Localism Bill

Memorandum submitted by the Mayor of London

and the London Assembly (L 19)

Summary

1. The Mayor of London and the London Assembly welcome the Government’s ‘New Settlement for London’, as contained in Part Seven of the Localism Bill. These provisions not only grant London, its institutions and people with greater power over the decisions which most affect their daily lives, but also recognise the maturity, success and legitimacy of London’s unique governance arrangements. The provisions in this part of the Bill reflect the proposals put forward by the Mayor, Assembly and London Councils in June of last year.

2. Part Seven of the Bill builds on the devolution settlement which was put in place by the Greater London Authority (GLA) Act 1999 and which re-established London government with an elected Mayor acting as the executive for the GLA group and the Assembly as the group’s scrutiny body.

3. London’s devolution settlement will be greatly strengthened by the Bill’s proposals for, and the Government’s commitment to:

· Devolving the powers and responsibilities of the Homes and Communities Agency (HCA) in London to the GLA;

· Rolling into the GLA the functions currently carried out by the London Development Agency (LDA);

· Providing the GLA with the power to establish Mayoral Development Corporations (MDCs) to focus regeneration where it is most needed; and

· Strengthening the accountability and transparency of the GLA group by giving the Assembly a power of rejection by two-thirds majority over Mayoral strategies and applying local government transparency requirements to Transport for London.

4. The Mayor and Assembly welcome the Government’s recent Statement of Intent regarding the transfer of the management of the Royal Parks to the GLA and hope that this can be taken forward through the Localism Bill.

5. The Mayor and Assembly believe, however, that there are several elements of the legislation which ought to be improved during the Bill’s Committee Stage:

· Standards; the Mayor and Assembly should jointly oversee any future standards regime rather than it being solely a matter for the Assembly;

· EU fines; the Government should first have exhausted all potential remedies in domestic law before passing on an EU fine and, should it become necessary to pass on part of a fine, the penalty should be determined objectively through a judicial process;

· Local referendums; given that the cost of each pan-London referendum would be between £5 million and £11 million, the Bill should include a proportionality test to be applied by the GLA for pan-London referendums;

· Creation of MDCs; the Mayor and Assembly are aware of, and are sensitive to, London boroughs’ concerns about MDCs’ potential impact on borough planning powers, and are happy to consider safeguards that could be built into the process of establishing MDCs;

· Shared services; the current GLA shared services power should be widened from the GLA and its functional bodies to cover all public bodies;

· London TravelWatch; TravelWatch should cease to be a separate body; and

· Assembly summonsing powers; the Assembly’s powers to summons persons and information should be widened to include bodies outside of the GLA.

Part 1 – Standards

6. The Mayor and Assembly welcome the flexibilities proposed for local authorities’ standards regimes contained in the Bill. However, they also note that the Bill provides that GLA standards duties and powers would in the future be solely the responsibility of the Assembly. In the context of the GLA, such a regime should be shaped by both the Mayor and Assembly (as it currently is), rather than just the Assembly (as is proposed), as the Mayor would also be subject to the regime and should, therefore, have an opportunity to shape it.

Part 2 – EU fines

7. Part 2 of the Bill makes it possible for a Minister to require a local authority to make a payment in relation to an EU financial sanction imposed on the UK if the Minister is satisfied that the authority caused or contributed to the infraction of EU law. 

8. The Mayor and Assembly believe that the Bill should make it clear that Ministers cannot impose a financial sanction on a local authority unless they have exhausted all potential remedies in domestic law to address the alleged infraction and that the penalty is determined objectively through a judicial process so as to allow all relevant authorities to make representations in an independent forum. This will be particularly necessary for complex issues such as waste and air quality.

Part 4 - Local Referendums

9. The Mayor and Assembly support the introduction of local referendums for issues of concern to Londoners. However, the cost of a GLA pan-London referendum would be between £5 million and £11 million on each occasion (depending on whether it is combined with an existing election). This would be disproportionate in comparison to the annual cost of running the GLA (approximately £70 million).

10. The Bill should therefore include a proportionality or value for money test to be applied by the GLA when determining whether or not it is appropriate that a pan-London referendum should be held.

Part 5 – Planning

11. The Mayor and Assembly welcome the changes proposed to the Community Infrastructure Levy, particularly the flexibility being proposed around examiners’ reports. This will shift power to local authorities from unelected officials to determine local authority development priorities and plans.

Part 7 – London

Housing – Chapter 1

12. The Mayor and Assembly welcome the Bill’s provisions for tailoring housing delivery arrangements to meet London’s needs. The Bill devolves the powers and responsibilities of the HCA in London to the GLA and also sets out the relationship between the Mayor and the Social Housing Regulator, placing obligations on each body to co-operate with one another.

13. These provisions will improve the ability of the Mayor to make joined up strategic decisions about the major infrastructure for which he is responsible – on social housing, transport and economic development – by enabling him to wrap housing investment decisions into the GLA group’s budget and planning processes.

14. The Mayor will not only have greater freedom and flexibility to respond to the needs of Londoners and to improve further the delivery of key services, such as the provision of affordable housing, but the Assembly will also be able to play a much fuller role in scrutinising the delivery of housing on behalf of Londoners.

Economic Development – Chapter 1

15. The Mayor and Assembly welcome the proposals in the Bill relating to economic development. The Bill’s provisions will enable the Mayor to have a more direct say over economic development in the capital as a result of the plans to:

· Roll into the GLA the functions currently carried out by the LDA;

· Give the Mayor a new power to create MDCs; and

· Place the Mayoral Economic Development Strategy directly under the GLA.

16. For this transfer of powers to be a success it is, however, vital that the Government continues its policy of ensuring there are sufficient resources to carry out these functions.

Mayoral Development Corporations – Chapter 2

17. The Mayor and Assembly welcome the proposals in the Bill for the GLA to establish MDCs to focus regeneration where it is most needed. While the Bill includes powers for the Mayor to create MDCs anywhere in London, there are no current plans to create any beyond an Olympic Park MDC.

18. Having identified the Olympic Park and surrounding area as London’s single most important regeneration project for the next 25 years, the Mayor believes that an MDC will provide the clear, integrated and streamlined delivery structures which will be necessary for the regeneration and development of this area and responsive to local concerns.

19. While welcoming the clauses of the Bill relating to MDCs, the Mayor and Assembly are aware of, and are sensitive to, London boroughs’ concerns about their potential impact on borough planning powers and are happy to consider safeguards that could be built into the process of establishing MDCs.

Greater London Authority Governance – Chapter 3

20. The Mayor and Assembly believe that the Bill’s provisions for streamlining the GLA’s governance framework are sensible. They welcome, in particular, the proposals for:

· Allowing Ministers to delegate Whitehall functions to the GLA by mutual consent and the flexibility that this would afford London;

· Rationalising the number of Mayoral environmental strategies and to streamline the consultation process for all Mayoral strategies;

· Strengthening the Assembly’s role with regard to Mayoral strategies by giving the Assembly a power of rejection, exercisable in the event that the Assembly achieves a two-thirds majority to do so; and

· Applying local government transparency requirements to Transport for London's board and committees, in order to formalise and strengthen its transparency arrangements.

21. In addition to the Bill’s existing provisions, the Mayor and Assembly would like to see the following included in the legislation, each of which reflects the proposals put forward by the Mayor, Assembly and London Councils last year.

Shared Services

22. The Mayor and Assembly believe that the Bill should amend the GLA Act 1999 to allow the GLA and its functional bodies to share services with all public bodies and not just with one another, as is presently the case. This would enable further savings to be achieved across London’s government and other public bodies.

TravelWatch

23. The Mayor and Assembly do not consider that there is a case for retaining London TravelWatch as a separate body when the elected Assembly could fulfil its functions at a much lower cost and with a clearer line of accountability to the electorate.

24. The Mayor and Assembly would like to see the Assembly’s powers to summons persons and information widened to include all relevant bodies outside of the GLA group, such as the London Ambulance Service and the London operations of the Environment Agency and Network Rail.

January 2011