deal with changes in financial
circumstances and any spending needs that emerge during the financial
year.
New clause 19
states explicitly that the assembly can allocate moneys as it sees fit
within its own agreed component budget total. The new clause is
unnecessary. It is clearly within the spirit of the Bill’s
changes that the assembly should decide how its budget is spent, within
the agreed total of the assembly component budget. In addition, since
the assembly can do anything incidental to the exercise of its
functions under section 34 of the 1999 Act, the assembly has a legal
basis for making such a decision. I therefore ask hon. Members opposite
not to press their amendments, and encourage my hon. Friends to vote
them down if they do.
The
Chairman:
Order. This has been a complex debate on a
complex set of amendments. It would be helpful if the hon. Member for
Surrey Heath would indicate which of his amendments he wishes to press
to a
Division.
Michael
Gove:
Thank you, Mr. O’Hara, for that
courtesy. I apologise for arriving after the time specified. You
specified ample time; it was discourtesy on my part, for which I alone
am responsible. I apologise to you and to the Committee for that
discourtesy, and I hope that it will not happen
again.
In the spirit
in which you asked me to do so, Mr. O’Hara, I will
explain the amendments that we wish to push to a Division. We would
like to divide on amendment No. 43. If it is carried by some happy
chance, we will then push amendments Nos. 44 to 46. However, if
amendment No. 43 is lost, then Nos. 44 to 46 will no longer be
valid.
Amendment No.
60 was tabled by the Liberal Democrats. I hope that they will push it
to a Division, but it is for them to decide whether that is appropriate
in the circumstances. I shall then press amendmentNo. 41. If
we lose amendment No. 41, amendment No. 42 will fall automatically. We
will then move to the new
clauses.
The
Chairman:
Order. The new clauses will come later. When
they do come, they will be moved formally, as debate has taken
place.
Michael
Gove:
Thank you, Mr. O’Hara. I shall not
detain the Committee any longer by outlining our proposals for the new
clauses, but given what we have said, I suspect that you can probably
infer what we will do. I shall clarify the matter when the appropriate
moment comes.
I am
disappointed that the Government have not considered it appropriate to
embrace the spirit of the amendments that the Opposition have been
trying to move. The Minister said that the budget-setting process is
tried and tested. By the same argument, the process of setting staff
limits, numbers and indeed terms and conditions is tried and tested,
yet the Government wish to amend that and not this. It is curious.
Whenwe propose to defend the assembly’s rights, the
Government say, “Well, it might be tried and tested, but we want
to see a shift in power from the assembly.” When we propose to
strengthen the assembly’s powers in a new way, they say,
“Things are tried and tested. There is no reason to move in that
direction.” The only consistency is the Government’s
attachment not to what is tried and tested but to having the
assembly’s teeth drawn—or, when we propose that the
assembly should have more teeth, to add no more teeth to its
bite.
6.15
pm
Jim
Fitzpatrick:
That something is tried and
tested does not mean that it cannot be improved. The hon. Gentleman
indicated that he wished for something to
be improved that we believed was tried and tested, and we decided that
we did not wish to make the change that he proposed. These are
straightforward differences of opinion; I do not think that there is
any inconsistency in the philosophy behind our
arguments.
Michael
Gove:
Indeed there is no inconsistency in the
Government’s philosophy, but it would be a mistake to think that
their philosophy is to defend that which is tried and tested. Their
philosophy is perfectly clear: more powers for the Mayor? Yes, under
certain circumstances. More powers for the assembly? Certainly
not—those impertinent figures should know their place. That
seems to be a misunderstanding of the original spirit of the 1999 Act
and of what Londoners expect from both wings of the
GLA.
My hon. Friend
the Member for Bromley and Chislehurst made an important point when he
used the examples of the Welsh Assembly, the Scottish Parliament and,
in particular, New York. The Minister’s response was not
convincing. He displayed an authoritative grasp of how New
York’s assembly works, but the more he explained how it works,
the more he vindicated the position of my hon.
Friend.
The Minister
pointed out that representatives in the New York City assembly operate
on a territorial basis. When they seek to amend the budget, they do so
because they wish to preserve their constituents’ interests, or
to get more pork for them from the municipal barrel. Their operation is
entirely constituency oriented. As my hon. Friend pointed out, the GLA
operates in the interests of London overall, so when it seeks to amend
the budget, it is not in a spirit of partisanship and members are not
saying, “My constituency must come first and Deil take the
hindmost for all the rest.” It operates in a constructive
spirit, so why should a system that functions well in New York, albeit
with a group of individuals who may put their constituencies first, not
apply in our own capital city when we have so constituted the assembly
that it puts the interests of all Londoners first?
In discussing how all Londoners
are put first, I should say that the intervention of the hon. Member
for Battersea, who mentioned safer neighbourhoods, was singularly
inappropriate. By introducing our line-item veto, we seek to create the
opportunity for members of the assembly specifically to protect, or
indeed enhance, items of the budget without allowing the Mayor to say
that their opposition to the budget overall is opposition to each
individual part.
We in
this Committee are engaged in the exercise of saying that we object to
certain parts of the Bill but agree with others. Anyone who takes an
interest can draw a distinction between the fact that, for example, the
Liberal Democrats and the Conservatives are concerned about planning
powers, and the fact that they take a slightly different position on
one or two other issues. People can draw appropriate and legitimate
inferences from that process. The absence of a line-item veto would
make it possible for the Mayor to draw a blanket over opposition to
particular items in the budget and say that members of the assembly
oppose item A when it is item B or C to which they
object.
I particularly want to invite
the Minister and his colleagues to think again about amendment No. 33.
The Minister devoted some time to explaining why he felt that the
assembly collectively could safeguard its interests under the current
provisions. I underline the point that was made by my hon. Friends the
Members for Bromley and Chislehurst and for Croydon, Central: at
moment, the Mayor, acting in concert with one political group, or one
political group and a small and—as my hon. Friend the Member for
Hammersmith and Fulham pointed out—potentially fringe party, can
alter the budget in such a way as to penalise the
assembly.
The point of
the amendment is to allow the assembly to safeguard its budgetary
allocation. I accept that some people on the Government Benches may
believe it appropriate for the Mayor to set his own budget without the
enhanced scrutiny powers that we ask for being given to the assembly. I
understand that, although I disagree with it. However, I cannot
understand why the Government refuse to allow the assembly, in relation
to its own budget, to protect by a simple majority the money that it
needs for its scrutiny functions from a potential raid mounted by the
Mayor and a political party with which he or she might be working in
concert.
I issue a
plea to Government Members: although they might not see merit in all
our amendments—I would like to say something about new clause 19
in due course, if the opportunity arises—I hope that in respect
of amendment No. 33 they might see the merit of what we are
proposing.
Tom
Brake:
I would like some guidance from you, Mr.
O’Hara. I would like to press amendment No. 60 to a vote, if
that is deemed appropriate. I suspect that the Government’s
response will be similar to the one that we received to amendment No.
43, in that we are talking about a complex formula for trying to ensure
that the assembly’s budget is not varied by a disproportionate
and damaging
amount.
The
Chairman:
We were consulting frantically as the hon.
Gentleman was talking. If amendment No. 60 were an alternative to
amendment No. 43, one might press it to a vote, but it is additional to
it, so if amendment No. 43 falls, amendment No. 60 would
fall.
Tom
Brake:
Thank you, Mr. O’Hara. Amendment
No. 60 is similar to amendment No. 43, but there are some
differences.
The
Chairman:
I must apologise; I was consulting as the hon.
Gentleman was talking and I was looking at the wrong amendment. I shall
use my discretion and say that there is sufficient difference to press
amendment No. 60 to a Division, should the hon. Gentleman wish
it.
Question
put, That the amendment be made:—
The
Committee divided: Ayes 7, Noes
10.
Division
No.
6
]
AYESNOES
Question
accordingly negatived.
Amendment proposed: No.
60, in clause 13, page 13, line 12, at end
insert—
‘(5A) After
paragraph 5A
insert—
“Limit on the Mayor’s powers to prepare a draft budget for the Assembly5B (1) In exercising
his powers to prepare a draft component budget for the Assembly under
paragraph 2 of Schedule 6 above, the Mayor must not prepare a draft
component budget for the Assembly if the draft component budget
contravenes sub-paragraph (2)
below.
(2) The Mayor’s
draft component budget contravenes this sub-paragraph
if—
(a) the draft
component budget for the Assembly is less
than
(b) the minimum draft
component budget requirement for the
Assembly.
(3) Find the minimum
draft component budget requirement for the Assembly as
follows.
(4) If NM is greater
than OM (as calculated under sub-paragraph (5) of paragraph 5A of
Schedule 6 to this
Act)—
(a) find the
percentage by which NM is greater than OM,
and
(b) reduce the amount of
the component budget requirement for the Assembly for the previous
financial year by the same
percentage.
The result is the
minimum draft component budget requirement for the
Assembly.
(5) If NM is less
than OM (as calculated under sub-paragraph (5) of paragraph 5A of
Schedule 6 to this
Act)—
(a) find the
percentage by which NM is less than OM,
and
(b) reduce the amount of
the component budget requirement for the Assembly for the previous
financial year by the same
percentage.
The result is the
minimum draft component budget requirement for the
Assembly.
(6) If NM equals OM
(as calculated under sub-paragraph (5) of paragraph 5A of Schedule 6 to
this Act) the minimum draft component budget requirement for the
Assembly equals the amount of the component budget requirement for the
Assembly for the previous
year.
(7) Sub-paragraphs (9) to
(11) of paragraph 5A of Schedule 6 to this Act (power of chief finance
officer to direct amounts to be left out of account) also have effect
for the purposes of this paragraph.’.—[Tom
Brake.]
Question
put, That the amendment be
made:—
The
Committee divided: Ayes 7, Noes
10.
Division
No.
7
]
AYESNOES
Question
accordingly negatived.
Clause 13 ordered to stand
part of the
Bill.
Clause 14
ordered to stand part of the
Bill.
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