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28 Oct 2009 : Column 305

Mrs. Spelman: Once again, my right hon. Friend's observation about Cumbria shows that it is perfectly possible to provide such information for every area. The question is why that is not happening.

This huge chunk of public spending, which is channelled through non-departmental public bodies, including RDAs, has been granted an exemption. So what started out as a means of shining a light on the way that public money is spent seems to have ended up as more of a dull fog concealing the truth. I am sure all hon. Members will share my concern that many supporters of the Bill will see that as a fundamental breach of trust. They will know from their constituencies that when Local Works campaigners held public meetings and signed up supporters, this halfway house is not what they had in mind, and the practical working of this compromised position has set back what pioneers of the Bill sought to achieve. It makes a nonsense of the time spent debating the Bill, with so much work put in by hon. Members, only to end up with such a large proportion of public spending being exempted. In essence, that fatally undermines the power that people have to scrutinise and challenge where their money is being spent.

In my constituency, I am astonished that we are not able to find out where and when public money is being spent by our RDA. What I can ascertain is that significantly less public money is awarded to Advantage West Midlands than to One NorthEast-approximately half, to be precise. The figure is £55 per head in the west midlands, as opposed to £96 per head in the north-east for 2008-11. That will seem very strange to people in my area, which is so badly affected by the recession.

The Secretary of State for Communities and Local Government (Mr. John Denham): The hon. Lady is obviously not speaking as a constituency MP but as her party's representative on these matters. May we take what you have just said as a clear indication that you would change the allocation of resources to RDAs on the lines that you have suggested? That would be very important news to many people-

Mr. Deputy Speaker (Sir Michael Lord): Order. The Secretary of State is very experienced and he knows that he must use the correct parliamentary language.

Mrs. Spelman: I am sure that you would not want to have to answer such a disingenuous question, Mr. Deputy Speaker. Given that the Government are already in bad odour in the Chamber for failing to produce a document pertinent to today's debate, attempting an intervention that is just point-scoring party politics is not a good start by a comparatively new Secretary of State.

The important point is that we want to know where the money is going. I cannot cross-reference how spending in the north-east compares with spending in the west midlands, but our constituents might reasonably expect us to be able to do so. Constituents in Cumbria are fortunate to have the opportunity to do so, but it is not generally available. Does the Secretary of State understand how infuriating it is to be kept in the dark over exactly where the money is going, and in what sort of quantity? It is not only infuriating, but disempowering for elected representatives and the communities that they serve.

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The Minister for Regional Economic Development and Co-ordination (Ms Rosie Winterton): The hon. Lady makes several points about the spending of RDAs. Why is her party failing to participate in the Regional Select Committees, which could look in detail at those very issues?

Mrs. Spelman: Most hon. Members find it an extraordinary afterthought that, so late in this Parliament, the Government have realised that there might be a problem with lack of accountability in the regional structures that they have tried to create. All of us understand that there is something fundamentally wrong with the regional structures that the Government have set up. My party would seek to solve that by returning powers to local government, where there is democratic accountability.

At a time of recession, when households are having to account for every penny carefully, and our national debt is forecast to grow by £240 billion a year, it is all the more poignant that people cannot see where their money is going. Insulating quangos from public scrutiny will serve only to strengthen people's suspicion and distrust of quangos. They are seen as mandated by Whitehall to take the decisions that Ministers do not want their fingerprints on, and the bodies which spend taxpayers' money are free from interrogation.

In recent years, the quango machinery has accelerated. In 2007, spending on non-departmental public bodies rose from £37 billion to £43 billion. That information comes from the Cabinet Office. There are now 1,152 quangos in the UK employing more than 500,000 people. The TaxPayers Alliance estimates that every year £90 billion of taxpayers' money is spent by unelected quangos-equivalent to more than £3,500 for every household. The fact that the best that we can obtain is an estimate is telling in itself. Surely, we should all be entitled to know exactly how much money is being spent. My sense is that, if anything, £90 billion is probably on the low side.

Under the current regime, the figure will certainly be escalating. Let us take two examples with which the Secretary of State will be dealing. The Infrastructure Planning Commission is forecast to cost £10 million a year and will take the most controversial planning decisions out of the hands of elected representatives, but despite the scale of its finances and the impact of its decision-making power, it is not covered by the 2007 Act.

Just when we thought that public patience with elaborate and unaccountable quangos, which have failed to deliver in important areas such as housing, had run out, the Government have put them on a life support machine in the Local Democracy, Economic Development and Construction Bill. RDAs will now be spending vast sums of taxpayers' money on functions that they were never designed to deliver and taking decisions over some of the most controversial aspects of housing and planning. Yet RDAs, along with the rest of the quangos, have been exempted from the 2007 Act.

At a time when every publicly funded organisation is having to demonstrate its value for money, I cannot believe that the RDAs welcome being veiled in secrecy. Ironically, the RDAs might be better placed to advocate their case if they were covered by the 2007 Act. The quango culture is of a piece with public suspicion that politicians seek to abrogate responsibility and spend
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taxpayers' money without recourse. That corrosive cynicism is undermining our democracy and we need an antidote to it. People need to know how much is being spent, by whom and on what. Could it be the case that at the back of the Government's decision to dilute the requirements for publishing spending, there is a genuine concern that people would be horrified at the level of waste? What is incontrovertible, however, is that opening up the books would enable people to see just how their area compares to others in the share of funding that it gets.

Having set out how and why I believe that the Government have got it wrong in compromising the scope of local spending reports, I want to advocate how we might better match the reality of the 2007 Act with the rhetoric of the Local Democracy, Economic Development and Construction Bill. For a start, we should honour the commitment given by Parliament to enact the legislation in full. As legislators, we should aim to meet not just the letter but the spirit of the legislation and really open up spending to local scrutiny and counter-bid.

Hon. Members on both sides of the House have sought opportunities to do this, and I know that my hon. Friends the Members for Peterborough (Mr. Jackson) and for Wycombe (Mr. Goodman) recently tabled amendments to the Bill to that effect. Sadly, however, those were to no avail. It is clear, therefore, that if the public's desire for transparency in local spending is to be realised, it will take bold action. On my part, I believe that we should go further than the terms of the Bill, and that we should be bolder and even more radical in the quest to get transparency and accountability into public spending.

The Conservative party has made it clear that under a Conservative Government councils would have to publish online details of all expenditure over £500-already some Conservative councils, such as Windsor and Maidenhead, do that. That will let people see, at the click of a mouse, how their local authority is using their money. The emphasis will be on making the data easy to access, easy to understand and easy to compare with other councils.

That cannot be said of the current format in which the sustainable communities spending reports are being published. I consider myself to be fairly adept with Excel, and those reports are a cautionary lesson in making information at best opaque, and at worst simply indecipherable. However, the key to making those council spending reports valuable as a means of scrutiny is our pledge to abolish the entire regional tier of government and repatriate power to democratically elected councils. That would solve at a stroke the problem of regional bodies not being covered by the 2007 Act.

Our approach of discharging as much power as possible to elected councils, rather than unelected quangos, will give real force to the power of publishing spending online. We would also go back to the source-the grant formula-and make it more transparent. That, along with the power of local referendums and our commitment to phasing out ring-fencing, would deliver a sea change in the way we do politics. We are intent on devolving real power to councils so that they can deliver on the priorities and needs of their communities.

That approach is best summed up in our policy of giving councils a general power of competence-a power to enshrine the presumption that councils could, and
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should, be free to act in accordance with the wishes of the communities that they serve. However, in return, the communities deserve to be given the tools to hold those councils to account. They have to have at their disposal the information and the levers of power to challenge spending decisions and get things changed.

Is that not at the heart of the original motivation behind the spending reports that we are debating? It is a silver thread that has been running for some time in various incarnations but with very limited success-from local area agreements, to local strategic partnerships, the 2007 Act and, most recently, the Total Place initiative. Sadly, however, none of those manifestations has delivered what we need, which is why we find ourselves here today. We are in the early days of the Total Place pilots, and Conservative Members are watching with interest to see whether the Government can crack it.

It all goes back to the money, however. Bringing budget holders around the table can yield great results, but it is predicated on knowing what money is spent, by whom and on what.

Mr. Letwin: I am grateful to my hon. Friend for giving way again, and I am glad to tell her that this intervention relates to Dorset, rather than Cumbria. Does she think it as important as I do that the Secretary of State explains how, in the Total Place pilot in Dorset, all Government agencies have been able to reveal their figures-this time, not published-to the other partnership authorities in Dorset?

Mrs. Spelman: When the Secretary of State replies, he will have a golden opportunity to explain those discrepancies.

I shall draw my opening comments to a close, because I am keen that others have an opportunity to speak. It is an important debate because it goes beyond the subject of local spending reports and to the heart of what the public expect of us and how Parliament responds to them. The past year has been a deeply damaging one for this institution. We have been left with a clear, unambiguous instruction from voters that they are sick of public money being spent behind closed doors. They want to see where their money is going and whether it is being used efficiently. Politicians ignore that at their peril. The Government's desire to keep public spending under wraps is completely at odds with where the public are.

The organisation Unlock Democracy put the matter well when it said:

a previous Minister. As politicians, we are on notice that we have to live up to the high standards expected of us, which is why backtracking is so dangerous. The tide of public opinion has turned. It is unflinching and there is no going back. People are no longer content to defer to distant individuals or faceless organisations over how their money is spent. They are determined to know.

I firmly believe that Parliament, as with any organisation in receipt of public funds, has a moral and unquestionable duty to make public how it spends our money. To resist that will only foster more of the kind of distrust, cynicism and resentment that we have already seen
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when taxpayer-funded organisations refuse to come clean on where the money is going. We have to show that we are better than that. Delivering in full on local spending reports would do that. With sadness, however, I say to colleagues that those reports have not been forthcoming in the way that hon. Members on both sides of the House had hoped. In recognition of that, I urge colleagues to support this motion so that we can go some way to restoring the House's integrity in the eyes of supporters of the 2007 Act.

1.49 pm

The Secretary of State for Communities and Local Government (Mr. John Denham): I beg to move an amendment, to leave out from "House" to the end of the Question and add:

This is an important debate. I want to go through what has been achieved so far and what the next steps are. I did not think that the speech by the hon. Member for Meriden (Mrs. Spelman) showed an enormous grasp of the nature of public data and how they are made available or of what has been done so far and what will be done in future. I regret that, because I believe that those public data are important. It is also important that we build on what has been done so far.

There are clearly some conceptual difficulties. Whatever the merits of, for example, the Infrastructure Planning Commission-I think that they are considerable, but that is a debatable point and has been debated in the House-it is a national body, as is the Supreme Court. It had not occurred to me to previously that the Supreme Court should be covered by local spending reports. Presumably the spending should be divided by the number of local authorities and put into a report, but would it really help to subdivide what are essentially national institutions into local reports? The hon. Lady told us that the IPC and similar bodies-presumably including the armed forces and so on-should be included in local spending reports. However, we need a bit of clarity about the purposes behind the legislation, because that will enable us to look at what can reasonably be done in future.

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John Howell (Henley) (Con): Does the Secretary of State not understand that councils, particularly during this recession, are trying to develop policies to help local people get back into jobs? The absence of figures for regional development agencies and Jobcentre Plus is not only a disincentive in itself, but fundamentally works against the notion of partnership that is needed for such activities.

Mr. Denham: I agree about the importance of such information. I was merely making the point that suggesting, as the hon. Member for Meriden did, that expenditure in institutions that operate at a national level should be covered in local spending reports is a misunderstanding of what the original 2007 Act was about. It would be better to concentrate on how we make relevant and timely information available on genuinely local public spending.

The ground that we are covering today has been fairly well trodden in recent weeks and months, but is no less important for that. There are two things that we should try to do in this debate. The first is to establish the importance of information on local spending in driving the delivery of effective, personal, high-quality and value-for-money public services. However, we also need to establish the deep divide that now separates the two major parties on the future of local government. Perhaps I could start by setting that scene first.

I recognise that there is a superficial rhetorical similarity between the commitments of the parties to decentralisation, but in practice they are a long way apart. Time and again in yesterday's Communities and Local Government questions, we saw Opposition Members lining up to remind us that their local government policy is against growth, against jobs, against homes, against sensible transport planning and against the regional development agencies, which have helped to support numerous businesses through the downturn.

Julia Goldsworthy (Falmouth and Camborne) (LD): Surely the help that local businesses have received via the RDAs is a classic example of regional spending having an impact at a local level, where it would be beneficial for the public to know the quantities of money being spent in their areas.

Mr. Denham: I will come to that point, although I am glad that the hon. Lady does not seem to share the desire of the Conservative Opposition simply to do away with those structures and pretend that nothing should exist between central Government and local expenditure. That is a huge gulf between us, and it puts the Opposition in a terribly weak position when they try to argue that they have policies that will help us come out of recession and deliver decent public services.

Mr. Stephen Dorrell (Charnwood) (Con): The Secretary of State is right that there is a gulf between the two sides on the future of regional development agencies, but what on earth does that have to do with local spending reports? While he is on his feet, could he address the issue in the Opposition motion? For example, how can we take the experience being developed in Leicestershire through the Total Place initiative, which focuses on drugs and alcohol and which the Government say they support, and use it outside Leicestershire if, say, the youth offending service or the probation service does not publish the information that would allow other local authorities to use that experience?

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