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Lord Hanningfield moved Amendment No. 43:

"( ) Any statement under subsection (2) shall be accompanied by an estimate by the Electoral Commission of their best estimate of the total annual cost of paying for the proposed regional assembly and the regional administration in the referendum area."

The noble Lord said: Given previous discussions in Committee, it is important for the electorate to know the costs of establishing regional government. The White Paper Your Move, Your Choice stated that the cost of running a regional elected assembly would be around 25 million per year. The real cost will be for the reorganisation of local government.

When the referendums are held, the local government reorganisation will have been sorted out. The Government say that they want the electorate to vote on whether they want a region and whether they want the local government to be reorganised in that area. We have been told that there will be a year's process of looking at local government reorganisation in the area. Therefore, if one is establishing unitaries in

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a county there will be an approximate cost. We feel very strongly indeed that the public should be told the costs of reorganisation.

The cost of running the assembly will be the cost of the Members, the staff and establishing a building for the assembly. The cost of reorganisation will be considerable. As we have said during these debates, it will be probably up to 2 billion nationally. Certainly, where one has a preponderance of two-tier authorities there will be a tremendous amount of reorganisation. Even in, for example, Yorkshire and Humberside where authorities are mainly unitary there will be considerable costs of reorganisation. We wish the public to be aware of the cost of reorganisation as well as the cost of setting up regional assemblies. I beg to move.

Baroness Hamwee: Can the noble Lord, Lord Hanningfield, explain whether in proposing that there is an estimate for paying not just for the assembly but also the "regional administration" he can distinguish between the cost of regional administration under the aegis of a regional assembly and regional administration full stop? We have regional administration now. I am sure that the noble Lord does not intend the public to be confused by the inclusion of existing costs with future costs.

Lord Hanningfield: Perhaps I may clarify the matter. The amendment refers to "the proposed regional assembly". It is those costs. I accept the comments of the noble Baroness that there is presently the cost of running a regional office. However, we are talking about the costs of running a proposed regional assembly, the newly established body that will be set up after the referendum.

Baroness Hanham: Is it the Government's intention to allow any regional assembly to build new headquarters? With the Scottish Parliament, the Welsh Assembly and London, untold millions were invested into new headquarters, which are probably basically unnecessary and certainly in regional government terms should be unnecessary.

Lord Evans of Temple Guiting: I shall deal with Amendment No. 43 first. It asks that the Electoral Commission's estimate of the total annual cost of paying for the proposed regional assembly be looked at. The Electoral Commission has no expertise and no background. It is not part of its function to provide the figures. Estimated figures have been provided, as the noble Lord said, by the Government in Your Region, Your Choice. As he said, the Government's estimate at the moment is running costs of 25 million per year. Around 5 million of that will be directly offset by staff transferring from existing bodies.

The noble Lord, Lord Hanningfield, raised the question of local government reorganisation. He argued that this will cost money. It may. We cannot approach the matter and issue sensible figures until the boundary reports appear.

Lord Hanningfield: That was my point. By the time the referendum is held, the work will have been done.

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Therefore, the figure might be approximate but it could be estimated to the next 10 million. A figure will be available by the time we reach the referendum of what the local government reorganisation might cost. That was the point. I accept it is not available now, but it will be after a year's work and before the electorate vote. Therefore, that figure should be made available to the electorate at that stage, as well as the potential costs associated with running the regional assembly.

Lord Evans of Temple Guiting: I was about to say that later on we shall publish a full summary of our proposals, including costings for elected regional assemblies before any referendum to ensure that voters are well informed. Throughout the debate we have made the point that we are determined to give the electorate as much information as possible so that they can not only make an informed decision but will know—to use the vernacular—what they are letting themselves in for on a costs basis.

I was asked about assembly buildings. We do not want massive new buildings throughout the regions. We very much hope that where regional assemblies are wanted by the electorate they will be able to house themselves in existing buildings.

The Earl of Onslow: In his forecasts of the costs of regional assemblies will the noble Lord attach a footnote which states that all costs since the rebuilding of this Palace in the 1840s to the building of the Scottish regional assembly have gone at least four times over estimate?

Baroness Blatch: In response to my noble friend's question about buildings, we were told that London, Wales and Scotland would not have large buildings. There was nothing in those Acts of Parliament to say, "Thou shalt not build large monuments to yourselves". Therefore, what guarantee can the noble Lord as a Minister of the Government give us that none of these regions will build a new building? I do not think it is possible for the noble Lord to give that assurance across the Dispatch Box.

Lord Evans of Temple Guiting: It is not our plan that there should be new regional buildings. As my noble friend Lord Rooker said right at the beginning, and I repeat half his mantra: "There is no new money". Regional assemblies will not be able to afford to build brand new buildings, as happened in Scotland and Wales.

3.30 p.m.

Lord Waddington: The Minister used the word "hope": he hoped that they would accommodate themselves in existing buildings. Is that the end of the matter? Can they divert existing funds into new buildings, rather than use them for worthwhile purposes? What powers do the Government have or will they take to prevent abuses such as have already occurred in places such as London? It is an abuse that

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authorities should use our money, the council tax payers' money, on bricks and mortar when they should be using it on services.

Baroness Hamwee: I am sorry, but I cannot stand it any longer. I declare an interest as a Member of the Greater London Assembly. I have several points to make, but shall endeavour to restrict them. The building occupied by the Greater London Authority was commissioned by central government. One may have plenty of complaints about that, but as a matter of fact, it was not commissioned by the mayor or the assembly and it came in within budget.

We have not seen the legislation regarding finance, but we have heard the phrase, "No new money". The chances must be that the finance regime for regional assemblies will be that of or close to that of local government. All of us with experience of spending funds locally will be accustomed to ring-fencing, now ear-marking, and so on of the funds made available. As the regional assemblies will not have tax-raising powers, the chance of them having the dosh to build monuments to themselves, even if they wanted to, is remote.

But if the regional assemblies are to do a good job of undertaking strategic government, they do not need iconic, massive, grand, glorious buildings, but they need offices that are fit for purpose to enable the delivery of good regional government.

Baroness Blatch: On the point made by the noble Baroness—that regional assemblies will not have tax-raising powers—I have reread carefully what Mr Raynsford said in another place, and they will have precepting powers. I pay rates, council tax, in London. My council tax has risen phenomenally under the Greater London Authority. My rate demand for the coming year has risen by just over 29 per cent. What is to stop regional assemblies using precepting powers to build large buildings?

Lord Evans of Temple Guiting: My noble friend Lord Rooker, who is sitting behind me, says, "common sense".

To address the point made by the noble Lord, Lord Waddington, it would be politically unwise for a regional assembly to move moneys from services into a new building. Of course that could happen, but in a world of sensible decision-making, it is unlikely that the regional assembly in the North East, North West, Cornwall, or wherever, would say, "What we need as a sort of virility symbol is a brand-new building. We shall raid social services for the money to build it". I simply do not believe that that will happen.

We must return to the amendment. It says nothing about the cost of reorganisation. It is all about the cost of running the assembly. With all due respect, the amendment does not achieve the laudable aim of the noble Lord, Lord Hanningfield.

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