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It always important to consider the potential effect of the enhanced regime on the bodies to be brought within it, and it will be vital to strike the right balance between enabling constructive and challenging scrutiny, while avoiding the process becoming overly time consuming or burdensome to the new bodies brought into the regime. Measures will be needed to ensure that the burdens are minimised and that operational independence is not compromised. My Bill recognises this. There will be new provisions to minimise burdens, duplication and effort, and to maximise the efficiency, effectiveness and benefits of constructive scrutiny.

In addition to the framework for the enhanced regime, the Bill recognises the increased importance of scrutiny as a key council function. It will require the council's scrutiny officers to be fully and sufficiently resourced. We know that councils are now required to have a designated scrutiny officer. Across the country the number of councils with a designated team is quite small. In most councils the scrutiny function tends to be shared between a number of officers. The average number of officers engaged in scrutiny is currently about three, though obviously there is a wide range, reflecting the size of local authorities. My Bill's provision to ensure that the scrutiny officer is sufficiently resourced will make a significant improvement and lead to greater quality and thoroughness in the scrutiny process.

The impact assessment published alongside the Bill indicates that the total cost of compliance on the new providers brought within the regime is likely to be less than £300,000 per annum. The cost of ensuring that scrutiny officers are properly resourced to do the job will be less than £4.5 million per annum and will be fully funded by the Department.

I shall refer briefly to some of the scrutiny work that my local authority, Bury metropolitan district council, has done in recent years. It is an authority without a dedicated team of officers. Nevertheless, it has adjusted to the new regime and started to get to grips with serious issues affecting the borough. It has built strong relationships with its partner providers, and it has a good track record on work on, for example, domestic violence, hard to reach young people, town centre safety, the future of the music service, safeguarding children, alcohol misuse and residential care. As the lead authority for the joint committee for the Pennine Acute Hospitals NHS Trust, my authority has contributed to a much larger review of dementia services, stroke services and health care-acquired infections.

I draw the attention of the House to the annual awards made by the Centre for Public Scrutiny-the good scrutiny awards. There is an impressive list of authorities that have won awards under different headings-for the best team, for financial scrutiny, for community engagement, and for scrutiny of health policy. This is the best example, which is available on the website of the Centre for Public Scrutiny, showing the range, depth and growing innovation in scrutiny processes.

There are probably four characteristics of good scrutiny, and my Bill will enhance all four. It is important that the scrutiny role adopts the approach of a critical friend. Scrutiny should not be hostile, aggressive or designed to subvert or destroy; it should, as I have said, act as a critical friend. Scrutiny must respond to and reflect
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genuine and deep public concerns; it cannot be arbitrary. It must be owned by people with an independent mind who are not subject to predetermined thinking on the issue that they investigate and scrutinise, and the object of scrutiny must be to drive improvement in public services.

In conclusion, I again thank all those who have contributed to the development and preparation of the Bill. It is based on principles that are now supported in all parts of the House, and it makes provision for new powers that build on those that have been agreed to in previous legislation. Those new powers are designed to improve the quality of public services through greater accountability in order to help renew public confidence in the local democratic process. I commend the Bill to the House.

10 am

Justine Greening (Putney) (Con): The Opposition very much appreciate the Bill's intention, which is to give councils much greater powers to scrutinise local public services. We all recognise that the delivery of those local public services has changed over time, and a variety of providers not just in the private sector but increasingly in the third sector now provide essential public services for local communities throughout the country. A local authority's scrutiny functions are therefore a vital tool in promoting accountability and ensuring transparency in local decision making, and that allows local communities to become involved in the decisions that affect their daily lives. Given the importance of the powers that the Bill confers, and the Government's previous commitments to introduce them, we are slightly concerned that the actual legislation before us is a private Member's Bill. It appears to all intents and purposes to be a Government Bill.

Having said that, I turn to the broad sweep of the Bill, the intention behind which we support. We have some concerns about the wording of certain clauses, and before the Bill goes into Committee we would like to flag up those concerns so that Ministers and the hon. Member for Bury, North (Mr. Chaytor) take them on board and we have a more constructive debate in Committee.

Overview and scrutiny committees perform an important function, reviewing policy and performance and holding local public service providers to account. Currently, those committees have the power to require information from a range of organisations including councils, NHS bodies, law and order bodies and partner authorities that are involved in local area agreements. The committees can also summon representatives of most of those bodies to appear before them, and they can require such officials to respond to reports and recommendations that have been issued to them. However, that does not happen with all bodies-for example, partners that are involved in delivering local area agreement objectives. Indeed, many other local bodies are not required to submit to the same level of scrutiny by local authorities, so their voluntary participation in scrutiny is not guaranteed.

There is a growing recognition that overview and scrutiny committees need to have powers over a wider range of external organisations as they become more involved in local public services, and that councils should provide sufficient resources and support to those committees so that they can undertake more scrutiny.

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The Bill seeks to address a number of issues, and we welcome its intention to increase local scrutiny powers. However, I want to flag up a number of concerns about how the Bill, as currently worded, will work in practice, so that in Committee we can have a proper debate about the range of challenges that the Bill poses. I shall quickly go through the Bill, clause by clause.

One of the most important measures in the Bill is the power to scrutinise a "designated person or authority", and there are questions about how that designation will be defined. It would therefore be helpful if the Minister could either set out his views on the organisations that could come under the Bill's designation or state whether he intends to publish a draft list of such bodies. That would be helpful, because many Members would then have a better idea of the Bill's sweep.

The hon. Member for Hendon (Mr. Dismore) rightly raised not concern but his interest in understanding how broad the designation will be, because clause 1 is vague. Subsection (2) defines a matter "'of local concern'", but it does so relatively, stating:

I am not clear about how that definition will work in practice, or about whether we actually want that provision.

Mr. Dismore: First Capital Connect-my example-has seriously affected not only my constituents but those of all MPs all the way along the line, from Bedford down to the south coast. On that basis, the test to which the hon. Lady refers might not be met. However, that example would clearly meet the test of a matter of great local concern.

Justine Greening: The hon. Gentleman raises an important practical example, demonstrating why we want the Bill to be improved and more tightly worded. The other obvious example is the post office closure programme, which was incredibly controversial in many local communities. It affected all local communities, including my own, but, based on clause 1 as drafted, it would not fall within the scope of an overview and scrutiny committee. The committee would not be able to question Post Office managers about the way its service proposals might affect local communities and businesses, and we have some concerns about that.

Clause 1 also includes the power to designate

Does the Minister feel that there is a danger of the designation becoming broader than necessary? We want to ensure that the Bill is effective, but that it does not become so broad that it ends up being cumbersome for all concerned. More clarity from the Minister would help our understanding of the clause's breadth. Specifically, will regional development agencies be included? The hon. Member for Hendon is clearly concerned about transport providers, and many London MPs regard them as bodies providing public services that their local councillors may well want to scrutinise.

Once we have agreed which public service providers come under the designation, the next question is, what activities will be scrutinised? The Bill's definition of a matter "of local concern" is vague, so will the issues that it covers be consistent with those that were outlined
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in the Department's 2009 Green Paper, "Strengthening Local Democracy"? That document mentioned police strategies, fire and rescue authority plans, council delivery of education and wider issues that were not related to local area agreement targets. Given that the Bill follows on from that Green Paper, will it be consistent, to all intents and purposes, with that document's list of issues?

The Department's press notice on 1 February stated that the scrutiny arrangements "could" mean that service providers were held to account on issues "like" energy companies leaving repairs unfinished, station safety and facilities and the availability of rural bus services. Will the remit extend to local matters that have not occurred but might do, such as a potential post office closure, or a potential change? People are often concerned about such change before it occurs. Many local authorities will want to scrutinise decisions before they are taken, but the Bill restricts them to scrutinising decisions that have already been taken.

I shall move on, as I do not want to detain the House for too long. The Bill also covers the information that scrutiny committees can require from the relevant bodies and services. An appropriate representative can be required to appear before the committee to answer questions and the organisation can be required to reply to reports or recommendations. We see the merit in that.

Obviously, granting councils a full range of scrutiny powers over local bodies is a step in the right direction, but we need to be careful that the regulations brought in by the Secretary of State do not impose an excessive burden on organisations affected by the Bill. It would help if the Minister told us a little more about the breadth and formulation of those regulations. What criteria might the Secretary of State and the Minister use to determine any limits on these powers? Clause 3(1) talks about committees having information that they "reasonably" require; in Committee, it will be important to talk in more depth about what, in practice, that reasonableness test might be.

The impact assessment accompanying the Bill estimates that the private and public sectors could face an extra £285,000 and £35,000 respectively in compliance costs. Ministers must have made some sort of detailed assessment to come up with such figures, and I should like to know about that assessment in a bit more detail.

I deal now with the issue of having executive council members on the committee. I want to flag up a concern about that, as it seems to go against what Ministers were saying back in 2000, when they brought forward the more dramatic changes to the management of councils. The Bill starts to go back on the distinction between councillors involved in delivering policy and those involved in scrutiny. It would be helpful to hear a bit more about why the hon. Member for Bury, North and the Minister-the Government support the Bill-feel that that is a good move and is worth doing. Will it not undermine the overall structure of accountability, which has proved useful to many local councils? The Centre for Policy Studies was previously concerned that the involvement of executive councils in the scrutiny process would blur the lines between the two functions.

I want to mention scrutiny within councils and the cost to local authorities. Clause 9 requires that officers should be provided with

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as are determined by the officer to be sufficient to discharge their functions. The Local Government Association has said that it wants to be left with the ability to make local decisions about how to ensure that scrutiny is well supported within its local authorities. The explanatory notes said that the new powers could cost local authorities £4.5 million, and I am sure that the Minister will confirm that that will come out of their existing budgets.

Given the constraints on local authority budgets at the moment, it is particularly important that local authorities be able to make their own decisions about how they want to ensure that councillors involved in scrutiny can scrutinise well. For many councils, that may well mean more of a focus on developing the councillors' skill sets rather than having support for them. To my mind, that would be no bad thing at all, although it would not necessarily mean the approach to scrutiny and its resourcing that is set out in the Bill, which is too prescriptive in many respects.

The 2008 Centre for Policy Studies survey of local government scrutiny found that there was a slight negative trend in the size of allocated discretionary budgets for scrutiny. Clearly, there is a change of approach among local authorities in respect of resourcing scrutiny. It is important that we work with them to find out how they feel it can best be delivered.

My last point is about joint committees, and I want to issue a challenge to the Minister. The Bill talks about joint overview and scrutiny committees. As I am sure the Minister is aware, those were enacted, as it were, in January this year, but the regulations to enable them to come into being with the powers given by last year's Bill have not gone through Parliament. Given that, technically, the committees do not yet exist, it seems a bit presumptuous that this Bill should extend their powers further. Will the Minister enlighten the House on when those regulations will pass through Parliament, so that joint overview and scrutiny committees can be properly established?

Broadly, we believe that the Bill could move the quality of scrutiny at the local level in the right direction, so we shall not stand in its way. We have some concerns, which I have begun to outline, about the wording and breadth of clauses and how effective they may prove. However, we look forward to working with the Government and the hon. Member for Bury, North in Committee. I look forward to hearing the Minister's response.

10.16 pm

Mr. Nick Raynsford (Greenwich and Woolwich) (Lab): At the outset, I should declare a non-remunerated interest: I am the chairman of the Centre for Public Scrutiny. I am grateful to my hon. Friend the Member for Bury, North (Mr. Chaytor) for his kind remarks about the centre's work and the support that it has given him in preparing the Bill.

I very much welcome the Bill and congratulate my hon. Friend on his choice of subject. All of us in the House are aware of the importance of scrutiny in achieving a range of different objectives. First, it advances good government, on the simple principle that an executive is always kept more on its toes if its activities are properly scrutinised, whether in local government, here or anywhere else. Secondly, scrutiny is a way of identifying
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opportunities for doing things better-finding innovative ways of tackling problems or saving money by achieving objectives in a more cost-effective way. That has been demonstrated across a range of different scrutiny activities at both central and local government levels. Thirdly, scrutiny can help to identify areas where we could ensure better co-ordination between different agencies, all of which have a role in the delivery of public services. That, of course, is very much the focus of the Bill.

As we all know, we have a long tradition of scrutiny here, but the tradition in local government is much shorter. My hon. Friend has highlighted the progress since the Local Government Act 2000 in the extension of scrutiny and scrutiny powers in local government, including the extension to cover other functions such as policing and health, which has been enacted by subsequent legislation. The Bill is an important further step along the route of extending and embedding the principle of good scrutiny at a local level. I very much welcome it.

The extension of the powers to require evidence and to require people in certain circumstances to appear in front of a scrutiny committee is important. There is anecdotal evidence that in some cases local authorities seeking to scrutinise have found it difficult to secure the attendance of partners or other local authorities with a significant role in the delivery of public services; they have been reluctant to submit themselves to local authority scrutiny. In my view, it is absolutely right that the additional powers should be provided.

At the same time, it is right that the way the legislation is drafted should not seek to impose too prescriptive an approach. One of the strengths of the way scrutiny has developed in local government has been the capacity of individual authorities to be innovative and try approaches slightly different from those of their neighbours. We should continue to encourage that; we should allow the greatest possible flexibility and freedom for authorities to develop not only their own scrutiny functions, but joint scrutiny activities with other authorities and the scrutiny of their partners in innovative ways.

We need to think much more about how to disseminate good practice. My hon. Friend was kind enough to refer to the Centre for Public Scrutiny's annual scrutiny awards and the focus that they are intended to give to spreading good practice and highlighting examples of innovative work by local authorities, on the basis that others should learn from that.

I support all that, but there is a curious gap in the process as far as we in the House are concerned. For all the talk of better scrutiny, I can see no evidence whatever of any Select Committees entering into joint scrutiny functions with local scrutiny committees or seeing the scope for using the evidence that emerges from local scrutiny to support or underpin their work. It is surprising that we operate in two separate silos-central and local government. We are not exploring the scope for better joint working to the extent that we should. Although Select Committees are not covered by the Bill, I hope that in our consideration of the principle of bringing together different public authorities responsible for delivering services and of the impact they have on a particular area, which is very much part of the Bill, we will also consider how we can bring together the scrutiny functions of our Select Committees and those of local authority scrutiny committees and learn from each other's good practice.

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