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I am going to depart from my notes because I want to clarify one or two points. We have talked about the Assembly having scrutiny powers, but it seems obvious that it should have the right kind of budget to carry out its scrutiny function. The Assembly is the right body to do that but it has to have some protection. As I understand it, there is no floor to the budget, as has been the subject of our discussion. The Assembly should be able to create a budget that is protected in some way, and I should like assurance on that point.
We have talked a lot about scrutiny. If we have a strong mayoral model, the Assembly must have a strong scrutiny function and powers to create its budget, but that does not seem to be the case. We seem to have got confused regarding agreeing budgets line by line, and so on. We are giving a lot of extra power to the Mayor so that he is a strong Mayor, but we need to give equivalent power to the Assembly so that it can carry out the scrutiny. The amendment seeks to clarify that.
This matter will clearly be the subject of debate not just in Committee but throughout the passage of this legislation. We need to understand it so that we know what amendments to put forward, or even to vote on, at later stages to ensure that the Assembly has enough scrutiny powers.
I am concerned that we are not considering the matter sufficiently. The Assembly is elected on the same day as the Mayor and therefore it has a political mandate. Even if its Members are not from the same political party as the Mayor or the majority are not from the same party, they are still elected on the same day. The people of London will have voted for them and I am sure that they will want to see the checks and balances created by the Mayor. It might be sensible to insist that they are all from the same party,
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Lord Campbell-Savours: There is no floor to the scrutiny budget at Essex County Council, so why should there be one at the GLA?
Lord Hanningfield: A democratic body would ensure that enough money was available for the scrutiny function, but if I, as leader of Essex County Council, wanted to thwart that, I could. Here, we are suggesting that the Mayor might have the power to thwart the functioning of the Assembly, and we want to prevent that.
Lord Campbell-Savours: Did I hear the noble Lord say that he was the leader of the Essex authority?
Lord Campbell-Savours: If the noble Lord can do it, why cannot the Mayor? Is the noble Lord any less or more likely to do it than the Mayor?
4.45 pm
Lord Hanningfield: In local government we have a strong leader in a Cabinet model, but the county council has the power to pass the budget. As leader of Essex County Council, I propose a budget that has to be scrutinised and passed by the full council. The leader and the Cabinet have no power to implement that—all 75 members of Essex County Council have to debate and pass the budget. That does not happen in London although there is a strong Mayor model. I will be interested to see what happens in the forthcoming local government Bill. Will I, as leader of Essex County Council, have the power of veto over the county council? We will talk about that when we debate that legislation.
Let us have some more clarity; when we know where we are and how the Assembly can protect its budget, we can debate it properly. I am getting more and more confused about how the Assembly can function in London.
Baroness Turner of Camden: The amendments seem to constitute a major rewording of a whole chunk of the Bill. I gather from the briefing I have had from the Mayor’s Office that he supports the Bill as it stands, which gives the Assembly greater powers of scrutiny. However, parts of the amendments undermine to some degree the powers that the Mayor already has; we have had some discussion about that in the context of my noble friend Lord Harris’s contribution. There is a move here to transform the Assembly into a Greater London Council, which it is not. It is not the GLC but an Assembly with scrutiny powers. I can see no real reason for departing from the wording in the Bill. I would be grateful to know if the Minister can see any reason; I can see none except an attempt to undermine to some degree the powers that the Mayor already has. Although we may have different views of what the government of London ought to be, we are all agreed
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Baroness Andrews: This has been a lively debate. I will not follow the noble Baroness, Lady Hamwee, through the detailed way in which she presented her arguments. It is probably better that I do what I was invited to do by the noble Lord, Lord Hanningfield, and address some simple political realities. I am grateful for the contributions of my noble friends Lady Turner and Lord Campbell-Savours. They raised issues which are contextually germane to what we are proposing.
I believe that noble Lords have erected fears which are unfounded. The strategy they propose runs greater risks than does accepting what we are trying to do, not only by inventing a budget for the Assembly. The underlying fear is that the Mayor might, in the face of argument or criticism, reduce and diminish the power of the Assembly by cutting the budget. I am not convinced that there need be any additional statutory safeguards; the normal democratic processes are there to do just that. Creating an Assembly budget which then can be promoted and defended gives the Assembly a new and unique ability to do that.
Let me deal first with the Assembly component budget and the simple majority question. Amendments Nos. 30 and 32 specifically allow the Assembly to amend by simple majority only its own final draft budget. To pick up a point made by the noble Baroness, Lady Hamwee, there is no basis in legislation, as I said earlier, for the Assembly to vote against the Mayor’s budget as a whole. It must approve the final draft, with or without amendment.
I have three arguments. The first is to do with inconsistency, and I do not think it is frivolous; the second is to do with the reputation and function of the Assembly; and the third is to do with the realpolitik of what it means to operate in a democratic environment. It does not make sense for the Assembly to be allowed to amend one part of the final budget through a simple majority vote while the rest of the consolidated budget requires a two-thirds majority for amendment, even if that part is about the Assembly’s own budget. That takes us to the question of reputation. It would send a curious and unconfident signal if the first thing the Assembly did on getting its own independent budget was to try to secure preferential treatment to ensure that it was more protected and easier to increase than budgets for GLA front-line services. The noble Baroness said that that would not be so, but I believe the perception of Londoners would be that neighbourhood police forces are less important and have less political salience than the administration of the Assembly or that the fire service counts for less than securing more staffing for Assembly Members. I would not feel comfortable sending that message.
The second risk, which is related to the first, concerns reputation and realpolitik. For the first time, Assembly Members will have a strong common interest in ensuring that the Assembly has the resources necessary to fulfil its functions. This is the point raised by the question of
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Amendments Nos. 21, 31 and 33 set the minimum amount. The same arguments apply in part. The amendments provide the Assembly with additional and preferential safeguards in its budget rather than ensuring that the existing arrangements, whereby it can amend its final draft budget by a two-thirds majority, work well. I find this a rather alarmist scenario. I do not say that it is typical of the noble Baroness, Lady Hamwee, but the expectation that something cannot be achieved within the present arrangements is strange because the two-thirds rule provides a sufficient safeguard to enable the Assembly to amend an excessively low budget proposed by the Mayor. As the noble Lord, Lord Campbell-Savours, implied, rather than establishing a complex and arbitrary mechanism to guarantee a minimum budget, the Assembly should have confidence in itself and use its existing powers and the powers of persuasion between parties to command a majority that ensures a fair and equitable budget.
We are having architectural arguments about ceilings and floors. I do not think it is inconsistent to have a ceiling and no floor. A ceiling is important because it would look very odd to give the Assembly carte blanche to increase its own budget unacceptably, but a floor anticipates a profound lack of trust between the Assembly and the Mayor and a lack of self-confidence in the Assembly. It sends a seriously uncomfortable and probably inappropriate message that the Assembly budget is more worthy of extra protection than the budgets of front-line services. It is a very cumbersome and complicated way to protect the Assembly. It adds more layers of complexity to an already complex process.
I shall not repeat my response to the argument that, without a budgetary floor, the Assembly would suffer a death by 1,000 cuts. The noble Baroness’s amendment would not have its intended effect. The calculation it proposes would allow the Mayor to freeze the budget—a cut in real terms—and increase his own budget. That would not protect the Assembly from cumulative cuts.
AmendmentNo. 35 makes explicit that the Assembly can allocate money as it sees fit from within its own agreed budget. The amendment is not necessary, given the spirit and the letter of the law. It is clearly within the spirit of the Bill that the Assembly should decide how best to allocate its budget within the agreed total of that budget, regardless of whether or not it had
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The point raised by the noble Baroness in her amendment is covered. I hope that noble Lords will not press their amendments.
Baroness Hamwee: At Second Reading I referred to these clauses as being as complicated as a Fair Isle knitting pattern. I apologise to noble Lords that I have not made the process more like a stocking stitch. The noble Lord, Lord Campbell-Savours, asked why, if there was no budgetary floor in Essex County Council, there should be one in London. Conversely, if it is wrong in London, it may be wrong in Essex also and we should look at changing the arrangements for Essex.
Lord Campbell-Savours: The noble Baroness was surprised at the proposition in the Bill that the draft component budgets could be amended. On two occasions she said that that was news to her. That would be an immeasurable power in discussions over scrutiny budgets. I would have thought that her group and the Conservative group in the authority would wish to look very closely at my noble friend’s undertaking. If I were a member of the GLA and that power were available to me, I would feel assured that I could obtain whatever money I needed for scrutiny.
Baroness Hamwee: The noble Lord is right; that is why I have readily accepted an invitation to discuss the matter with the Minister. However, there is some history to this issue, which has been of concern to the Assembly. I am not saying that the Assembly and its advisers have never thought about or looked at this matter, but I want to be absolutely sure about it. I believe that I am right to say that, whatever assurances the Minister may give from the Dispatch Box, although welcome, if they can be challenged afterwards on the basis of the wording of the legislation, they would, sadly, not count.
The position of Essex and all other local authorities is not the same as that of London. Even with a Cabinet model, there is a leader and a Cabinet drawn from the whole council and the council has control of the whole budget. That is not the case in London. The noble Baroness, Lady Turner, characterised the amendment as rewording the Bill. That is not the intention; the intention is to provide additions. That may sound a tedious point, but it is important. Nor is the amendment aimed at undermining the structure and constitutional arrangements or at turning the Assembly into a GLC mark II. It aims to ensure that the Assembly is in control of that one bit of the budget. That is what the Government said, at the start of the process, they sought to achieve. Despite their length, these are intended to be technical amendments to achieve what the Government say they are trying to do.
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The Minister talked about reducing the Mayor’s powers. The amendments would not do that, except to the extent that the Mayor would have a power, as we believe, to reduce the Assembly’s budget subject to a cap but not to a minimum, or a floor.
The Minister said that the Assembly should rely on the democratic processes already in place. I do not know about other noble Lords, but I would not fancy knocking on doors saying, “Vote for my party because the Mayor has been very mean to the Assembly”. Electors would, quite rightly, have other matters on their mind. It is up to us, as politicians, to ensure that the means are there.
5 pm
Baroness Andrews: Internal democratic processes would enable coalitions to make a difference and allow the Assembly to get its way against the Mayor rather than external democratic processes.
Baroness Hamwee: Perhaps it comes from cynicism born of experience, but I do not see the realpolitik in the same way as the Minister does. She says that it would reflect on the political parties; I part company from her there.
Legislation should set up the structure which restricts elected politicians from doing, or allows them to do, whatever is intended. One should not rely on people showing the common sense that we, in 2007, think they should show in five years’ time, when provision can be achieved in legislation.
The noble Baroness talked about reputation. Given that there would be a ceiling—I am not challenging the ceiling on the Assembly’s budget—I part company with her there as well. I do not approach this in some Cassandra-like fashion, looking for a problem; instead, I seek to think through the “what ifs?” and find the protection.
There is a difference from the functional bodies which are part of the Mayor’s arm. I am glad that the Minister thinks it is not necessary to have a clause dealing with the allocation of resources—that is within the spirit of the amendment. Clause 34 provides:
to facilitate its functions. That was where I had a problem. However, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Sitting suspended for a Division in the House from 5.03 to 5.16 pm.]
5.16 pm
[Amendments Nos. 30 and 31 not moved.]
Clause 14 [Substitute calculations]:
[Amendments Nos. 32 to 34 not moved.]
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Baroness Hamwee moved Amendment No. 36:
“(3) In any direction given under this Act by the Mayor, the reference to a “direction” shall include the following—
(4) In this section and in section 404A above, any reference to “this Act” includes any provisions which, by virtue of the Greater London Authority Act 1999 (as amended from time to time), have been or are inserted into any other Act of Parliament or statutory instrument.”.”
The noble Baroness said: I shall also speak to Amendment No. 38. The noble Baroness, Lady Hanham, has Amendment No. 73 in this group as well. The Mayor already has powers to issue directions to the London Development Agency and Transport for London; these are to be extended to the London Fire and Emergency Planning Authority, to which the noble Baroness’s amendment refers. My amendment relates to directions to all the functional bodies. The principal amendment is Amendment No. 38, which would enable the Assembly to call in directions.
The amendment is not tantamount to a veto. It is proposed that, when the Mayor issues a direction, the Assembly should have an opportunity to require the Mayor to take account of any recommendations made by it within a period of three weeks and to justify why he does not—in other words, it creates a pause.
This is not new in local government—indeed, quite the contrary. In local authorities, the executive have to publish forward plans and there is a right to call in odd decisions, but neither applies in the case of the Greater London Authority. The amendments are about openness and about the Mayor justifying his proposals and that is what scrutiny should be about.
The point of difference between my noble friends and me and perhaps the Minister—but certainly between Assembly members and the Mayor—is whether scrutiny should always be in arrears or whether it can take place in advance of an action. I do not believe that scrutiny should be confined to occurring after an event. The Assembly could not block the Mayor but would simply ask him to explain himself.
The Minister said that the 21-day period in Amendment No. 38 would gravely hinder the Mayor, leaving him unable to act quickly and decisively. But it is hard to think of a direction that might come out of the blue and mean that the 21-day period would be of such importance. For a direction to be issued, one would expect the functional body—the fire authority or the development agency—to have considered the
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Lord Campbell-Savours: I am sorry to intervene again, but can the noble Baroness give us an example of where it might have been better if a direction had been dealt with in this way? She referred to five directions a year. Can she give us a particular example?
Baroness Hamwee: I do not think that I can, but I am not sure that I am required to. As I said on the last group of amendments, our job here is to think through the “what ifs?”, not to start from the point that the Assembly would be utterly difficult or would block the Mayor. This is not about blocking but about an explanation. It is not an answer to these amendments to say that the Assembly would have used this on a matter in the past. In a well functioning authority, this sort of thing would be such a last resort that one would not want to see it used. I take the noble Lord’s point that it might be helpful to have an example. However, the fact that my brain is not working fast enough should not undermine my amendment in the way that he might imply.
The first of my two amendments deals with what would be counted as a direction for this purpose. We are all accustomed to the different levels of diktats. In different levels of government, they are suggestions and guidance at one end and gentle encouragement at the other. The amendment would extend the term “directions” to include not only specific directions about particular decisions by the functional bodies but also general directions about how each body might act and guidance about the way it exercises its functions. I beg to move.
Baroness Hanham: My Amendment No. 73 is in this group. It is very similar to those moved by the noble Baroness but it refers to the London Fire and Emergency Planning Authority. Our amendment continues the arguments that have been used by the noble Baroness and I do not need to go into them in much detail. However, it again underlines the debate that we are having about increasing the Assembly's ability to scrutinise the Mayor's powers and introducing greater transparency into the decision-making process.
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