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Andrew Mackinlay: My right hon. Friend will regret giving way. If she looks at the O fficial R eport tomorrow, she will see that all this about economic prosperity boards tying up with some other bodies is gobbledegook.
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Most people have had enough of all this. Why can we not cut away this plethora of bodies and focus on democratically elected local authorities? That is why I say to her that this is complete nonsense and that we have had enough; we want to get rid of this plethora of quangos and joint bodies, and all this linking up and partnerships—all these buzzwords. I say take it back.

Hazel Blears: I do not regret giving way, because it always good to have a healthy debate. All I would say to my hon. Friend is that I do not know how much discussion he has with the various bodies in his local community, but the people who run the health service, the police service and the council in my community feel that there is great benefit to be had from working in partnership, from pooling their budgets and from having more joined-up services, and that that provides a better service to local people.

Mr. Garnier rose—

Hazel Blears: No, I am not going to give way.

Mr. Garnier: I am not going to ask the same question as the hon. Gentleman.

Madam Deputy Speaker (Sylvia Heal): Order. The hon. and learned Gentleman knows that whether or not to give way is entirely up to the Minister.

Hazel Blears: Now, I was —[Interruption.] There is lots of democracy in this Chamber; I have been speaking for quite a long time.

I was just making the point about transport, because it is important. Transport sometimes sits separately from other issues associated with economic development, and if our funding streams and capital allocations are not aligned with the decisions that we need to take to encourage economic development, we do not get the most out of the resource that is available to us. So, again, the approach we are taking is a positive way forward.

Mr. Garnier: This is not a humorous matter, although there have been some humorous moments this evening. Before we move on to the final parts 8 and 9 of the Bill, which deal with construction contracts, could the Secretary of State give us a running total of the number of additional bodies, quangos, boards—

Andrew Mackinlay: Partnerships.

Mr. Garnier: And partnerships. How many such bodies will this Bill create? How many such bodies will it replace—or will it add to others that currently exist? What is the total public expenditure cost of the Bill?

Hazel Blears: I have no doubt that the hon. and learned Gentleman will be pursuing that question on a regular basis while the Bill is being discussed on the Floor of the House and while it goes through Committee. I tried to make the point as kindly as I could earlier, but if he thinks that the world is still made up of a series of entirely separate, isolated and dislocated public services, he is not in touch with the communities out there. For a
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young offender who has difficulties in his home life, finds it hard to access training and cannot get an apprenticeship or a job, we need a series of local public services to come together in order to be able to provide the response for that young person in an integrated way—that is the way of the world these days. Hon. Members might wish to go back to the mythical halcyon days when everything was done separately in silos, but they are looking back through rose-tinted glasses. That is not the world of today, and the hon. and learned Gentleman is out of touch with reality— [ Interruption. ] I have answered him. He may not like my answer, but I have answered him.

Ms Sally Keeble (Northampton, North) (Lab): On the issue of construction contracts, would my right hon. Friend consider giving local authorities powers, when awarding contracts, to take into account their functions under clause 66 of the Bill to promote the economic development and regeneration of their areas, and to consider the desirability of maintaining a diverse range of contractors? In addition to value for money, local authorities should consider local economic circumstances and the position of local building firms, which are suffering severely in this recession. This legislation could help them.

Hazel Blears: My hon. Friend makes a thoughtful and practical point. We can be more creative, when it comes to Government and local authority procurement, in looking at the factors that we take into account. We need to look not only at the bottom line, but at the social impact in an area. The evidence base suggests that if money is spent locally in the local community, every £1 spent has £7 worth of economic impact. If it is spent outside the area, the impact is much lower. In these tough economic times, it is very important to have local supply chains that help to create and sustain employment.

The aspects of this Bill that relate to the construction industry are about better cash flow and trying to ensure that there is an adjudication process for the industry. I think that the Bill will provide practical help for construction companies in the present climate.

Mr. Mark Prisk (Hertford and Stortford) (Con): I welcome the intentions of part 8 of the Bill, but much of the industry is concerned that the payment notice procedure is far too complicated. Will she undertake to look carefully at how the procedure will operate, so that it can be radically simplified and genuinely deliver real help for small businesses? Will she give a commitment to that effect today?

Hazel Blears: That will be the subject of discussion. I remind the hon. Gentleman that this Government have provided significant support to small businesses through advice and the option to defer tax and VAT. Already more than 100,000 businesses have benefited from that provision, and we have a proud record of helping business. If there is more that we can do, I am sure that that will be discussed in Committee.

Kelvin Hopkins (Luton, North) (Lab): On the basis of what my right hon. Friend was saying about ordering locally, will she urge all public authorities, especially those in the home counties area, to order the excellent vans made in Luton?

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Hazel Blears: I am sure that my hon. Friend will continue to be a champion for Luton and the people who depend for their employment on vans and other products from the area. We must never forget the damaging impact of this recession on people’s jobs, and we are determined to try to ensure that we keep people in their jobs as much as we possibly can.

Mr. David Heathcoat-Amory (Wells) (Con): The Secretary of State is glossing over the construction provisions at the end of the Bill, which are being watched carefully by subcontractors who are suffering at the moment. If a customer becomes insolvent, the main contractor can cease paying all the subcontractors immediately, even if those subcontractors have supplied all the materials and work on time and to schedule. That is very unfair, especially in a recession, and the companies are unable to obtain insurance against it happening. The Bill does not deal with that situation, and that puzzles me. Will the Secretary of State look again at the issue? I know that other Departments are involved, but she has received representations from me and my constituents about this issue. What is her present view on it?

Hazel Blears: The provisions in this part of the Bill are primarily about trying to improve cash flow, but I take the right hon. Gentleman’s point about the dislocation of the supply chain and the impact that that has particularly on small subcontractors. We want to try to make it as simple as we can—the right hon. Gentleman has made that point—and we want a procedure to resolve disputes properly. I am not in a position today to tell him whether we will be able to expand the scope of these provisions, but I think that it is very important that small businesses in the construction supply chain, in particular, have as much protection as they can.

The right hon. Gentleman will know that we have asked local authorities to pay their bills, for example, as quickly as they possibly can. Many of them now have very good payment records. One of the problems is that although they might pay the main contractor very promptly, ensuring that that goes down the supply chain is very important when it can mean the difference between a local company staying in business or not. I am conscious of these issues. I am not glossing over this part of the Bill and I want to see what I can do.

Several hon. Members rose

Hazel Blears: I shall give way to my hon. Friend the Member for Stockton, South (Ms Taylor), who has not spoken.

Ms Dari Taylor (Stockton, South) (Lab): I am most grateful to my right hon. Friend for giving way and I am keen to support the points that are being made. Small building companies are writing to me and they are very anxious. They understand the integrity of part 8 and they are very clear about its potential value, but they have made it clear to me that the form in which it is written is complex and that they would appreciate it greatly if that complexity could be resolved before the Bill becomes law.

Hazel Blears: I am grateful to my hon. Friend for that point. As ever, she is practically focused on doing the things that matter in her constituency and to her local
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companies. I certainly undertake that, in Committee, we will examine the issue of complexity and making it simple and straightforward. She is so right—we have to keep many of those small building companies in business because they often employ people whose skills are essential to this country. In previous recessions, we lost those skills because we saw such companies go to the wall. We are determined to do what we can to ensure that such companies stay in business and keep employing the hundreds and thousands of local people in our communities who are so important to us.

Joan Walley: On the issue of small businesses and the part of the Bill that deals with construction companies, will my right hon. Friend consider ways in which smaller building companies can still have a part to play? There is a real fear that the joint ventures and the move towards bigger contracts are cutting out local companies from the local economy altogether. There is an urgent need to ensure that we keep that local supply chain.

Hazel Blears: That point is similar to one that was raised earlier. I am very conscious that we should ensure that we have local procurement; it is often good value for money, too.

Ms Keeble: The Bill makes provision for more transparency in the contractual process. Will there be more guidelines, in the Bill or elsewhere, for local authorities on the subcontracting done by the main contractor? Increasingly, large companies are going for local authority contracts but the way in which they then subcontract is opaque and is sometimes not open to local companies. Some extra guidance on that would be important.

Hazel Blears: It might not be a matter for these clauses, but the way in which we carry out our procurement more generally and ensure that it is transparent, open and simple for firms to access is a major priority for us. One thing that this difficult economic period has shown us is that ensuring that people can access the available contracts in a way that is appropriate to them is quite a challenge, not just to local authorities but for Government procurement, too. As a priority, we should look at the NHS and our big Government Departments—really significant economic players—and ensure that the system is as open as it can be to people in small organisations.

It is appropriate that we have just had that discussion, because the last time the UK experienced a recession, councils were pretty underfunded and were certainly demoralised. Today, I think that local authorities are thriving, innovative and powerful organisations that are well placed to respond to the challenges ahead.

Kelvin Hopkins: During the recession in the 1970s, when I was a member of a local authority, local authorities were encouraged to build tens of thousands—hundreds of thousands—of council houses, which we did. We completely housed all those on the waiting list during that time. Would my right hon. Friend not suggest that that is the way forward, both to house people and to save the construction industry?

Hazel Blears: My hon. Friend will know that there was £100 million in the Budget to encourage precisely such activity and that we are removing barriers that
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prevent local authorities from building houses. He will also, I hope, be aware of the £1 billion future jobs fund that I hope will help to employ young people, in particular, in 150,000 jobs over the next two years. I am sure that many of those jobs could be in the kind of work that he has outlined, involving building good-quality, environmentally friendly homes for the people who need them.

Today, local government is thriving, innovative, powerful, and well placed to respond to the challenges ahead. The Bill is designed to reinforce that position by strengthening local democracy and supporting economic development, which are the two imperatives of our time. I commend the Bill to the House.

4.30 pm

Mrs. Caroline Spelman (Meriden) (Con): I am sure that everyone in the Chamber with an interest in local government will have spent the past few weeks, including the recess, campaigning for the local elections. After knocking on doors daily throughout the expenses furore, I am sure that we are under no illusion that people want our democracy to work better for them, and I was glad that the Secretary of State began by acknowledging that.

On the face of it, the title of the Bill seems to hold out some promise for us all, but it is a bit misleading, which is just the first of many disappointments. Far from being a local democracy Bill, it is a charter that snatches power away from people. It is about taking power away from locally elected decision makers and giving it to regional quangos, combined authorities and economic prosperity boards—the gobbledegook, to which the hon. Member for Thurrock (Andrew Mackinlay) has referred, that makes people feel distant from the political process.

The sheer fact that something as vital as strengthening local democracy has been lumped together with provisions on the construction industry and other economic aims tells us that the Government do not see strengthening local democracy as sufficiently pressing in itself. Instead, local democracy has been tagged on to a series of measures that look like remnants of other Bills that have been scraped off the floor. Why, for example, are we legislating to create a national tenant voice within a few days of the Office for Tenants and Social Landlords coming into operation? Either the Housing and Regeneration Act 2008 has been found wanting or this is unnecessary duplication. No wonder my noble Friend Baroness Warsi described the Bill as a “ramshackle” piece of legislation with

The critique was not confined to the Conservative Benches. Noble Lords from all parties described the Bill as “an eclectic mix”, “a bureaucracy Bill” and, at best, a “mixed bag”.

Mr. Nick Raynsford (Greenwich and Woolwich) (Lab): The hon. Lady asked why there should be a voice for tenants in addition to the Tenant Services Authority. The Cave review, which proposed the reform, makes it clear that the tenant voice is a separate function that
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must be discharged by a body separate from the TSA. Does she therefore agree that there is considerable good sense in the Bill’s proposal?

Mrs. Spelman: The right hon. Gentleman has considerable knowledge about local government, but my point concerns the Government’s legislative competence. Given that the Housing and Regeneration Act 2008 went through both Houses of Parliament, why was the opportunity not taken to legislate on precisely the point in the Cave review to which he has referred?

Peter Luff: In the light of the criticism admirably made by the hon. Member for Thurrock (Andrew Mackinlay) about the complexity of the Bill, my hon. Friend might like to know that my Committee’s report on the Bill is the first that has required a glossary at the beginning so that people can find their way through it—I commend the glossary to the House.

Mrs. Spelman: I thank my hon. Friend for referring hon. Members to where they can find out how to understand the language used in the Bill.

I have long held a theory that the longer the title of a Bill, the more delphic its content, and this Bill is no different. I say that advisedly as the author of a book snappily titled “Non-food uses of agricultural raw materials: Economics, biotechnology and politics”. Needless to say, the book did not find its way on to Richard and Judy’s bestseller list.

To return to the matter in hand, over and over again I found myself writing, “Why do we need to do this?” in the margins beside the clauses of the Bill. So much of the Bill is plain common sense, or is already best practice for some councils. Best practice should be spread by councils sharing and emulating the good ideas that well-run councils introduce, but does it need a change in the law to tell them how to do that? I do not think so. Will more legislation make councils do their jobs better? I doubt it. It will stifle innovation and suppress diversity, and I happen to believe that diversity drives up standards. Diversity is a far better tool for change than the dead hand of the state. The Bill is simply legislation for legislation’s sake. By that, I mean that it is unnecessary, and even counter-productive for being so prescriptive.

I invite hon. Members to admit that half the contents of the Bill are things that most decent local authorities are doing anyway. Why are we using valuable time in the Chamber, in Committee and in the other place debating legislation that dictates when, where and how councils go about promoting democracy? On the evidence of the Bill, I venture to suggest that Ministers should not be giving advice to anyone about how to promote democracy. Why not trust councils, which have to secure their own mandate, to manage their own ways of promoting democracy, and let them be judged by the voters?

Mr. Curry: Does my hon. Friend think that it is a promotion of democracy to seek to bring the Bill out of Committee on 18 June, given that it is unlikely to go into Committee until a week tomorrow?

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