Examination of Witnesses (Questions 60
- 69)
TUESDAY 7 OCTOBER 2008
MR CHRIS
HANNANT, MR
STEVE RADLEY
AND MS
KAREN DEE
Q60 Mr Wright: Is there not a consideration
that because of the relationship with the RDAs and the local authorities
through the proposed forum that is put forward that there would
be a conflict of interest there?
Ms Dee: There is a concern, in
theory anyway, if it happened that way, that local authorities
would be involved in setting the priorities and then actually
delivering some of them if the funding is devolved and then holding
the RDAs to account. They seem to have quite a lot of responsibility
and whether there would be a real onus on making sure that there
were mechanisms in place to ensure that there was no malpractice.
I am not suggesting there would be malpractice but it seems that
setting the strategy, delivering it and then holding the other
people to account is quite a big function for a local authority
to have.
Mr Binley: Just a quick one on that particular
point that RDAs should not do everything. I met with my own RDA,
the East Midlands Development Agency on that very point, and specifically
they said that, in short, business support in the East Midlands
is designed by businesses and delivered by businesses. The truth
of the matter is that you have a widespread connective network.
We need to know from you—privately and I am happy that you
write—which ones are taking that approach and which ones
are not and how that relates to effectiveness, because that would
be very important.
Chairman: I think that is a comment to
build on the earlier answer you gave. Mick Clapham will now draw
to a conclusion the threads of some of the underlying themes of
this session—and I hope we have not stolen some of his thunder.
Q61 Mr Clapham: I do not think you
have and I think we can certainly do some probing anyway. It seems
to me listening as we have gone through this session that what
you are really saying is that the effective RDAs are those that
engage with business on the one hand and local authorities on
the other. Of course we know that the sub-national review is talking
in terms of transfer of powers, et cetera, and that should
bring greater focus of that approach, so when, for example, Karen
says that we cannot pick out those RDAs that are good against
those RDAs that are bad, it seems to me that what you are saying
is that the good RDAs are the ones that engage in the way that
I have just suggested and the poor ones are the ones that do not.
Would that be correct?
Mr Hannant: It is not always so
black and white. Just to give you an example, picking up from
what we have just been talking about, our members do see that
the RDAs should not be delivering unless there is absolutely no-one
to do it and they are seeing some RDAs competing with private
companies delivering services. One of those that has been cited
to us as doing this is the North East. On virtually every other
measure the North East is cited as an excellent RDA. It has excellent
engagement with business and local authorities and it is doing
a good job, but it is not always just everything that any given
RDA does is good and top of the class. It is a slightly blurred
picture.
Q62 Mr Clapham: I think all three
of you are in agreement that the RDAs, or a structure like the
RDAs, is necessary. Before we look at the sub-national review
and the transfer of powers and what you think about that, coming
back to that first aspect of the question, would you agree that
the RDAs are necessary in order to be able to ensure that we get
that unified strategy and that the integrated strategy is likely
to bring a greater focus on actually doing that?
Mr Hannant: Yes, broadly. I think
that there is a need for something at the sub-national level that
co-ordinates and leads on a regional bases, so yes.
Q63 Mr Clapham: Coming to the sub-national
review then, in terms of accountability do you agree with the
measures that are set out in the review and, if not, why not and
what do you think might be added to make the accountability better?
Ms Dee: You mean in terms of the
leaders' forum?
Q64 Mr Clapham: Yes.
Ms Dee: We have partly touched
on that but the CBI does have significant concerns about the leaders'
forum. As I indicated previously, we feel that there are difficult
decisions to be made. If it was intended, and it is not clear
actually from the proposals, that the group of local authorities
would have a veto, and if they could not reach agreement
the strategy could not proceed, that would be very damaging indeed.
Our view was that it would be quite tricky to get all those local
authorities to agree. Quite what the basis for that sort of vote,
it did not talk in any detail in the proposals about how that
would work, so we have considerable concerns about that. We also
felt that might lead simply to a solution where the RDAs were
tempted then to follow the path of least political resistance,
and you may end up with sub-optimal decision-making or the wrong
types of projects pursued, and we could see a problem with that.
Q65
Q66 Mr Clapham: Would you all agree
with that approach?
Mr Hannant: Broadly, yes. One
of our concerns is it could lead to a sort of pork barrel approach.
Q67 Mr Clapham: So, really, are we
saying the priority is to find the balance between accountability
at the regional level and accountability at the national level?
By the way, there has been a change in the way in which the regional
ministers have been appointed because we have now got regional
ministers appointed that do not have another sort of remit; they
are going to focus primarily on the regions. Presumably that change
the Government is looking at, in terms of regional ministers,
would be helpful in bringing about the priorities that you want
to see in the balance of powers.
Mr Radley: We feel that regional
ministers could be well placed to do this, particularly if they
are allowed to have the time to do it well. At the same time,
you clearly want to have good quality people. In danger of turning
into the Liam Byrne fan club, we have actually found from talking
to local businesses, EEF and other local organisations, he has
been extremely effective in engaging with local businesses. So
I think you can do these things, and obviously you end up being
incredibly busy. We would just propose the regional ministers
as one way forward, and some of the other ideas that are on the
table, such as majority voting, certainly deserve a lot of scrutiny
as well, and they could offer a sensible way forward. What we
are concerned about is that if the convoy is moving at the pace
of the slowest ship you will end up with paralysis or fudge, or
a combination of the two.
Chairman: I wish we could go on a lot
longer, frankly, because there is a lot more we could have explored
on some of these issues. I would like to have taken them in more
detail. The idea that the mechanism is set up to achieve nothing,
of course, summarises the American Constitution, and the checks
and balances that are there to make sure that no decision is ever
taken has served that country quite well. There we are. Thank
you very much for your time and trouble. There is one more thing,
which is the breakdown of the research that the Chambers of Commerce
did, and your own views on the effectiveness of different RDAs.
Q68 Mr Hoyle: Just on that point,
because it was interesting actually that you knew the scores for
the North East, where they were excellent all the way through
except for one, so obviously you must have the information. Or
do you just happen to know the North East and nobody else?
Mr Hannant: With all our surveys
we do not always collect information on—
Q69 Mr Hoyle: I thought you would
fudge the question.
Mr Hannant: We will have a look
at what we collected at the time.
Chairman: We are grateful to you for
your time and trouble. Thank you very much indeed.
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