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Local Government (Lancashire)

Volume 459: debated on Wednesday 18 April 2007

Motion made, and Question proposed, That the sitting be now adjourned.—[Steve McCabe.]

I rise with trepidation to open this Adjournment debate, given the potential contentiousness of the issue in hand and the fact that it affects so many able and committed councillors in Lancashire, many of whom are personal friends. I wish first to thank friends and colleagues on Burnley borough council and Lancashire county council for their help in preparing my remarks this morning. I hope that my contribution will reflect not only my experience, but their experience. I am also grateful for the advice of my hon. Friends who represent Lancashire constituencies. They have been in this place a little longer than I have and have shared their experiences with me. I am particularly pleased to see so many of them here this morning.

I am pleased to welcome the chief executive and the leader of Burnley borough council to the Public Gallery. Their 500-mile round trip to be here today demonstrates the importance of the issue to my constituency. I am grateful to the Minister for the time that she will spend in the Chamber today and look forward to her response. It is a privilege, Lady Winterton, to have secured this Adjournment debate under your chairpersonship.

Thank you, Lady Winterton. I am grateful for the clarification.

I shall come straight to the point. It is my strong belief that the issues faced by my constituents require an end to two-tier and a return to unitary government. Having consulted widely, I know that the majority of other Members of Parliament who represent Lancashire constituencies—certainly Labour hon. Members—believe the same given experiences in their own constituencies. Indeed, my right hon. Friend the Leader of the House of Commons, who unfortunately cannot be here this morning, summarised his views in a note that he wrote to me yesterday. It states:

“I have long been in no doubt that the two-tier re-organisation of local government which Edward Heath forced through in 1972 (against heavy opposition, not least from the Labour Party) was and remains fundamentally flawed in conception and execution. It has progressively been abandoned by successive governments—totally within the metropolitan areas, and in part in the shire areas.

What is significant is that almost the moment an area moves to single tier local government the benefits become obvious all round, and no one argues for the restoration of the status quo ante.

You will be aware that our party has long seen the merits of unitary councils.”

My right hon. Friend speaks with authority on the matter, not least because he saw with his own eyes the effects of his constituency moving from a two-tier to a unitary system.

I shall not argue for a particular map, but rather that my right hon. and hon. Friends on the Front Bench accept the principle of what I will call a unitary solution to the Lancashire question and that they should lead a process that will resolve the issue for our generation. As for outcomes, there are many potential options, one of which is a unitary county council. Another is the abolition of the county council and its being replaced by a number of unitaries operating across the geographic county of Lancashire, either with or without alterations to existing local authority boundaries. Furthermore, we could allow a handful of the current boroughs to opt out of county and go it alone, as Burnley and Pendle, Preston and Lancaster have sought to do.

People will have strong views on the various options and no doubt we could be here for several days discussing various permutations, but that is not my aim. Instead, I sought to secure the debate to establish the principle of unitary government, something that our party has long supported. I hope that the Minister will confirm that her Department agrees with that and will offer a process on the way forward to achieve its implementation in Lancashire. It is up to the Government to propose the answers to the Lancashire question by initiating a review of the current two-tier arrangements.

The argument for unitaries is straightforward. First, as described in the local government White Paper, we need local authorities to be both strategic leaders and place shapers. It is no secret that my constituency is one of the poorest in Britain, with specific regeneration issues. To put matters in a nutshell, we have empty boarded-up houses, depopulation and massive health and infrastructure issues that need to be resolved. The far right is active and, while I do not like to mention it because it puts us on the map for all the wrong reasons, hon. Members will recall that we had violent clashes in the streets in 2001.

Cash is now flowing in from central Government as it is to other towns in the north of England: £500 million earmarked for my constituency alone in the next few years. Fragmented two-tier local government is a barrier to the strong local leadership necessary for the effective allocation of those resources. Only strong leaders with a clear vision and with all available resources at their disposal will be able to drive forward the transformation of places such as Burnley, and to create a place that my constituents want and deserve. Lancashire county council delivers services effectively but, in my view, its coverage is too wide to provide the place-shaping leadership role that my constituency requires.

Will the hon. Lady say what the people of Lancashire want? Does she agree with her right hon. Friend the Deputy Prime Minister about local government structure and reorganisation—that people who live in counties should hold a ballot if they want a unitary authority? Does that seem fair?

I will indeed come to the point about what constituents want. As far as I am concerned, the main thing is that they find the current arrangements extremely confusing and difficult to understand. I shall also be making some points about what Opposition Members want—they have demonstrated their usual degree of flip-floppery about their intentions over the past few years.

The second argument for unitary status is that taxpayers’ money and resources are being wasted by disputes between the two tiers of local government. I can think of three immediate and high-profile examples from my local area from the last two years, all of which are a source of immense frustration, but they illustrate the point.

First, Burnley college and the university of central Lancashire, which was supported by the borough council, wanted to build a new sixth-form college, university faculty and business park on some land that was leased to the county council and which was being used for a waste depot. The issue led to considerable acrimony between the two institutions and the wasting of many hundreds of man hours in an attempt to find a non-legal resolution—all to no avail. Only when the borough had to forcibly evict the county council from the site did a solution began to appear—when there were no other options.

Secondly, while that was happening, the county council had a compulsory purchase order served on the borough council for a strip of land on which to build a new secondary school despite having outline planning permission. Thirdly, both sides have taken legal advice about the site of a second new school.

All those disputes have been pursued using taxpayers’ money and they have all helped to dwarf the otherwise positive ratings for service delivery that both institutions received from the Audit Commission—the county is currently rated as excellent and the borough as good. If there had been a unitary structure, the problems could have been solved internally and in the interests of the town, as opposed to the interests of the respective institutions.

There are democratic issues. Because Burnley has a strong local identity, my constituents automatically look to the borough council to solve their problems. My constituents’ sense of place is to Burnley and the surrounding towns and valleys, not to Lancashire as a whole. For its part, the borough council clearly sees itself as having a leadership role in bringing local partners together to address the many and varied challenges facing the town, yet the vast majority of the money my constituents pay in local taxation goes to the county council.

Two things follow from that situation. First, while the six county councillors wield most of the power, the 45 borough councillors feel the democratic pressure and get the majority of the casework. Secondly, my experience is that sometimes Lancashire officers who advise county councillors on the decisions that affect my constituents live and work many miles away and have no desire to speak to local residents, no links in the local community and no understanding of local sensitivities. Perhaps that goes some way towards answering the point made by the hon. Member for Brentwood and Ongar (Mr. Pickles), but it is a state of affairs that feels all wrong. Also, the problem is compounded by the fact that many of our talented local politicians seek career advancement by standing for the county council, for which offices they are better remunerated.

The hon. Lady seems to think that she satisfied me, but my question is straightforward: who should decide? Should it be her preferred option, that the patricians decide for the people, or should the people themselves decide?

I am grateful for the opportunity to clarify my remarks. By leading this debate, I am attempting to secure from the Government the initiation of a process by which to resolve the matter. Once we have some proposals to which the stakeholders can agree, I am comfortable for them to be put to the population as the final stage of the process, but that is not something that I wish to address today. I am making the point that the current two-tier system is in many ways anti-democratic.

As I was saying, the problems are compounded by the fact that many of our talented local politicians seek career advancement by standing for the better remunerated county council, thereby spreading their experience and expertise more thinly, as far as my constituents are concerned. It should be possible for some of our best councillors to get career satisfaction from resolving the large and well documented regeneration issues in their own communities, but the current structure of local government militates against that. The stronger our local leadership, the more effective could be our efforts to improve community cohesion, which is a key issue in my constituency.

My hon. Friend has secured a very important debate and I thank her for giving way. However, in the end, what is happening today is the raking over of the ashes of Government decisions on the future of unitary status—or the absence of such a future, in Lancashire’s case. Does my hon. Friend agree that we expect a clear message from the Minister about whether a flame will be reignited from the fire, so that Lancashire can decide? If not, let us be told that it will be 10 years before the matter can be considered. Let us have a clear message for the people of Lancashire; then we will know where we are going.

I could not agree more with my hon. Friend. I have several questions for the Minister, which she will be delighted to know are only a few paragraphs away.

Absolutely. We want clear messages.

Having established the case for unitary government, I want to consider why the issue is one to consider now, which picks up on the point made by my hon. Friend. In a sense we have been here before, quite recently. When we had the prospect of elected regional assemblies, it was Government policy, rightly, that those should be accompanied by an end to two-tier authorities. A consensus-building exercise was conducted, and two options were drawn up to be put on the ballot paper, to enable people to decide alongside the referendum on a regional assembly. I remind hon. Members that the first option was a unitary Lancashire county council, and the second was the expansion of Lancashire’s existing unitary councils and the creation of three new ones, including one that would have covered Burnley and Pendle and neighbouring areas, with Rossendale. When the referendums were put on hold, so was the process for agreeing a structure for unitary government. However, by then it had acquired a certain momentum and a broad buy-in, and my argument is that we should now pick up where we left off.

Separately the result of the opportunities created by last year’s local government White Paper was that bids were received by the Government for unitary local authorities in Burnley and Pendle, Preston and Lancaster. All were turned down, but the general question of what to do about the case for a unitary solution across Lancashire as a whole was not addressed. Indeed, the Burnley and Pendle bid, which I supported, passed on every criterion, apart from the effect with regard to service delivery across Lancashire. Other bids with the same extrapolated points score were able to proceed but ours was not. My first question to the Minister is what failing in that category actually means. Does it mean that the bid cannot be supported because it would weaken the county’s ability to deliver services to the residual area of Lancashire? If so, surely the logical next step is to consider a new unitary solution for the whole county, rather than to dismiss an otherwise good bid from part of the county. Perhaps the Minister would care to respond to that point.

My main question is this: does the Department support the case for unitary government in principle? I presume that the answer is yes, or my hon. Friends on the Front Bench would not have proposed its introduction in the event of regional assemblies being accepted. Indeed, the White Paper, which was published in October, states that a move to unitary government would

“improve accountability and leadership, increase efficiency and improve outcomes for local people.”

If that is indeed the case, my third question is what the Government intend to do to explore which unitary solution is best for the geographic county of Lancashire. Will they ask the Boundary Commission for England to investigate the various options and report back? Will they use the powers in the Local Government and Public Involvement in Health Bill, once it receives Royal Assent, to direct Lancashire local authorities to state which of the various unitary solutions they would prefer, perhaps on the basis of the work done before the aborted referendum on the regional assembly? Will they meet me to discuss a way forward, with urgency? I ask the Government to tell us what they believe, and to act out of conviction.

After all, there is nothing particularly brave or radical about supporting unitary authorities. I remind the hon. Member for Brentwood and Ongar that Governments of all hues have done so for some time. It may be worth reminding all Opposition Members of the words of Michael Heseltine in April 1991, when he announced his forthcoming consultation paper entitled “The Structure of Local Government in England”. He said:

“First, unitary authorities are more clearly responsible for the delivery of services, and more clearly accountable for the bill local people are expected to pay. Secondly, two tiers may lead to excessive bureaucracy and duplication of effort…the present structures of local government do not win universal favour with local people”.—[Official Report, 23 April 1991; Vol. 189, c. 901.]

Perhaps Opposition Members could therefore enlighten me during the debate as to precisely what has happened between now and then to cause them to do an about-turn and oppose those Labour and Liberal Democrat councillors up and down the country who now support a move to unitary government.

Perhaps it was the Conservative party’s gut preference for unitary structures that led the then Government to ask the independent Local Government Commission to look again at the case for unitaries in Blackpool and Blackburn after it had returned a negative proposal in 1995. As a result, two new unitary governments were created in Blackburn and Blackpool, but it is worth noting the Local Government Commission’s words about Blackburn at the time. It said that Blackburn’s

“case for unitary status is strong”,

but added:

“There will be consequences for Lancashire County Council in providing services to East Lancashire, but these are not of sufficient magnitude to deter the Commission from a draft recommendation for unitary status for Blackburn.”

In summary, my argument is simple: it is time to recognise that the consequences for east Lancashire, which were set out 12 years ago, are ones that we can no longer accept. It is time to pick up where we left off during the debate on regional assemblies and to come up with a coherent view of the structure of local government in Lancashire. The Government have kicked off the process by inviting local authorities in Lancashire to express their interest, and four local authorities from all corners of the country have responded positively. That demonstrates that there is real demand, which raises all sorts of new questions that need to be resolved for the county as a whole. The strength of feeling among my hon. Friends will be demonstrated in the next hour or so, and I believe that the Government’s preference for unitary authorities was implicit in their response to those who made bids.

Let us now consider the wider questions and come up with a process that resolves the issue of unitary government in Lancashire once and for all in the interests of our constituents and the places that we represent.

I congratulate my hon. Friend the Member for Burnley (Kitty Ussher) on securing this important debate. Discussion of this issue has been raging in Lancashire for some years, and certainly since well before I became the Member of Parliament for Preston. Obviously, I concur with much of what my hon. Friend said about the logic and rationale behind introducing unitary authorities in Lancashire. As Preston’s Member of Parliament, however, I should like to put things in a different perspective and particularly to give Preston’s point of view.

As many hon. Members know, Preston bid for unitary status, along with Burnley and Pendle, and Lancaster. Initially, it was meant to make a joint bid with the borough of South Ribble, and that would have proceeded quite well. Indeed, I would also have liked Chorley to be included, because the size and population of the resulting area, which would eventually have become a unitary authority, would have given it some rationale and allowed it to achieve efficiencies and economies of scale. However, Preston bravely made a bid on its own.

I was talking about what would have happened had things moved along quite quickly, and I shall come to West Lancashire a bit later.

As I said, Preston made a bid on its own, so its bid did not have the necessary gravitas to be accepted first time. We are therefore here today to map a way forward that will allow us to achieve unitary solutions across Lancashire as a whole.

Lancashire has been promised a good number of things over the years, and I look to my hon. Friend the Minister in saying that. For quite some time, both before the Labour party came into office in 1997 and afterwards, the north-west was promised regional government, but those plans have taken a back seat—possibly indefinitely. Recently, we were also promised that the Lancashire and Cumbria police forces would be merged, but again those ambitious proposals have taken a back seat. Now, with the local government White Paper, several local authorities will be granted unitary status. Unfortunately, those bids that came from Lancashire have not yet been accepted. We want that promise of unitary status to be upheld by the Government and to be realised through the review and discussion that was mentioned by my hon. Friend the Member for Burnley because there is still a very strong case for creating unitary authorities across Lancashire.

Preston, in particular, is working very closely with South Ribble and Chorley on issues such as the local government framework and the regional spatial strategy. There is already a good deal of horizontal co-operation between those three authorities, and in the future I can see us working more closely with West Lancashire. Therefore there is a good deal of good will, good co-operation and sharing of best practice across central Lancashire at the moment. As my hon. Friend the Member for Burnley pointed out, what is not working very well is the idea of two-tier government—the vertical relationship between the county and the districts. It is that problem that the unitary solution would address.

The logic behind unitary status is clear. As has been said, two-tier working is outdated, inefficient and bureaucratic. We want local people to have control over their own affairs through locally elected councillors who are familiar with and relate to the areas that they serve. That includes the extremities of that authority area. The idea of having somebody at one end of Lancashire making decisions that affect the other end of the county when they probably do not have much affinity with that particular area is an outdated viewpoint and one that would be addressed by unitary authorities.

The other point is that there are a good number of economic drivers in central Lancashire that make a great deal of sense. For example, shopping and the economy are very much affected by what happens in Preston. Much of the housing is provided in South Ribble, Chorley and parts of West Lancashire, but all look to Preston for economic activity and generation. Many residents of those areas will probably work in Preston, and Preston people will probably work in the outlying authorities as well. Transport and the general infrastructure are very much interrelated and interdependent. Therefore, central Lancashire as an economic unit is functioning very successfully. It is functioning as well as Manchester and Liverpool and, if I dare say so in present company, better than the rest of Lancashire. Unitary government will bring a lot to central Lancashire and its time has clearly come.

The hon. Gentleman has given a very good justification for granting unitary status, but is there any reason why he believes that having lots of small unitaries is a better way to use taxpayers’ money than having one larger unitary, perhaps countywide or even two per county?

I thank the hon. Gentleman for his intervention, but I think that the county is too big to be a unitary. We want a local council, but one that is big enough to be able to provide services and give economies of scale to ensure value for money for the council tax payer. I think that Preston is too small to become a unitary and Lancashire county is too big. We need something in between. I believe that four or five unitaries across Lancashire offer that balance between localness and economies of scale and efficiency that local councils could provide.

As a result of the local government White Paper, all the major conurbations in Lancashire are either bidding to become unitary or, as in the case of Blackpool and Blackburn, are already unitary. In my view, if it is good enough for Blackpool and for Blackburn then it is good enough for the only city within the county boundaries, which is Preston, to become a unitary authority through a new central Lancashire authority. In solving this problem, one of the oversights by Ministers in the past—

The hon. Gentleman is speaking powerfully for the people of Preston. Will he give the Chamber an indication of how much of an additional population needs to join the Preston borough to create something that has sufficient size and sufficient weight to be able to run? What addition does he think is necessary?

I thank the hon. Gentleman for that intervention, and I should put the situation to him plainly. Before I represented the central Lancashire area as a Member of a Parliament—I was a Member of the European Parliament before I became a Member of the House of Commons—I served as a city councillor in Salford. That is an authority in Greater Manchester, which itself had a county council until that was abolished in the mid-1980s by the previous Conservative Government. An authority that had about 250,000 inhabitants was created in Salford. We have seen that authorities of a similar size work well in Greater Manchester, and such an authority can sustain effective, good local government. Having said that, anything between 150,000 and 300,000 people is a reasonable size for a unitary authority, and would balance localness with the efficiencies of scale that being a unitary authority would bring. In addition, there would be the efficiency of having just one tier of decision making.

As I said, all the major conurbations—Lancaster, Burnley, Pendle, Preston—have bid, and Blackpool and Blackburn are already unitary authorities. One of the oversights of Ministers when they put forward these proposals, to which authorities obviously responded, involved what would happen to the rump of what is left of Lancashire county should those bids be accepted: what should be done with the remaining authorities that did not bid to have a unitary authority and did not give an indication?

I hope that a process is now under way, partly as a result of this debate and partly because of discussions that I and my hon. Friends have had with Ministers about what to do with the remaining authorities. I understand that the remaining authorities, which have not bid, will be consulted and asked which neighbouring authorities they feel most closely associated with. I hope that leads to a process whereby the major conurbations join with a variety of other authorities to become a unitary solution for the whole of Lancashire that would fit together like a neat jigsaw. I hope that in my area, Preston, South Ribble and Chorley will come together to form a unitary authority along with either the whole or part of West Lancashire, which we would not want to be left out on a limb and subsumed into Merseyside or Greater Manchester as a whole.

These are important issues and the people of Lancashire have unfortunately been left to deal with them for many years. The time has come for the Government to make these things a reality, not just a promise. I hope that the Minister takes the views expressed in this debate back to the Department, because I think that she will find that the overwhelming number of Labour Members are fully supportive of a unitary solution for the whole of Lancashire. That does not necessarily mean a unitary solution for Lancashire county as it stands at the moment, but one where four or five authorities spread from east to west across the county.

I was about to call “Pope Gregory”, which is the name that I normally use as a joke. I call Gregory Pope.

Either way, I am grateful to be called by you to make a brief contribution in this important debate, Lady Winterton, and I thank my hon. Friend the Member for Burnley (Kitty Ussher) for securing it.

When I was first elected to this House, I thought that two things would not be around for very long. One of them was me, because I had a very small majority—it was the same as the year of my birth—and I thought that I would be in this place for only a couple of years. I thought that the debate over the future of Lancashire would not be around for much longer either. As it turns out, 15 years on, both are still here.

The uncertainty over structures in Lancashire is unhelpful and bad for morale. If one talks to officers of almost any district, or indeed of Lancashire county council, the issue of reform dominates the conversation—it is always at or near the top of the agenda—and when one talks to councillors, the same issue is raised.

I represent the whole of the borough of Hyndburn, part of the borough of Rossendale and part of the Lancashire county council area. I want to make the point at the outset that none of my comments are meant to be criticisms of those authorities. Over the last 10 years, all those councils have improved hugely. Generally speaking, there are hard-working councillors and officers. I would like to single out, in particular, Hazel Harding at Lancashire county council, who has made a huge improvement in the time that she has been its leader. The county is much improved and is far more responsive than it was previously.

It is the structure that lets these authorities down. They cannot deliver the level of service that my constituents and I want, because the structure fails them. In short, the two-tier system imposed by the Local Government Act 1972 has proven, over time, to be a failure. As my hon. Friend the Member for Preston (Mr. Hendrick) so eloquently put it, the county is simply too big and the districts are too small.

The conundrum for the Government—my hon. Friend the Member for Burnley spoke of this—is that there is a fierce pride in the towns and districts and people identify with the towns. My hon. Friend knows this better than most, because we are currently going through a health service review, part of which involves centralising accident and emergency services in Blackburn and maternity services in Burnley. The truth is that people in Burnley do not want to be patched up in Blackburn, and people in Blackburn do not want their babies to be born in Burnley. There is fierce pride in both, and whenever the two football teams meet, the pride that people have in their districts is all too evident. It sometimes seems to me that people’s pride in their districts is almost in inverse proportion to the ability of the district structurally to deliver the level of service that is needed.

For example, the budgets of these district councils are tiny and the councils are constrained by this. I do not have the exact figures to hand, but Hyndburn borough council’s total budget this year is something like £14 million. Burnley’s will be slightly larger than that, and Rossendale’s slightly smaller. These are tiny amounts of money, yet the burden of expectation that is placed on the districts is huge, because people identify with them far more than they do with the county council.

Why has this not changed over time? I think that it is partly because the Government have pursued the chimaera of consensus when in fact there is no consensus at all, and partly because of the fierce pride that people have in their districts. When we went through this process a few years ago in the run-up to the plan for regional government, the Accrington Observer in my constituency effortlessly compiled a huge petition against Hyndburn being merged with Blackburn. People in Hyndburn perceived that Blackburn would be a larger neighbouring authority, a big brother, which would swallow them up. I think that it is also safe to say that, at that time, Lancashire county council ran an effective, if perhaps disingenuous, campaign, which managed to muddy the waters. It was able to say that people identified strongly with Lancashire. Of course people in Lancashire identify strongly with Lancashire; that is not the same as saying that they identify strongly with Lancashire county council administratively, which has different borders from the traditional palatine county of Lancashire.

There are also powerful vested interests. There are hundreds—possibly in excess of 300—district councillors across Lancashire; there are, I think, 84 county councillors on Lancashire county council; and there must be well over 100 councillors in the unitary authorities of Blackpool and Blackburn with Darwen. If we go for a unitary system, all those council seats will be abolished and replaced with far fewer seats, which will not only be more efficient for the people of the county of Lancashire but will be damaging to the careers of the councillors who serve in those wards. There are powerful vested interests against it. It sometimes seems to me that the Government look like they want this problem to go away. They give every indication that they think that, somehow, this is not solvable. It is perhaps the Schleswig-Holstein question of the 21st century.

Hon. Members will recall that Lord Palmerston said that only three people understood the Schleswig-Holstein question. One was Prince Albert, who was dead; one was a German professor, who was in a lunatic asylum; and the other was Lord Palmerston himself, who had forgotten the solution. I put it to hon. Members that in this scenario my hon. Friend the Minister for Local Government is, not for the first time, Lord Palmerston, because he has forgotten the answer to the problem.

We should make it easy for the Government by saying that they should ask themselves this simple question: would unitary councils in Lancashire deliver better services than the current two-tier system? The answer is, emphatically, yes. Let us consider the boroughs that have left Lancashire recently: Blackburn with Darwen, and Blackpool. Does anyone anywhere believe that the people of those areas would be better served by those councils giving up 90 per cent. of their budgets and services and returning to a two-tier system? Nobody believes that; it is simply unthinkable.

I echo the point made by my hon. Friend the Member for Preston. If it is good enough for the people of Blackburn with Darwen and of Blackpool to have quality unitary local government, I am pretty sure that it is good enough for the people of Hyndburn, Burnley, Pendle and Rossendale too—perhaps not in individual unitary authorities, but in amalgamations of authorities under the existing system.

I was going to say that it was telling that not a single Member of Parliament in the whole of Lancashire believes that the current two-tier system is that effective. I stand to be corrected, but I am fairly confident that nobody will stand up to defend the status quo. Given the length of their experience—I think that there are 12 MPs in Lancashire—that is a fairly stunning comment. Again, these are criticisms not of the hard-working councillors but of the structures.

The solution is fairly straightforward. The Government should stop dithering, bite the bullet and get on and do this. They should announce that there will be unitary local government in Lancashire. They should state at the outset that the county is too big to be considered a unitary authority and that the districts on their own are too small to be considered unitary authorities, and they should invite bids based on something in between.

Everybody I have spoken to—every MP, every councillor, every officer, everybody—knows that Lancashire can and should be split into four or five separate unitary authorities. My constituents deserve what the people of Blackpool and Blackburn with Darwen already have—that is, to be covered by a unitary authority. My personal view is that it should be a unitary authority covering the whole of east Lancashire. We are the size of a city, with getting on for 500,000 people, yet we are fragmented into four or five tiny boroughs, which cannot make the difference that we all want to see. I hope that my hon. Friend the Minister will take away from the debate the message that the representatives of the people of Lancashire want the Government to find the political will to make that happen.

I have just a few observations. I congratulate my friend next door, the Member for Burnley (Kitty Ussher), on initiating the debate, which comes at a very appropriate time. I do not want to sound a discordant note, but let me say at the outset that I do not believe that two-tier systems are necessarily anomalous. There are two-tier local government systems across the developed world and they function well.

One of the curiosities of what the Government propose is that the new unitaries that may be created will largely be county-based. Sixteen proposals have been waved through to the second stage, and of those, 10 will be county unitary authorities. My constituency is next to North Yorkshire county council, which it is proposed will be a county unitary. The idea that such a vast county that stretches from Craven, which is next door to where I am in Pendle, through Harrogate, all the way to Scarborough, should have a unitary authority is astonishing. That is not local government—such a huge county unitary is not what local government is about.

My preference is for local government that is actually local. The bigger the authority, the fewer councillors there are and the shallower the connections are with local people. I want to see local government that is local. However, I also want new ways of working. As my friend the Member for Hyndburn (Mr. Pope) said, the old ways of working did not reflect the new realities. People want openness, transparency, and responsiveness in their local authorities, and they want to know who is carrying the can. The leader of Lancashire county council, Hazel Harding, has made a qualitative difference, and that council is now a much better authority than it used to be. The problems that we remember with Lancashire county council in the past—the closure of care homes, difficulties with social services and so on—have been turned around. The council now trumpets that it is an excellent four star performing local authority and we should echo that.

Compared with other local authorities, Labour-controlled Lancashire does quite well. However, the transformational agenda that I have talked about must continue so that people feel comfortable and at home with the idea of a Lancashire local authority. It has just published a document on improving two-tier working between district and county councils, at the back of which are practical examples of how the two-tier system can be improved.

I remember the local government reorganisation of the 1990s. Sir John Banham, who was in charge at that time, memorably said of local government that

“any reorganisation costs more, takes longer and delivers less than any proponents of change ever thought”.

That is true. The opportunity costs of restructuring and of drawing up plans are absolutely huge—whether those costs relate to the health service or to the abortive plans to merge Cumbria and Lancashire police forces. Chief executives and leaders of councils, who have come all the way down from Burnley and Pendle, are here. The amount of time that must have gone into preparing the document, “Burnley and Pendle: reaching for new heights” is legion. It says in the document that Burnley and Pendle councils are proposing the creation of a new unitary authority, which arises out of an exciting vision that was developed and shared by their citizens, partners and elected members.

I think that that is a complete fantasy. The document was not developed and shared by citizens. I was never consulted; people in Pendle were never consulted; and of course people in Burnley were not consulted either. Yet a leading member of Pendle council, who is a friend of mine, John David—I like him although he sometimes says silly things—said to the Burnley Express that I was a disgrace for not supporting the Member for Burnley. The article stated that he

“expressed disappointment that while Burnley MP Kitty Ussher had given her backing to the bid, Pendle's Gordon Prentice had not, something he said was ‘a disgrace’”.

That is completely over the top. We had a difference of opinions. I had a difference of opinion with the previous Member for Burnley, my old friend Peter Pike, who constantly harked back to the glories of the county borough of Burnley and long believed in having a unitary authority to cover the whole of east Lancashire. He had a different view from mine, but I do not think that he is a disgrace or that my friend the Member for Burnley is a disgrace; we just have different views.

There are different views between political parties as well as within them. I wonder what the Liberal Democrats in Craven, Harrogate or Scarborough will say when those district authorities are swept away and we have this possibly huge new creation of North Yorkshire county council. While I am on the subject of the Liberal Democrats, allow me to say this—

He is a nice guy. He is also a friend, and I get on well with him. Nothing I say is ever personal.

The Liberal Democrats published their policy paper on local government less than a year ago. The ink is still wet. It stated:

“Any move from two-tier to single tier must be preceded by a local referendum, not imposed by central government”.

And yet—

I wonder whether it would help the hon. Gentleman in deploying his argument if I advised him that that policy paper was referred back by our conference, and is not yet established party policy.

It should be. It is a disgrace.

I do not want to go into this. I have lived with these changes for too long. However, if local government is to be truly local, and if people are to have a sense of place, as my friend the Member for Burnley said, they should be consulted. Sometimes, my local authority in Pendle, which is Liberal-controlled, as is the authority in Burnley, consults people. I remember getting a form—last year or perhaps the year before; I cannot remember—inviting me to give my views on a proposal to establish new parish and town councils. I thought that that was great. Pendle’s housing has now been floated off, and is no longer the direct responsibility of the district council, but the tenants were consulted. The tenants voted in favour of having the repairs done, and so on. They were persuaded, as there was a public campaign, but I do not have any problems with that, as they were consulted. The idea that we can propose these huge changes to local government just by referring to the views of stakeholders, whoever they might be, and not consulting the people is absurd.

To sum up my position, I am not persuaded that it is necessary to go through huge restructuring and upheaval to deliver the better services that people expect, and have a right to expect. I want to see the transformational agenda continue. I want to see local government providing services that are tailored to the needs of local people, and are responsive. I do not resile from that agenda. However, the dividing line is that, before these changes occur, if they do occur, local people should be consulted.

Earlier, I had discussions with councillors from Preston and officials from Lancaster. I want to welcome those who have come here today.

Order. It may help hon. Members if I make the point that it is not the custom to refer to people in the Gallery either here in Westminster Hall or in the main Chamber. It has happened twice, but I did not pull up the initiator of the debate as she is a new Member.

Thank you, Lady Winterton. I, too, am a new Member, so perhaps a bit of leeway might be given.

I thought that it might be interesting to make a point about the automatic assumption that unitary rather than two-tier is best, and perhaps echo some of the comments of the hon. Member for Pendle (Mr. Prentice). He and I have one thing in common: we are both from Scotland. I represented a region in the Scottish Parliament and saw the consequences of the Conservative Government’s changes. Lord Lang, as he is now called, abolished overnight the two-tier system across the whole of Scotland. I can certainly say from experience that that did not lead de facto to better services across Scotland. It is still the case that what make for better local authority services in Scotland are the quality of the councillors and officials, and where the boundaries are drawn.

I represented Aberdeenshire, and the area that I had to cover was more than 10,000 square miles. In larger regions, the urban environment inevitably wins out over the rural. In comparison, services in urban areas are better than those that people in rural areas have to accept. We should not simply assume that two-tier is wrong. It works in other countries. Perhaps we do not have the boundaries right, and perhaps the population thresholds need to change.

I kept in touch with my local authorities, and what I found most disturbing was the process that the Government went through in deciding who should be considered and who should not. It may have led to some confusion for my colleagues in Lancashire and for councillors, as it was not clear what councils had to do to qualify and what they had to promise to deliver in order for their bid to win. That has not helped the situation.

There is a good dose of politics in all local authority reorganisation, whichever Government are doing it. It is no coincidence that the list of the 16 successful bids begins with Conservative, Conservative, Liberal Democrat, Conservative, no overall control, Conservative. The vast majority happen to be Conservative, Liberal Democrat or no overall control local authorities.

I could mischievously speculate that Lancashire county council without Preston and Burnley would much more likely be a Conservative-run council. Several county councillors would be lost—they would go into the pot—and perhaps that is not desirable. As the Conservatives found in Scotland, if a Government abolish all district councils, overnight they lose party workers who worked for them in the election. At the stroke of a pen, they wipe out hundreds of Labour or Conservative councillors—they are no longer around.

It is interesting that the direction of flow in unitaries has been upwards. I am a devolutionist, which is fairly rare in the Conservative party. I do not have a problem with devolution. I believe in letting people in communities make many of the decisions about boundaries and direction, as they know what they want and how they want to be governed. I find it peculiar that the vast majority of bids in the list involve districts going up to county—they will not be closer to the people but further away. It is a cause for concern that the direction is not towards re-engaging local people but towards making authorities bigger.

The hon. Member for Pendle is absolutely right. One of my borders is with North Yorkshire. In fact, before the 1974 changes, part of my constituency was in Yorkshire. Hon. Members can imagine how many Yorkshiremen there are in my constituency who are happy that they are now in Lancashire.

Is there such a thing as a happy Yorkshireman? Perhaps we should ask ourselves that question.

I certainly think that some of the regions are too big. My experience in Aberdeenshire tells me that North Yorkshire is too big. We must determine what is the right size. In a parliamentary question, I asked for a population guide for authorities making a bid, but the Government do not have one. They certainly did not publish one or say that there was one but that it would not be used. The issue is important, and it needs to be addressed.

I represent the constituency of Lancaster and Wyre, a large part of which is the borough of Wyre. My constituency is predominantly rural. My right hon. Friend the Member for Fylde (Mr. Jack) and my hon. Friend the Member for Ribble Valley (Mr. Evans) are not here, but theirs are large rural constituencies in Lancashire.

Why have the urban conurbations been quicker to queue up for the unitary system? It is because, as we all know, a lot of services in rural areas are more expensive to deliver. Such services include health care; in Cumbria, for example, historically there have been funding problems, right back to the Black report, about delivering health care at the primary and acute levels in rural settings. We know that delivering social services and school transport is more expensive in rural areas.

I am a Unionist and I worry that we get into the “every man for himself” routine when it comes to drawing up unitary boundaries—“You know, we would be much better off if we just got rid of those people along the road. We do not want them.”

The hon. Gentleman and my hon. Friend the Member for Pendle (Mr. Prentice) seem to make continual reference to authorities elsewhere in the country, and some in other counties are not so far away. A number of Labour Members including me, would like unitary authorities to be based not necessarily only on the conurbations about which we have spoken—those that have made the bids—but on much wider and bigger ones that also encompass rural areas. There are huge rural areas in places such as West Lancashire, South Ribble and Chorley. We have nothing against rural areas. If unitary authorities are good for a conurbation such as Preston, they are good for rural areas as well. We are not being exclusive.

I have not said that I am against unitary authorities—nor, if I am not mistaken, did the hon. Member for Pendle. It is interesting that we would all be in a different position if the Government said, “You must find 300,000 or 250,000 people before you get through the front door of a unitary status bid.” That would force a lot of us in this Chamber to work together to find an applicable boundary. It would make us say, “We have to have Wyre or Ribble Valley”, or Ribble Valley might have to find somewhere else.

That would have been a good starting point, but I am afraid that we did not get it. We got a lot of warmish words and a few targets, but nothing specific. That is what I meant in saying that we should try to clear up any confusion before going along the path. There is confusion about who the stakeholders are and how they should have to consult—a local referendum? Like the hon. Member for Pendle, I did not get lots of requests and forms. I was not asked lots of questions. I was not particularly consulted. We should have had a clear consultation process as well.

How much of the issue is also about disappointment in the county delivery of services and performance?

I had hoped to have made a longer contribution in this debate. It is really important that we recognise the difficulty that constituents face because of the two-tier system and whether county or district should be responsible. In talking about bringing representation down to the local level, people have forgotten the Government’s recent decisions about parish councils. Constituencies such as mine—and, I am sure, the hon. Gentleman’s—also face the big city regions such as Liverpool, Manchester and Preston. We are not important to such areas and will not be unless we become a bigger player. We need the weight and size to be able to have a strong voice. My constituency loses out time and again.

Lady Winterton, I shall be brief, because I recognise that the summing up will have to start soon.

To answer the hon. Lady, a lot of the strategies that affect our constituents are now regionally-based anyhow. In respect of economic development, we are constantly frustrated that Manchester, Liverpool and Warrington seem to be involved and the rest of us can go hang. That is one of the problems.

In summary, unitaries should be formed on a case-by-case basis; we have to accept that. We need clearer guidance from the Government on where to go, how to qualify and what they are trying to achieve. We should not throw everything out because we think that two-tier is wrong and unitary is good. I do not accept that; my experience has not been that. The Government could have been clearer about what they were trying to achieve and about all the different points in respect of how to qualify for a bid to become accepted as a local authority. If that is so, Lancashire may come up with some solutions in future. I do not know. I hope that the Minister will indicate today that that will be so. We have to ask some questions about the delivery for the county and how much that drives people’s frustration at the moment.

This has been an interesting debate for those of us whose specialist subject is local government in Lancashire from 1970 to 2007. It has a parallel with the Schleswig-Holstein question, although I am not sure whether the Danes or the Germans will come out on top in this particular matter. I appreciate the strength of feeling in the Chamber and I am sure that that will be one of the problems that the Minister and her Department encounter in deciding what should happen and what they should do next.

The hon. Member for Burnley (Kitty Ussher) is to be congratulated on advancing a sane, calm and reasoned case on behalf of the Burnley and Pendle application and on considering her constituents. That is her right and it is proper that she should do so. She prayed in aid Lord Heseltine and she could have mentioned the Liberal Democrats, as the hon. Member for Pendle (Mr. Prentice) was kind enough to do, because it is true that they believe that, normally, a single tier of authorities at local government level would be appropriate. However, we have an essential, vital qualification, which is that reorganisation should be validated by clear evidence of public support locally. We in the House have to remember the damage that the impatience of rulers does, whether we take Thomas à Becket as our example of when things go wrong or more recent examples, even in respect of the current Administration. If there is not public consent and public validation, the reorganisation of representative democracy, particularly, is likely to fail.

The hon. Member for Pendle was not a million miles away from expressing my view: where there is clear local consent there should be a move towards unitaries, and where there is not there definitely should not. We are not just talking about a mechanical process for the delivery of services but a representative, democratic system, so things have to be done with popular consent.

The Minister knows that we have argued strongly in the Committee on the recent local government Bill against giving the Government continuing powers to return to this topic time and again. It is right that there should be an opportunity to discuss the proposals, but there should not be an ever-open door allowing them to rattle around. The cost and destabilisation of returning to this matter every three or four years means that that should not be attempted. Reorganisation should not be carried out lightly or repeatedly and it certainly should not be done punitively.

The hon. Member for Lancaster and Wyre (Mr. Wallace) suggested that there might be some ulterior motives in the choices that the Government have made. I am sure that the Minister will deny that. Clearly, reorganisation should not be carried out because of expected political outcomes or as punishment for previous political outcomes. The Conservatives did that with the abolition of the Greater London council and they lived to regret their choice. It should not be done, either, on the basis of poor performances or perceived failures to meet Government targets; it should be done to reinforce and enhance democratic representation.

It is not my job as a Front-Bench spokesman to support or reject any set of options for Burnley and Pendle, but the hon. Member for Burnley made an interesting case. I understand that all three mainstream political parties in Burnley are in favour of the bid and in Pendle the Liberal Democrat and Labour members are in favour of it, although I understand that the hon. Member for Pendle is not.

Affordability was good, neighbourhood engagement was excellent and strategic vision was good too. The problem seemed if anything to be with service delivery, which, as the hon. Member for Burnley observed, was a problem for the rest of Lancashire rather than being attributable to the inability of the authority—if it comes into being—to deliver services. Will the Minister therefore carefully consider the case that has been put to her for reconsidering the Lancashire situation? If she is minded to approve or push forward any of the bids that have been submitted to her for Lancashire—not just Burnley and Pendle, but Lancaster and Preston—will she attach a strong condition that there should be clear evidence of local popular support for that measure?

As other hon. Members have mentioned, failure to do that will lead to real difficulties. I listened carefully to the hon. Member for Hyndburn (Mr. Pope), and he had the impatience of rulers—writ large. Having explained how none of his constituents wanted to be born in the wrong hospital, or indeed cross over the border, he then said that he thought the real solution was an east Lancashire authority that should be imposed on people whether they liked it or not. That is absolutely the wrong approach to the problem. There should be an organic bringing together of communities that have taken decisions in common—not some shotgun marriage, imposed from Whitehall or from this building.

It will be interesting to hear the Minister’s response, and I hope that her colleague the Minister for Local Government has left her a few jottings for this morning on whether the Danes or the Germans should take control of Fylde and the Ribble under the new arrangements.

It is a great pleasure to appear before you in this important debate, Lady Winterton, and I congratulate the hon. Member for Burnley (Kitty Ussher) on successfully securing it. She started by saying that she had a degree of trepidation, but I had the opportunity of seeing her arrive in the building, and she was wearing a bright yellow, fluorescent flak jacket. I hope that that was not an indication of how things will develop. [Interruption.] I know—I was making a joke. I knew the jacket was for the hon. Lady’s bike and I was just being nice. I did not really think that she required bullet-proofing but I am grateful for the correction.

Don’t politicians just love restructuring? They find it fascinating. If it was up to me I would draw the boundaries of my own constituency. Heck, I would even do the same for the Minister, my neighbour. We like to discuss restructuring because it reminds us of canvassing and stops us getting involved in really important things such as policy, care for the elderly, education, or the problems of sheltered housing. We can spend and waste millions of pounds of taxpayers’ money trying to find the right structure for an organisation that will go into limbo for year upon year until that right structure is actually found.

I might be doing the hon. Member for Burnley an injustice. However, as far as I understand it, the hon. Lady’s justification for her position is that her constituents are confused. She believes that all the decent councillors want more money, and that rather than spend time serving the people they would disappear to the county council to get a few extra bob.

I do not know what motivated you, Lady Winterton, but the amount of money that I receive as a Member of Parliament is not my predominant motivation, and I can say the same about most councillors. They are not that bothered about the amount of money that they receive; civic duty and putting something back into the community motivate most people in local government. To her eternal credit, however, the hon. Lady thinks that when there has eventually been a decision on the right structure there should be some consultation with the odd member of the public.

The hon. Member for Preston (Mr. Hendrick)—who I suppose is seeking expansion, as Bismarck was—is looking toward a greater or über-Preston. He thought that adding two might make up a central Lancashire city. There is a good reason why Preston was a Nobby no-mates when the application came for a unitary system: nobody else wanted to join.

I am most obliged to a redoubtable local campaigner, Mrs. Lorraine Fullbrook, who led a very successful campaign in South Ribble to persuade the council—Conservative, Labour and Liberal Democrat—not to join. The reason why she was so successful was that she had a clear idea of what the situation was likely to be. She said, “First of all, let’s consider the cost. The cost for the people of South Ribble is likely to be £350 per household a year for no extra teacher, no extra policeman, no extra health service and no extra paper clips”— £350 so that we politicians can be happy just for moving the process around. She then asked whether it would be an equal partnership. She read the regional and sub-regional strategy updates of the Cabinet meeting, which said that South Ribble would be used to

“drive the growth of Preston…South Ribble is seen as more ‘dynamic’ than Preston. South Ribble has an important part to play in supporting Preston’s emergence as a growth centre”.

In other words, what Preston wants is to take South Ribble into its friendship and then build all over it—to take away those bits of South Ribble that make it unique.

On a point of order, Lady Winterton. Is it in order for a Member of this House, particularly a Front-Bench Member, to publicise a Conservative parliamentary candidate during a debate of this nature?

I was speaking about the remarkably successful Lorraine Fullbrook, who will undoubtedly be a Member of this House soon. I am grateful to the hon. Member for Preston for pointing that out—no doubt the press will pick it up—but I detect his nervousness, so I shall try not to mention the name of Lorraine Fullbrook, Tory candidate, again. There were other considerations about the amount of open space and green belt threatened in South Ribble, but to spare the hon. Gentleman’s blushes I shall move on from the marvellous work of Lorraine Fullbrook, Conservative candidate.

The hon. Member for Hyndburn (Mr. Pope) said that when two or three officers are gathered together, they talk of little else but restructuring. I am not entirely surprised. For an officer, moving toward restructuring is better than getting a telephone call from Chris Tarrant. There is loads of money in it. We know that from The Sunday Times, whose appointments page suggested that chief executive salaries will rise by at least £30,000 if restructuring proceeds. That is a lot of money, so I am not surprised that officers are interested in the idea of restructuring, but I am pretty certain that were we to go down to the dog and duck in Hyndburn—although I do not know whether there is one—and wander across to talk to members of the public when two or three of them are gathered together, they would not want to talk about restructuring. They want to talk about council services. They want to know why their granny cannot get into an old persons’ home or get additional help through home care. They are concerned about their children’s education, not whether a particular restructuring will occur or a chief executive can at last buy the villa on the Costa del Sol that they so richly deserve.

I was surprised by the idea that people are so proud of their locality. I would like to think that no matter what area we represent, we are all proud of our locality. The great thing about British local government and constituencies is that they are not entirely an electoral quota. They tend to be made up of real communities, and real communities should have pride. Just because a real community will not vote for its extinction is no reason to deny it the vote.

My hon. Friend the Member for Lancaster and Wyre (Mr. Wallace) asked whether Yorkshiremen had a sense of humour. I come from Essex, but have vague connections with Yorkshire, and like a Scotsman, one can never mistake a Yorkshireman with a grievance for a ray of sunshine. My hon. Friend was right to talk about the quality of services and to say that rural areas matter most. We know that the issue has caused enormous problems in all political parties. The last time we debated it, I quoted from Labour’s national policy forum blog in which the Prime Minister said that he was aware of the many differences between county and district, and urged us to concentrate on issues that voters care about.

We know, courtesy of the Municipal Journal, that the Cabinet was split over the proposals, and that the Environment Secretary was keen to avoid the political bloodbath that opposing bids were likely to create, but his efforts to have some of the bids removed from the shortlist caused major delays. He may well have been right, judging by what has ensued.

I agree with much of what the hon. Member for Pendle (Mr. Prentice) said. The substantive point is that it does not matter whether an authority is unitary or two-tier because it is services that are important, and changing structures is so old-fashioned. It is up to us to sort out the confusion that may exist in people’s minds; it will not be sorted out by changing the structures, because of the changing reality. I have been tremendously heartened by the growth of local area agreements between districts, counties and different sorts of organisations such as health authorities and police authorities. That should be the future. We should allow local authority structures to grow naturally and organically, and see where that process goes, instead of imposing non-reality on what is happening on the ground. We will ensure in those processes that people receive better services.

In conclusion, I say to the hon. Member for Burnley that I am sure that every Member of the House would be willing to co-operate on that basis.

The Parliamentary Under-Secretary of State for Communities and Local Government
(Angela E. Smith)

I am grateful for the contributions to the debate and congratulate my hon. Friend the Member for Burnley (Kitty Ussher) on securing it. The matter is obviously a key issue for the people of Lancashire, and I appreciate the strong feelings that are held and the passion with which she and my hon. Friends the Members for Hyndburn (Mr. Pope), for Preston (Mr. Hendrick), for West Lancashire (Rosie Cooper) and for Pendle (Mr. Prentice) described the issues affecting their constituents.

I have to take issue with the hon. Member for Brentwood and Ongar (Mr. Pickles). It pains me to do so, as he is a fellow Essex MP, but I think that he is rather cynical on these issues. I hope that his comments about the motives of those who secured this debate and about officers and politicians discussing structure were tongue-in-cheek. My hon. Friend the Member for Burnley secured the debate not so that she could avoid discussing anything else that was important, as he suggested, but—this came through clearly in the contributions—because of a commitment to service delivery to constituents in her area. That seemed to be the motivating factor for all hon. Members who spoke.

I also take issue with some of the comments about the reasons for decisions. Hon. Members will be aware that 26 proposals were received from local authorities for the creation of unitary structures in their areas in response to the invitation published alongside the local government White Paper in October last year. The hon. Members for Lancaster and Wyre (Mr. Wallace) and for Hazel Grove (Andrew Stunell) suggested that the Government might have been politically motivated. The hon. Member for Hazel Grove rather ingeniously referred to similarities between that and the abolition of the GLC. It is absolutely clear that these were proposals that came through local authorities themselves, put forward because they wanted to be considered for unitary status. I am not aware that the GLC ever said, “Hey—let’s abolish ourselves”. That was imposed by the Government of the time; these are proposals whose true definition is bottom-up, with local authorities themselves making the decision to put them forward and asking the Government to consider them.

The Minister will be aware that there can be conflicting views within a county. In Shropshire, the districts were against a move upwards while the county wanted to become unitary, but on most occasions—in that example and others—the Government chose to listen to the county rather than the anti-unitaries from the districts.

We are considering that particular bid at the moment. The hon. Gentleman made a point about it being political, but Shropshire county council is a Conservative council and the districts opposing it are Conservative districts. It can hardly be a political issue if they are all of the same party, and I take issue with that point in his comments, which were totally unfair.

After careful consideration against published criteria, it has been agreed that 16 proposals will go forward to further stakeholder consultation. I hope that my hon. Friend the Member for Burnley and others will understand that I am somewhat constrained in what I can say about those: we are now in the middle of a legal process and, for reasons of propriety, I cannot get into a debate about the merits of specific proposals. I know that a number of hon. Members have raised issues different from those of Lancashire, but I cannot get into a debate on them. The reasons for the judgment are set out in the decision letters that were sent out to local authorities.

However, my hon. Friends raised a number of important issues about the next steps for local authorities, following that decision in Lancashire. It is important that I set out first how we got to where we are.

Powers in the Local Government and Public Involvement in Health Bill that is going through Parliament. The hon. Gentleman is aware of that, and it is a lawyer’s trick to ask a question to which one knows the answer.

As I said, a number of important issues must be addressed in what happens next and where Lancashire goes from here. That is the point that my hon. Friend the Member for Burnley and her colleagues were pressing. The invitation to bid for unitary status was published in response to views expressed during the long-standing debate on the future of local governance—that existing arrangements in some two-tier areas do not deliver the governance that places need. There is no doubt that there are risks of confusion, duplication and inefficiency in a two-tier structure.

In response to some comments made, particularly by my hon. Friend the Member for Pendle, let me say that at no point have the Government said that in no cases can a two-tier structure be efficient and effective. That is a matter for local areas themselves to judge on. The White Paper made it clear that two-tier areas faced challenges, and councils within those areas could make bids for unitary status against the criteria set down where they felt that there was a case to be made.

It was put to us that, in a number of areas, accountability could be improved and that there could be stronger and more focused leadership, greater efficiency and improved outcomes for local people. Again, I take issue with the hon. Member for Brentwood and Ongar, who said that it was not about outcomes, when the guiding principle on restructuring and reorganisation is clearly the outcome of service delivery for local people. So we were allowing restructuring to take place where that view was held, and that was quite evident when we received 26 proposals at the time.

On 27 March, my hon. Friend the Minister for Local Government announced that 16 proposals had been shortlisted to proceed to stakeholder consultation. In reaching that decision, the Government had to look at all the relevant information that was submitted. We have written to all councils that submitted proposals, setting out the reasons and the basis on which we reached our decisions. The proposals were assessed against the criteria, and it would be helpful if I said something about those criteria, because they have been mentioned and the hon. Member for Hazel Grove may have misunderstood them.

We are very clear that the proposals must be affordable. Any change in unitary structure must give local residents value for money and must be met from the council’s existing resource envelope. Proposals must also be supported by a broad cross-section of partners and stakeholders. My hon. Friend the Member for Hyndburn said that there must be consensus, but it is difficult to reach absolute consensus on such things. None the less, there should be broad agreement and evidence that there has been broad consultation and involvement.

In addition to affordability and support, proposals must provide strong, effective and accountable strategic leadership across the area. They must also deliver genuine opportunities for neighbourhood flexibility and empowerment—my hon. Friend the Member for Pendle was concerned that there should be local empowerment and local engagement. Finally, they must deliver value for money and equity in public services.

After careful consideration, it was agreed that 10 proposals would not go forward and that 16 would. The judgment was that there was not a reasonable likelihood of the 10 proposals, if implemented, achieving all the outcomes specified in the five criteria. The decisions are now being consulted on, and all the information presented to Ministers will be considered during that process. When we take our final decisions, we will proceed to implementation only if we are satisfied that the proposals fully meet the criteria.

As regards our next steps, the Budget confirmed that the whole public sector will be expected to achieve 3 per cent. per annum net cashable efficiency savings, and the potential new unitaries have shown what can be achieved. We expect all councils, whatever their structure, to work together to achieve greater improvement and efficiency gains. We therefore want to see similar improvements, whatever a council’s structure—again, the focus is on outcomes, rather than just structure. We asked all the principal councils that are already committed to going for a greatly improved and innovative two-tier approach to step forward and act as pathfinders. Five county areas have come forward to be pathfinders, and their proposals are being considered.

It is clear from the points made by my hon. Friend the Member for Burnley that there is a real desire to move to more effective, efficient and accountable local government in Lancashire and to achieve value for money. At this stage, it is important that all local authorities in Lancashire reflect on how that can be achieved within the existing structure.

My hon. Friend asked some specific questions, and we want to reflect carefully on them. She wanted to know whether the Government would meet her and other hon. Members on this issue, and I can give her an assurance that we will. It will probably be the Minister for Local Government—

I was not referring to Lord Palmerston, and I am not sure whether my hon. Friend the Minister for Local Government will still want to meet hon. Members when he finds out that he has been compared to him, but we shall put that to him. However, he has agreed to meet hon. Members and he will reflect on the request of my hon. Friend the Member for Burnley.

My hon. Friend asked two other specific questions. First, she wanted to know what failing actually means and to have information about the ability to deliver. The judgment on delivery was taken in the round against the five criteria that I outlined. That made it clear that account must be taken of the whole affected area and of the impact outside it. A judgment was made not about the services that the existing structures currently deliver, but about the impact of the new structures.

My hon. Friend’s second question was whether we support the case for unitary authorities in principle, and I think that I have made that clear. We are not saying that the two-tier structure is inappropriate or wrong in every case, but there are clear risks associated with it, which I have addressed.

The hon. Member for Brentwood and Ongar asked about referendums, should they become necessary. Traditionally, change in local government has been top-down, and I mentioned the GLC. However, we are talking about a bottom-up approach, and there must be consultation and engagement, with bids coming from local authorities themselves.

It is clear that there is a drive in Lancashire to ensure that authorities are real players and that there is greater service delivery. We must go away, reflect on the comments that have been made and offer a meeting with those hon. Members who have raised the issue. Whatever the structure, however, it is clear that there must be good service delivery, with the citizen as the focus.