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The purpose is obviously to raise the general principle. There are two sides to it and the situation in any locality can get incredibly complicated. Rightly or wrongly, the Government are encouraging what they call partnership working, which means that local authorities are working with other bodies to invest in and deliver services which, in the old days, would have been the responsibility of the local authority itself. In those circumstances, the local authority doing something is no problem. Councillors are councillors and get on with their jobs.

Where partnerships are set up on which the local authority is represented, you have two classes of members on the board: there are the councillors, who are, in the main, appointed by local authorities, although there may be some who sit there for other reasons; and then there is everyone else. They are in two quite different sets of circumstances. That kind of double hatting, as it is known, in some cases leads to two problems.

First, I refer specifically to LSPs, because they are so important. The Minister will tell me again that they are not statutory bodies, have no legal status and exist in some kind of void or limbo. That is not how it seems locally. The LSPs are very important bodies indeed, and the Government and all kinds of government-related quangos divert huge amounts of investment through them. All the single regeneration budget schemes, which still exist in many places, the neighbourhood renewal fund and many more are funded by government money that is channelled through LSPs. So the idea that they are some sort of local advisory body and do nothing very important is absolutely untrue.

12.30 pm

Councillors and non-councillors, who represent a whole range of bodies such as voluntary organisations, local colleges and local businesses, sit on LSPs. LSPs—I give this caveat to almost everything—work very differently in different places. In some places, they work hand in glove with the council; in others, including in some quite large cities, they are almost freestanding, independent bodies on which the council is simply represented, perhaps by only one person. It varies a lot. When councillors sit on LSPs, they obviously sit as councillors, and must declare any personal interests that they might have. Yet the other members do not. If someone represents an FE college and matters relating to it arise, it is perfectly reasonable for that interest to be declared but not to be prejudicial because that is why they are there. It should be declared, but it does not have to be at the moment. If, however, the person representing

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that college has an interest in something else that arises at the LSP—they might be a shareholder in a local firm that is benefiting from an investment project or a member of a community group that is being funded by the LSP—they do not have to declare it. This is illogical. It does not lead to the transparency of decision-making which the whole question of declarations of interest is supposed to create, and it could in some circumstances lead to corrupt practices.

On the other hand, the councillors on the LSP must declare an interest of one sort of another, depending on what it is, when they return to their local authority. Under the new code of conduct, if they are local authority representatives on the LSP, the interest would be non-prejudicial, as I understand it. If they are on the LSP in some other capacity, however, it would not be. Councillors, who are the elected representatives of the community, are therefore being treated differently from and more restrictively than others who are there in other capacities. My amendments therefore seek to probe what some of us think is an anomaly and to ask what might be done about it. I have great interest in what the Minister has to say about this. It is not right at the moment, and the matter really does have to be probed further. I beg to move.

Baroness Andrews: These are two very interesting Opposition amendments. The first would add regional assemblies, and the second would add local strategic partnerships and other partnership bodies to the list of relevant authorities for the purposes of the ethical regime for local government, which would mean that members of these bodies would be subject to the provisions of the code of conduct that members of relevant authorities are required to follow.

I am grateful to the noble Baroness for resisting the temptation to take us on an excursion to the future regional assemblies. I will observe the same discipline. There is no doubt in my mind that it is important that members of regional assemblies should follow high standards of conduct and good practice so that they act transparently and accountably. My difficulty is with a blanket extension of the national code of conduct to members of these bodies, as the amendment suggests. That is unnecessary for the following reasons. Regional assemblies are not currently subject to a statutory code of conduct, but two-thirds of members of the assemblies are already covered by a code of conduct as they are members of local authorities. That code applies to them when they act as representatives of their authority on other bodies such as the assemblies. In addition, I understand that the conduct of the remaining third of members who are not representatives of their local authorities are also subject to a code, as the assemblies have adopted their own voluntary codes of conduct that broadly reflect the terms of the model code for local authorities, although not on a statutory basis. I therefore hope that that overlapping system takes care of the noble Baroness’s anxieties.

The noble Lord’s amendments explore a very interesting situation in relation to the LSPs, but it is

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interesting because of the nature of local authority partnerships as a whole and the interrelationship between the people who sit on those bodies and their respective responsibilities, because they sometimes wear two, three or even four hats. I have to give him the answer that he expected, which in essence is that LSPs are not legal bodies and so cannot be covered by the code in the same way. We cannot place a duty on an LSP for that reason. I dispute the assertion that there is a void. I spoke at some length a couple of days ago about how important the LSPs were, not least as bodies that formulate and articulate the local area agreements. They are incredibly important, but they are very variable. We cannot put such institutions under the code in the same way. Moreover, each public statutory partner to an LSP has its own structure and rules, and carries that code with it. As the noble Lord said, local authority members certainly would. Each organisation must therefore take measures to ensure that its LSP representatives act appropriately.

The list of partner authorities in Clause 106 includes a number of bodies that are already covered by the code of conduct. It also includes persons and members of bodies, such as the chief of police and members of the local probation board, to whom it would be inappropriate to extend the local government code of conduct. However, I do find the noble Lord’s argument about the LSPs very interesting, and, although I cannot promise to do anything, I can promise to think about it and to discuss it and other issues to which it gives rise with the department.

Lord Greaves: I am very grateful for that response, which is as good as I thought it would be. These amendments were tabled precisely to try to get people and the Government to think about it. On the point about the LSPs, it has come home to me only in the past fortnight while we have discussed this matter in Committee just how much of a legal limbo—I know that the Minister does not like that phrase—LSPs seem to find themselves in. It is absolutely true that they exercise their powers on behalf of their members, particularly the local authorities, but they are, as the Minister said, incredibly important bodies in regeneration and the whole partnership structure in an area that has now grown up. I am coming to the view that people should be thinking very seriously about their status and whether they should be put on a statutory footing. These bodies take decisions involving millions and millions of pounds—more in some areas—of investment. Should they really have this non-legal status? It is quite extraordinary how this has happened. However, that is a different matter and my amendments do not relate to it. I am very grateful that the Minister will think about this during her summer holidays, although I cannot promise her that I will. On that basis, I am quite happy. I beg leave to withdraw the amendment.

Amendment No. 235ZAA, as an amendment to Amendment No. 235A, by leave, withdrawn.

[Amendment No. 235ZAB, as an amendment to Amendment No. 235A, not moved.]

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Baroness Scott of Needham Market: I am grateful to the noble Baroness for her slight encouragement to my noble friend Lord Greaves. My noble friend and I were dealing with the same issue, although one of us at a very local sense and the other regional. In essence, as local authorities work in partnership with a wide variety of bodies, it is becoming increasingly obvious that having one set of processes governing the conduct of the elected members and another set governing the conduct of those who are not is becoming problematic. It seems to me that this can be approached in two ways. One either has a stringent code of conduct which applies to everyone or something approaching the situation described by the Minister for regional assemblies; that is, a voluntary code of conduct which everyone knows and understands. Certainly, from these Benches, that would be our preferred option. Local arrangements arrived at voluntarily by all the partners, and applicable to all the partners, would be a much better way forward. The real issue and the reason that we have tabled these amendments is to bring to the attention of the Government the fact that one set of rules applies to councillors, which contains fairly heavy sanctions, while those same rules do not apply to others. However, we will read carefully what the noble Baroness has said and will wait to hear the Government’s thinking on this. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Scott of Needham Market moved Amendment No. 235AA:

The noble Baroness said: Previously in Committee, we had lengthy discussions about the new category of parish councillors who are to be appointed rather than elected or co-opted. This amendment simply is to ask the noble Baroness to confirm, so that we have it on record, that councillors who are appointed to parishes will be subject to the code of conduct, as are other categories of councillors. I beg to move.

Lord Greaves: Amendments Nos. 235AC and 237ZA are to probe the meaning of the model code of conduct and the advice given to councillors in relation to it. When the model code of conduct was first adopted—I think that it was originally in regulations in 2001—it was intended that local authorities could amend or add to it in their own circumstances. It appears that it has now become very much a code of conduct which you have to have and you modify or add to it at your peril.

I have an interesting document, which everyone who has the privilege to be an elected councillor will have received recently, called The Code of Conduct—Guide for Members, issued in May 2007 by the Standards Board for England. The pamphlet explains the new model code for councillors. Page 4 of the introduction, “Adopting the Model Code of Conduct”, says:

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We appear to have a situation now where it is not a model code of conduct; it is virtually a statutory code of conduct or an instruction on what councils have to do. If they go beyond this, they do so at their own peril. I believe that this leads to confusion. My amendment probes how far the Standards Board for England is saying, “You adopt this, full stop”, on behalf of the Government and how much it has decided for itself.

Baroness Andrews: It is wonderful that so many noble Lords have joined us for this important discussion on the model code of conduct. I hope that I shall be swift in dealing with this. I can confirm that the noble Baroness, Lady Scott, is correct on the first amendment. As she suggested, this applies in the same way to appointed members.

On the second group of amendments, I am afraid that the noble Lord has wrong-footed me because I did not expect him to come from that direction. One can never predict which direction he will come from. However, I shall say briefly what I intended to say. His amendment removes the remit of the code to include all behaviour in members’ private and official capacity, which is the substance of Clause 104 dealing with the remit of the principles and provisions of the model code. It follows from the judgment in 2006 in the appeal of the Mayor of London, which cast doubt on the ability of the code to cover the conduct of members in their private capacity. I am sure that we will come on to discuss those issues at a later stage. There are some interesting things that I want to say about that.

The noble Lord, Lord Greaves, raised the rigidity, or inflexibility, of the code. It is a statutory instrument which councils are required to observe. It is not easily extended. That can be done only by negative instrument. I suggest reading Hansard. I will come back to him on this point when we can have a discussion on the issues implied in his questions.

Finally, Amendment No. 238ZAA also was in this group. Authorities which do not adopt a code of conduct, and whose members are subject to the model code of conduct issued by the Secretary of State, are required to include a copy of the model code as part of their constitution. Amendment No. 238ZAA would delete this provision, which would be unfortunate because it would reduce transparency and accountability. That is why we would have difficulty in accepting that amendment.

Lord Greaves: I am sorry. I was confused with the groupings, largely because I was away yesterday. I deliberately did not speak to Amendment No. 238ZAA because I was advised by my noble friend that it is not in this group.

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Baroness Scott of Needham Market: No, it is not. I shall not keep the House in suspense any longer. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Crawley: This may be a good moment to resume the House and I confirm that the Committee will begin again after the lunch adjournment. I beg to move that the House do now resume.

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

House resumed.

House of Lords: Reform

12.48 pm

The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Hunt of Kings Heath): My Lords, with the leave of the House, I shall repeat a Statement made by my right honourable friend the Secretary of State for Justice in another place. The Statement is as follows:

“With permission, Mr Speaker, I should like to make a Statement on the way forward on reform of the House of Lords. On 7 March 2007, after the free votes in both Houses, I said I would make arrangements to reconvene the cross-party working group, and after discussions with that group I would return to this House to make a Statement outlining the Government’s plans.“The free votes marked the fulfilment of the specific terms of one of our manifesto commitments on House of Lords reform. While this was an important milestone in the history of Lords reform over the past 100 years, we must not now lose the opportunity to make further and more fundamental reform happen.“In March, this House voted overwhelmingly, by a majority of 113, for a wholly elected House of Lords. It backed by a margin of 38 a substantially elected House based on 80 per cent elected and 20 per cent appointed. It also voted by a majority of 280 to remove the remaining hereditary Peers. As part of a comprehensive package of reforms, the Government are committed to removing this anomaly of the remaining hereditary Peers, in line with the will of this House. As this House will be aware, at the same time the other place voted for a wholly appointed House by a majority of 240.“My right honourable friend the Prime Minister in his Statement of 3 July set out the Government's view that we should proceed in line with the wishes of this House, which all accept is the primary Chamber. This approach was underlined in the Green Paper on constitutional reform, The Governance of Britain, published on the same day. The Conservative and Liberal Democrat parties are also committed by their 2005 manifestos to a substantially elected House of Lords. “Tomorrow in the other place, the Private Member's Bill of the noble Lord, Lord Steel, on Lords reform will have its Second Reading. My

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noble friend Lord Hunt of Kings Heath will expand on our response when he comes to speak in this debate, but suffice it now to say that this Bill does not contain the comprehensive reform which is the clear will of this House.“The cross-party talks before the free votes were successful in building up a significant degree of consensus on a wide range of issues, as reflected in the White Paper, House of Lords Reform, published in February. I believe this is the best way of proceeding. I shall continue to lead the cross-party talks, and since the free votes we have held two further meetings.“As all three main parties are committed by their manifestos to further reform of the House of Lords, it is right that the group should consist of Front-Bench representatives of those parties, as well as representatives of the Cross Benches and Lords spiritual. But of course we want the widest possible consensus and I intend to make arrangements so that we can take proper account of the views of all parliamentarians, including non-party independent members, as well as interest groups and the public.“The White Paper I published in February this year was adumbrated on the view that consensus lay on a ‘hybrid’ House for a 50 per cent elected and 50 per cent appointed House of Lords. Since this option was rejected in both Houses, we have to proceed with remodelling our work based on an 80 per cent or 100 per cent elected House of Lords. While there is agreement on some of the areas outlined in the White Paper, there is still some way to go on others. So the group will be discussing the outstanding elements of the reform package, including powers, electoral systems, financial packages, balance and size of the House, including diversity and gender issues. We will also need to discuss the transition towards a reformed House in detail, including the position of existing life Peers and the need for action to avoid gratuitously cutting Conservative Party representation in the Lords when and if the remaining hereditary Peers are removed. “Let me now turn to the powers of a reformed House. The Government have always said that the balance of powers between the two Houses described by the excellent and recent Cunningham report should apply to a reformed House. These powers are currently underpinned by some statutory provisions, standing orders and conventions. We undertook to look further at whether the current conventions were adequate to ensure the desired relationship with a reformed House after the free votes. Over the coming months, we will be looking at how best to deliver a substantially or wholly elected House, based on the principle that this House is the primary Chamber and that an elected House of Lords should complement the Commons and not be a rival to it. As part of that programme of work it is vital that the relative powers of a reformed House are made clear. We will therefore be looking at ways to enshrine in a constitutional settlement the current balance of powers and the different roles of the two Houses.

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“The Government are determined to proceed with this programme of reform with a view to its completion. In dealing with such a central element of the constitution, it is right that there is as much all-party agreement as possible. I accept that there may well not be total agreement, but the constitution does not belong to any one party and it should not be used as a partisan tool. The immediate next steps are that I hope to be able to publish a further White Paper around the turn of the year setting out where we have got to by then in the cross-party talks, possibly accompanied with draft clauses.“Our intention through the work of the cross-party group is to formulate a comprehensive reform package which we would put to the electorate as a manifesto commitment at the next general election, and which we hope the other main parties will include in their manifestos. There may of course be areas upon which each party takes a different view, but I believe that there is the potential to reach a degree of cross-party consensus which could lead to the completion of Lords reform. The free votes in the Commons in March gave us a clear direction of travel on an issue which has dogged the country for decades. We now have a chance finally to finish the job”.

My Lords, that concludes the Statement.

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Lord Strathclyde: My Lords, I thank the noble Lord, Lord Hunt of Kings Heath, for repeating the Statement and for his courtesy, and that of Jack Straw, in allowing us advance sight of it and for warning us that it would take place this morning. I also welcome the noble Lord to his new responsibilities, where I have no doubt he will shine as brightly as he did in his former role.

In many ways, it is a pity that the Statement comes the very day before so many of your Lordships will express a view in the debate on the Bill championed by the noble Lord, Lord Steel of Aikwood, but the House will no doubt have noted that the Government do not see that Bill as a viable reform. We will hear more on that from the noble Lord, Lord Hunt, tomorrow.

As a more general response, I welcome the measured way in which the Lord Chancellor in another place is approaching what is clearly a very difficult task. How very different his approach is from the rushed charge which led to the loss of the Lord Chancellor to another place, and with the future purge, at enormous cost, of the Law Lords from our Chamber.

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