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Lord Grocott: My Lords, I have a sense of the meeting although I was not in my place. I think that we are all agreed that we should take the second Statement now.

I beg to move that further consideration on Report be now adjourned. In moving the Motion I should remind the House that we shall return to consider the Pensions Bill no earlier than 8 p.m., although of course it may be later than that.

Perhaps I may remind the House of what I said earlier. We shall move from the Statement straight to the Motion tabled in the name of the noble Lord, Lord Lester. Since we cannot predict exactly how long these two pieces of business will take, I move that the House should not return to further consideration on Report any earlier than 8 p.m.

Moved accordingly, and, on Question, Motion agreed to.

Regional Referendums

The Minister of State, Office of the Deputy Prime Minister (Lord Rooker): My Lords, with the leave of the House, I shall now repeat a Statement made earlier in another place by my right honourable friend the Deputy Prime Minister regarding the elected regional assembly referendum held in the north-east. The Statement is as follows:

"With permission, I would like to report to the House on the regional referendum in the north-east held last Thursday.

"May I first congratulate Ged Fitzgerald, the Chief Counting Officer, and his staff across the north-east, who ran such a well organised poll and count. I also want to thank the police, the Post Office and the Electoral Commission for their co-operation during the referendum.

"Turnout at nearly 48 per cent was a great deal more than many people expected, and has shown that all postal voting can be extremely successful when the ground is well prepared. The ballot was conducted successfully without witness statements and the turnout has increased considerably. It was higher than the turnout in the European elections in the north-east, at 42 per cent; higher than in the
 
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London referendum at 34 per cent, and very similar to the Welsh referendum at 50 per cent. I am sure that the Electoral Commission will want to reflect on this.

"Throughout the referendum, the Government have made it absolutely clear that the decision whether to have elected regional government rests with the people. It is their choice, their say. Our policy of devolution set out in our manifesto means giving power to people in our nations and regions so that they can set their own priorities and make more decisions which affect their lives.

"As a result, London now has city-wide government and a Mayor powerful enough to run a global city. The Scottish Parliament enables the people of Scotland to make key decisions without recourse to Westminster for the first time in hundreds of years. The Welsh Assembly has given the Welsh people a powerful new voice to create jobs, prosperity and social justice. Each of these new bodies was voted for by the people and has since proved to be very popular.

"It is worth remembering that proposals for Scottish and Welsh devolution failed to win public support in the first referendum held in 1979, only for the situation to be reversed 20 years later in a new referendum.

"Last Thursday, 4 November, we offered the people of the north-east the chance to benefit from an elected regional assembly. Voters in the region decided by a margin of 78 per cent to 22 per cent that they did not want this, and of course we abide by their decision.

"I confirm to the House that the result of the referendum means, first, that the Regional Assemblies Bill will not be introduced in the coming Session of Parliament; secondly, that under existing legislation there can be no further referendum on regional assemblies in the north-east for at least seven years; and, thirdly, let me make it clear that despite speculation, there will be no reorganisation of local government in County Durham or Northumberland arising out of this referendum result.

"This now raises the question of whether to proceed, as we previously intended, with referendums in the north-west and in Yorkshire and the Humber. We have reflected on the outcome of the referendum in the north-east. We also made it clear that referendums in the north-west and Yorkshire and the Humber would have to wait until the Electoral Commission has completed its work on the 'new foundation model for voting'. This is not due to be published until the end of March 2005. The Electoral Commission has also said that there should be no electoral pilots using the new model until at least September 2005. But in the mean time, under the legislation, our ability to hold referendums based on the current soundings exercise runs out in June 2005. We would therefore need to conduct a new soundings exercise and bring orders to call the referendums before both Houses of Parliament under the Regional Assemblies (Preparations) Act 2003.
 
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"All this would result in a long period of uncertainty for local government in the two regions, which we do not think is acceptable. I will therefore not be bringing forward orders for referendums in either the north-west or Yorkshire and the Humber. If and when, in the future, a region does want to move ahead with a referendum, the House will have plenty of notice of that event.

"I do not want to underplay the importance of last week's decision. But the House should remember that elected regional assemblies are just one part of a wider programme of devolution and decentralisation in England. For a decade or more it has been recognised that there are issues which must be dealt with at a regional rather than a national level, but which need to be co-ordinated over an area larger than any single local authority.

"That is why the party opposite established the Government Offices for the Regions in 1994, and rightly so. We have since strengthened the Government Offices to include more central government departments. We also created the regional development agencies in 1998 as economic powerhouses for their regions. The English RDAs have created or safeguarded more than 160,000 jobs over the past two years alone, and have played a major part in reshaping our regional economies.

"The House will also be aware that every English region was given the choice in 1998 to have a voluntary regional assembly composed of representatives of local government, business, trade unions and other representatives of the wider community. All eight regions chose to have one of these voluntary regional assemblies. All parties are represented on them, and some are even chaired by Conservatives.

"The voluntary assemblies have an important influence on housing, planning, transport, economic development, skills and training in their region. These regional bodies play a co-ordinating, strategic role with the full involvement of local authorities and other representatives of the region.

"The successful Northern Way initiative, launched in February this year, is a good example of the benefits of this approach. The RDAs and their partners in the three northern regions are working together to create more jobs, more prosperity and greater social justice.

"The Northern Way has been warmly received and has really energised the people in the three northern regions. It is one example of how, across the country, regional structures and initiatives will continue to work for the benefit of the regions with the full support of this Government.

"Our continuing agenda of reform and devolution to local government is equally important. This was evident in July, when we launched our document, Local Vision, beginning an extensive consultation about the future of local government.

"It means allowing more decisions to be made in local communities. Along with the modernisation and reform of local government, we have taken
 
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several steps to devolve decision making to local authorities. We have removed restrictive controls on local authority borrowing; we have given local authorities greater power to promote the well being of their communities; we have given them freedoms and flexibilities to deliver better services; and we are piloting local area agreements which will streamline funding from Whitehall so that spending can better reflect local priorities, determined locally. All of these measures have been warmly welcomed by the local authorities concerned.

"Our agenda for reform, change and modernisation means we will continue to decentralise and devolve power wherever we can. We have already done a lot, and there is more to do. We have already brought economic stability, lower unemployment and lower inflation—and our commitment to delivering the best possible future for all the regions remains as strong as ever".

My Lords, that concludes the Statement.

Baroness Hanham: My Lords, I thank the Minister for repeating the Statement made in the other place.

On an earlier occasion, when he was required to announce that the Deputy Prime Minister had made a decision to drop the referendums in the north-west and Yorkshire and Humberside—because it was as plain as a pikestaff that the Government would lose—I suggested that the noble Lord might be embarrassed at having to make such a statement. He denied it emphatically and he denied that he was ever embarrassed. But he should be today. The whole of the ministerial team of the Department of the Deputy Prime Minister, including the noble Lord the Minister, have been extolling the virtues of elected regional government—a policy which has now spectacularly blown up in their faces thanks to the good sense of the electors in the north-east. Theirs was a total and emphatic rejection of the Government's regional policy.

It cannot be stressed enough how overwhelming was the margin of the Government's defeat. The figures speak for themselves: 696,519, or 78 per cent, voted against a regional assembly; 197,310, or 22 per cent, voted in favour. That is a substantial rejection.

To give him his due, the Deputy Prime Minister does not try to say that this is a partial endorsement of regionalism or elected regional government. He sees, as well as we can, that the people of the north-east—and it is the people, not the politicians—have spoken, and they have spoken clearly against elected regional assemblies.

They knew that they were being sold a dummy. They could not be fooled into believing that the assemblies would have meaningful powers devolved from central government; rather that the reality was of responsibilities being sucked away from local government. They sussed out that the assemblies would have no powers, would bring more highly paid politicians with little to do, more bureaucracy, higher council tax bills and that the well tried and tested structure of local government would be
 
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destroyed. It is little wonder therefore that they chose the only viable option open to them and voted in droves to reject such an ill-judged and half-baked idea.

All of this—I do not want to dwell on it too long—was rehearsed as being the reality of the outcome of the Government's regional policy over and over again in this House and in the other place. But the Government did not listen and now have only themselves to blame for the result they have now achieved.

The Deputy Prime Minister, having read the runes, now opines that he will not be bringing forward orders for referendums in either the north-west or Yorkshire and Humber—a truly inspired and wise decision, particularly, as he acknowledges himself, since he now has little authority to do so. Equally, as demonstrated, there is no electoral support for doing so. This policy is a duck so dead that it has mortified.

In light of the clear indication from the north-west and Yorkshire and Humberside, it is time to ask some searching questions about the whole fiasco. In going forward with this policy in this one region, were the Government aware that the Electoral Commission would spend more than £100,000 of taxpayers' money on the accredited "Yes" and "No" campaigns? Were they aware that the Boundary Commission would spend a further £6 million on publicity and an unnecessary complementary local government review? Were they aware that the Minister's department would spend another £5 million on advertising its "Your Say" campaign? Were they aware that unknown sums would be spent on supporting visits by Ministers to campaign in the region?

Taken together, the minimum cost to the Exchequer of one regional referendum campaign was around £11 million. Does the Minister appreciate that for this money the north-east alone could have employed an extra 518 teachers, an extra 382 policemen or paid for an additional 2,450 hip operations, or the Deputy Prime Minister could have bought 227—and a half—brand new S-type Jaguars.

With this rejection of regionalism, will the Minister confirm that the Government will not embark on any new plans for new legislation for any form of regional government?

In his Statement the Deputy Prime Minister drew attention to the fact that the previous government created the Government Offices to co-ordinate issues over an area larger than any single local authority. Indeed, but it was to co-ordinate the work of government departments as outposts, not to create and oversee planning strategy, not to impose policies such as the siting of hundreds of thousands of new houses, and not to manage the fire service.

Therefore, will the Government now say that regional fire authorities, regional housing boards, regional transport bodies, regional planning bodies, together with all the other regional quangos and non-elected bodies, will be restored to the current and proper structures of local government?

Local government needs to be acknowledged for the work that it does, given the tasks to do and the wherewithal to do them. The Government need to be
 
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far more forthcoming about devolving more responsibility under the current structures of the bodies I have outlined. They need to recognise that the reversal they have suffered over this flagship policy is not just a little problem to brush over and pass on. The north-east electors can rejoice, but the Government cannot.

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