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Lord Hunt of Tanworth : The general dislike of Henry VIII powers is so great that one's instinct is to be extremely suspicious of them. The Committee will know, however, that the Local Government Association is anxious to have these powers and I am persuaded that they are right. The best value regime is a new scheme. No one is quite sure exactly how it will work and what kind of problems it will run into.

There must be a power for the Secretary of State to authorise exemptions. That may constitute an extension of powers or may simply be a question of an authority doing something differently that it is prevented from doing at present. Until some of the schemes get off the ground, however, it is difficult to say what changes, if any, will be needed. The question therefore concerns what safeguards exist to prevent the misuse of these powers. The Delegated Powers and Deregulation Committee is absolutely right in saying that the measure should be subject to the affirmative procedure. That seems to give the necessary flexibility as well as providing safeguards against a misuse of Henry VIII powers. I therefore support the proposal.

Lord Whitty: In view of some of the comments of the noble Baroness perhaps I should place on record that whether or not we believe that all future Secretaries of State will be as benign as the Deputy Prime Minister, we must expunge any feeling that anybody can buy off the Delegated Powers and Deregulation Committee by promises or anything else. The Delegated Powers and Deregulation Committee, probably for the reasons just indicated by the noble Lord, Lord Hunt of Tanworth, reached a judgment that the Henry VIII powers here--in so far as you can regard them as such, and not everything that Henry VIII did was non-benign--will in fact have a benign influence on the introduction of a best value regime.

Indeed the illustrations that the noble Baroness reeled off as regards the frustration of a number of local authorities in terms of what would appear to be red tape are precisely the kind of issues that we will have to tackle. I am not promising her that we will tackle all those particular ones. We will need to build a consensus among authorities as to whether or not we can take action. As the noble Lord, Lord Hunt, has just said, this

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can also be a matter for affirmative resolution. Nevertheless those are the kind of matters that we have to get out of the way if the best value regime is to operate to full effect.

That is why we need flexibility for the future and why Clause 15 has been drafted in the way that it has. No one can claim at this stage to know or understand all the ways in which best value might be achieved and all the barriers which it might come up against that would require some legislative alterations. It is really only by providing flexibility of legislative response that we can assure flexibility in local delivery. Clause 15 will enable the Secretary of State to modify or exclude the application of existing legislation or enact new legislation where that will help authorities to achieve best value. That is the best way of expressing it. As the Committee will know, we have also identified four broad areas where these clauses will be able to assist best value authorities in achieving best value. They are, in broad terms first, facilitating joined-up service delivery (that is, working across organisational boundaries by pooling budgets and the integration of services within and between authorities); secondly, the regularisation of powers in respect of partnership arrangements, including the operation of local authority companies; thirdly, clarifying the circumstances under which local authorities can provide goods and services to others; and, fourthly, making better use of local authority assets. Those broad areas cover most of the circumstances in which we would raise them. There may, however, be others.

The way in which Clause 15 is currently drafted would enable existing legislation to be modified to give authorities the powers that they need to achieve best value. We recognise and provide in Clause 15 that for many best value authorities the issue is not just that existing powers need to be changed but that new powers may have to be made available to them so that they can make the most of their assets in achieving best value.

Those are wide powers, but they are all geared to achieving best value and they are all subject, as the noble Lord, Lord Hunt, has just said, to the parliamentary safeguards of affirmative resolution.

I do not believe that Amendment No. 70 would help resolve those points. Before we can enable best value authorities to carry out income-generating activities, as required by the clause, we have to consider issues beyond the best value area. First and foremost, local authorities' activities must be firmly tied in to the best value framework and to statutory responsibilities. The purposes of the Secretary of State's powers through Clause 15 is not to permit local authorities to trade as such and to generate income as such, but to ensure that they have the right powers with which to achieve best value within the framework of their existing functions, which may include in the process trading and income generation. I do not believe that the amendment as drafted makes that clear. Indeed, we do not believe, therefore, that if we specified that the objective had to be best value we would need explicitly to put in income generation, or by implication, trading.

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Amendment No. 75 seems to provide that any orders under this clause would have to extend the power of best value authorities. I understand what is meant by that and we do want to ensure that best value authorities have all the powers they need to enable them to deliver best value to the local taxpayer; that is why the Bill is drafted in such a way as to give them extra powers where necessary.

We also need to address the fact that some enactments inhibit the delivery of best value in a different way. That is why Clause 15 also gives the Secretary of State powers to modify or to exclude the application of enactments to best value authorities. It will not necessarily be an extension of the powers; it may well be a modification, an exclusion or an exemption where that will help them achieve best value. We wish to ensure that the Secretary of State has maximum flexibility, therefore we would wish to limit the situation of explicitly extending powers to local authorities. The current drafting of Clause 15 achieves that flexibility.

There is a related point in the first amendment from the noble Lord, Lord Dixon-Smith. I understand the intention behind Amendment No. 71 and agree with the view that in certain cases legislation makes it difficult for authorities to achieve best value and exemptions are needed. However, Section 15(1), as drafted, already permits the Secretary of State to exclude the application of specific legislation to best value authorities. Amendment No. 71 does not add to that; it duplicates it and does not achieve anything more than is already provided for in the Bill in Clause 15(1). I therefore consider the amendment unnecessary.

I turn to Amendments Nos. 76 and 77 which stand in the name of the noble Lord, Lord Dixon-Smith. Clause 16 requires the Secretary of State to consult all authorities or persons which represent those interests affected by order made under Clause 15. I confirm that we intend this to include representatives of best value authorities. Clearly consultation is a key component of the whole regime of best value. However, Amendment No. 76, as drafted, would, in effect, implicitly limit the obligation laid on the Secretary of State to consult. Requiring him to consult best value authorities would mean there would be no duty under that clause to consult those other non-best value bodies which represent interests affected by the Secretary of State's proposals to modify legislation. That could be unnecessarily restrictive. I can assure the noble Lord that it is our clear intention that the Secretary of State should consult all those representing persons affected by the proposals, and that goes beyond best value authorities. To pick them out explicitly in this sense may actually restrict the powers under this clause. We also need some flexibility in that consultation. Taken together, Clauses 76 and 77 would reduce that flexibility and I would therefore ask the noble Lord not to press his amendment, and the noble Baroness to withdraw her amendment.

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4.30 p.m.

Baroness Miller of Chilthorne Domer: The Minister mentioned partnership working. I do not have the draft Bill about political structures in front of me, so I am unable to check this. If it were necessary, will this clause facilitate partnership working between authorities? Will the Secretary of State be able to facilitate varying political structures under which authorities might be operating so that they can foist delegated executive authority on to a committee of two or more of those authorities, which the next Bill will preclude? Would it be this clause that will be relied upon, or will there be provision in the next Bill giving a similar power to the Secretary of State? I am not clear whether the powers in this clause will apply to that next Bill, too.

Lord Whitty: This power would apply to the ability to modify any legislation. However, the particular example which the noble Baroness raises will be dealt with more by the next Bill than by this Bill. The circumstances she describes are more about the exercise of functions than about removing or altering legislation. We can probably debate that in the context of the draft Bill which will be scrutinised shortly.

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