18 Mar 2014 : Column 702

Local Government: Combined Authority Orders

Mr Speaker: With the permission of the House, we will debate the combined authority orders together.

3.52 pm

The Parliamentary Under-Secretary of State for Communities and Local Government (Brandon Lewis): I beg to move,

That the draft Combined Authorities (Consequential Amendments) Order 2014, which was laid before this House on 10 March, be approved.

Mr Speaker: With this we shall consider the following motions:

That the draft Barnsley, Doncaster, Rotherham and Sheffield Combined Authority Order 2014, which was laid before this House on 10 March, be approved.

That the draft Halton, Knowsley, Liverpool, St Helens, Sefton and Wirral Combined Authority Order 2014, which was laid before this House on 10 March, be approved.

That the draft West Yorkshire Combined Authority Order 2014, which was laid before this House on 10 March, be approved.

Brandon Lewis: These orders, if approved, will bring about the establishment of combined authorities in three of our major metropolitan areas: across Merseyside and Liverpool; around Sheffield and South Yorkshire; and in West Yorkshire. In each of those areas the combined authority will be responsible for economic development and regeneration, and for transport. As all the councils in each area have agreed, their combined authority will be able to recognise and exercise their functions on economic development and regeneration. Their combined authority will also have the transport functions currently exercised by the area’s integrated transport authority, and that ITA will be abolished on the establishment of the combined authority.

Central to what we are considering today are two key priorities for this coalition Government: growth and localism. Achieving economic growth is essential to the recovery of our economy and rebuilding our future after the economic failures and spiralling of debt that we inherited when we took office in May 2010. It is through achieving economic growth that jobs are created, that incomes of hard-working families can grow and that we can build sustainable prosperity for communities across the country. The policies of this coalition Government are delivering, with unemployment now at just 7.2%; with increasing numbers of people in employment; with more women in work than ever before; and, as my right hon. Friend the Chancellor told the House in November, with growth then estimated by the Office for Budget Responsibility at 1.4%.

An important element of our policies, as we made clear in our White Paper response to Lord Heseltine’s report on growth, is that local authorities have a vital role to play. Councils should put economic development at the heart of all that they do, collaborating with private sector partners and others across a functional economic area. A combined authority is a means for councils to undertake that collaboration, which will be the foundation of all that they do to promote economic growth. It is not surprising, therefore, that each of the proposed combined authorities has been recognised as key in the city deals that we have agreed with each area.

18 Mar 2014 : Column 703

If Parliament approves the draft orders, we expect those authorities to be equally key in any future growth deals with funding from the local growth fund.

Under our policy of localism, it is entirely up to councils whether they choose to collaborate through a combined authority or through some other arrangement. Our whole approach to combined authorities, which is reflected in the draft orders, is one of localism. When councils come forward with a proposal for a combined authority that commands wide local support, our policy is this. If we consider that the statutory conditions are met, we will invite Parliament to approve a draft order that provides for the establishment of the proposed combined authority, which will enable the councils concerned to give full effect to their ambitions for joint working.

Localism will guide our response to any proposals for changes to a combined authority after its establishment, such as if another council wishes to join the combined authority as a constituent council, or if a council that is a member of a combined authority wishes to leave. In any such case, our policy will be to seek parliamentary approval for a draft order that enables the change to be made, provided that we are clear that the change meets the statutory conditions.

John Healey (Wentworth and Dearne) (Lab): The Minister is making the interesting argument that localism will be the principle that guides future decisions about the development of the combined authorities. Does that principle also apply to the devolution of further powers and responsibilities to combined authorities if they properly request such powers?

Brandon Lewis: The right hon. Gentleman’s question gets to the heart of the Localism Act 2011, which was about devolving power not only to local authorities but to local communities to empower people to get things done. If local authorities have further ideas about things that they want to do, I encourage them to come and talk to us. The Minister of State, Cabinet Office, my right hon. Friend the Member for Tunbridge Wells (Greg Clark) and I will be interested to talk to local authorities about what more we can do to empower them to develop economic growth and take their communities forward.

In each of the draft orders, we have considered the circumstances of the combined authority proposal that the councils have made, as the law requires, and we have concluded that it is right for us to pursue our localist policy in those cases. We have considered each proposal for a combined authority in the light of the statutory conditions set out in the Local Democracy, Economic Development and Construction Act 2009, under which any combined authority is established. Those conditions are that my right hon. Friend the Secretary of State must consider that establishing the combined authority is likely to improve the exercise of statutory functions relating to transport in the area; improve the effectiveness and efficiency of transport in the area; improve the exercise of statutory functions relating to economic development and regeneration in the area; and improve the economic conditions in the area. We consider that those tests are unambiguously met in each case.

In short, each combined authority will bring together decision making on the closely interrelated issues of transport and economic development, and will provide

18 Mar 2014 : Column 704

for more efficient, effective, and transparent decision making by councils, with their partners, across the whole of the functional economic area they serve. We consider that it is right to establish those combined authorities, having regard, as the 2009 Act requires, to the need to reflect the identities and interests of local communities and to secure effective and convenient local government. Further, we are clear that in each of the areas, the combined authority will command wide local support.

Julian Smith (Skipton and Ripon) (Con): What consideration has been given to the impact on the communities that will be left behind when a local authority decides to get into bed with one of the new combined authorities?

Brandon Lewis: I appreciate the point that my hon. Friend is making, but nobody will be left behind. Other areas will be able to form their own combined authorities and develop their own economic growth, and we would encourage them to do so. I think that he is referring directly to the situation in York, which does not form part of today’s discussions; that debate will follow at a later date. There will also be a consultation process, and the people and businesses in York, as well as the local enterprise partnership, the local authorities and the Members concerned, will obviously want to feed into that process their views on the effects of the proposals on York, and on the benefits or otherwise of York being part of a combined authority. I have made it clear that we will facilitate opportunities for areas such as York to join a combined authority later. We are also ensuring that a local authority will be able to step away from such an arrangement if it feels right for it to do so.

Julian Smith: I thank the Minister for that full response. When he and his Department consider any application by York to join the new West Yorkshire combined authority, I urge him to consider carefully the impact that that would have on constituencies such as mine in Skipton and Ripon and on other rural areas that rely on their relationship with York.

Brandon Lewis: I can give my hon. Friend an assurance that we will give that matter our full consideration. One reason that the arrangements in York are not part of today’s orders is that we intend, before purdah, to lay the paperwork for a legislative reform order and to have a full consultation process, and I am sure that he and others will wish to feed into that process, offering views both for and against the proposals. Their views will be given full consideration.

We are clear that in each of these areas the combined authority would command good support from local businesses, from the local enterprise partnership, from other public bodies, from institutions such as the universities in the area and from local people and their democratically elected representatives. Accordingly, on the basis of our localist approach, we are seeking the approval of the House for these draft orders today—orders to which each of the constituent councils has consented. We are doing this on the basis of the information that we have about each proposed combined authority. That includes the governance reviews undertaken by the councils in each of the areas, as required by the 2009 Act if they are to propose a combined authority.

18 Mar 2014 : Column 705

John Healey: I welcome the orders that have been placed before the House. The Minister described them a moment ago as “draft orders”. If they are draft orders, when will we get the actual orders? He rightly said earlier that the integrated transport authorities would be abolished on the day on which the orders are made. For the sake of clarity, will he therefore tell us whether the orders that he is asking the House to approve today are draft orders or the orders that will actually do the job that he has described?

Brandon Lewis: I think that there is an issue around wording here. They are draft orders until the House approves them. When that happens, they become the orders. I am asking Members to vote today on the orders, but they are technically draft orders until we approve them.

John Healey: I thank the Minister for that clarification. Will he therefore tell me the date on which the orders will come into force and on which the integrated transport authorities will effectively be abolished?

Brandon Lewis: If the right hon. Gentleman will bear with me, I will come back to him on that question later this afternoon.

Mr George Howarth (Knowsley) (Lab): It is 1 April.

Brandon Lewis: Does the right hon. Gentleman wish to intervene?

Mr Howarth: The Minister is probably in a better position to know about this than I am, but I think that all these arrangements come into effect on 1 April.

Brandon Lewis: Yes, that is the intention. I was going to come to that in a few moments. I am grateful to the right hon. Gentleman for his intervention.

As I was saying, we are doing this on the basis of the information that we have about each proposed combined authority. That also includes the results of the consultations we have undertaken for each of the proposed combined authorities—again, as required by the 2009 Act—as well as detailed proposals from each group of councils on how they wish their combined authority to operate, to take decisions and, most importantly, to be open, transparent and accountable. I know that the shadow Minister, the hon. Member for Corby (Andy Sawford) and I share a view on that.

John Pugh (Southport) (LD): On the question of transparency and openness, I note that the explanatory memorandum states:

“The Government has now provided in the Order that it is mandatory for the Combined Authority to have an overview and scrutiny committee which can be made up of members across the parties.”

In that context, would political representation on such a committee have to be mixed, or could there be representation by just one party, even in an area with very mixed political representation?

Brandon Lewis: I will touch on the make-up in a moment. It would be representative of the political representation across the combined authorities—so a mixed make-up.

John Pugh: Proportionally?

18 Mar 2014 : Column 706

Brandon Lewis: Yes, proportionally.

On the draft orders, three provide for the establishment of combined authorities across Greater Merseyside, South Yorkshire and West Yorkshire. Each of the three draft orders specifies the formal legal name of the combined authority to which all the councils concerned have consented. How that authority will brand itself, including the use of any brand name, will be entirely a matter for the combined authority.

The three draft orders also make provision for the abolition of the integrated transport authority for the area. They also set out the transport and economic functions of the combined authority and its membership and constitutional arrangements. Those constitutional arrangements include a requirement for there to be at least one overview and scrutiny committee, with a membership drawn from members of the councils concerned, to hold the combined authority to account. Good governance practice will mean that such committees will be politically balanced, enabling appropriate representation of councils’ minority parties in the governance of the combined authority.

The fourth draft order simply makes amendments to transport legislation, which are applicable to all combined authorities. The draft orders will come into force the day after they are made, and the intention is for that to be 31 March.

The draft orders, if approved, will open the way for the councils in each of the functional economic areas surrounding some of our greatest cities to deepen and intensify their collaborative joint working with each other and with public and private sector partners. By doing that, they will open the way to boosting economic growth in three of our major conurbations, increasing investment, and promoting more strongly and effectively the economic prosperity of those areas, which is something that we all want to see happen in our communities. I therefore commend these draft orders to the House.

4.7 pm

Andy Sawford (Corby) (Lab/Co-op): I welcome the opportunity to debate these important statutory instruments, which will help local authorities in key areas of the country to work together more effectively in the interests of their communities. It is good to see so many Members here to participate in the debate and to share local perspectives on how to ensure that the combined authority areas can succeed.

Labour is broadly supportive of the statutory instruments. We note that they have the support of the local authorities in the areas concerned. Indeed there is clear evidence of support from the public, businesses and other partners in the areas. The authorities concerned are overwhelmingly Labour. Along with Greater Manchester, they are giving a lead to all of local government, and we are proud of them. Thanks to their committed and innovative leadership, those authorities are making a real difference and showing the way forward through a cost of living crisis created by this Government.

Julian Smith: Does the hon. Gentleman think that leadership was the reason the Labour-led York council played petty politics with the York and North Yorkshire local enterprise partnership last year—petty politics

18 Mar 2014 : Column 707

that have continued into this year? Such behaviour shows that the level of leadership in the council is really pretty depressing and low.

Andy Sawford: Well, I know petty politics when I see it, and the hon. Gentleman’s remarks sound very much like it. His remarks were inconsistent with his earlier comments about the importance of the partnership between the authorities that surround York. I will come on to the arrangements in that area of the country: I want to raise issues about York, which may interest the hon. Gentleman. Whether or not he will agree with me on them remains to be seen.

For economic success across the country, we must make the most of the strengths of different sectors across our country, and develop new skills and industries. Clearly, greater local collaboration and co-operation can produce much better results on issues such as transport, housing, employment, skills and training than can national programmes run from Whitehall. Combined authorities have a key role to play in that, as many councils believe that to deliver the best outcomes for their communities, the time has come to take current governance models to the next level, moving from informal collaboration to joint decision making on some issues.

There is an irony in the fact that the Government now recognise the value of combined authorities, which were first introduced in the Local Democracy, Economic Development and Construction Act 2009, about which Government Members have been contemptuous both in opposition and in government. The Act made provision for the establishment of economic prosperity boards and for combined authorities. After some years of drift, during which the Government tore up the regional development agency structure in an act of economic vandalism at a time when our economy was beginning to recover from a global recession, Lord Heseltine’s much-trumpeted review in 2013 came up with the big idea of combined authorities. We welcome the Government’s conversion, however reluctant it is, but we regret the delay.

The new combined authorities will bring many benefits, including the strong and visible collective leadership of an area with democratic accountability and an influential and unified voice. That leadership will be able to have a single conversation with the Government, national agencies and business leaders and to align decision making and economic growth at a strategic level so that there is a single framework underpinned by a coherent strategy and investment programme. It will have the opportunity to draw together a range of funding sources, including EU funds—this has been a key issue in the recent interregnum, during which there has not been a clear strategy from central Government—and a devolved local growth fund. The combined authorities also create the opportunity for closer working across the public sector to integrate functions and services and provide innovative solutions to the challenges of reduced budgets, which particularly affect the authorities in the combined authority areas that have had an above-average cut in a deeply unfair funding settlement.

The Greater Manchester combined authority shows the benefit of the system: its achievements include the major refurbishment of Bolton and Rochdale railway stations; the revolving infrastructure fund, which is

18 Mar 2014 : Column 708

worth £30 million a year; permission for up to 7,000 new homes to be built by 2017; a programme of low-carbon measures; and overall savings of £11.7 million a year.

I recommend that all Members of the House read the excellent report recently published by Labour’s local government innovation taskforce, which includes many of the success stories of the Greater Manchester combined authority and local authority partnerships across the country. I firmly believe that the West Yorkshire combined authority, the South Yorkshire combined authority and the Halton, Knowsley, Liverpool, St Helens, Sefton and Wirral combined authority will succeed as Greater Manchester has. I also hope that the order will soon be tabled for the north-east combined authority.

The Association of North East Councils tells me that establishing a combined authority for the north-east, to put into legal form what the north-east leadership board has been doing by consent for some time, is widely supported. I hope that there can be progress.

Brandon Lewis: I can provide a piece of information to help the shadow Minister: that order was tabled on 13 March, so it will come to us for consideration shortly.

Andy Sawford: I thank the Minister for that clarification and we hope that the order will be before us soon. I understood that the conversation in that region between the local authorities had made substantial progress and that they were looking to move forward. The Opposition will support the establishment of the north-east combined authority when that is proposed, however it is named.

Today’s steps on combined authorities are welcome but still more can be done on additional freedoms. The Opposition are considering the case being made by organisations including the Local Government Association, the special interest group of municipal authorities, ANEC and other bodies for additional powers. We agree with them that there is a need for a clearer plan for sub-national government that, crucially, works for all areas of the country. There is a need for further consideration of what arrangements will work best in two-tier areas, for example. There needs to be further devolution of funding streams. The Opposition are committed to significant reform in that area: for example, we will give local authorities a strong role in co-commissioning the Work programme.

The new combined authorities are keen to have a dialogue with the Minister, as he is no doubt aware, about “earn back” schemes for their areas. Such a scheme has been a feature of the Greater Manchester combined authority. It will be useful to hear the Minister’s thoughts, and to hear about any progress that has been made with the three new combined authorities.

There is also the question of legal restrictions around the combined authorities’ ability to borrow for non-transport purposes. The authorities have argued that that will remove a significant barrier to the unlocking of local resources to support infrastructure and growth. That change has been strongly advocated by Greater Manchester. What is the Government’s view on that and how do they intend to respond? Are the Government prepared to consider the request for combined authorities to be able to recover VAT, as local authorities do?

18 Mar 2014 : Column 709

In relation to York, may we have an update from the Minister on the important matter of non-contiguous boundaries affecting authorities’ ability to combine? The Minister and I have discussed that issue informally on several occasions, and there have been exchanges in the House between us and between the Secretary of State and the shadow Secretary of State on the matter. Although those exchanges have been encouraging, there is frustration in some parts of the country about the delay. The Minister may be aware that Portsmouth and Southampton councils, for example, are keen to work more closely together but feel that they are being prevented from doing so by Hampshire county council, which does not wish to be involved in such joint arrangements. We urge the Government to consider how that issue can be dealt with in all parts of the country, but the Government may choose to make specific arrangements in individual cases.

As the Minister knows, my right hon. Friend the Member for Leeds Central (Hilary Benn) has made the case for the City of York, which wishes to join the Leeds city region. The Secretary of State has agreed that that makes sense. He told my right hon. Friend on 28 October 2013:

“I am confident we can have a resolution before Christmas.”—[Official Report, 28 October 2013; Vol. 569, c. 690.]

However, in a written answer in February the Under-Secretary of State for Communities and Local Government, the hon. Member for Great Yarmouth (Brandon Lewis), who is in his place, said that

“we are now considering consulting before the summer on a Legislative Reform Order”—[Official Report, 24 February 2014; Vol. 576, c. 120W.]

That may be the order to which he referred earlier, which the Government hope to bring forward before the purdah period.

My right hon. Friend raised the delay at Communities and Local Government questions on 3 March. The Secretary of State said:

“I did not specify which Christmas I meant. However, I gave the right hon. Gentleman an undertaking, and it was a proper undertaking. Various legal obstacles were put in our way, but we intend to consult, and, subject to the position being legally satisfactory, there will be a resolution. Given that I gave an undertaking from the Dispatch Box to resolve the matter, I will not lightly do otherwise.”—[Official Report, 3 March 2014; Vol. 576, c. 621.]

We welcome that assurance. We have appreciated the constructive dialogue that has taken place between the Opposition and the Government. We accept that the Secretary of State’s undertaking was given in good faith, but I am sure the Minister understands that there is some disappointment that the matter is dragging on.

Julian Smith: Will the hon. Gentleman clarify to the House why he is so eager for York to get into bed with the West Yorkshire combined authority? Will he come clean with the House and with voters in York and north Yorkshire? Why is he pushing this hobby horse?

Andy Sawford: The hon. Gentleman may wish to ask the Secretary of State why he agrees with us that the proposal makes sense. [Interruption.] The hon. Gentleman pushes me to say why I am keen: I am a localist. If the

18 Mar 2014 : Column 710

City of York believes that the proposal is in the interests of the community that it serves, subject to a proper process—there will be a consultation, and there will have to be compelling evidence, as there has been in the other three areas that we are considering today, that this is the right way forward—and if it is the wish of local people, of course it should go ahead. It is undemocratic of the hon. Gentleman to seek to hold back the economic development of the City of York.

Julian Smith: What does the hon. Gentleman say about the commitment that York has made—half-in and half-out—to the York and North Yorkshire local enterprise partnership? Should he not be urging York council to play a much more vigorous part in that partnership and to stop thinking about getting over to where the grass is greener in the new West Yorkshire authority?

Andy Sawford: If the people of York and the elected local authority in York believe that it is in the interests of their community, they should have the right to make that case to the Government. If the hon. Gentleman disagrees, he can put his view forward. In the end, he will have to persuade his own side, not me. I am persuaded that if that is what the City of York wants, of course it should go forward. However, the hon. Gentleman does have an important point about the relationship between the combined authorities and the local enterprise partnerships. I shall refer to that.

We accept that the Secretary of State gave the undertaking in good faith. He said that there are legal obstacles. Is it possible to address the specific issue of the City of York and address those legal obstacles separately, or are they in effect bound up together? Perhaps the Minister could comment on that. In view of the constructive dialogue that has taken place, it would be helpful for us to have a greater understanding of the legal dimension that the Government are grappling with.

There is a wider issue about how the geography of the country and the structure of local government mean that establishing combined authorities is much more difficult in many areas of the country. The hon. Gentleman alluded to that in relation to arrangements in Yorkshire. The arrangements for LEPs around the country vary hugely, and they already reflect the complex geography. There are issues regarding LEPs that need further consideration, especially around how coherently they operate with the boundaries of combined authorities. For example, the Sheffield city region LEP includes a number of Nottinghamshire and Derbyshire districts. However, given that the two county councils will not be members of the combined authority, non-South Yorkshire districts cannot be constituent members of the authority, and South Yorkshire members must always hold a majority of the vote.

If LEPs are to co-exist with combined authorities and strategic counties, they cannot merely operate in the same space. There needs to be a clear distinction of roles and responsibilities. The critical point is that while LEPs can provide private sector input and insight, which is to be welcomed, they are neither statutory nor democratically accountable bodies, and in their current form they should not hold resources themselves. The Minister will no doubt fondly recall the extensive debate

18 Mar 2014 : Column 711

on the accountability of LEPs during the passage of the Local Audit and Accountability Act 2014, and I hope that it is something he will consider further in light of the development of combined authority arrangements. The Opposition will work closely with local authorities and talk with LEPs throughout the country about their future role, particularly through the review being undertaken by Lord Adonis.

Before I conclude, I want to comment on Total Place, which the Government have rather reluctantly taken forward in their limited approach to community budgets, whereas the Opposition see much more potential and believe that combined authorities will take a lead. As well as investing more in prevention and early intervention, it is crucial that we support councils to deliver economic growth in all areas of the country. To do that, we will extend the model of city deals throughout local government, devolving power over housing and planning, and jobs and skills, but councils and communities must come together to decide how best to use the powers, and develop arrangements that suit local needs. That is what my right hon. Friend the Member for Leeds Central (Hilary Benn) calls “the English deal”.

Despite the Government promising to push power down, it has taken four years for the orders to come forward. It will be left to the next Labour Government radically to reconfigure the way in which services are designed and delivered. By devolving ineffective national programmes to local areas we will give local people more power to create services that are more responsive to local conditions, build in people’s involvement in decisions more closely, and power our economies forward throughout the country in a way that is fair.

4.22 pm

Julian Sturdy (York Outer) (Con): I join colleagues on both sides of the House in welcoming the Secretary of State’s creation of combined authorities. Far from stepping back and passively surrendering to the unyielding rise of London, with its increasingly dominant role in our economy during the past 30 years—which I know the Secretary of State would never do—the Government are rightly taking the necessary and vital steps to tackle the north-south divide head on.

The reality is that all major conurbations that have worked towards the combined authority status have, in their day, been global leaders in their respective field—steel production in Sheffield, shipbuilding in Newcastle and Liverpool, cotton spinning in Manchester, which was the world’s first industrialised city, and woollen textiles in Leeds, which in 1770 handled one sixth of the country’s entire export trade.

Alas, an illustrious history alone is not enough to sustain jobs in today’s fast-paced and frenetic global economy. We are, as has rightly been pointed out many times, in a global race, not just with our established rivals, such as New York, Paris and Tokyo, but with the new emerging business centres of the east, such as Dhaka in Bangladesh, Hyderabad in India and Guangzhou in China, a city of some 14 million people of which many in this country will not have heard. Providing our major northern cities with the tools they need to compete, not just against London but against everyone else in the international marketplace, is therefore essential to the future economic prosperity of the north and the rest of

18 Mar 2014 : Column 712

the country at large. Combined authorities show every sign of being successful in future, provided that the well-being of local residents and the long-term interests of the business community remain at the centre of their decision making.

While I am clearly in favour of combined authorities in principle, and although it undoubtedly makes sense for Leeds, Bradford and the surrounding west riding authorities to join together, I am not yet convinced that York’s destiny lies with the West Yorkshire combined authority. For those Members who are not aware, York is not, and has never been, part of the west riding. Although its economy is undoubtedly intertwined with that of Leeds and the surrounding region, its connections with the rest of North Yorkshire run deeper still, as I know the Secretary of State, being a fellow Yorkshireman, is well aware.

It is with North Yorkshire that York shares its police force and its fire and rescue services. Indeed, as has been touched on already, York has no boundaries with West Yorkshire whatsoever, encircled as it is by the North Yorkshire districts of Selby, Harrogate, Hambleton, Ryedale and East Riding. How, then, is York placed to benefit meaningfully from its membership of the West Yorkshire combined authority when it lies at the heart of North Yorkshire, and in more ways than one?

Julian Smith: My hon. Friend is making some powerful points. In his summary of all the fantastic elements of York and North Yorkshire, will he pay tribute to the work of Barry Dodd and the local enterprise partnership, which has been leading the way in ensuring that we get inward investment and new businesses set up in both York and North Yorkshire?

Julian Sturdy: I thank my hon. Friend for that timely intervention. He is absolutely right. The York, North Yorkshire and East Riding enterprise partnership has taken amazing strides forward, ably led by Barry Dodd, and it is doing great work. It is really important for the LEP that York plays a key role within it, and rightly so.

As York does not share contiguous boundaries with the rest of the West Yorkshire combined authority, it is now to be a non-constituent member without voting rights. The residents of York will presumably have to contribute funds to the combined authority—there is still some uncertainly over that—but they will not possess a vote on important matters. What safeguards will be put in place to stop those taxes being used to improve transport priorities in West Yorkshire, rather than in York?

Ultimately, it seems to me that we need not only a West Yorkshire combined authority, but a North and East Yorkshire combined authority, to act as an essential counterbalance and to support the rural hinterland that York sits at the centre of—geographically, culturally and economically. In essence, York is the heartbeat of that rural hinterland of North Yorkshire, and removing it could have far-reaching economic consequences.

Julian Smith: Is not that why it is so surprising to hear the shadow Minister’s complete lack of understanding of the economic ties that bring together the highly rural areas I represent and the outskirts of York that my hon. Friend represents?

18 Mar 2014 : Column 713

Julian Sturdy: My hon. Friend is absolutely right. There is a real danger that if York is removed, the North and East Yorkshire conurbations will lack a centre. I fear that it would be very difficult for a combined authority to come forward in those circumstances. Removing York would essentially leave North and East Yorkshire alone.

John Healey: Will the hon. Gentleman give way?

Julian Sturdy: I am more than happy to give way to another Yorkshire MP.

John Healey: The beauty of the Minister’s solution is that it will not take York out of the heart of North Yorkshire. As the hon. Member for York Outer (Julian Sturdy) has argued, York’s economy is intertwined with West Yorkshire’s. This is a variable geometry that allows it to be part of a combined authority for some of the strategic economic decisions that it can play a part in and benefit from while still maintaining its leading role within the wider North Yorkshire area for other purposes and services.

Julian Sturdy: I thank the right hon. Gentleman for his intervention. He might not be aware that York plays a key role in both LEPs, because it sits within not only the York, North Yorkshire and East Riding LEP but the Leeds LEP. It is absolutely vital that the city of York plays a leading role in both LEPs. Worryingly, over the past 12 months York took a decision to leave the North Yorkshire LEP and put all its eggs into the Leeds LEP basket. Thankfully, after some strong persuasion, that situation has been reversed. However, it showed the real danger that York could, in essence, walk away from its hinterland area for completely the wrong reasons, and we have to guard against that.

York, as a leading centre of innovation and wealth creation in the north, has so much to offer, but such opportunities must not be squandered by jumping on the first bus that comes along, which is what I fear is happening. In my view, that bus is also travelling in the wrong direction. York must not rush headlong into a decision. It must consider all its options, in consultation with local businesses and local residents, as the shadow Minister said, and then come to a transparent decision—I underline the word “transparent”—that reflects the views of the majority, not just the few.

4.31 pm

Mr George Howarth (Knowsley) (Lab): I intend to support the draft statutory instruments, and I shall give my reasons for doing so.

What used to be known as Merseyside and is now known as the Liverpool city region has, over the years, underperformed in comparison with the place we are most often compared with, Greater Manchester. That might seem a strange thing for me to say, as a Merseyside MP, but I have said it publicly before. Indeed, the Minister of State, Cabinet Office, the right hon. Member for Tunbridge Wells (Greg Clark), has heard me do so privately and publicly. I say it because we have been very reluctant, as individual authorities rather than collectively, to decide on what was right strategically for the whole city region as opposed to what might be difficult, in the short term, to argue in St Helens, Halton or Knowsley. There has been no mechanism, and often no will, to get

18 Mar 2014 : Column 714

together and say, “This is important for the whole city region. We should all get behind it and hopefully bring it to a successful conclusion.”

I will cite an example. It is significant that my hon. Friend the Member for Halton (Derek Twigg) is here as I discuss this. Under the previous Government, there was a well-worked-up project called Merseytram line 1, which the transport authority had taken to a very late stage; it had carried out all the consultation and the project was ready to go ahead. My hon. Friend, who was the Minister responsible at the time, had to decline it because of opposition from within the Liverpool city region. In other words, some parts of the city region were unwilling to support something that did not go through their own boroughs on the grounds that there was no immediate benefit to them, even though it was of strategic importance to the wider city region. That was a very short-sighted way to behave, and I said so at the time. That is partly why I welcome these orders.

John Pugh: Having said that, the scheme would have been much more successful had the route gone first to the airport, which would have benefited the whole region.

Mr Howarth: The hon. Gentleman makes a good point, but I do not agree with him. Even if he is right, is the fact that he did not agree with the specific route a reason to scupper the whole project? By saying, “If I can’t get the route I want, we won’t have a tram at all,” I think he has made the point I am trying to demonstrate. My criticism of how we have responded in the past is supported by and encapsulated in his intervention.

Derek Twigg (Halton) (Lab): I thank my right hon. Friend for making some very important points. I know the history well. There is now a much greater will in the Merseyside authorities to work together and this is probably an opportune time to do this, because there is a realisation that we have to work more closely together on strategic transport and economic issues.

Mr Howarth: My hon. Friend is exactly right. That is the case I am trying make, although perhaps not as pithily as he has. I will try to develop the argument, but before I move on I want to say that I am particularly indebted to the chief executive of Knowsley borough council, Sheena Ramsey, and her staff for the briefing they have provided for this debate.

I want to make a few points about the proposals as they stand. How can I put this? The glass is half full, and I want to explain why it is not entirely full. It is important that the combined authority will have responsibility for strategic decision making on economic development, transport, housing and employment and skills. It is time that we as a city region had that focus, which we have not always had, or even been able to have, in the past. My briefing states that the combined authority will

“be focussed entirely on strategic governance to facilitate economic growth.”

As the Minister said, that is an important new departure and one that should be welcomed. Those are the potential themes and powers, and I hope that the governance system will work.

18 Mar 2014 : Column 715

That is why I am in favour of the order and why, in the unlikely event of a Division, I would vote for it. On the Halton, Knowsley, Liverpool, St Helens, Sefton and Wirral Combined Authority Order 2014, paragraph 8.11 of the explanatory memorandum states:

“All of the statutory consultees, the Local Enterprise Partnership and the neighbouring local authorities all support the establishment of the Combined Authority.”

That is fine; it is even a breakthrough in terms of our history. Paragraph 8.12 goes on to say:

“However, the statutory consultees asked for the name to be changed from that which was proposed in the consultation (The Greater Merseyside Combined Authority). Their responses were in support of a name that included the word ‘Liverpool’, rather than ‘Merseyside’. The six constituent authorities and the Local Enterprise Partnership stated their preference for ‘Liverpool City Region Combined Authority’. Having taken account of all of the comments made”—

this is ludicrous—

“the Government has decided the name in the Order, to which the statutory consultees have now all consented, of ‘the Halton, Knowsley, Liverpool, St Helens, Sefton and Wirral Combined Authority’—

a name that really rolls off the tongue. It will be instantly forgettable for anybody who hears it.

I do have a serious point to make. The Secretary of State champions the cause of localism—I have no reason to disbelieve him—as, indeed, does my party these days. For central Government, localism means being prepared to let go a little and to say, “Well, if that’s what local authorities want to do, that’s their decision, and if they get it wrong, they’ll be punished by the electorate.” That is the essence of what localism is all about. I am sure that the Minister will not confirm this, but my information is that the person who decided that the combined authority could not be called the Liverpool city region was none other than the Secretary of State. Why on earth did he want to interfere with the naming of the new combined authority and, having decided to interfere, why did he come up with a name such as the Halton, Knowsley, Liverpool, St Helens, Sefton and Wirral combined authority?

We could argue that the name is a very accurate description of the areas concerned, but I honestly believe that this is a lesson for us all, and certainly for those in government or who aspire to be in government. If we are serious about localism, we should let local authorities make the wise decisions of which they are capable, and not tell them what to call a new combined authority. It seems to me to be an utter waste and, frankly, a misapplication of the time available to the Secretary of State, who should be getting on with more important things than interfering with this name.

A slight problem that has been a source of some controversy in my part of the world in recent weeks is that, because there is a directly elected mayor in Liverpool—Joe Anderson—the governance system is potentially asymmetric. The fact that one person is directly elected as the mayor of the city of Liverpool while the other local authorities all have leaders might make the system asymmetric. There has been a bit of a spat in the local media about who will chair the combined authority, and whether the elected mayor should do so. I do not want to interfere in that discussion. I have nothing but praise to heap on the shoulders of Joe Anderson, the elected mayor of Liverpool, who is doing

18 Mar 2014 : Column 716

a good job, but the fact is that he has not been directly elected as the mayor of Knowsley, Halton, St Helens, Wirral or Sefton, which may create a bit of asymmetry in the system.

Ultimately, my solution would be to have an elected mayor for the city region in the long term. That would mean that there was a direct relationship, on such issues as transport, between the person elected by the whole city region, and the powers available to them and their accountability to a wider electorate. We cannot allow a mayor elected for one local authority to acquire by accretion—I am not saying that that is Joe Anderson’s intention, because I know that it is not—powers in areas of which they were not elected to be mayor, which is a potential problem.

Derek Twigg: That point is very important. Most people would recognise the need for and be sympathetic to having the kind of transport and economic strategy that could be developed by the combined authority in a city region, but they clearly do not want the individual local authorities that they elect to lose powers to a wider body. There is certainly no support for that in my constituency.

Mr Howarth: Frankly, there would be no support for that in Knowsley, St Helens or Wirral. The public do not want the powers that their local authority has to be passed on to some other body. That is not what is proposed. They would also not want those powers to be passed on to a mayor who has been elected by one area, but not by the wider city region. I repeat that I mean no criticism of the individual concerned, who is doing a good job. It is just that there are two systems operating within the one city region.

I think that we will eventually reach the answer that I have put forward. In fact, as the Minister of State, Cabinet Office, the right hon. Member for Tunbridge Wells will confirm, we could have gone down that route on this occasion, but that was not the decision that the local authorities made. At one memorable meeting, I predicted that that would be the case, based on past form. However, those problems can be confronted in the fullness of time and are not barriers to going ahead with the order.

I am happy to support the order and to wish the new, inelegantly titled city region all the best for the future. I hope that it will do the job that it is billed to do, because we desperately need that in our city region.

4.46 pm

John Pugh (Southport) (LD): It is a pleasure to follow the right hon. Member for Knowsley (Mr Howarth). We have talked about these subjects many times in private and public settings. However, I do not share his enthusiasm for city region mayors.

The orders will be passed in any case, but I want to point out four distinct problems as quickly as I can. The first is the problem of peripheries. Although we talk much about communities, the orders are about councils. Councils and communities are not quite the same thing. Communities that are on the periphery of council areas, such as my town of Southport, often feel overlooked in such arrangements. I am sure that the Minister, as a representative of a seaside town, will understand that

18 Mar 2014 : Column 717

seaside towns have a special and distinct offer to make in respect of tourism, which might be lost in a city region picture.

The second problem, which we must all acknowledge honestly, is that the authorities to be combined are not of equal size. There is always the problem of the big player, whether it be Liverpool, Manchester or possibly Leeds. Manchester has dealt with the problem extraordinarily well. The combined authority is not chaired by Manchester. The system thrives in Manchester because the personnel work very well together. We cannot guarantee that that will happen everywhere.

The third problem is that of spare-part authorities. I will use the example of west Lancashire, which adjoins the Liverpool city region—I will call it that to save time. We have to accept that local authority boundaries are often the result more of gerrymandering than of intelligent design. West Lancs is very much part of many aspects of the Liverpool city region. For example, the Merseyrail transport system runs right through west Lancs. It is part of a two-tier system and at some point that anomaly will be recognised. I would like the Minister to say how that will be dealt with and how we can have not just variable geometry, but variable geography.

Lastly, I would like the Minister to say a few more words about proper scrutiny. At times, the political culture in some city regions can be somewhat monolithic—it has been recently. Its tradition is certainly adversarial. I am sure that some political players in the regions would be perfectly happy to meet in private and to strike deals away from the public and opposition members, and probably away from MPs as well. It is therefore necessary to hardwire proper scrutiny arrangements into the system. That is essential not just because it is a good thing, but because there has to be public confidence in the system. There will not be public confidence unless there is transparency and proper scrutiny. I hope that the Minister will address that issue, along with the issue of boundaries.

4.49 pm

John Healey (Wentworth and Dearne) (Lab): It is good to follow the hon. Member for Southport (John Pugh), who reminded the House just how complex any system or blueprint can be if the objective is to make it universal. That is why the Government are right to help groups of local authorities find a way to come together when that reflects a desire in their local communities. It is a question of responding to demand.

The Minister rightly told the House that he is ready to make the membership of the combined authorities as flexible as possible, according to the decisions of local people and local authorities. I hope that the Government and local authorities will not take a commitment to a combined authority lightly and simply walk away if decisions start to go against them or the political leadership of a local authority changes.

Julian Smith: Does the right hon. Gentleman agree that that is exactly what City of York council did last year? It walked away from the York, North Yorkshire and East Riding economic partnership. That example of walking away from a commitment that it had made was pretty shocking.

18 Mar 2014 : Column 718

John Healey: I am not entirely convinced that the two situations are comparable. We are talking today about a legislative commitment that binds authorities into exercising statutory powers. Participation in a local enterprise partnership is of a totally different order. I do not know the details of the judgment that City of York Council took about that LEP’s performance and its contribution to the jobs and wealth of people in the city—it would have to explain that.

I am pleased to speak after my right hon. Friend the Member for Knowsley (Mr Howarth), who is a very good friend. He made the important point that the change is a good first step, with the potential for our areas—South Yorkshire in my case, Merseyside in his—to go a great deal further, as long as the Government are prepared to back them to do so and to devolve essential powers and funding decisions that are better taken at that level. I will return to that point.

I also agree with my right hon. Friend that the South Yorkshire combined authority could and should be called that. Instead, we are asked to approve the Barnsley, Doncaster, Rotherham and Sheffield combined authority. I hope that the Minister will prove as flexible about name changes as he has promised to be about membership changes.

Brandon Lewis indicated assent.

John Healey: The Minister nods, so I will take that as a good sign. Perhaps the new combined authorities will make a forceful case for a name that properly reflects not just the geography but the identity of the area, which is what really counts for the people for whom the new combined authority will work.

I am really pleased by the active involvement of the hon. Members for York Outer (Julian Sturdy) and for Skipton and Ripon (Julian Smith) in the debate and by the arguments that they have made. That signifies to me that there is a good Conservative case, and good Conservative support, for the innovation and wealth creation potential of areas outside London and the south-east. The hon. Member for York Outer reminded us of the great contribution that many of our northern and midlands cities have made in the past and can make again. I hope that both hon. Members have made strong representations to the Chancellor on that point, and that tomorrow he will provide significant policy freedoms and funding that could give life to the arguments that they have made. I am not holding my breath, but I will be delighted if they have succeeded in arguing that case with the Chancellor.

The Minister opened the debate with the obligatory page of the Chancellor’s spin sheet. The platitudes about racing economic recovery simply do not ring true in most areas of South Yorkshire. The recovery has not reached Rotherham or Barnsley. People there feel, and are, worse off under the current Government, because incomes have not kept pace with the cost of living—in fact, they have fallen behind it. The average family in my area are at least £2,000 worse off than when the Government came into power. In a year’s time, when the Government leave power, families face the prospect of being worse off at the end of a Government’s five-year period than they were at the beginning of it, for the first time.

18 Mar 2014 : Column 719

I do not wish to make any more political points because this is an important debate and there is a broad measure of support for what the Government are proposing. On behalf of the four South Yorkshire local authorities, I pay tribute to the Minister’s decision to lay these orders before the House, and to his very able civil servants who have worked with our authorities to frame these provisions. Certainly from my point of view, and I think that of other Labour Members, he will receive support.

Authorities and areas such as Barnsley, Rotherham and Doncaster in South Yorkshire have a long history of working together well over the years, which reflects our natural economic geography and sense of identity in the wider county. The introduction of local enterprise partnerships, underpowered as they are, have reinforced that joint working over the past couple of years, and in some respects the combined authority will help to hardwire the private and public partnership working that we have established in South Yorkshire.

This is legislation for what has been collaboration by consent up to this point, and in future joint decision making will be more formal, have a legislative underpinning, and be part of a statutory entity. Those words do not mean much outside Whitehall, but I say to the Minister, and to the Minister of State, who has left his place, that I am prepared to take at face value the assertions given to the House that both Ministers are willing to consider and argue the case for greater devolution of powers, funding and responsibilities from central Government.

The problem, however, is that their arguments have not cut enough ice with colleagues in the Government and they have not made enough headway. Establishing the combined authorities removes one of the alibis that the Minister will often have found in Whitehall against devolution: “But Minister, we don’t know with any certainty who we’re devolving to.” Now that argument, that pretext for hanging on to powers at the centre, is gone. A statutory body, properly constituted with a governance arrangement and a degree of democratic accountability will, I hope, reinforce the Minister’s hand in the final 12 to 14 months that he and his Government have in office.

I hope that this will be not just the first example of bringing strategic economic development powers under the new combined authorities, working alongside LEPs, or of the powers and responsibilities of the current integrated transport authorities in our areas, but the start of a much more significant programme of devolution from the centre to our new combined authorities.

I make a plea for two steps for the Minister and his colleagues to argue with the Treasury. Will he argue to ensure that the combined authorities will, like the local authorities that constitute their membership, be able to reclaim VAT? That will make them more efficient with the use of public money, and reinforce their capacity to make a real economic difference to our area. Secondly, will he make the case, and will the Government concede for the new combined authorities the same borrowing powers that integrated transport authorities and local authorities now have—in other words, the well-established prudential regime, which is proven since the mid-2000s to have worked well for local government? Will he allow the combined authorities to borrow in order to invest beyond simply the transport field? I offer those remarks

18 Mar 2014 : Column 720

to the Minister perhaps as a very late Budget representation for Budget 2014. If I am too late for that, however, may I offer them as the first Budget representation for Budget 2015?

4.59 pm

Brandon Lewis: The shadow Minister and other Labour Members commented on the Government’s ability to localise, but I struggle to listen to them on devolution and localisation. As a council leader under the previous Labour Government, I did not see very much devolution or localisation and neither did other council leaders. I gently point out that after 13 years in government the number of combined authorities the Labour Government put in place was zero, while this Government have managed to introduce them in just three years.

We have taken a lead on combined authorities in a short time and I am glad that we have the support of Opposition Members. I remind them, particularly the hon. Member for Corby (Andy Sawford), that the Localism Act 2011 saw a massive change in how we devolve powers to local communities, not just to local government. It is probably a large part of why the well-respected Richard Leese said that there had been more devolution in three years of this coalition Government than in 13 years under Labour. Labour Members might want to bear that in mind before trying to give us lessons on how to localise.

On a more positive note, we have had an interesting debate on what will be—if Parliament approves the orders and it is clear from what has been said that the House will support them—an important development in each of the three areas under consideration. It is an important development for the economic success of the three major conurbations, centred on the cities of Leeds, Liverpool and Sheffield. It is a development that epitomises localism, being in each area founded on, and driven by, the initiative of the councils and their partners. The combined authorities will have a central role in taking forward the city deals in each of these areas. The combined authorities will be able to provide stable, efficient and accountable governance to drive forward the projects and investment needed to deliver the outcomes envisaged in those city deals. Likewise, the combined authorities will be able to provide the governance needed for any future growth deals, with resources being provided from the local growth fund.

Important points were raised by hon. Members from all parts of the House. The hon. Member for Corby raised a number of issues, not least on the local government finance settlement. He and I have had that debate on a number occasions and I can only remind him that the settlement made it clear that authorities with the highest demand for services continue to receive substantially more funding than others and have higher spending power.

The hon. Gentleman asked how the counties and districts will operate in South Yorkshire. The Sheffield city region local enterprise partnership has a strong board, and the intention is for it to work alongside the combined authority. We also understand now that the chief executives of the counties and constituent authorities have come together in agreement with the councils to have clear structures for joint working, and that gives us confidence.

18 Mar 2014 : Column 721

The hon. Gentleman rightly raised, as he has before, the question of why York cannot now be part of the order for West Yorkshire. I am happy to deal with that point. The Local Democracy, Economic Development and Construction Act 2009 requires that combined authorities consist of whole local authority areas that share the same boundaries. We are committed to reviewing the legislation as soon as possible and we will consult on how to change it and facilitate that change at the earliest opportunity. We intend to consult in the next few weeks.

The hon. Gentleman and the right hon. Member for Wentworth and Dearne (John Healey) raised the question of VAT. I am pleased to be able to give them some reassurance. I confirm that the Government will open a consultation shortly on a proposal to add Greater Manchester and the combined authorities to the existing VAT refund scheme for local authorities, and to do that through secondary legislation.

John Healey: That is an extremely welcome statement, which will be warmly welcomed in Barnsley, Rotherham, Doncaster and Sheffield. Will he give the House an indication of the value of that move for the funding available to the combined authorities?

Brandon Lewis: Not at this stage, but I will happily look into it and write to the right hon. Gentleman.

My hon. Friend the Member for York Outer (Julian Sturdy) highlighted concern that York could walk away from North Yorkshire. As the Secretary of State and I said to him when we discussed this matter recently, we appreciate the circumstances. It will be important for York to continue to maintain a constructive partnership with North Yorkshire while it pursues its ambition for calibration with the neighbouring West Yorkshire councils, its natural economic partners. I understand that York is committed to that. However, my hon. Friend also raised the interesting possibility of a combined authority of a different construction. No doubt he will be putting forward that proposal soon.

Julian Smith: I welcome my hon. Friend’s commitment to ensuring that North Yorkshire does not lose out. May I urge him also to ensure that this attempt by York is transparent and open for consultation, and is not a gerrymandering deal as well as a city deal?

Brandon Lewis: I can assure my hon. Friend of that. There will be a full process including consultation and, as has happened today, the input of Members here in the House.

My hon. Friend the Member for York Outer also asked whether the non-constituent authorities would have to contribute to the costs of the combined authorities. I can tell him that they are not required to do that. They will have to contribute only if and when they become constituent members. Funding will be based on an agreement between the constituent authorities themselves and I stress the word “constituent”—or on a default agreement relating to the populations of the constituent authorities.

The right hon. Member for Knowsley (Mr Howarth) asked about the name of his combined authority. The names of the authorities have been agreed on and

18 Mar 2014 : Column 722

consented to by all the statutory consultees, but let me say in response to an issue that others have also raised that this is localism at its absolute purest. The authorities can choose whatever name they want, work under that name, brand it and “logo” it, and I wish them all the luck in the world.

Mr George Howarth: I think it would be more accurate to say that the authorities agreed to the new name reluctantly on the understanding that they would never have to use it, which rather makes my point. What was the point of the Secretary of State’s intervening in the first place?

Brandon Lewis: Coming up with a name on which every member of every combined authority agrees to be the one and only name—and a legal name—is not always that straightforward. Under the powers that we have introduced, combined authorities can now choose the brand name that they want to use, whatever it may be, and use it strongly and effectively to represent themselves.

Mr Howarth: I do not want to labour the point, but the fact is that all the authorities had previously agreed to the name “Liverpool city region”. It was only because the Secretary of State intervened that they eventually decided to give in rather than prolong things, by calling it what they had decided rather than what he had decided.

Brandon Lewis: I am glad that the right hon. Gentleman welcomes the fact that we have given authorities the power to do what they like, to brand their names, and to use them as they wish. I am sure that they will do so very successfully. I also noted what he said about what he thinks will be the future development of the process and the establishment of a non-elected mayor for the entire area. That touches on a point that he made about this being a first step for local authorities. I am happy to state clearly from the Dispatch Box that I agree that local government is evolving and changing, as it always does over time. That is one of the strengths and beauties of the way in which local government in our country works. I have no doubt that it will evolve and change further in many other ways, and the right hon. Gentleman has described one potential change in his own area.

The hon. Member for Southport (John Pugh) mentioned seaside towns, and I share the experience that he described. He was right to point out that such towns felt left behind in the past, which is one of the reasons for the coalition Government’s introduction of the coastal communities fund. I was delighted to announce the round 2 funding a couple of weeks ago, along with the opening of round 3, which will make much more money available to help seaside towns with their economic regeneration. New criteria will make it easier for them to grow their economic futures while protecting their coastlines from erosion.

The hon. Gentleman also raised an issue related to governance. I will give him more details in writing, but I can tell him that each constituent council will appoint at least one of its elected members to be a member of the combined authority. As I said earlier, we intend them also to have non-voting members and members representing minority parties.

18 Mar 2014 : Column 723

The hon. Gentleman also mentioned the potential for dominance by the big players. The orders have specified the voting arrangements based on the scheme developed by the councils concerned and each member does have one vote and no member has a casting vote. That is why it is important that the scrutiny is run efficiently and effectively.

The hon. Gentleman also touched on West Lancashire. In response to the Government’s consultation, West Lancashire stated its support for the combined authority because of the expected improvements in transport and economic growth.

The right hon. Member for Wentworth and Dearne, in asking about VAT, also mentioned the powers to borrow. The combined authorities’ borrowing powers are limited to their transport function. They will inherit the levy-raising power of the integrated transport authority, hence the revenue-raising power exists only in relation to transport. The right hon. Gentleman also commented on my opening remarks.

John Healey: The Minister is being generous in giving way and in responding to some of the arguments today. He is stating the obvious fact that the borrowing powers in relation to transport derive from the levy-raising powers of the integrated transport authority from which the functions will be taken. However, what is the principled case for these properly constituted, legally established combined authorities not being able to borrow within the general prudential borrowing regime for local government?

Brandon Lewis: We believe the bodies that have the powers to raise revenue, or precepting bodies, should have directly elected members and be directly answerable to the electorate, and that is not possible for combined authorities. Indeed, to make it possible would require changes to primary legislation. However, I can see that the right hon. Gentleman may want to take up this issue, but, as I said earlier—and I know the Minister of State, Cabinet Office, my right hon. Friend the Member for Tunbridge Wells (Greg Clark) takes the same view—if areas have ideas on how they want to move forward and what they want to develop, they can make the case. We will certainly give them the airtime to look at that, but I would say there is a concern around them and the point about elected accountability.

I understand why the right hon. Gentleman referred to my opening remarks about economic prosperity and the desire to see more of it in parts of the country. I am sure he will want to join me in apologising to the people of his area for the problems they have faced over the last few years as a direct result of the economic mess left by the last Labour Government.

John Healey rose—

Brandon Lewis: I am sure the right hon. Gentleman is going to agree with me now—

John Healey: On the contrary.

Brandon Lewis: But I may be disappointed.

18 Mar 2014 : Column 724

John Healey: In 2007 people in my area of Barnsley and Rotherham had seen 10 years of stable economic growth, unemployment fall, employment rise, and inflation and interest rates at a stable level. Then the global financial crisis hit, and this country faced enormous economic problems, but I am proud to say the Labour Government played a part in co-ordinating the international response that dealt with that.

Brandon Lewis: The right hon. Gentleman will not be surprised to learn that I do not entirely agree with his description. He seems to forget that from 2007 to 2010 not only was there the issue with the banks, but that since 2010 this Government have been having to deal with the bad economic decisions of the previous Government. We are having to deal with the fact that they spent money the country simply did not have. Nobody should be doing that; certainly we know from our own credit card bills that that is not a good way to move forward. This coalition Government are dealing with that mess and are making the difficult decisions required to develop a good long-term economic plan. The outcomes of that are now starting to be seen, with growth coming back while interest rates are being held down and with more people in work and unemployment falling. That is a good thing for our country and I commend that to the House in the same way that I will commend these combined authority orders.

Establishing these combined authorities is what the areas themselves want to see. They want them because of their commitment to delivering growth and prosperity for their areas and this Government have given them the power to do that. It is a priority that should be at the heart of everything that councils across our country are working to do. It is a commitment that business and other partners in each of these areas rightly share. It is also a commitment this coalition Government share, as demonstrated through the city deals we have agreed with these areas and others. Let us be clear about the importance of this: the first wave of deals alone is expected to create 175,000 jobs and 37,000 new apprentices —that is in addition to the almost 1.5 million new jobs in the private sector under this Government. It is a commitment I am confident this House shares, and I commend the orders to the House.

Question put and agreed to.

Resolved,

That the draft Combined Authorities (Consequential Amendments) Order 2014, which was laid before this House on 10 March, be approved.

Madam Deputy Speaker (Mrs Eleanor Laing): With the leave of the House, I will put the Questions on the three remaining motions together.

Resolved,

That the draft Barnsley, Doncaster, Rotherham and Sheffield Combined Authority Order 2014, which was laid before this House on 10 March, be approved.

That the draft Halton, Knowsley, Liverpool, St Helens, Sefton and Wirral Combined Authority Order 2014, which was laid before this House on 10 March, be approved.

That the draft West Yorkshire Combined Authority Order 2014, which was laid before this House on 10 March, be approved.—(Brandon Lewis.)

18 Mar 2014 : Column 725

Criminal Procedural Rights (Opt-in Decision)

[Relevant document: The Thirty-Second Report from the European Scrutiny Committee, HC 83-xxix.]

5.15 pm

The Lord Chancellor and Secretary of State for Justice (Chris Grayling): I beg to move,

That this House takes note of European Union Documents No. 17621/13 and Addenda 1 to 3, a draft Directive on the strengthening of certain aspects of the presumption of innocence and of the right to be present at trial in criminal proceedings, No. 17633/13 and Addenda 1 to 3, a draft Directive on procedural safeguards for children suspected or accused in criminal proceedings, No. 17642/13, a Commission Recommendation on procedural safeguards for vulnerable persons suspected or accused in criminal proceedings, and No. 17635/13 and Addenda 1 to 3, a draft Directive on provisional legal aid for suspects or accused persons deprived of liberty and legal aid in European Arrest Warrant Proceedings; and agrees with the Government that the UK should not exercise the opt-in to these measures.

I am pleased that the European Scrutiny Committee has called this debate, as these potentially important matters are of interest to Parliament and the public. The three proposals to be considered today all flow from the Stockholm work programme agreed in 2010, and two of them flow directly from the criminal procedural rights road map agreed in 2009 and later confirmed in the Stockholm programme. We have been presented with three directives, which appeared at the same time and which share a common date of 19 March for a decision on whether the UK will opt in. The decisions are individual and specific to each proposal.

I can tell the House that we have considered each proposal carefully. In line with the coalition agreement, we have looked at the potential benefits and disadvantages of UK participation to the national interest on a case-by-case basis. We asked ourselves whether it is in our national interest to be bound by any or all of the proposals, and we have concluded that it is not. The motion is therefore clear that we are minded not to opt in to any of the proposals, and I of course look forward to hearing the views of the House this afternoon.

Jacob Rees-Mogg (North East Somerset) (Con): I congratulate my right hon. Friend on his absolutely right decision, but can he confirm that it is the intention of Her Majesty’s Government not to opt in at any stage?

Chris Grayling: I was going to make reference to that. I can confirm that we have agreed that we will not participate in the first and third item at any stage. We have agreed across the coalition that we will take a look at the second item in the discussions that take place. We will participate in the negotiations, but I say to the House this afternoon that I do not expect, at the end of that process, any change to the decision that we are proposing, which I hope the House will endorse this afternoon.

I have also given our officials permission to take part as observers in the negotiations on the other two measures, because, naturally, I am keen to ensure that our European partners take sensible steps, too. It is right and proper that we should be aware of what takes place, but I could not conceive of a situation where we could consider

18 Mar 2014 : Column 726

taking part in the presumption of innocence and the legal aid matters. Therefore, it is not our intention at any stage to participate.

I was glad to see that the European Scrutiny Committee has also concluded that the UK should not opt in to the proposals, so we are of one mind on them. It is also worth highlighting that we are considering these three measures alone today, and that the Government continue to engage with the Commission on wider 2014 measures. I will briefly discuss the possible pros and cons of each proposal, as it is important that the House understands the basis for our decisions and the proposal we are putting to it this afternoon. First, I wish to make a general point relevant to each of the proposals. Each of them would of course apply to all criminal cases in the UK. None is restricted to cross-border cases. That means that if we accept any of the proposals, we also effectively agree that, henceforth, the relevant matters of internal procedural law will be determined at an EU level rather than here. In addition, the highest court overseeing the implementation and interpretation of the rules would thereafter be the European Court of Justice and not any UK court. That is, of course, true of all EU laws, but it is important to bear that in mind as we consider the proposals.

I remind the House that the agreement we reached on the 2014 measures is that we do not believe that Britain should be part of a European justice system. We do not believe in the harmonisation of court and legal procedure, and our decisions reflect that view. I do not agree with those who wish to create such a unified system. Other member states are free to do so if they choose, but we have decided that this country should not be part of such an approach.

Sir Alan Beith (Berwick-upon-Tweed) (LD): The process that my right hon. Friend has described raises another problem, and I wonder whether he shares my view on it or approaches it from a different perspective. The proposals open up the possibility of conflicting decisions between the European Union system and the European convention on human rights on a number of issues. What happens in Britain has passed the test of the ECHR, but it would not necessarily pass the tests set in the proposals.

Chris Grayling: That is a very valid point, and my right hon. Friend is right to raise it. As he knows, we have different perspectives on the European Court of Human Rights, but he has highlighted one of the incongruities that will exist if we simply hand over jurisdiction in such crucial areas to the European Court of Justice, because there are some clear contradictions between European measures and those set out in the convention. Whatever our different perspectives in the coalition, we share that view of the problems that may arise from such Europeanisation of law.

Mr William Cash (Stone) (Con): I am grateful for my right hon. Friend’s concluding remarks to the Chair of the Select Committee on Justice, the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith). The difference between the ECHR and the European Court is that according to section 3 of the European Communities Act 1972, when a decision has been taken under that section, it is binding on us. Our Supreme Court cannot change that law, and there is no opportunity to appeal. That raises the whole question of who governs the United Kingdom in that area.

18 Mar 2014 : Column 727

Chris Grayling: My hon. Friend highlights an area about which I am concerned, and on which there are perhaps disagreements within the coalition. Although there are democratic checks on the court system in this country—if Parliament does not agree with a Supreme Court ruling, it has the option of changing the law accordingly—the same is not true of international courts.

We have a lively discussion in the coalition about our future relationship with the ECHR, but if we start to hand over key elements of the working of our justice system to the ECJ, there is a real danger that in an attempt to harmonise, we will lose some of the things that make our system strong. There is no doubt in my mind that English, Scottish and Northern Irish law are highly regarded around the world, and I would not want to see them internationalised. If that happened, the distinctive features that make London, Edinburgh and Belfast attractive legal centres might be less pronounced than they are today.

Geraint Davies (Swansea West) (Lab/Co-op): Does the Secretary of State agree that there is a case for minimum standards for the treatment of child defendants, and for people to have the right to appear in court and to be considered innocent until proven guilty? What is wrong with that? Why should other people not share those values?

Chris Grayling: In some respects, the hon. Gentleman is right, and that is what we do in this country. The question is whether he believes we should hand over future decision making about our judicial process and court process to an international court over which we have no control. He and his party clearly think that we should. I do not, and that is one of the things that divide us.

Mr Douglas Carswell (Clacton) (Con): I applaud my right hon. Friend’s wise and sensible decision, and I am particularly pleased to hear him say that the national interest is paramount in the consideration of such matters. I note his decision, and I say, “Very well done.” Can he do more to ensure that some of his ministerial colleagues are as wise and sensible when considering other opt-ins to ensure that this outbreak of sensible decision making is consistent across the board?

Chris Grayling: I will do my best.

Let me touch briefly on the three measures. The first relates to the presumption of innocence. The proposal does not flow directly from the road map; it stems from the invitation in the Stockholm work programme for the Commission to consider whether issues not explicitly included in the road map—such as the presumption of innocence—might have a bearing on the mutual trust between member states.

It is very much a matter of regret to me that, in response to an invitation to consider that matter, the Commission concluded that legislative action was necessary. Even if it had concluded that something had to be done—that is a matter for debate—there are alternatives to new legislation or common EU rules. I say this as there seems to be very little evidence of need for the proposal or for common EU rules in this area. That point seems to be acknowledged in the Commission’s own impact assessment, which notes that quantifiable evidence of any problem is scant. In the light of that, I wonder why it has still proposed common rules.

18 Mar 2014 : Column 728

This has been a matter of particular interest to the House of Commons European Scrutiny Committee, in the context of the proposal’s compliance with the subsidiarity principle. I note that the Committee issued a reasoned opinion on the matter, and it is a shame that it did not manage to secure support from other Parliaments in doing so. I want to see the Commission paying a little more attention to the yellow card system than it has been doing recently.

Mr Cash: My right hon. Friend will recall that, on the question of the public prosecutor, the threshold was crossed but, even then, the European Commission decided that it would go ahead. Does he not regard that as an extraordinary situation? Does he agree that the yellow card system has been severely vitiated as a result?

Chris Grayling: I attended the Justice and Home Affairs Council at which this issue was discussed, and I have to say that there was extensive disquiet among member states. If the Commission wishes to be credible, it cannot simply ignore the system that was put in place by the Lisbon treaty in the way that it did in that particular case.

Let me turn to the second item on the list, which is the proposal on child defendants. By any assessment, I consider the UK arrangements for dealing with and helping children who become engaged with the law enforcement agencies and with criminal proceedings to be very good. There is a raft of specific provisions in place in the UK to assist children in those situations, and we wholeheartedly support the principle that children in those circumstances need to be treated differently from adults in some respects, given their particular vulnerabilities.

Beyond the general principle behind the proposal, however, and given that the UK’s current arrangements provide a significant degree of protection as good as that available anywhere else, the proposal presents significant difficulties. First, the definition of a child in the proposal is set at those under 18 years of age. In England and Wales, the procedural protections provided to suspects and defendants based on their age are varied to reflect the specific circumstances of their case. Article 1 of the United Nations convention on the rights of the child—to which the UK is a signatory, and to which the coalition Government undertook to give due consideration when making new policies and legislation—contains the same definition. In the context of the courts, prisons and the probation service, those under 18 years of age are treated as children and young people. However, there is a different approach for when the police deal with 17-year-olds under the Police and Criminal Evidence Act 1984, when, for practical reasons, 17-year-olds suspected of committing an offence are for some purposes treated as adults. Clearly, that would be an issue in regard to these proposals as well. The position in Scotland stands in even clearer contrast to the proposal, as it tends to treat younger people—that is, those aged 16 and above—as adults for these and other purposes.

Keith Vaz (Leicester East) (Lab) rose—

Chris Grayling: I give way to the Chairman of the Home Affairs Committee.

18 Mar 2014 : Column 729

Keith Vaz: I agree with what the Lord Chancellor has said this evening. Does he know whether we have been able to persuade any of our EU partners to adopt the very sensible practices and procedures that we have adopted in respect of children?

Chris Grayling: At the moment, this is in the early stages. One reason that we agreed to participate in the negotiations—albeit expressing up front our intention not to opt in—was to allow precisely that kind of discussion to take place. I have nothing to be ashamed of in relation to the way we manage our affairs in this country, although I understand that improvements might be needed elsewhere. My sole concern is that our rules should not be subject to the jurisdiction of an international court over which we hold no sway.

Mr James Clappison (Hertsmere) (Con): I am grateful to my right hon. Friend for giving way and I am sorry that I missed the very beginning of his speech. I warmly welcome the course that he has taken today. Is not the point that these matters are part of our arrangements in this country—in England and in Scotland—and should be decided here in this Parliament, subject to debate, representations from our constituents and election, and not by the European Union?

Chris Grayling: That is the point. We have 800 years of legal tradition in this country. It has evolved in a number of different ways and is subject to change and review in both the courts and our Parliament. I do not really feel that we need to bring a third body into that relationship. To my mind keeping the European Court of Justice at arm’s length over these matters is absolutely where we need to be.

Geraint Davies: On that point and the point made by my right hon. Friend the Member for Leicester East (Keith Vaz)—with which I do not agree, incidentally—the age of criminal responsibility in Britain for children is 10, which is far younger than elsewhere in Europe. Children are required to go to a full criminal court. Surely there is something to be learned from others, or are we too arrogant to listen?

Chris Grayling: The hon. Gentleman and I are on different sides of the House. When we disagree on different issues we can debate them in this House. If it is his view that the age of criminal responsibility in this country is too low, it is perfectly reasonable to articulate that in this House, to bring forward measures that could change that, and for us to debate it. My issue is that that is a decision for this Parliament and not for elsewhere, which is why I am taking the view I am this afternoon.

It is also worth saying that the proposal seeks to establish that any deprivation of a child’s liberty must be as a matter of “last resort”. The notion that children should not be detained unless necessary causes little difficulty in the UK, but it is obvious that it introduces a different test from that which currently applies in England and Wales in which children are deprived of their liberty if it is considered necessary—during a police investigation or on remand awaiting trial. That would also have to be subject to reconsideration if we were to opt into this measure and could lead to significant changes, which should be a matter for this Parliament and not for anyone else.

18 Mar 2014 : Column 730

Given that the UK has one of the most comprehensive and generous legal aid regimes in the world, it will perhaps not surprise this House that our analysis suggests that our current practice—in England, Wales, Scotland and Northern Ireland—means that we are already compliant with the majority of the provisions of the proposed directive. We might, therefore, argue that as it does not ask much change of us, it would be fine to opt into it. However, it does require some change. It requires changes to procedures around the entitlement of somebody who is subject to a European arrest warrant to receive legal advice both in the country of arrest and the country that is seeking arrest. That would have small financial cost for us, but it is, none the less, a financial change that would be imposed on us. It would not be a priority area for us to increase legal aid spending at a time when the legal aid budget is, for necessary reasons, under enormous pressure.

It is not necessary or appropriate for our legal aid system to come under international rules. The level and nature of spend should be subject to a decision in this House. It should be a matter for Parliament. I do not think that we should pass over ultimate jurisdiction over our legal aid rules to the European Court of Justice, which is why I have said clearly that I cannot conceive of a situation in which we would wish to opt into this. I am therefore not prepared at this stage to leave that door open. It is not what this Parliament or this country want. I will not try to pretend otherwise. Let us be clear and up front and say that this is not something of which we wish to be a part.

Geraint Davies: Perhaps the right hon. Gentleman can confirm the estimated costs of that measure in terms of added legal aid costs. My understanding is that it is just £200,000, compared with his budget of £7.5 billion. It is not significant, so he is talking about the principle rather than the money.

Chris Grayling: I just said that it was not a large amount. It is a question of principle. Do we want decisions about legal aid entitlement to be taken in this Parliament by Government, scrutinised by the Select Committees of the House and by Parliament itself, or do we want to subject ourselves to an uncertain international jurisdiction that may, at a later date, decide that we have to do things in a wholly different way from the customs and practices in this country, often with a cost that is simply not budgeted for? My view is that we do not want that, and I propose that we do not accept that.

I have set out here in both general and specific terms why the proposals present difficulties in the UK, why, in their current shape, we could not support them and why we conclude that we should not opt into any of them. There is, of course, a question about negotiability, and these texts are not final. They may be open to changes in discussions in Brussels, which may improve them, but our assessment at this stage must be taken on the basis of the presented text; we have no other basis. It is of course possible that the proposed directive will change for the better in negotiation, but it is also possible that it could change in a way that make things even more problematical. We do not know for sure. We face a new Commission and a new Parliament in the summer. The Lisbon treaty provides co-decision making to the European Parliament. Matters relating to these directives can be amended in that Parliament and could theoretically impose costs on us that are absolutely not budgeted for.

18 Mar 2014 : Column 731

It seems to me that the scale of our difficulties with the current proposals on the presumption of innocence and legal aid are such that it is difficult to foresee any realistic prospect of negotiating them to a conclusion that the UK could now accept. They are simply too far away from acceptability. Although we will continue to monitor the forthcoming negotiations, we will be clear about our position at the outset. I hope that that clarity will be useful to the House and that the House will support it this afternoon.

The proposals on child defendants also present significant difficulties and I do not underestimate them. I think it is pretty unlikely that we would be able to secure changes that would make them acceptable or better. That is why we are recommending this afternoon that we should also indicate that we will not opt in. I have instructed officials that they should participate in the negotiation to see whether changes made at a later date would be advantageous to this country. I am not convinced that that will happen, but I have left it open as a possibility. That was what was agreed across the Government.

I will ask my officials to work closely with interested Departments, including the Home Office and the Foreign Office, to ensure that the message is communicated effectively to our EU partners and is factored into wider engagements on matters such as the 2014 decision. My view is that the proposal I am laying before the House this afternoon is in the national interest. I have considered carefully the different measures and I am very clear that it is not right for the UK to opt into them, but it is important that this House has its say. I hope that the House will endorse that approach and that everyone in the Chamber will feel that it is right to accept our proposals and support the motion.

5.36 pm

Mr Andy Slaughter (Hammersmith) (Lab): I can be fairly brief in addressing these three draft directives. That is not to say that they are unimportant both in themselves and in the context of European legislation, but the Government’s approach to them has been so casual and tardy that the ground has not been laid for sensible debate. I pray in aid the article in tonight’s Evening Standard entitled “EU law change ‘could help drivers escape speed fines’, says Chris Grayling”. That is how the Lord Chancellor sums up these three important draft directives for the public at large. If one were cynical, it would be tempting to assume that when the Secretary of State hears that European legislation is to be debated he first ignores it and then decides to oppose it not because of its merits but because it is European.

It is good to see the Secretary of State proposing the motion. The previous Lord Chancellor used to leave it to his junior Ministers; I wonder why? The current Lord Chancellor’s appearances in the House are rare compared with those in the Evening Standard, but I think that he has come for the approbation of the hon. Member for Stone (Mr Cash) and others rather than to give a reasoned opinion on the matter in hand. His opening speech has sadly confirmed that. The Chair of the European Scrutiny Committee is too wise a man to play the Secretary of State’s game, as the Committee’s reports in the bundle make clear.

Let me first set out the Opposition’s position on the draft directives and then have a little moan about how they have come before us. The presumption of innocence

18 Mar 2014 : Column 732

is speedily dealt with. We debated it in the Chamber a month ago and my opinion has not changed since then. I gave two reasons why we would agree with the Government and not support the opt-in. They were:

“First, it is not the difference in standards or the falling short per se that provokes the draft directive, but the alleged effect that has on confidence in the judicial systems in states that are failing. There is anecdotal evidence to support that; indeed, much of the debate about the European arrest warrant focused on worries about the criminal justice system in the extraditing state. However, as the Commission itself concedes, there is ‘limited statistical quantifiable evidence’, and that is not a good basis for such a radical restructuring of European criminal law”—

and—

“Radical though the draft directive may be—this is the second problem—it goes beyond what the ECHR demands.”

That is the point made by the Committee Chairman. I went on:

“For example, under the Police and Criminal Evidence Act 1984 and subsequent legislation, it is permitted in English criminal courts to draw inferences from the silence of the accused. The burden of proof does not always lie on the prosecution, and the right to representation, interpretation and translation varies at different stages of the criminal process. I do not seek to defend the law in its current form by saying that, but I do say that the directive is not the means by which to open a wholesale review of those and other provisions of the criminal law.”—[Official Report, 10 February 2014; Vol. 575, c. 671.]

Interestingly, in Committee on the Criminal Justice and Courts Bill, we are about to debate further provisions that would allow for more speedy and, the Government would say, effective trial of cases in absence on minor offences. That partly organic and partly operational process of the courts is a good example of why it is wrong that we adopt that particular draft directive.

The two other draft directives are more compelling. They go to the practice and procedure in the law, rather than its fundamentals. They sit more comfortably with the three measures previously debated and decided on by the Government.

Geraint Davies: My hon. Friend will be aware that we already practise the assumption of innocence unless proven guilty and people’s right to be present in court. Is it not part of this partnership to promote best practice to others, rather than to abstain completely in the way the Government have, in particular by not providing the data to the EU Commission on the effectiveness of the justice system? We are the only country not to do that. It is ridiculous.

Mr Slaughter: My hon. Friend makes a good point. Where that is possible we should do it, and I will refer to a draft directive where we took exactly that line. I simply say in relation to the draft directive on the presumption of innocence that it was proving too difficult to accommodate the principally Roman law system of the other EU countries with our developed system of common law. It was just impossible. However, it does not stop us advocating within the EU on those matters, which we do very well; I just do not think that they are entirely compatible.

The Government opted in to the directives on the right to interpretation and translation in criminal proceedings and on the right to information in criminal proceedings. I do not know whether that was because they were prior to regime change at the MOJ—a regime

18 Mar 2014 : Column 733

change so dramatic it makes the regime change in Crimea look positively evolutionary by comparison. We disagreed with the Government on the directive on the right to access a lawyer in criminal and European arrest warrant proceedings and voted against them because their arguments were poorly structured and articulated.

I have re-read the debate from 7 September 2011 and I am more than persuaded by the arguments that I put forward on that occasion, even though it did put me at odds with the Chair of the European Scrutiny Committee, something that I am loth to do, given his reservoir of knowledge on these matters. The Law SocietyGazette, an esteemed publication, reported me as saying that

“the government’s reasons for opting out of that directive were ‘at best unconvincing and at worst spurious’.”

It went on:

“He said the directive’s requirements are ‘broadly in line’ with current UK legislation and by not opting into it the government would ‘appear to be throwing away an advantage to British citizens’. Opting out at this stage, he said would ‘fatally’ undermine the UK’s authority and leverage during the negotiations. He added”–

presciently—

“‘it looks as though the government are looking for reasons to opt out at this stage’”—

something that has now become commonplace.

I mention that first, because I think that that directive had more in common with the other two draft directives that we have before us today, and secondly, because we do not resile from voting against the Government when we think that it is appropriate. Interestingly, one of the reasons for not opting in to the draft directive on safeguarding children’s rights is because part of that refers back to the directive on access to a lawyer. We clearly do not adopt that point. There are good reasons for supporting the draft directive on children’s rights, even on the Government’s case, as there are for favouring the right to an appropriate level of legal aid across the EU. The difficulty with supporting those draft directives is that the position is still far from clear.

Mr Clappison: The House will have been relieved to hear that the hon. Gentleman is persuaded by his own arguments—he is at least clear about that. Can he just tell us, in short, whether his position is that we should opt in to all these measures, or indeed any of them?

Mr Slaughter: That is the purpose of this speech, if the hon. Gentleman will bear with me. In relation to the draft directives on children’s rights and legal aid, the insurmountable hurdles that apply to the presumption of innocence directive do not apply. The difficulty we have tonight relates to some important questions, such as what will the cost be; what are the implications for UK legislation, meaning what would have to change; how far are they necessary harmonising measures; and how far do they fall into the same trap as the presumption of innocence draft directive, meaning how far do they exhort us to do something, rather than actually harmonising. It is quite difficult to say.

Let me explain what I mean. If we look at the very belated letter from the Government on the cost of these measures, we see that, in relation to the draft directive on safeguarding children’s rights, it is estimated that

18 Mar 2014 : Column 734

transporting 17-year-olds after being charged to local authority accommodation for overnight detention would cost £2.1 million. A breakdown of that figure shows that an estimated additional 5,200 places in local authority accommodation would be required each year in England and Wales, at a cost of approximately £395 a day for each 17-year-old suspect. With all due respect to the Lord Chancellor, those figures look as though they have been drawn up on the back of a fag packet. They were dreamt up at the last minute because the Committee was quite rightly pressing the Department to come up with a decision and some reason for it.

With regard to legal aid, as my hon. Friend the Member for Swansea West (Geraint Davies) pointed out, we are told that the net monetised discounted cost impact of the article over a 10-year appraisal period, if we opt in to the directive, is estimated to be between £1.5 million and £5 million, with a main estimate of around £2 million. That would equate to an undiscounted cost of approximately £200,000 per annum. Again, it looks as though—I think the Lord Chancellor effectively admitted this—we comply with those proposals. There would not be a great cost in opting in, but it is best to “big it up” and make it look worse than it is. I am afraid that I just do not trust what is in those documents.

Chris Grayling: My main concern about these measures, as I have said, is the fact that opting in to them would mean passing over jurisdiction to the European Court of Justice. Will the hon. Gentleman tell the House whether his party thinks that it is appropriate for the European Court of Justice to have sway in areas such as legal aid? He seems to be saying that it is not a big deal. Does he accept that the European Court of Justice should not have sway, or does he think that it should?

Mr Slaughter: I do not accept the argument that everything that comes out of Brussels is necessarily evil or inimical to the interests of this country, which appears to be the bizarre position that the Lord Chancellor has painted himself into. Uncharacteristically, we will sit on our hands tonight in relation to two of the draft directives. To answer his question directly, I do not rule out any future opt-in, as of course the Government do not in relation to the directive on access to a lawyer, because I understand that their position is that they still might opt in. Even with the spin that he has put on it, I understand that for at least one of the draft directives there is a possibility that negotiations will lead to an opt-in. I welcome that pragmatic approach. It is a conservative approach, but it keeps the door open, rather than taking the radical approach that the Lord Chancellor would like to be seen to be taking.

Geraint Davies: Surely the point on legal aid is that this is to protect British citizens who might be wrongly accused and languishing in an unfit foreign prison, and to provide them with some legal support, at a total estimated cost of £200,000—a fraction of the value of the Home Secretary’s house.

Mr Slaughter: My hon. Friend makes a good point which is exactly the one I made in relation to access to a lawyer: it is primarily British citizens abroad who would benefit. Yes, there is a moral purpose in our trying to get other EU countries to adopt the high standards that we have in this country, but there is also a practical

18 Mar 2014 : Column 735

purpose in trying to ensure that when British citizens get into trouble abroad they get the best assistance that they can in those countries. That is why it is sensible, where possible—as in two but perhaps not in the third of these draft directives—at least to keep the door open.

I wish that the Government would address these proposals seriously and not in a rhetorical and political way, and that they would respond to the Committee’s requests more timeously. The pertinent quote from the Committee is this:

“We repeat again our disappointment at the poor quality of the Government’s”—

explanatory memorandums—

“on the three proposals forming the Commission’s procedural rights package, particularly in the light of the time taken to draft and deposit them.”

I am afraid that this is becoming typical of the way in which the Ministry of Justice operates. It is to a low standard and it shows a certain degree of, if not contempt, then at least disregard for this House and its Committees. If the hon. Member for Stone cannot elicit discipline and compliance from the Secretary of State, then it is beyond me, but I feel that the debate is poorer for it.

5.51 pm

Sir Alan Beith (Berwick-upon-Tweed) (LD): As the hon. Member for Hammersmith (Mr Slaughter) said, the handling of this set of proposals has not been ideal, to put it mildly. The criticisms made by the European Scrutiny Committee have considerable weight. They also suggest that because of time constraints the Committee did not come to the Justice Committee for an opinion on proposals that fall pretty squarely within its remit. That would have been a much more desirable process to follow, and lessons ought to be learned from this.

Mr Cash: That process is exactly what we recommend in our report, which is currently awaiting the Government’s response. The right hon. Gentleman and I are in complete agreement about this. The more often it is possible, as in this case it was not, to go to one of the departmental Select Committees for its considered opinion, the better.

Sir Alan Beith: Perhaps unusually, my hon. Friend and I are indeed at one on this issue. As Chairman of the Liaison Committee, I give every encouragement to Select Committees to be ready to respond when the European Scrutiny Committee draws attention to matters and seeks opinions on them. That is how the process should work, so that we make the maximum uses of the resources of expertise among Members and, indeed, House staff, that we have built up over recent years.

Let me turn to some of the specific measures. On the presumption of innocence, the basis of the directive is that there might be significant difficulties in cross-border matters when identical standards have not been observed. However, no measurable evidence has been produced showing that cases under the European arrest warrant, for example, have frequently been obstructed over a lack of compliance with identical standards. Therefore, the whole basis on which the Commission is proceeding appears to be weak. The suggested measures would certainly adversely affect the UK provision that in certain circumstances inferences can be drawn from silence. The House has debated this at great length and

18 Mar 2014 : Column 736

with some care, and the courts have developed the operation of the system with some care. The caution administered to suspects reflects the fact that adverse inferences can be drawn from silence. These provisions would completely disrupt all those processes.

The biggest danger is one that I mentioned earlier in an intervention—that processes that have satisfied tests under the European convention on human rights would not necessarily pass the test of this directive. We would therefore end up with two alternative sources of challenge to English criminal law, leaving open the possibility of passing one and failing the other. That would be an undesirable state of affairs. It would cause confusion and, indeed, forum shopping, whereby someone could obtain their preferred outcome.

On the recommendation regarding legal aid and access to a lawyer, the jurisdiction both in England and Wales and in Scotland already satisfies the provision. My colleague and friend Sarah Ludford MEP has raised issues about the fact that, without the provision, there is no requirement for access to a lawyer in the state that issues the European arrest warrant. Problems can arise from that. Indeed, we have seen them in practice, whereby, had appropriate legal advice been available in the issuing state, an ill-founded arrest warrant might never have been issued in the first place. That factor needs to be considered in the future as the situation develops.

On procedural safeguards for children, a number of problems would arise if we were to adopt the Commission’s provisions, including with regard to the difference between ages, which has already been referred to, and the mandatory representation issue. As the Lord Chancellor has himself indicated, the United Nations convention on human rights is the most accepted international baseline for the protection of children in legal proceedings. It would be better if we proceeded with these matters through advocacy of that convention and used all the resources available to the European Commission to advocate and support adherence to it, rather than create complications between member states over issues that are not central to the protection of children’s rights.

I feel most strongly about an issue I addressed earlier. I do not want to see the role of the European convention on human rights as the primary European benchmark for human rights undermined by the creation of rival or alternative procedures. That is the danger we would run if we opted into the directives.

5.57 pm

Keith Vaz (Leicester East) (Lab): I will be brief. It is a pleasure to follow the Chair of the Liaison and Justice Committees. I agree with him and the hon. Member for Stone (Mr Cash) and make a plea to the Government: I know it is difficult and complicated when dealing with the European Union, but it is essential to give this House and its Select Committees as much opportunity as possible to discuss European issues. I am sure that the Lord Chancellor has sought to do that and that he will take that plea away with him for future debates and discussions.

I agree with what the Lord Chancellor has said today: it would be wrong for us to opt into any of the directives. I am particularly concerned about the third directive regarding legal aid and the European arrest warrant. As the House will know, the Home Affairs Committee is

18 Mar 2014 : Column 737

not a great fan of the European arrest warrant. We believe it is flawed and that it should be improved. There have been two judgments in the past week—I think the last one came from a court in Florence. The Government need to look again at the issue. I am sure it will be part of the Home Secretary’s discussions with her colleagues when they consider the entire justice and home affairs agenda and the question of opt-outs.

In a rare example of unity among departmental Select Committees, three of them—the European Scrutiny, Justice and Home Affairs Committees—will agree, word for word, a joint report. Given the personalities on those various Committees—indeed, given the personalities of their Chairs—it will be quite an achievement to get almost 30 Members of this House to agree, word for word, on one document, but I think that is what we are about to do.

I support what the Lord Chancellor has said. We need to be very cautious in dealing with jurisdictions, especially as far as the criminal law is concerned. In my view, our criminal law and procedures are different from what happens in the rest of the European Union. The Lord Chancellor is right to let his officials continue to be part of the ongoing discussions, not because we want to convince the 27 other countries to adopt what we do but because if anything comes out of the discussions that would benefit our system of justice we will certainly want to adopt it. I also agree with my hon. Friend the Member for Hammersmith (Mr Slaughter), the shadow Justice Minister. It is important to allow the Government to proceed on the basis that they are, and we should not oppose the motion.

6 pm

Jacob Rees-Mogg (North East Somerset) (Con): The hon. Member for Hammersmith (Mr Slaughter) quoted his speech in 2011, but it is his speech today that ought to go down in legend and song. Indeed, a sentence from it should be engraved in the deepest, finest granite and remembered by all of us who are interested in this debate, for he got absolutely to the heart of the subject when he said that the problem is trying to impose a system of Roman law on a common law system. That is at the heart of the difficulty of imposing anything from the justice area on the United Kingdom. I rejoice at his saying it, because I hope that it shows a change from his attitude in 2011, when he was quite keen on opting into things. I did not agree with the vision of his previous speech, but this one was of the greatest quality, nobility and thoughtfulness, and I hope that it receives the praise it deserves.

While in this mood of good will, I want to praise the wisdom of my right hon. Friend the Lord Chancellor. In opting out of the three important directives—and, indeed, from the directive on right of access to a lawyer—he has avoided falling into the European trap. A number of directives are coming through in the justice and home affairs area, particularly on the European arrest warrant, which we have opted into, and the trap is very serious. Once we have opted into one thing, the next step is to say that because it is possible for a British citizen to be arrested by a foreign court and taken out of this country to be tried in a foreign place, losing the rights that would normally belong to a British subject, we need to

18 Mar 2014 : Column 738

impose other safeguards, but to impose such safeguards we need common rules to ensure that treatment is the same and that we have a pan-European view on the presumption of innocence.

Such a view is needed because a British subject can be taken out of this country and taken abroad without any questioning in this country of whether their trial will be fair and proper. As that can be done under the European arrest warrant, we are led to say that it is only right and proper to have safeguards on the presumption of innocence. Exactly the same applies to the directive on procedural safeguards for children and, tying in with it, the right of access to a lawyer.

Once there is common acceptance of other nations’ legal systems, we begin to say that they will work only if we have common safeguards, and once we begin to accept common safeguards we are effectively implementing a single criminal law across the whole of Europe. Once that has been done, legal aid must of course be unified across the European Union, because the person arrested needs to be able to afford the defence to which they are entitled, in accordance with laws laid down by the centre.

This is not a matter of co-operating with European partners or of saying that there is a proper degree of justice in some European countries to which we are willing to extradite our citizens; it is a question of saying that we believe that ours is the only way to ensure proper justice in relation to some relatively undeveloped judicial systems. I am thinking of some countries that have joined the European Union more recently, particularly Croatia. In our debates about its application for membership of the European Union, we discussed the difficulties in its judiciary and police that were not solved before it joined. Despite the European Union’s requirement that they should be resolved, it was allowed to leave them to be improved after it joined. The same applies to Romania and Bulgaria. Once it has been accepted that such countries have the right to arrest British subjects, it inevitably follows that common standards of protection must be applied, with an overall court of appeal that can review it. Those are the stepping stones towards a single European criminal justice system.

I praise the Lord Chancellor because he is now, I hope, taking the stepping stones in the other direction. We have had the block opt-out. We have restored to the United Kingdom rights over justice and home affairs. Unfortunately, we have not settled on which items we wish to opt back into. When that list comes forward, it is crucial that the things that we opt back into are not used as an excuse for bringing back the measures before us. I am thinking in particular of the European arrest warrant. As soon as that is in, the presumption of innocence must be a pan-European right, because nobody in this House would like a British subject to be deported to a foreign country and not have the presumption of innocence in his favour. The same is true of the other two measures that we are countering.

I hope that in the battles that go on within Whitehall the Lord High Chancellor will know that he has the support not just of Conservative Members but of the bulk of the country in standing up for our common law system against, as the hon. Member for Hammersmith reminded us, a Roman law system that is not suitable for this nation.

18 Mar 2014 : Column 739

6.6 pm

Geraint Davies (Swansea West) (Lab/Co-op): I am sympathetic to the directives. The case for minimum standards across Europe has partially been made already. We live in a new Europe where people are mobile and in which people expect minimum standards. I understand that people are attached to their different judicial systems. There is a move in Wales to have a new, devolved judicial system. We could have lots of different and confusing judicial systems everywhere. There is a case for having our rights in Britain, but there is also a case for having minimum standards.

We should take a sensible approach to this matter, rather than our instinct being that everything is wrong and that we should have a block opt-out. There is a cost to British citizens in that. In this case, it is that dangerous criminals will be roaming around Europe and evading detection through confusion and a lack of co-operation.

The presumption of innocence and the right to be present are established in our law. I think that we should trumpet our best practice and encourage the adoption of minimum standards in countries that are entering the European Union. When British people go abroad, they expect those standards to prevail. Instead, we are saying, “We’re doing what we like and we don’t care what you’re doing. If you like it, you can take it, but it’s nothing to do with us.” We should be taking leadership, not being isolationist. It is the mentality of the UK Independence party and the Scottish National party to say, “We know best where we live.” That is certainly not the case.

The children’s rights directive says that there is a right to information, a right to a lawyer and a right to medical examination. I mentioned in an intervention that the age of criminal responsibility in Britain is very low at the age of 10. That is one reason why we need to afford our children the maximum possible protection. They are much more vulnerable than their European counterparts because they can be criminally responsible at a much younger age. In my view, there should be video recording of interviews with children. There is a strong case for medical examination. We are virtually alone in preserving the defence of reasonable chastisement. The British continue the ritual of hitting their children—smacking and all the rest of it. Having medical examinations in such cases is important to protect our children. It is also right that children should have a right to maintain contact with parents and guardians. The lot of children in Britain is not a happy one in comparison with the rest of Europe. We have something to learn. It is wrong to take the arrogant approach that we do everything right and they have all got it wrong.

When people are mobile within one community, they should be afforded the same rights—hence my support for the legal aid proposal. We have talked about costs, and we know that legal aid carries massive costs, but the costs of protecting UK citizens abroad who may have been wrongly accused and left in jail are estimated at £200,000 a year. That is very little to afford people that right. However, in the name of anti-Europeanism we are saying, “Oh, we don’t want them interfering with what we’ve got.” We live in a common judicial market in some senses, and we can have minimum standards while retaining our own laws.

18 Mar 2014 : Column 740

The case is always made that if we agree to one step, the journey will continue endlessly and it will be the thin end of the wedge. I do not accept that. I believe that we should have a more mature and joined-up approach to debates such as this and take a selective view of the directives before us.

6.10 pm

Mr William Cash (Stone) (Con): I am extremely glad to be able to commend the Lord Chancellor and Secretary of State for Justice for his good decision on the directives. Inevitably, I am pleased that he has agreed with the European Scrutiny Committee. We spent a lot of time on the subject and gave our opinions, and I am glad that he has taken a similar view to ours. That has a consequence, of course, because although we hoped for a three-hour debate, there is no need for one when there is such a healthy degree of agreement between the parties, subject only to a few comments that we have just heard from the hon. Member for Swansea West (Geraint Davies).

Jacob Rees-Mogg: Is my hon. Friend struck by the fact that when the Conservative party is Eurosceptic, it is united?

Mr Cash: I am indeed. I must be careful in what I say, but I simply note that when the Lisbon treaty was going through the House, I tabled 150 or so amendments, and there was complete unanimity among me and my close friends of the Euro-realist type, who supported those amendments, and the Opposition as a whole. The Conservative party was completely united right the way through the proceedings, for the first time since 1972. My hon. Friend is completely right, and there is a strong lesson there.

Moving on to the substance of the matters in question, Lidington debates form part of a package of measures that were intended to

“significantly strengthen Parliament’s oversight of EU Justice and Home Affairs matters and make the Government more accountable for the decisions it makes in the EU.”—[Official Report, 20 January 2011; Vol. 521, c. 52WS.]

That was what the Minister for Europe said in his written statement in January 2011, and it is important that we put it on the record. It is therefore disappointing—this is the only caveat to my otherwise considerable appreciation of what the Justice Secretary has done today—that, yet again, the Government were unable to give the Committee adequate notice of their recommended approach to the opt-in decision. That is a great pity, because we would not have needed to request a three-hour debate. There would not have been any need for it, subject to the agreement of the Opposition Front Benchers. I suggest that it would be helpful to understand what steps the Government intend to take to improve the process for holding Lidington debates and how they will ensure that their internal decision-making procedures do not continue to hamper the timely provision of information to Members of Parliament.

I also wish to make a point about explanatory memorandums. In the Committee’s initial report, we stated that we were not satisfied with the quality of the memorandums relating to all three proposals that we are discussing today. We have said that before, but I wished to put it on record again. That is a matter of concern to us in relation to not just the Ministry of

18 Mar 2014 : Column 741

Justice but Departments in general. The explanatory memorandum is the most important information that can be made available—I do not mean when compared with everything else, but it is important in its own right. It is therefore extremely important, as we say in our European Scrutiny Committee report—for which we are awaiting the Government’s response—that explanatory memorandums are of sufficiently high quality, because that is the basis on which we hold the Government to account. When they explain in a memorandum the policy that underlies their decision, that should be the basis on which we are able to address the House, and be sure that the Government are answering the questions that we have put and are coming up with a policy that is coherent and makes sense.

The first of the three draft directives under consideration is that on the presumption of innocence. Its scope, which sets out certain rights that could be interpreted more widely than similar rights in the European Court of Human Rights by the Strasbourg Court, is a matter of great concern, and I am extremely grateful for the remarks of the Chair of the Justice Committee on that issue. I am also glad that the Lord Chancellor has made it clear that at no stage will that measure be opted back into, and I will give one or two reasons by way of amplification.

To take up the point made by the Chair of the Justice Committee, there would otherwise be different European Union and European Court of Human Rights procedural standards, which could cause legal uncertainty and confusion. That has now become an extremely topical question when applied to the judiciary. Members may have noted that, in their varying ways and without going into the detail, Lord Judge, Lord Sumption, Lord Mance and Lord Neuberger, the President of the Supreme Court, have all made incredibly important statements, in the most measured terms, about their concerns over the manner in which the Strasbourg Court approaches some of its judgments. This is not the time to go into all the detail, but I strongly recommend that their respective speeches are read by those who read these proceedings.

It is very important that people understand our concerns as members of the Conservative party—and indeed of other parties. Furthermore, some of the arguments that are presented as if we are just Eurosceptics who are out to be critical for the sake of it, are now increasingly supported—however discreetly—by some of the most eminent members of the judiciary in our analysis, which has taken a great deal of time and expertise to develop. It is important to remember that our arguments about the directive on the presumption of innocence are illustrative of the broader question of the methods of interpretation, for example, and the procedural standards in the two different Courts I have mentioned.