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Lord Whitty: Further clarification is probably best left to correspondence in that respect. Clause 3(2)(d) indicates a requirement for the local authority to identify consultees with an interest in any of the services which it delivers. Whether I can define "area" as a precisely geographical area, I will have to let the noble Baroness know and she can perhaps act accordingly at a later stage.

Baroness Hamwee: I hope this is not simply a geographical area-- that is the point of my question.

Lord Dixon-Smith: I am genuinely grateful to everyone who has contributed to this discussion and I am grateful to the Minister for his reply. In an era of non-confrontational politics, if different people approach the same object from different positions and all meet at the same point at the same time, it is inevitable that they will hit one another.

We have had a very good discussion on the nature of public consultation and it was with that at the back of my mind that I moved the amendment. I shall study the debate with great interest and in the mean time I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 15 to 18 not moved.]

Clause 3 agreed to.

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Clause 4 [Performance indicators and standards]:

Lord Dixon-Smith moved Amendment No. 19:

Page 3, leave out line 25 and insert ("Guidance issued by the Secretary of State under section 3 may include--")

The noble Lord said: We now come to what is really the core of the Bill, the Minister's power over local authorities. I am afraid the amendment does not make much sense because when I drafted it I allowed my eye to drift upwards. When one's eye drifts upwards from Clause 4 one sees immediately above:

    "an authority must have regard to any guidance issued by the Secretary of State". That should have been read upwards rather than downwards, of course, so that the amendment strictly will not achieve what I wish it to achieve. Nonetheless, I wish to discuss it.

At the present time, Clause 4(1) says:

    "The Secretary of State may by order specify--

    (a) factors ("performance indicators") by reference to which a best value authority's performance in exercising functions can be measured;

    (b) standards ("performance standards") to be met by best value authorities". I have the greatest difficulty with that as a proposition. It seems to me that while it is perfectly appropriate for the Secretary of State to issue guidance to local authorities, local authorities are elected bodies. They are supposed to be independent; they are supposed to be responsible--they certainly always were in my day; and they are supposed to be able to take rational and sensible decisions. They are also supposed to be able to handle resources sensibly and adequately. Yet, the Bill provides that:

    "The Secretary of State may by order specify". In other words, he can tell them in intimate detail what to do in operating their authority.

The purpose of Amendment No. 19 is really very simple, although I must admit I have missed the target because I allowed my eye to drift. It is to delete the words,

    "The Secretary of State may by order specify", and insert the words,

    "Guidance issued by the Secretary of State may include".

I went further beyond that because, again, I am afraid that I am old fashioned and I still believe in local authorities actually having some authority. I went on to remove the question of performance standards. I am happy that the Secretary of State should issue guidance and I am glad that local authorities should have to work with performance indicators. But it seems to me that if local authorities are in fact to be local authorities they should, for example, have some discretion in schools. Head teachers should be able to adjust class sizes where they have staff available in order to take care of a slightly less advantaged group, perhaps slightly at the expense of those who are more gifted. I am referring specifically to the issue of class size.

In my part of the country, a number of schools were running classes of 32, 33 or 34, but they did so specifically to take out smaller groups of 10, 12, 14 or fewer to give those in need additional assistance. They

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no longer have that flexibility. I do not believe that it is the function of a Secretary of State to intervene at that level in the way a local authority carries out its functions.

From my point of view therefore there is here a deep and fundamental point, probably one on which at the end of the day we may have to agree to differ. It may be that ultimately we shall have to find out what is stronger in another climate. That is the purpose of putting down this amendment. I admit that I have missed the target in the way I have worded it but it is in fact a fundamental issue.

I believe in local government. The attitude that this clause reveals to local government is--at the very least--over paternalistic. If one wishes to go beyond that one could even say that it reveals the attitude of a busybody and someone who interferes. That, surely, is not the function of government. The role of government should be to facilitate local government, just as the role of local government is to facilitate the provision of services as local circumstances demand which happens to be something that central government cannot do. That is the reason local government exists. I beg to move.

Baroness Hamwee: I do not believe this clause is paternalistic or interfering in the sense of a busybody; it is really rather worse than that. I refer to the Secretary of State's intervention powers. However, performance indicators and performance standards have perhaps a greater significance than the word "busybody" suggests.

My next remark may apply more to standards than to indicators but I want to follow directly on from what the noble Lord has said. Having to meet centrally set standards simply means that it is not possible to establish local priority setting. There are certain standards which I am sure all noble Lords would view as being important to meet. I refer to such matters as ensuring that there is no abuse of children in children's homes. There are, however, many standards, and many indicators relating to them, which are of a much lesser, quite different, order. The noble Lord referred to class sizes, which was the example that occurred to me too. One cannot simply consider the number of children in a class without also considering the number of assistants who are available, other provision that is being made, what is happening in other schools around the area, as well as matters such as travel distance and so on.

Much is made by the Government of the best value duty that is owed to local people rather than to the Secretary of State. I agree with that. The best way of reinforcing that would seem to be to allow local flexibility and not to have this highly centralising--or at any rate potentially centralising--measure with regard to which I share the fears that have been expressed.

Baroness Miller of Chilthorne Domer : One of the difficulties with this section of the Bill concerns the mixing up of performance indicators and performance standards in one clause. A process must be established if you want local authorities to relate to their local people--whom we have just discussed at length--and their local community and to relate their services to their

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community plans. As regards local indicators, you would have to establish the following cycle: consult, set indicators, perform, measure, and then report. There is only one point in that cycle where national standards should apply; namely, when you are measuring what has been done. At that point it is useful to measure your local indicators against a set of national standards. That, however, is just one part of the process. It would then be for a local community to decide whether or not its local authority's indicators were appropriate. If the community decided they were not, no doubt it would like to ask the authority to do something about that. As the measure is drafted here, we have a great lack of definition between what should happen locally and what should happen nationally. It does not allow for local discretion. Although subsection (2) allows the Secretary of State to specify different performance indicators or standards, the spirit of the provision will simply mean that when he sees a reason to vary it he will do so, without allowing for any local discretion. I should have preferred to see that what happened to local councils was meaningful when it came to community planning, and that those national standards were simply a measure against which the local indicators were viewed and which then informed the way that a local authority would "re-set".

I can see why the Government have arrived at this provision. It is an effort to drag up the worst-performing local authorities. However it does not provide an appropriate incentive for the authorities that are performing well; although beacon status will no doubt mean that they are allowed different performance indicators and standards, it will also mean that those authorities that are not too bad, but are not brilliant, as beacon authorities will be allowed very little discretion locally. It will therefore be harder for them to become better authorities.

6 p.m.

Lord Bassam of Brighton: I am reluctant to enter into this debate, but reading the clause, looking at the notes and listening to the remarks of noble Lords opposite, I find the words at line 25,

    "The Secretary of State may be order specify", somewhat familiar. I am sure I have read those words in Bills in the past, and no doubt the noble Lord, Lord Dixon-Smith, will be familiar with them. He will no doubt have read them in local government legislation historically and perhaps in recent times too.

As a local government leader I see this clause as rather useful. It is not, as has been suggested, about centralising and putting the heavy hand of the centre on the shoulder of local government, but enables local authorities to raise standards in common, so that we can all reasonably expect a service from our local authority to hit a particular target, level or quality. In that light the clause should be welcomed. While I can understand any local government member or anyone with a history of local government involvement being horrified that the "big boss" of the centre will descend upon them and dictate how things should be done, it is not unreasonable that members of the public should expect a particular quality and standard of service. Looking back, I

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remember that when Margaret Thatcher was Prime Minister she demanded of local government a minimum quality threshold. I see reasonable cause to support that notion. If that is what this provision attempts to achieve, I am sure that the Secretary of State will use his or her powers sparingly to that end.

There is much reference to the Audit Commission, and one has to pay tribute to the work that it has done in specifying standards and setting out indicators, which are not always easy to define in legislation. Here we have a practical way of doing it. The provision is not overly centralising; and as the clause later specifies, there are important opportunities for the Secretary of State to consult with such persons as he or she sees fit to determine how indicators might be defined.

We should try to see this as a measure of the centre saying, "This is what we should aspire to; if we fail and fall below that, it is not unreasonable that we should express a view and try to help the local authority to work to that standard". Given the initiatives that are being undertaken by local government through the IDA, that natural co-operation and spirit of help from the centre will be welcomed by many local authorities.

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