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The source of my disappointment with the Bill is that it had the potential to breathe fresh life into local democracy. Instead, it is more like the death rattle of a Government who have run out of ideas. It smacks of a
Department desperate to be seen to be doing something. Perhaps it is because the community empowerment Bill seems to have been dropped that the Secretary of State feels that the Department has to “make busy”.
To be fair, Ministers have been busy exploring ideas in the White Paper entitled “Communities in control”. Two of the most interesting ideas mooted in that document concern making it easier for councillors to vote and encouraging people to turn up at the ballot box. One solution, we are told, is to enable councillors to vote remotely, perhaps—who knows?—from their sofa or from the pub. As for getting people to take part in local elections, there are various exciting options such as free entry to a prize draw if people vote or a free doughnut for every vote cast; the list goes on. What is so telling about the White Paper is the extent to which it completely misdiagnoses why people are so switched off from local government. It is not because councillors cannot be bothered to go the town hall or because voters would rather be doing lottery scratchcards—it is because people see how local government is overruled by the centre at every stage. The Bill should address head on the priorities of communities up and down the country who are crying out for more say over the decisions that affect their neighbourhoods.
The truth is that the Bill would have carried twice as much weight if it had been half the size and dealt with only two issues—planning and council tax. How is it that we are debating a Bill about local government that ignores the fury about rising council tax? This year, Ministers happily referred to seeing the lowest level of increase for some years; meanwhile, most people were staggered that it went up at all, given that the average council tax bill has more than doubled since 1997. It is a real cause of pain for hard-working families and people on fixed incomes. The Government should have grasped that issue. How about a council tax freeze of the kind that we have offered? How about giving communities the right to block excessive council tax rises through a referendum? That would be local democracy at work.
Graham Stringer (Manchester, Blackley) (Lab): I have listened carefully to what the hon. Lady has said, and I agree with her, not my party’s Front Benchers, on some things. However, I found her latest statement quite astounding. She had been making the case for local democracy, but then she said quite blatantly, “But we will control the level of taxation.” Is it not the case that what will really stimulate local democracy is a direct relationship between local services and the money raised to pay for them, which can be dealt with at the ballot box?
Mrs. Spelman: I think that the hon. Gentleman rose to intervene before he heard my last sentence. Putting an end to capping from the centre, but allowing the local population to cap council tax increases through a referendum, if necessary, is genuine local democracy.
The Government have pushed on regardless and are now gearing up for a revaluation in 2010. We know that because they have just renewed their contract with Rightmove, which means that data on nine out of 10 house sales will be imported to a Government database, ready to be used as a means of driving up
council tax even further through revaluation. When will the Government realise that we need to help people by getting the tax burden down?
Mr. Raynsford: Does the hon. Lady believe that it is right for all council tax valuations to be based on notional 1991 values? If she does not, when does she believe that it is appropriate for the register to be updated to take account of the change in values since that time? As she will recognise, 1991 was a very long time ago.
Mrs. Spelman: The right hon. Gentleman is very knowledgeable about local government, and we have debated revaluation many times. He will know that one purpose for which revaluations are prescribed in legislation is to deal with regional differences in house price increases. The reality of the sad point that we have reached in the housing crisis is that the degree of regional variation is not marked, so the case for a revaluation is not there.
There is exactly the same problem with business rates. There is something slightly surreal about debating a Bill at a time of economic crisis that has the words “Economic Development” in its title but that does nothing to address business rates. Our country’s recovery from recession will be determined by how well our businesses compete with those from overseas. Instead of giving them a helping hand, the Treasury has given them a smack in the teeth by increasing business rates above inflation and pushing ahead with business rate revaluation. Those things are conspiring to undermine businesses at a time when we need to help them. Deferring an above-inflation business rate increase is no panacea, because it will still have to be paid. Anyone running or working in a business whose amount of work is shrinking exists in a world of anxiety, and any small business looking for comfort in the Bill will not find any.
The situation is similar for port-related businesses. I had to suppress some shock at the difficulty we had in trying to get an amendment about port taxes in order in the other place. Colleagues might imagine that if there is one virtue in such a convoluted Bill title, it is that it provides an opportunity to debate almost anything. However, that does not seem to include port taxes, despite the fact that they clearly come under the aegis of local democracy and play an undeniable role in economic development. Port businesses have had a huge unexpected tax rise, backdated to 2005, at a time when recession is biting. It simply defies belief that the Government will not give any quarter. No impact assessment was done; there was no consultation; and businesses are casually being handed debts that, in many cases, will make them balance-sheet insolvent.
Those are big, urgent, immediate issues, which are at the front of people’s minds. Does the Secretary of State understand how people will look at this Bill? They will read it, listen to the debate and think that politicians are from another planet. How ironic that no more than eight hours after the Prime Minister told Radio 4:
“Power must be more accountable to the people who elect MPs and councillors”,
we have a Bill that does exactly the opposite. The Prime Minister held forth this morning about listeners feeling powerless and politics not being sufficiently accountable. If the Bill is supposed to be the solution, God help us. Let us face it, people are fed up. They are fed up with
the recession and the pain it brings; they are fed up with MPs; and they are fed up with the Government. The Bill should have been a chance to begin to put things right and make politics relevant again. Instead, I fear that it will do the opposite.
When I meet voters, they are beside themselves with frustration about the imposition of unsustainable numbers of houses on their communities. Mums in the playground are really angry that a mobile phone mast has gone up right next door to the school, despite Government recommendations that it should not. I understand that the silent majority seek a silent revolution. They want politics to change, but, far from delivering that, the Bill serves up more of the same. It has been cobbled together to fill the parliamentary programme and give Ministers more levers to pull. The Bill is about keeping control over councils via the statute book, because the Government cannot do it through the ballot box. People deserve better than that.
The political landscape has changed beyond recognition since the Bill was in another place. The public’s fury over expenses is not only about money, but a reflex against the entire nature of our broken politics—the top-down, centrally imposed decision making and the inflexible, insensitive bureaucracy that bosses people about from day to day. Supporting the Bill would send a clear message that we are not listening to the electorate. Unless we discharge real power, the current animosity between the public and Parliament will simply turn into a long goodbye.
The Prime Minister got one thing right when he said that recent events had exposed a big need for a real change in our politics, but he got it wrong when he suggested that he and his Government were the right people to deliver it. The Bill makes it abundantly clear that a public hungry for change in politics will get that only through a change of Government.
5.6 pm
Graham Stringer (Manchester, Blackley) (Lab): The history of the last 65 years is one of increasing centralisation of democracy in this country, in three phases. After the second world war and until the 1970s, the utilities and health services were taken out of local government hands, in many cases for good reasons. After two world wars and lack of investment, the gas and electricity industries and many hospitals were not in a good state. None the less, services that had been developed locally and were responsive to local electors were nationalised, and eventually, in the next phase, they were privatised.
Baroness Thatcher started the next phase, which lasted through the 1980s and into the 1990s. It involved more centralisation, but with an explicit and direct hostility towards local democracy. The Conservative party then fundamentally believed that services were better provided by the private sector. Nicholas Ridley believed that councils should meet only once a year to hand out contracts to the private sector to deliver services. If something could not be done by the private sector, quangos were considered better than local democracy.
The third phase is that of my Government, who have been much gentler with local democracy; the rhetoric has been different. Even so, there has been an increase in centralisation and central missives to local authorities, to the absurd extent that, in one year, the Secretary of
State for education sent out 4,000 pages to head teachers alone. That is extraordinary. Quangos have frequently been preferred to local councils because Ministers said that delivery of local services was often patchy. When considering quangos, “patchy” is a description to which one would aspire when assessing some services that they produced.
Most of the decisions by central Government and by the officials who make recommendations to Ministers have been based on the myth that central Government are more efficient, effective and economical than local government. I am prepared to give way to any Minister or other hon. Member who can provide evidence to show that the delivery of services by central Government is better than by local government. Most local authorities keep within their budgets when most parts of central Government have a poor record of doing so. Indeed, if we assessed the worst local authorities in the 1980s—Hackney and Liverpool are not controversial examples of poor local authorities—against the Home Office, which a previous Home Secretary described as dysfunctional, which would be found to be the better deliverer of services? Would it be the Home Office, which regularly loses my constituents’ records and overspends its budget, or the Hackney and Liverpool of the 1980s?
One can make all sorts of comparisons with quangos that deliver government services and with local authorities that are not doing so well currently, and I will give a couple of examples before getting to the details of the Bill. I am not making party political points, but I doubt whether there was any more profligate or inefficient waste of money under the previous Conservative Government than the Child Support Agency, which has not delivered services. If anything was a greater waste of money, as well as being unfair, it was the poll tax, which we are still paying for in extra VAT. The poll tax was completely unfair and cost us about £20 billion. However, the Learning and Skills Council, a more recent quango set up by my Government that we are part way through investigating in the Select Committee on Innovation, Universities, Science and Skills, has let a capital programme get out of hand in a way that I have never witnessed in a local authority.
The Learning and Skills Council has not only let a capital programme get completely out of hand, but— [ Interruption. ] I suspect that my right hon. Friend the Member for Greenwich and Woolwich (Mr. Raynsford) is saying that he has seen some local authority budgets get out of hand, and they have. However, I doubt whether he has seen anything like what the Learning and Skills Council did. Not only did the budget get out of hand, but the Learning and Skills Council changed all the priorities, so that, under a Labour Government, the money went to the wealthiest areas in the country and the poorest areas got very little. In Yorkshire, Bradford got nothing and the adjacent rich Tory areas got a great deal of capital expenditure. Indeed, we can look all around the country for further examples.
Mr. Kilfoyle:
My hon. Friend has moved on now, but I was quite taken by his reference to the efficiency, or lack of it, of Hackney and Liverpool in the 1980s, which still bore comparison with central Government. He will recall well that councillors were removed from office at that time because of a notional loss of £110,000
due to the late setting of a rate. Can he tell me of any Minister who has been removed from office for the loss of a comparable sum or for any reason whatever?
Graham Stringer: I cannot do that. There is no set of laws or rules that apply to Ministers or civil servants that are equivalent to those that apply to elected councils and local government officers.
Andrew Mackinlay: Before my hon. Friend moves on from the history of local government over the past few years, may I invite him and you, Madam Deputy Speaker, to pause and reflect on the fact that under both Prime Minister Blair and the current Prime Minister, we have had a revolving door of Local Government Ministers, particularly Ministers responsible for housing construction? I might have exaggerated when I said earlier that my right hon. Friend the Member for Streatham (Keith Hill) was the Minister about 10 Ministers ago, but there is constant change and no settlement, and people are never properly on board. I predict that by next Tuesday there will be different Ministers responsible for housing and construction again. I am not referring to anybody in particular—they can be good, bad or indifferent—but the Prime Minister keeps changing people. It is ludicrous. There is no settlement and we suffer from that.
Graham Stringer: That takes me away from what I was saying, but it is a substantial point.
Julia Goldsworthy: I am grateful to the hon. Gentleman for being so generous in giving way. I will attempt to bring him back to the direction in which I think he was going. Is this not the critical difference between the ineffectiveness of quangos and that of local authorities: ultimately people have the right to vote out local authorities that are not run in the way that they wish? Is it not disappointing that the opportunity was not taken in the Bill to make the quangos that we need more accountable and to get rid of the ones that we do not need at all?
Graham Stringer: The hon. Lady makes a point that I am coming to in about two minutes. However, to return to the point about wasting money, I have written down about 20 examples, whose costs run into billions of pounds. The grossest one, for which I can find no local government equivalent, is the exams fiasco last year. A process that had previously cost £10 million nationally now cost £610 million and went completely wrong, so that young people taking exams did not know their results and, when they did know them, suspected that they were wrong.
There is no evidence base for saying that central Government is better than local government, although I also looked at what Ministers have been saying. The most explicit quote that I could find was from my right hon. Friend the Member for Pontefract and Castleford (Yvette Cooper), who said that local taxing would lead to
“the worst kind of nimbyism...inequalities and...conservatism”.
I do not agree with her. I believe that local taxing, local democracy and the right to throw the rascals out, as the Americans put it in one presidential election, are absolutely fundamental to what our society should be about.
Before I move on to the details of the Bill, I want to mention two principles that ought to underlie it, and to point out that the Bill does not live up to the requirement that they involve. Neither principle would be thought strange in most other democracies. One is that democracy and the local taxation of services are related. If someone stands for election, they should say what money they are going to raise, and win or lose the vote on that basis. The second would involve a pretty fundamental change in how we think about things in this country. It is that central Government should justify their spending decisions to local government, rather than the other way around, because the evidence is that local government is better at it.
I shall turn now to the details of the Bill. Clause 1 covers duties relating to the promotion of democracy—a matter that was also raised in the debate in the other place. If we look at the House of Commons guide to the Bill, we see that the provisions, which will tell people how to become councillors, how to access services and how to send in information, are going to cost local authorities about £22 million. Compared with some of the sums that we are talking about, that is not a great deal of money. It probably equates to a couple of posts per local authority around the country. The provision is completely unnecessary, however. I asked one of the people who works for me to find out on the internet how to become a local councillor and how to get all the necessary information. Within five minutes, the Directgov website had pointed us towards other websites and we had all the information that we needed. As I have said, not a great deal of money is involved, but clause 1 is really unnecessary.
The point was well made by the hon. Member for Meriden (Mrs. Spelman) as well as by some Labour Members that most local authorities already take petitions. The fact is that everyone, whether they write a letter or send a petition to a local authority, deserves a response and should get one. I very much doubt that we need prescriptive legislation to achieve that. We just need a statement to that effect.
The biggest issue relating to local democracy in my area in the past 12 months was the referendum on the proposals for a congestion charge in Greater Manchester, which would have created the largest congestion charge zone in the world. However, there were no real powers in place to enable that referendum to be held. In fact, it was held under section 116 of the Local Government Act 2003, and it could have been held under section 170 of the Transport Act 2000. As a result, there were no real rules for holding that referendum, in which more than 1 million people participated.
Covering such circumstances would have been a more useful purpose for the Bill. I certainly have doubts about referendums, but there is no doubt that the electorate out there like the idea of holding a referendum on certain key issues. The one in the northern region has been mentioned, and there was also the one in Greater Manchester. Both had a higher turnout than the local elections, and we have to respect people’s views in this regard. It is within the terms of the Bill’s long title for this legislation to become a vehicle for putting regulations in place so we no longer need to hold referendums under strange parts of the Local Government Act. Having to do that in Greater Manchester meant that the so-called returning officer, Sir Neil McIntosh,
who was paid £30,000 to do the job, could decide to consult only the promoters of the relevant Bill on what question to put, and did not put into the main question on the referendum paper the most controversial aspect of the proposal—the levying of a congestion charge or a new tax on people. Also, he would not see people such as myself who were opposed to the proposals. I think that that is quite scandalous. More than 2 million people were entitled to vote in that referendum and more than 1 million people did, and we should use this Bill to codify the procedure so that that sort of situation cannot happen again. In fact, the returning officer was so biased that the arrangement actually worked in favour of the no rather than the yes campaign.
We have already discussed the regional development agencies and I would like to ask Ministers to clarify some issues relating to the north-west and co-operation. I have always made my views on RDAs clear: they should not have been set up and they should be abolished as quickly as possible, because they have no role whatever. It is not a question of businesses liking RDAs, as the Secretary of State suggested. No, they do not like RDAs, but they like the possibility of getting grants from them. So long as the money is not abolished and does not disappear, businesses would be pleased to get rid of the bureaucracy and deal directly with local authorities.
I would particularly like to ask my Front-Bench colleagues whether they agree with the following statement from Steven Broomhead, the chief executive of the Northwest Regional Development Agency, who said that there was
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