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The Deputy Speaker (Lord Lyell): My Lords, we are debating Amendment No. 42A, which the House will see is Amendment No. 44 re-tabled. I hope that that is helpful.

Lord Rooker: My Lords, the mysteries of this place continue to amaze and irritate me, because it is not so precise as the other place. I apologise for disturbing the noble Baroness's speech.

Baroness Hanham: My Lords, the Minister was not disturbing me; I simply thought that he was not listening.

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6.15 p.m.

Lord Rooker: My Lords, Amendment No. 42A, which started life as Amendment No. 44, aims to ensure that grants made under the new powers in Clause 31 are available to all authorities of the same category on the same terms, that those terms have been publicly certified as equitable by the accounting officer of the department, and that documentation on grant decisions is passed each year to the Comptroller and Auditor-General.

I understand the need to ensure that the use of that grant-making power is seen to be fair. Treasury approval will, of course, be needed for all grants made under Clause 31. Parliamentary approval will also be needed for the ambit of the department's vote under which the grant will be paid. I also confirmed during discussion in Grand Committee that we will be publishing a list of the expenditure grants made under the clause. The grants so made will set out the amount of the grant and the manner of its payment. We do not therefore see any need to go further and require the arrangements set out by the amendment.

In any case—this is a fallback, because it is a technical issue—the amendment is defective. It includes the expression "same category", which would need to be defined if the amendment were to make sense. It also requires the accounting officer to certify that the conditions are "equitable", which we have to presume means fair. However, we are not certain how the accounting officer would be meant to judge that. The amendment would also limit the use of the power. There will be cases in which it would be appropriate to use Clause 31 to make a grant to one authority only. The amendment attempts to preclude that.

Amendment No. 47, to which we are speaking with Amendment No. 42A, would restrict the timing of the use of the grant-making power in Clause 31 according to the parliamentary and local elections which may occur. That would mean that no grant could be made under the power more than four years into the term of a Parliament, up to six months before any local, regional or European election, while the parliamentary constituency within which a local authority sat was without a Member, or when there was a gap among the members of a local authority to be filled through election or by-election.

That would mean that an authority eligible for a grant, perhaps at short notice, might not be able to receive that grant through absolutely no fault of its own. The Government would be forced to revert to using Section 88B of the Local Government Finance Act 1988—I constantly referred to it in Committee as the poll tax Act—or some other specific power, if it were available. That would be likely to cause delays in the payment of the grant to the affected authority, and affect the flexibility with which the grant might be used.

In the light of those assurances—they are indeed assurances—I hope that the noble Baroness will withdraw her amendment. If the position has not been made clear, we obviously have another opportunity to come back to the matter, but there are assurances. I

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have given some practical reasons why Amendment No. 47 could not be accepted, and I have pointed to a technical defect in Amendment No. 42A. I do not rest the case on that, but there are issues about drafting amendments to put into law. The issue is not only about "equitable" but how the accounting officer is meant to operate the powers and the requirements in the amendment.

Baroness Hanham: My Lords, could the Minister give some idea of what the grants will be for? We have the Bellwin formula, which already provides for emergency grants. We have specific grants that have always been there, and we hope to see the reduction of them. But what will the grants be for? If we are going to give them to one authority, what is the purpose for that? If they are to be given to all county councils, what sort of grants might be given to county councils that will not be given to anyone else? My trouble with Clause 31 is that I do not see what it will be used for. If the Minister cannot answer me today but could write to me before Third Reading, it would be extremely helpful. He may be able to answer, so I shall bow to his great knowledge and give way.

Lord Rooker: My Lords, I cannot answer, but I should be able to. I should be able to give some kind of example. I have just asked the noble Lord, Lord Bassam, if the notes on clauses offer any clues. I shall certainly write to the noble Baroness because there is an interval between now and Third Reading in which I shall be able to make the position clearer.

It may be that the answer might still be that I do not know, but I shall look into the matter in order to satisfy the quite legitimate question about what the grants would be given for, bearing in mind the fact that there are other kinds of grant. As I recall from our debates in Committee—and I remember my referring there to Section 88B of the Local Government Act 1988—there are some rules about the way in which the powers in Section 88B are used, so we would be seeking to use Clause 31 instead of Section 88B. As I pointed out in relation to Amendment No. 47, if we wanted to give money to the local authority for any particular reason—and that would be known about, because they are not secret grants—we could not do that under Clause 31 and we would have to revert to Section 88B. It is clear that Section 88B will become a second choice for assuming grant-making powers, if Clause 31 reaches the statute book. To that extent, the clause is probably a replacement for Section 88B because of the inconvenience of the way in which that section operates. I will write further to the noble Baroness after today's debate.

Baroness Hanham: My Lords, I thank the Minister for that reply and I thank him for agreeing to let me know. I have been picking away at Clause 31 to find out what it is for. I acknowledge that the amendment is defective. I shall wait for the Minister's letter. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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Lord Rooker moved Amendment No. 43:

    Page 14, line 30, at end insert—

"( ) A Minister of the Crown, or the National Assembly for Wales, may pay a grant to a local authority in Wales towards expenditure incurred or to be incurred by it."

On Question, amendment agreed to.

[Amendment No. 44 had been retabled as Amendment No. 42A.]

Lord Rooker moved Amendments Nos. 45 and 46:

    Page 14, line 32, leave out "Minister of the Crown concerned" and insert "person paying it"

    Page 14, line 33, leave out "Minister of the Crown concerned" and insert "person paying it"

On Question, amendments agreed to.

[Amendment No. 47 not moved.]

Clause 32 [Power to require information]:

Lord Rooker moved Amendment No. 48:

    Leave out Clause 32.

On Question, amendment agreed to.

Clause 34 [Wales]:

Lord Rooker moved Amendment No. 49:

    Leave out Clause 34.

On Question, amendment agreed to.

Clause 35 [Interpretation of Chapter 1]:

Baroness Hanham moved Amendment No. 50:

    Page 16, line 11, at end insert—

"( ) No power under this section is to be exercisable in relation to a regional assembly in England."

The noble Baroness said: My Lords, the Minister's reply in Committee to our probing amendment on this matter was short and, if I give him the benefit of the doubt, not sharp, but crisp. He deemed the question as to whether regional assemblies would be able to benefit from the grant regime, by being included in the list of those prescribed as doing so in Clause 35, as virtually irrelevant.

We have agreed on innumerable occasions that regional assemblies are not local authorities, so presumably they are to have a separate funding regime—probably one which is financed by top-slicing the local government grant, although we did not go into that in any depth. However, since the Committee stage, an announcement has been made about regional assemblies and the referendums. Those may now become an entity, if the electorate can be gulled into accepting them. If they do, they will have, as we know, precepting powers.

Can the Minister envisage any occasion where a regional assembly might be the recipient of grant money that would otherwise, or as well, be going to local authorities? If not, will the Minister confirm that regional assemblies cannot, and will not, be included in the list of those authorities able to receive grants under Clause 31? That is the purpose of my amendment. I beg to move.

Lord Bassam of Brighton: My Lords, the noble Baroness anticipated my first line of response, which

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was to say that the amendment is unnecessary and irrelevant, so I congratulate her on that. This is not the place to discuss the funding mechanism of elected assemblies, but since the noble Baroness has asked about it, I shall try to respond as best I can.

Funding arrangements for the regional chambers and elected regional assemblies have already been made clear. Regional chambers receive a government grant of more than 11 million a year to carry out their scrutiny and planning activities. The White Paper, Your Region, Your Choice, detailed the arrangements for elected regional assemblies, which will be funded primarily through a government block grant. All issues relating to the financing of elected regional assemblies will be properly dealt with by a Bill which sets up those bodies. Such a Bill will be introduced following a "Yes" vote in a referendum about whether to have an elected assembly, and when parliamentary time permits.

Elected regional assemblies will, as we are both now agreed, not be local authorities. They will be new, regional bodies with strategic powers over activities that are currently carried out at regional level by central government, its agencies and quangos. The funding arrangements will be set out in a Bill, which will follow on from there being a "Yes" vote. Funding will not be conducted through Clause 31, because regional assemblies are not local authorities and because there will be separate legislation governing funding.

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