The Draft Regional Assemblies Bill (HC 972-iv) ODPM Committee 15 Sep 2004

Evidence given by Rt. Hon Nick Raynsford MP, Minister for Local and Regional Government, Office of the Deputy Prime Minister, and Ian Scotter, Regional Assemblies Division, Office of the Deputy Prime Minister; Alan Donnelly and Kevin Rowan, Yes 4 the North East; Councillor Philip Davis, Campaign for the English Regions, and Nick Skellett, Leader of Surrey County Council, South East County Leaders' Group (SECL).

Q424 Mr. David Clelland: As Ron Davies once famously put it: devolution is a process, not an event. I suppose, following Scotland, Wales, the GLA and indeed even Northern Ireland, that the Government's policy of strengthening the mechanisms for regional government would naturally follow on from that. How might the outcome of the referendum in the North East impact on the future direction of that general policy?

Mr Raynsford: I might answer that by saying that I hope the process will not quite be as complicated as it was for the person you quoted. I sincerely hope that what we will see is a move to a confident assembly in the North East elected in 2006 and getting to grips with the very important responsibilities that the assembly will have, notably to help economic development in the region, which we know in the past has lagged behind other regions in the country; there is a gap in terms of economic performance which has to be addressed. There are very encouraging signs at the moment, in my view, of revival in the North East economy, and that is a real incentive for the assembly to get to grips with that challenge and to build on the work of the RDA and ONE NorthEast and the other partners, economic and social partners, to drive the region's economy. There are many other responsibilities, as you know, which the assembly will have. That does not mean that there are not going to be requests, demands for additional powers. I think that is part and parcel of the process. We have heard that from the Mayor of London seeking additional powers; we have heard it from the Richard Committee commissioned in respect of Wales. I cannot anticipate that but all I will say is that there is a very big job to be done and I am confident that the assembly, if it is elected, if the referendum is a yes vote and therefore the assembly proceeds as elected, will have a great deal to get on with in its first session.

Q425 Mr. David Clelland: I was not specifically thinking of extended powers, although the Minister is well aware of my enthusiasm for local government and I would like to see extended powers in due course. The Bill only provides for one model of regional government; that is, elected regional assemblies. It has been put to the Committee in evidence that the Bill should really reflect different forms of regional governments: for instance, giving statutory powers to the existing voluntary regional assemblies. What does the Minister think of that?

Mr Raynsford: I had the responsibility, pleasure and privilege of taking the Greater London Authority Bill through Parliament, which I was told at the time was the longest Bill to be introduced since the Government of India Act of 1936. I said on that occasion that that was a bit of a handful and I did not really want it to be complicated by other matters. I take a rather similar view about this Bill, which will be a complex piece of legislation. I do not think it would be appropriate for it to extend beyond its remit, which is to enable elected regional assemblies to be established. That is what we promised we would do if there was a yes vote in the assembly. There are other issues, of course, which people always want to tack on to legislation, but, as you will know only too well, that can make the passage of the legislation quite a complex process. In my case, my priority is to get the main piece of legislation through, assuming there is a yes vote.

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Q428 Mr. David Clelland: We listened with interest to your statement on Monday on the report of the Electoral Commission. It seemed to make clear, to me anyway, that regardless of the outcome of the referendum in the North East, the referenda in the North West and in Yorkshire would go ahead. Is that the case: if the North East referendum were to be lost, would you still go ahead with those two referenda?

Mr Raynsford: We have pledged that the people of the North West and Yorkshire and Humber will have the opportunity to vote in a referendum as to whether they want to elect a regional assembly, and that is our intention and that is how we are going ahead. It is simply a question of getting the mechanism right to hold the election in a way that does encourage maximum participation in the light of the Electoral Commission's report and proposals for a new foundation model, which they expect to be setting out next March.

Q429 Mr. David Clelland: Regardless of the result in the North East, those will still go ahead?

Mr Raynsford: Yes.

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Q443 Mr. David Clelland: In terms of the Northern Way, the three regions involved in the referenda are obviously all involved in the Northern Way. In your opinion, if one of those regions had to have an elected assembly, would that strengthen or weaken its position within the Northern Way?

Mr Raynsford: I have said on a number of occasions that I suspect that all of the northern regions will be looking to some extent over their shoulders at how others vote because there will be a suspicion that the region or regions that are first in the field with assemblies may get a competitive advantage. They may well have a very powerful voice in advocating key priorities for their region, a voice that is possibly going to be more influential in Westminster, in Brussels and in other areas where decisions are made that will impact on the economy and the life of those regions and that this, as I say, will give a competitive edge to a region with an elected regional assembly. I cannot judge whether that will be the case or not. I just say that I think there are quite a lot of people who feel that may be the case.

Q444 Mr. David Clelland: The possibility is that if, for instance, the tragic event happens and the North East were to vote no and then Yorkshire and Humberside were to vote yes, that would put the North East at a disadvantage?

Mr Raynsford: I think a lot of people in the North East would be worried that that would leave Yorkshire and the Humber with a significant competitive advantage against the North East.

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Q451 Mr. David Clelland: Whatever the Government's policy is, we would expect that all government departments would be fully and enthusiastically behind that policy. It is not entirely clear in terms of regional government whether that is actually the case. To return to transport for a moment, while the regional assemblies will be expected to draw up transport strategies, they do not seem to have much power to ensure that those strategies and priorities are implemented. The proposed powers in the Bill do not seem to reflect the proposals in the recent White Paper Future of Transport: A Network for 2030 with its new role for passenger transport executives. Was the Department of Transport involved in drawing up the draft Bill?

Mr Raynsford: We have had fairly lengthy discussions with the Department of Transport about the appropriate model to ensure that there is real power and influence in the regions, but within a framework that recognises that many of the transport networks are national and have to be coherent nationally. You cannot have individual regions responsible for sections of the rail network. Clearly you have got to link, if you take the North East region, beyond Berwick into Scotland and south of Darlington into Yorkshire and other regions. That is the balance we are trying to achieve. As I indicated earlier, there have been discussions which have not been entirely completed yet. This is one area where we may well have further thoughts about the potential role of elected regional assemblies.

Q452 Mr. David Clelland: That is good because while the White Paper does in fact make very encouraging noises about regional transport policies, it does not actually talk about the role of regional government within those policies. It talks about passenger transport executives from county councils, et cetera. Will the DFT, for instance, be giving the Highways Agency instructions to ensure that the investment decisions of the regional assemblies are taken fully into account by the Highways Agency?

Mr Raynsford: We certainly would expect the Highways Agency to pay very close heed to the views of elected regional assemblies. I know of one particular issue which is very dear to the heart of people in the North East, the dualling of the A1 north to the Scottish border. I confidently expect that if there is a yes vote and an elected regional assembly in the North East, the assembly will be hammering on the door of the Highways Agency. We certainly want a framework where the Highways Agency will be paying very close attention to the view of the elected regional assembly.

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Q478 Mr. David Clelland: One argument against those who say that the assembly would be too small is the fact that there will be other people involved in the work of the assembly - stakeholders, the voluntary sector, the business sector, local government, et cetera. While the Bill gives assemblies an encouragement to facilitate the involvement of stakeholders to such an extent that the assembly may think fit, the assemblies are not subject to a more definitive obligation to encourage and facilitate stakeholder participation. Why is that?

Mr Raynsford: That is exactly for the reason we have been debating in the course of this discussion: there is a balance to be achieved between setting in place the overall objectives and giving discretion to individual elected regional assemblies to decide how best to do things in the light of circumstances in their region. The North East is a relatively small region. It may well feel that arrangements for engaging stakeholders can be handled in a way rather different to what might apply in, say, the North West where, because of the geographical distances, the arrangements for stakeholder involvement may be sub-regional. For example, a sub-regional structure may well be regarded as appropriate in a larger region and that might not be felt to be necessary. I am not saying it will not be but this will be a decision for the region to take. We think it is right there should be discretion and that regions should be able to shape their institutions in a way that does respond to their needs within the overall requirement that they have got to engage stakeholders. That is the balance we are trying to achieve. It is hard, as you will know from the questioning. On some issues I am being accused of being too much a centraliser by being prescriptive and on others I am being accused of allowing too much scope as in Clive Betts's question about whether it is right to let an assembly have a cabinet of just three. We have to try and get a balance here. My view is that we are trying to achieve a national framework that ensures some consistency between different regions where regional assemblies are set up in different regions and the basic principles are met but that we allow a good measure of discretion for the assembly itself to organise its own affairs.

Q479 Mr. David Clelland: While the assemblies would be encouraged, and I am sure they will wish to do so, to engage and involve stakeholders, stakeholders themselves may be reluctant to be involved unless they feel they have a real say in the work of the assembly. Of course, that comes down to whether they may have votes on committees and sub-committee. We have had some concerns expressed about people who are not directly elected having votes. What will be built into the legislation to allay those concerns?

Mr Raynsford: There will be a permissive framework: we are not going to exclude that possibility. We think that assemblies should be able to consider it, but there are certain things that must be decided only by elected members. I think it is possible within that permissive framework to allow a sensible engagement of stakeholders in a very creative way so that they could, for example, sit on scrutiny committees and have a vote in such circumstances; they could play a role in policy development and policy formulation; they could perform advisory functions and really feel that they are making an impact and influencing the work of the assembly. I think we do see scope for active participation. We will encourage it with guidance. I am sure that the stakeholders will come forward themselves. I have encouraged different stakeholder groups in the North East, including representatives of the rural sections of the region and the business community, to come forward with their own proposals as to how they can most usefully engage. I would hope that the assembly, if there is a yes vote and one is set up, will listen carefully and think deeply about these issues and then come forward with appropriate proposals to ensure constructive engagement by stakeholders.

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Q483 Mr. David Clelland: What about special advisers? What role do you see for special advisers and should it be left to the assembly to decide the numbers and the role of special advisers, or is this something you would want to be involved in as a Minister?

Mr Raynsford: We have set out a framework which ensures that there is scope for a limited number of special advisers, but I think the general view about local government, and indeed the Greater London Authority too, is that the numbers should be subject to restriction to avoid a potential abuse of an excessive number of political appointees.

Mr. David Clelland: Unlike central government.

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Q490 Mr. David Clelland: Can I ask what you see as the major problem with the assemblies as currently outlined in the Bill?

Cllr Davis: Can I respond? As I say, we are critical supporters, from the Campaign for the English Regions, of the principle of the assemblies. We want to see them happen; however, the earlier discussion with the Minister about the size of the assemblies is a concern of ours. The difficulty is, I think, that the model offered to the English regions is really the model which has been offered to London but without the mayor. The size of the assembly is more appropriate to a city region like London than diverse regions across England. If you consider that all but one English region has a population bigger than Wales - regions like my own region, the West Midlands, has 5.3 million, which is bigger than Scotland - we are potentially offered 35 people ultimately and, as we know, there are 60 AMs in Wales. Numbers are, to some degree, arbitrary, clearly, but we feel there are difficulties in terms of representativeness, particularly in a diverse region like ours (I am talking about diversity in terms of ethnic diversity as well) and there are also issues across England in terms of urban/rural divide. A higher number certainly, 50 maybe, would allow you then to factor into the structure much more representativeness in terms of urban issues and rural issues. Those are the key differentials between the London model and our own model in the other English regions.

Mr Donnelly: Chairman, from a business perspective we actually like the idea that the assembly is relatively small. One of the key things in the North East of England when we have talked to people in the region is that they ask us, "Will it mean lots more politicians?" Of course, one of the good things about this legislation is that it will actually scrap a tier of local government, so it will mean less politicians. Frankly, it was interesting listening to what the Minister said when he was answering questions from you about the idea of stakeholders. I think it is extremely important, if we are to actually make this thing work in the North East of England, that this is not window dressing, and that stakeholders have a real function and a real role in the assembly. While the assembly will be relatively small, we see the assembly actually reaching out to much wider and larger groups of people, so that the stakeholder forums will actually give an opportunity for many, many more people to take part, particularly from the business community. One of our conditions for supporting the assembly, from the business community in the North East, is that we will be fully engaged in that process, and we expect that from the point of view of economic development the stakeholder forum will allow business people to be fully engaged.

Mr Skellett: We believe the size of the assembly is too small. In our region there are over eight million people and we believe there should be a greater link between the members of the assembly and areas, and it would be very difficult, particularly on those who are not actually regional. So size is important. There is a disadvantage for rural communities, also, that we see, which has to be addressed. In most of the regions that have been subject to referenda there are huge majority urban populations despite the fact that there are large rural communities. At the present time those representations are normally from local authorities directly to government, and we could see the possibility of strategies being set regionally which disadvantage the rural communities. We believe that some kind of rural proofing or the emergence of large, strategic authorities representing rural areas are necessary. We also do not regard local government as just another stakeholder; local government provides the services which are required by the strategy set by the region and, therefore, a much clearer link between local government and government in the region is required; it is not just another stakeholder.

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Q494 Mr. David Clelland: The people you have identified in your polls as being in favour of regional government are in favour because of the years and years of campaigning which you have all been engaged in on the benefits of regional government. Do you see the contents of this draft Bill actually delivering those benefits which you have identified over those years?

Cllr Davis: Can I just comment from the CfER perspective? I am not sure I agree with the premise of the question. I think that, probably, a lot of the wish to have some form of regional assembly is to do with a concern that things are too over-centralised; there is too much done in London which could be better done in the particular regions. Interestingly, there has been a persistently high opinion poll response in terms of support for an elected regional assembly in my own region, the West Midlands, which does not feature in the referendum scenario currently. I think that is a reflection of that concern that too much is done in London and too many things which could be better done locally or could be resolved with a little bit more autonomy in the regions, whether it is in the North East or in the Midlands or the South West, or whatever, are not being done. That is, if you like, the negative push. Clearly, where there have been campaigning organisations, notably in the North East, then the organisations here will speak about that. The issue now is that people see that there is a gap in terms of delivery, and for me, as someone who is a local council leader, the issue is "Can I provide a better bus service? Can I provide a better transport service for local people?"

Q495 Mr. David Clelland: Can I just turn to the South East County Leaders' Group? You have said that the assemblies are a bit small, that the Bill is a bit of a fudge and local government is not adequately represented. If the Bill was to be changed radically to ensure that there was adequate representation of the electorate and of local authority involvement in these assemblies, and this was firmly secured, would you support the Bill?

Mr Skellett: No. What we believe ----

Q496 Mr. David Clelland: You are just opposed in principle to regional government?

Mr Skellett: The reason, as I said at the very beginning, is that we think it is the wrong direction, but clearly we are very interested in improving the Bill as it rolls through. What we believe in doing regionally is for local authorities to work together on a voluntary basis ----

Q497 Mr. David Clelland: However, the point is - we understand your objections in principle - we are debating here a draft Bill before Parliament. Is there any way that the Bill could be changed to get to a stage where you would actually support it?

Mr Skellett: No.

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Q505 Mr. David Clelland: We heard the Minister say earlier that regardless of what happens in the North East the referenda will still go ahead in the North West and Yorkshire. If, for instance, the North East was to vote no on 4 November and, subsequently, Yorkshire and the North West vote yes, what position will that leave the North East in, in terms of the Northern Way?

Mr Donnelly: I have to say there is a huge opportunity here for the region, and it is a pity, in a sense, that the No campaign did not accept the invitation to be here, because one of the things that really depresses me about what they are doing is they are talking down the region. If we lose the referendum in the North East I think it will have a long-term impact on the self-confidence of the region and, also, the view that people outside of the region have of the North East. This idea of the referendum is not just "Let's have a vote and see what people think"; the opportunity is massive but the downside is quite substantial, too, in the way that people will perceive us.

Q506 Mr. David Clelland: The Government's manifesto promise was to allow referenda for regional government in those regions that want it, and in order to assess whether the region wanted it or not they had this sounding exercise, which Alan Donnelly referred to earlier. Can you give us your impressions of the sounding exercise? How successful do you think it was in assessing the views of people in the North East? What is your view on how it was conceived and carried out?

Mr Rowan: I think the level of engagement in the sounding exercise in the North East was very high. I think there was a lot of participation from people and organisations expressing their view for and, in some cases, against the opportunity to have a referendum on a regional assembly. So that in itself would indicate that the process of the sounding exercise was reasonable and the outcome, to suggest that we should have a referendum in the North East, was pretty clear. The direct answer to your question is that the sounding exercise clearly worked well in that respect. If I can refer again to the ICM poll, 75 per cent of the people in the region understand enough of the issues to have made their mind up to vote yes or no - two to one in favour, as it stands now, of a yes vote - and 70 per cent of those people are indicating that they want more information. That, for me, indicates a level of engagement in the issue, which justifies cracking on with the referendum.

Q507 Mr. David Clelland: In terms of the Government assessing opinion in other regions - the West Midlands, for instance - would you say that we have nothing to learn from the sounding exercise in the North East, or do you think that perhaps we have got to look at ways of improving it? Should there be a more systematic basis of assessing opinion?

Mr Rowan: I think there are always lessons to learn. One of the lessons that we do learn is that people want more information sooner, and I think it will always be the case that people want more information, in terms of informing people about what they are thinking about and what they are discussing. It is very difficult in this case, of course, because we have only got ----

Q508 Chairman: Is there a danger that people say they want more information but they do not read it?

Mr Rowan: I think we have a responsibility to give people information in the way that they can access it.

Cllr Davis: The whole issue about regional structures currently is that they are a huge underground success story, are they not? Hardly anybody knows what the West Midlands Regional Assembly does, despite the fact that it is actually doing some quite useful work. So I think the point is well made that we need a more proactive attitude on the part of Government in terms of saying, "Look, this is the regional agenda; this is what we are all trying to do". We need to get that down to grass roots issues, back to the bus services and the improvement of services at a local level.

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Q516 Mr. David Clelland: The Government wants regional authorities to be manageable, focused and effective and has, therefore, decided they should be small. CfER, on the other hand, believe that that will lead to inadequate representation. Could Councillor Davis tell us what he thinks the ideal size of a regional assembly would be to meet those objectives?

Cllr Davis: The ideal situation would be to have a permissive regime, whereby within a reasonable range there could be a regional choice. However, we are not there. We recognise the political realities. It seems to me the comparator would be, say, the Welsh or Scottish models - not as big as the Scottish model and not even necessarily as big as the Welsh model. However, as I say, the disparity is that in a region of over five million people (or eight million people in the case of the South East) with only 35 members, there are inevitably going to be difficulties about representation. I thought your earlier discussion with the Minister about the voting system was interesting as well, because there are difficulties about constituencies and all the rest of that. We are not saying those are fundamental difficulties - we welcome the draft Bill - but we think that in the process of your considerations and the Parliamentary considerations this issue about numbers could be revisited, although we do understand the arguments that were being put by business representatives about wanting a tight organisation. We think it can be focused as long as the functions are clear, but we do think that because you have, for example, in regions like the West Midlands, about half the population living in a core urban area and half living in shire county areas with some big towns, there is quite a disparity there. What we are being offered, as I said earlier, is a city region model, which is fine for London but does not match the conditions that you necessarily find in English regions.

Q517 Mr. David Clelland: Does the proposal to introduce the Cabinet system, which local government has now been obliged to use, for regional government meet with your approval?

Cllr Davis: I do not think the principle of the Cabinet system is a problem, but the numbers - which I think you quite rightly explored with the Minister - do pose some difficulties. I will not repeat those because I think the points are well made; there are technical problems about the numbers and we would require rather more discretion to be given to assemblies to develop models which suit their local conditions. Certainly the situation where the scrutiny system will be run by the opposition party and the controlling coalition, or whatever, will be running the executive, by default, is not a healthy position. That needs to be addressed. There may be some unintended consequences if the Bill goes forward with that technical provision as it is. That, at least, is based on my experience of the Cabinet system in local government, which has produced some - and I see Mr Mole is nodding from his own experience - unintended consequences which have not been healthy for democracy or scrutiny.

This is an uncorrected transcript of evidence taken in public and reported to the House. The transcript has been placed on the internet on the authority of the Committee. Neither witnesses nor Members have had the opportunity to correct the record. The transcript is not yet an approved formal record of these proceedings.