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Baroness Farrington of Ribbleton: This group of amendments seeks to alter the assembly's role in approving the GLA's budget. The intention appears to be to ensure that there is no prospect of the assembly failing to vote on and approve the GLA's consolidated budget. As drafted, Schedule 5 allows for the possibility that the assembly may fail to approve the mayor's final draft.

The next group of amendments--the noble Baroness, Lady Hamwee, referred to these--give me an opportunity to explain how the procedures in Schedule 5 have been carefully designed to give the lead to the mayor, to provide a proper role for the assembly, to avoid deadlock and to ensure that a budget is set. It would not be acceptable for the assembly to decide the GLA's budget by a simple majority. That would be entirely out of kilter with the respective roles of the mayor and assembly. The details of paragraphs 8 and 9 of Schedule 5, which this group of amendments seeks to alter, are the end of a carefully designed process which needs to be considered as a whole.

While these amendments purport to give the assembly greater power, they could in fact lead to deadlock, with the GLA having no budget at all if the assembly failed to vote or agree on the mayor's final draft by the end of February. The noble Lord, Lord Dixon-Smith, said that was not a normal process and made a direct comparison with local authority structures generally. He wanted to stop the assembly being a puppet. The noble Lord fails to recognise that the entire procedure is based on a different model--one that gives the assembly a strong role in scrutiny, and executive powers to the mayor. Those powers are not dictatorial but are part of a new structure in a new system.

The noble Baroness, Lady Hamwee, referred to one reason that the amendments are defective, when she referred to paragraphs 8(3) and 8(4). For that reason also, the amendment is not acceptable and I urge the noble Lord to withdraw it.

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6 p.m.

Lord Phillips of Sudbury: Before the Minister sits down, may I ask--I hope not unfairly--whether she is aware of any precedent for such a majority?

Baroness Farrington of Ribbleton: It would be difficult to draw on a precedent when the proposal before the Committee is a totally new structure.

Lord Phillips of Sudbury: I was thinking in terms of other democracies, where the division of powers that is prevalent in the Bill is common enough--but I know of none where a two-thirds majority is required.

Baroness Farrington of Ribbleton: At this stage, I bow to the noble Lord's greater knowledge. If I can find a way of demonstrating greater knowledge than his, I shall do so in writing.

Baroness Young: Listening to the Minister, I was slightly surprised at the arguments that she adduced against my noble friend's amendment. She started with the proposition that the assembly was quite unlike anything else in local government. That statement is one with which we can all agree--although a great number of alarm bells will ring in my head if the assembly is taken as a model for other towns that might have directly elected mayors, because the precedent is most undesirable. I was glad to hear what was said by the noble Baroness, Lady Hamwee.

The Minister said in defence of the assembly that it is not similar to anything else. She then explained that the whole London procedure is different and that that the powers given to the mayor are a new structure in a new system. That may be a statement of fact, but it is not an argument in support of giving the mayor what are effectively dictatorial powers over the budget. We all agree that the budget will be the most important thing for the mayor. The budget is the most important thing for any organisation. If the mayor can ultimately overrule the assembly, that cannot possibly be regarded as democratic. That may be different and new, but it is certainly not democratic in relation to anything in local government that I have come across--and not democratic in relation to other constitutions. It sets a dangerous precedent.

It may be that the amendments are not correctly drafted, but they raise an important principle. I hope that the Government will look at all this again.

Lord Brooke of Alverthorpe: There are a variety of reasons for introducing change to London--not least the fundamental issues of democracy and efficiency. One problem we have in local government is that democracy is in an ever-downward spiral with regard to the accountability to the electorate of those elected. The proposed change relates to efficiency, but also to democracy for London, with the aim of getting a greater number of people involved in a new type of democracy compared with the traditional model used in local authorities and county councils. That change requires the Government to introduce through Parliament new structures to create a balance between the elected assembly, mayor and electorate.

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The budgetary approach will, of course, be important. It is impossible to envisage a situation in which, in year one, there could be a complete stalemate between the mayor and the assembly, with the matter sent back to the public, who we hope will vote in significant numbers.

I hope that people are prepared to be bold and will try to understand the new structure, with its attempts to introduce greater democracy on a larger scale as well as producing a more efficient operation than in the past. I hope that the Opposition will withdraw their amendment.

Lord Birdwood: I appreciate the Government's motivation in trying to create a structure having a high degree of lubrication, which majority voting would achieve. I cannot think of the social dynamics of a body that would find it in its heart to oppose nearly every budget put before it.

I have some intellectual curiosity about whether the proposal was a pure creation from the Pandora's Box of the government draftsman; or was a model from anywhere else in the developed world used as a template?

Baroness Carnegy of Lour: It was refreshing to hear the noble Lord, Lord Brooke of Alverthorpe, describe some of the thinking behind the Bill because it assists those of us on these Benches to hear other than members of the Government Front Bench explain something so new and different.

Is it the idea that the mayor's budget will get a fair wind and be amended only if it has something badly wrong with it in the view of the electorate? My experience of a two-thirds majority is that which I had to operate on an education committee if we had to dismiss a teacher. It is difficult to achieve a two-thirds majority on a council when one is not dealing with a matter of party politics.

The assembly will be elected by proportional representation, and that, in addition to the two-thirds majority, will make it difficult to amend the budget. Is it the idea that the mayor should get away with it unless there is something so pressingly wrong with the budget that it is possible to assemble a two-thirds majority against it? That is the only reason that I can think of for the Bill being constructed in the way that it is. As my noble friend Lady Young said, that is not the normal way to approach a democratic decision in local government.

Baroness Farrington of Ribbleton: The word "democratic" is used by different people in different ways. The framework of the structure put to Londoners in the referendum embodied an executive mayor and an assembly with the primary task of acting as a body of scrutiny, but also of serving in various capacities on bodies working within the overall strategy established by the mayor.

Within that concept, it is important that there should be a separation of powers between an executive mayor and an assembly. It is entirely right that an executive mayor should be in the lead in deciding the GLA's budget. We are very concerned to ensure that there is no deadlock, which would leave the GLA with no budget. There needs to be a means of setting the budget in the extremely

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unlikely event of the mayor failing to set one. Schedule 5 accommodates such factors. As the noble Baroness, Lady Carnegy of Lour, said, it is difficult, but not impossible, to get a two-thirds majority. It involves people thinking very seriously and coming together. That is an important feature of the proposals before the Committee.

The noble Baroness, Lady Young, raised the issue of how we had developed this particular model. It is not a model based on a rigid blueprint which has been transposed from one place to another. Indeed, it comes from looking at a variety of different models and different relationships that exist between directly elected mayors and assemblies or councils of one sort or another, both within Europe and the United States of America. We believe it is important for the assembly to be able to participate in, but not dominate, the budget process.

The procedures set out in Schedule 5 will allow the assembly to have a real influence on the level of overall spending, on the level of spending by each of the functional bodies, and on spending on different services. We believe that the proposals before the Committee get that balance right.

Baroness Young: I am sorry to intervene once again, but I must say that I was very surprised to hear the Minister call the referendum in aid of her argument. After all, only 34 per cent of Londoners voted for this. The idea that everyone who voted actually voted for a mayor and an assembly with these particular powers is beyond belief.

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