Examination of Witnesses (Questions 142-159)
MR STEPHEN
HUGHES, SIR
RICHARD LEESE
CBE AND MR
EAMONN BOYLAN
10 NOVEMBER 2008
Q142 Chair: Can I welcome you to this
first evidence session in our inquiry on the balance of power
between central and local government? You will know that you are
the first of three groups of local authorities this afternoon,
starting off with obviously two large metropolitan areas. So can
I start with the first question? I note that both of you argued
very strongly for greater powers being devolved to councils, from
your own experience, and largely it seems to be the arguments
are coming from cities. Are you suggesting that cities have a
particular claim for greater powers, or do the arguments that
you make apply to local authorities generally?
Mr Hughes: There is definitely
a particular role for cities, and coming from larger cities, you
would expect us to say that. Based on the evidence which was done
in, for example, the Parkinson report, which demonstrates that
cities are a key driver of the economic performance of the country,
but also underperforming compared with European counterparts,
we have started from the perspective that there is a greater role
that we could make, and that we can contribute more if we are
able to have more powers at a local level. I do not think necessarily
that that means that other areas could not form effective sub-regional
arrangements which could similarly deliver benefits, but clearly
it is really important that the major conurbations are able to
help drive forward the economic performance of the country.
Sir Richard Leese: If I could
give a practical example: one of the things we are attempting
to do in Manchester is tackle enormous levels of worklessness,
even more difficult in the current climate, where we have to get
not only what local authorities do but services from JobcentrePlus,
services funded from the Learning and Skills Council and so on,
joined up in a way that they historically have not been. We take
the view that we need more power in order to be able to do that
joining up effectively, but it is a particularly urban issue,
a particularly city issue, and there are other parts of the country
who would neither have the need to do that, nor would they have
the capacity to be able to do that as well. I think smaller rural
local authorities simply would not have the capacity to do that.
So we would argue for a differentiated approach in that the devolution
and decentralisation we would see coming to cities is not necessarily
the same that would go to other areas.
Q143 Sir Paul Beresford: The other
side of the argument, and remember I have been on both sides,
not at the same time—I am not a Liberal—I have been
on both sides at different times, is that the Government have
been elected on a programme, they have been elected with control
of the economy, including unemployment, et cetera, and
they will have a pattern that they wish to be installed throughout
the country. How could they risk letting you loose, in effect,
from their point of view, with the prospect of possibly not following
their guidelines and going off on your own?
Sir Richard Leese: I would say
that the framework of local area agreements, and, more recently,
multi-area agreements, allows a contractual arrangement to be
established between central government and local government about
meeting agreed outcomes for that particular area. What I think
central government often then tries to do, and does not have the
capacity to do, is to try and then tell us how we are going to
achieve those outcomes as well as what the outcomes are. I think
what we would argue is that we are in a far better place—on
outcomes that we agree with Government, there is no division between
us whatsoever, but we are better placed at a local level to know
what mechanisms are needed in order to be able to deliver those
outcomes.
Q144 Chair: Why does that not also
apply to smaller councils?
Sir Richard Leese: Again, I go
back to the capacity issue. First of all, if you take worklessness
in some parts of the country, it is nothing like the level you
will find in large urban areas. That is why I think it is a good
example of the need for differentiation, but also particularly
small district councils simply would not have the capacity to
be able to drive an agenda that needs co-ordinating a whole range
of public sector authorities. So it is a difference in need and
capacity, as I said earlier.
Mr Hughes: Just in answer to your
question, what local authorities are doing through local area
agreements at the moment is effectively trying to knit together
all the various different funding streams which are supposedly
designed to deal with things like worklessness. So you are working
not just with Working Neighbourhoods Fund which authorities like
ours have, but LSC (Learning and Skills Council) funding, JobcentrePlus,
the RDAs (Regional Development Agencies), all of those have different
sets of accountabilities back to central government, and what
we are spending a lot of time doing is trying to get them all
connected to deliver the local area agreement targets. Part of
what we have argued for, both of us, in our slightly separate
different ways, is that, having cleared one line of accountability
on an area basis back up to Government, whether that is through
a local area agreement or not, would help be more effective in
delivering services at a local level. That is about making local
delivery agencies all accountable in one way, instead of having
lots of different ways in which they are made accountable for
what they are doing.
Q145 Sir Paul Beresford: Local area
agreements, according to the Government, are a means of setting
you free.
Mr Hughes: Local area agreements
are a massive step forward compared with where we were, but because
you have to work it through a partnership arrangement, it is very
dependent on forging relationships at a local level, which sometimes
work, and we believe we are doing really well at it, but it is
still difficult to make all those things pull together.
Q146 Sir Paul Beresford: If I come
back to my original point, if you are sitting as a minister, and
you are looking at local government, you have, as I have used
the phrase before, the good, the bad and the ugly, and I am not
putting you into any of those classes: how can Government broadly
release more down to local government than they are doing now
when it has such a piebald mixture of quality?
Mr Hughes: I give my own example,
which is very close to my heart, what we have to do to get funding
to do the refurbishment of New Street Station—£400
million in total—three different government funding streams,
three different appraisal processes to get it agreed, and then
once you have the funding agreed, we then have micromanagement
of the project. It all takes a lot longer than it should do.
Sir Richard Leese: Can I take
issue with your description of that I think "piebald"
range of quality? Actually most local government is now good to
very good, and the amount of poor local government is very, very
limited. Indeed, if we are talking about ministers delivering
their objectives, if most civil service departments involved in
delivery were put through the same sort of competency tests that
local government is put through, they would not come out anywhere
near as good. So the first thing I say to ministers is: if you
really want your objectives delivered, the best way of doing it
is through local government.
Q147 Anne Main: I would like to take
you back to the different funding streams. Obviously there is
the complexity that you have said about the follow-through, but
do you accept that if you were allowed to do your own thing, shall
we put it, you may have difficulty accessing enough funding, because
you would not necessarily follow the priorities of the Government?
Chair : Sir Richard
Sir Richard Leese: I do not think
we are talking about just doing our own thing, we are not talking
about some sort of anarchy of 400-odd local authorities —
Q148 Anne Main: You may not be, but
someone else might be.
Sir Richard Leese: Well, we are
not, and in our evidence, that is not what we are saying. I think
it is quite clear that the LAA (Local Area Agreement) structure,
local government coming to a negotiated agreement with central
government, is something that we think has real value. We virtually
never disagree about outcomes, by the way, it is always about
the processes by which we will achieve those outcomes.
Mr Hughes: I think there is an
argument about whether we have enough resources, but actually
there are lots of resources already being delivered at a local
level, and what is not, I think, being done is making best use
of them. One of the problems is where interventions to deliver
outcomes are all agreed on to deliver benefits for people other
than the person who is doing the intervention. So, for example,
if we do work which helps reduce crime rates and people going
to prison, there are benefits to the police and the Prison Service,
Probation Service, but we do not necessarily at a local level
capture those benefits, and therefore, the actual cost of doing
that investment in the first place is much higher than it otherwise
would be.
Q149 Chair: Mr Hughes, just to qualify
on that example, the benefit is to your local population. The
financial saving may be to the police, but the benefit presumably
is to the people that your council is responsible for.
Mr Hughes: Of course it is, but
the point is that if you could pool together the different funding
streams, you could make a business case for making the interventions
which would reduce the cost to other public agencies which we
would not be able to do on our own, because we actually would
not have the resources to do it. That is the point, you can make
better use of the public resources that are available.
Q150 Chair: Can I pick you up on
that? Just one paragraph in the Birmingham submission, I think,
actually suggests that "all public spend in a large local
authority area to go via the local authority. Primary Care Trusts,
the police and other public agencies would then have to ask for
money from the local authority who would hold them to account
for performance." I would be interested in Sir Richard's
response to that one.
Sir Richard Leese: It is not a
route that we would look to go down, and there is a more powerful
route for local authorities being able certainly to set the strategy
for the area, and then we do have now, through the LAA framework,
a requirement for all public agencies to deliver that agreed strategy.
I do not think our ability to hold those agencies to account is
strong enough, nor is our ability to effectively change the delivery
method strong enough either, so we are about halfway down a road,
but actually we do not want to, in that sense, manage everything
in our area. What we want to do is to be able to oversee the delivery
of a strategy for an area, for a place, I think the place-making
role that was described by Lyons, where currently we do not have
sufficient co-ordinating power to deliver on that.
Q151 Mr Betts: Can I just follow
up? There are lots of words around like "hold to account"
and "set strategies", they all sound very nice, but
what does it mean in practical terms that you want to do? Say
with the PCT, should it be the council's job to say, "This
is the strategy, we are approving it, you go out and deliver it,
and if you do not, we have got certain sanctions against you"?
Sir Richard Leese: I think that
is the position we have to be in, and we are not in that position.
We can scrutinise, so we can call in people from the PCT and ask
them what they are doing and say, that is not very good, et
cetera. What we cannot do is then effectively say: No, you
are going to have to change what you are doing because you are
not meeting the objectives for [in our case] Manchester.
Q152 Chair: Just to press that, supposing
Manchester decided that, I do not know, heart disease was more
of a priority than cancer. Are you asking that you should be able
to get your PCT to deviate from national priorities and put more
money into heart disease?
Sir Richard Leese: Yes, and there
ought to be a balance between them. If you take what is a real
case at the moment, there is a tension between preventative health
work and spending on acute care, how do you stop hospital waiting
lists being too big? One way is to treat people fast when they
get on to those waiting lists; the second is to prevent people
getting there in the first place. There has been an ongoing tension
between local authorities, who would like to see a greater emphasis
on the preventative side, as against the Department of Health,
who put the emphasis on acute care.
Q153 Chair: I thought that might
excite people. Mr Boylan, do you want to add something?
Mr Boylan: If I might, Chair,
just to pick up on your comment, it would not be a matter of us
deciding that heart disease was a more significant factor, it
would be based on a very clear and rational analysis that shows
that cardiac disease is actually one of the things that makes
Manchester one of the places with the lowest life expectancy for
adult males in the UK, and it is not adequately reflected in terms
of the overall priorities that are being set nationally for NHS
delivery, so it is a matter of a mediation between local circumstance
and national priority. It is not about exclusively one or the
other. At the moment, the balance, we believe, is wrong.
Q154 Jim Dobbin: That touches on
the area that I was concerned about. It is interesting, this debate
about the relationship between health and local authorities, in
particular Primary Care Trusts. You mentioned balance of power;
where does that put a large regional health authority like the
one that covers the North of England, in relation to the comments
that have just been made about where the power should lie?
Sir Richard Leese: Well, the regional
health authorities say it is part of the NHS Executive, which
as far as I can see is simply an intermediary between a national
and a local level. I think where it plays a useful role is a lot
of those acute facilities do not and should not be provided simply
on a local level, so there do have to be strategies that are over
and above the local level, that are sub-national, I think there
is a role to play there. I have to say that I think primary health
and community health is an area of expenditure that I could see
at some point being part of what a local authority provides within
the area. I would not expect to see acute care necessarily being
part of the same thing.
Q155 Anne Main: I was interested
to hear you say that you would like to, for example, decide preventative
care rather than acute care was the way you would go as a local
authority, if you could do that. How would a neighbouring area
feel then in terms of a postcode lottery, if you decided to withdraw
yourself into that particular stance, and somebody says, I am
not going to get the treatment I need in Manchester because actually
they have decided that they should have prevented what I have
got rather than treat it?
Sir Richard Leese: There is a
fundamental argument there about what is the role of local democracy,
and if local democracy is that everybody gets the same wherever
they live, then there is not any local democracy. Again, I go
back to what Eamonn said, part of what we are talking about is
a balance between national and local, but are we going to get
different things in different places? Yes, I think not only we
are going to do that, but it is right and proper that you should
get different things in different places. If the area next door
thinks that is unfair, then what they ought to do is elect a different
council to get what they want.
Mr Hughes: It is also about how
you measure these inequalities. You might look at that in terms
of access to acute care, but you could also look at outcome in
point of fact that sizeable parts of our population have a life
expectancy of 10 years lower than other parts of the city, or
other parts of the country. That should be concerning us as as
great an inequality that we need to address as inequalities in
access to acute care.
Q156 Chair: Can I just mop up a question
in relation to the local area agreements, which is whether you
have actually had any disagreements with central government over
the conduct or process relating to LAAs?
Mr Hughes: We came to an agreement
at the end of the day, but we had a robust discussion along the
route about issues which individual central government departments
wanted to be included, the level of the targets that they wanted
to have, but at the end of the day, the agreement we came to was
one which not only the council but our partners were comfortable
with, as was the government department, so the process was robust,
as you would expect, but nevertheless, an agreement was arrived
at.
Sir Richard Leese: Yes, we do
have disagreements, as I say, generally about process rather than
outcomes, but if I give an example of a disagreement we had with
the Department for Work and Pensions, JobcentrePlus, the targets
we wanted to set locally for tackling worklessness were far more
ambitious than those that JobcentrePlus wanted to set, so we had
a disagreement about that. There is a multi-area agreement disagreement
around how we tackle skills, but this is rather more complex,
because the two government departments that are responsible for
different bits of skills, they are having an argument with each
other as well, so it is a three-way argument at the moment. And
again, I think that demonstrates what I see as part of the thing
we ought to be able to do at a local level, is to do that joining-up
that those two government departments, with all respect, will
never be capable of doing.
Mr Boylan: Local area agreements
are a huge step forward, as has already been said, but I think
they have an important limitation, and that is that they are defined
around a specific target, and over a fixed time period for the
delivery of a single target, albeit a range of them making up
the totality of an agreement. The approach we have tried to take
with the Greater Manchester multiple area agreement, which is
an important new development, because it involves not one but
all 10 of the Greater Manchester authorities, working on the delivery
of outcomes that actually, in terms of worklessness and health,
would have national significance if they were delivered, it is
an iterative process. It is actually a renegotiated process over
a period of time, so actually, it can monitor trend and performance
and not simply the delivery of a fixed target. Fixed targets,
by their very nature, tend to be out of date rather quickly, and
I think that is a limitation of the LAA framework, although I
think we could learn from the multiple area agreement approach
that has been taken in Manchester and elsewhere.
Q157 Jim Dobbin: We are right in
the middle of a very difficult economic process. What are your
councils doing to support your residents in protecting the local
economies through the global recession, and how do you think the
Government could help you in that whole process?
Sir Richard Leese: One of the
things we are trying to do, Jim, is to get £3 billion worth
of investment in public transport infrastructure, and we have
some misguided people opposing us. Actually, we are trying to
get investment in our infrastructure. There are a number of other
examples where the City Council is itself using public sector
money to invest and maintain momentum in other developments, including
commercial developments. We have established a partnership with
the Chamber of Commerce that we do monitor, and make sure we try
and have realtime information of what is happening in the economy,
to make sure we can intervene promptly if we have the capacity
to intervene. Clearly, the extent to which any local authority
can set itself against what is a global economic effect is somewhat
limited, but we are doing what we can.
Q158 Sir Paul Beresford: The latest
whizzkid idea of central government in both parties seems to be
cutting tax. Presumably your local authorities have cut your council
tax?
Sir Richard Leese: If you look
at Manchester's council tax, we have had an increase in council
tax no more than the rate of inflation for the last nine years,
in which period of time we have gone from, I think, the third
highest council tax in the country to what, according to The
Times, was the fourth lowest average council tax in the country.
So we have taken a fairly consistent approach on that.
Q159 Sir Paul Beresford: So there
is room for improvement?
Sir Richard Leese: In terms of
the financial issues, it is one of the reasons why I have argued
against supplementary business rates, and said it is no substitute
for relocalisation of business rates, because a supplementary
business rate only allows you to do one thing, which is to put
it up, whereas relocalisation would give us the option of being
able to put business rates down as well as put them up.
|
