Motion made, and Question proposed,
That the draft Cheshire (Structural Changes) Order 2008, which was laid before this House on 31st January, be approved.—[Mr. Jim Murphy.]
Tonight we are considering the draft order to implement the proposal to establish two new unitary councils for Cheshire. The proposal was originally made to us by Chester city council, subsequently endorsed and enjoined by three other district councils—Ellesmere Port and Neston, Macclesfield and Vale Royal. This is not the Government’s proposal; it is not the Government’s prescription for local government arrangements in Cheshire. It has been made to us by democratically elected and accountable councils, and it has been drawn up by those councils, which have discussed these views in their areas. They believe that it will put in place for the people and the businesses of Cheshire the best form of governance for the future of the area.
If the hon. Lady checks the record tomorrow she will find that precisely what I said is correct—that this was a proposal not from the Government but from local councils, that it was proposed by them and that we considered it alongside other proposals, including one from the county council, according to the five criteria that we set out at the very start of the process back in October 2006.
Is the Minister in effect disowning responsibility for the proposal and saying that he is no more than a delegate of Chester city council in regard to this proposal, rather than a Minister in a Government with a democratic accountability and a judgment that should be scrutinised?
The Minister is being disingenuous, to say the least. Why is he not proud of the arrangement that he has made? Six district councils are involved. Why have we suddenly become the whipping boy and handmaiden of Chester? Why does he not say plainly that he and his Department proposed this in the first place and have constantly changed the goalposts to progress this very shoddy matter?
Let me be clear. My Department certainly proposed the process and invited councils in two-tier areas across England to submit proposals for unitary arrangements. The minority of areas and councils submitted proposals, and the minority of those proposals have got to the stage of our looking to implement them.
My point is simply this, and I make it first to my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody): this process of putting in place unitary council arrangements is entirely different from the processes established by previous Governments. Those processes were centrally defined and the proposals came from the centre. In this instance, we have assessed what has been put to us. I have come to the House proposing to put this proposal into law because we believe that it and the arrangements offer a form of governance for the people, businesses and communities of Cheshire that will suit the future.
Order. Members must cease intervening from a sedentary position. If they want to intervene, they should do so in the normal way so that we can have a sensible debate.
Cheshire was in a relatively unusual situation compared with other parts of the country. Not only were two competing proposals submitted under the same single process but, uniquely, both proposals met the five criteria that we established at the outset. That was not the situation anywhere else in the country.
We had to set out a way of making a judgment between the two proposals, and in June we published our arrangements and made clear how we would carry them out. It was to be on the basis of which of the proposals, based on the evidence submitted to us, would deliver to a greater extent the benefits for which we were looking in three principal areas—first, strategic leadership; secondly, the empowerment of local people and local neighbourhoods; and thirdly, quality public services. Those made up our yardstick to try to distinguish between the relative merits of the two proposals.
The Minister drew a comparison with the ways that previous Governments had handled local government reorganisation. Will he confirm that last time the current Government considered this in the north-west—in relation to what would happen if people voted for a regional assembly in the north-west, which never took place because the Government did not hold the referendum—there was a commitment also to have a referendum question on local government reorganisation? Why have the Government abandoned the practice that they advocated just a couple of years ago? The Minister talks about empowering the people; why has he decided on this occasion not to let the people decide?
Because we set out in this process to approach the matter in an entirely different way—to be prepared to entertain proposals that were drawn up by elected councils representing their area and put to us as a Government. The hon. Gentleman is right to say that in 2004, under this Government, there was a question of potentially reorganising local government in Cheshire as part of the consideration of the wider referendum question on an elected regional assembly for the north-west. It was in the mid-1990s, under the previous Government of his party, that Cheshire was subject to potential reorganisation under the Banham proposals. As hon. Members who represent these parts of the county will know much better than I do, this is the third potential local government reorganisation in under 15 years. There comes a point when that continuing uncertainty starts to be a disadvantage, and there is a case for saying that it is important to make a decision and then allow those in the local areas to get on and try to implement it.
I am obviously not a Cheshire MP, but I was born in Cheshire. Let me express a concern that I sense is felt by many colleagues of all parties. This proposal, yet again, does a further job of breaking up an historic shire community that has already been sliced off at one edge around Manchester and sliced off at the other edge. It absolutely will not create what the Government say elsewhere that they want—a sense of real community cohesion. In that respect, it is the worst option, not the best option.
I hope that I will get the chance to come to that a little later. However, that is not the assessment that we have made of the potential for offering local areas a greater opportunity to be involved and to have an influence over decision making. The hon. Gentleman may have been born in Cheshire, but he misrepresents the nature of that unified, integrated, remaining historic shire county. It was the mid-1990s reorganisation that led to the carving out of Halton and Warrington.
Truth be told, the historic county of Cheshire has been broken up into bits previously. The question now is what is the best form of governance for the future within the area that is covered by Cheshire county council. I recognise that several Opposition Members argue for the status quo, but our starting point is that the general case for unitary local government is strong. It is a way of overcoming some of the well- established problems with county and district local government. The public are generally confused. The delivery of services can be fragmented. Local leaderships are sometimes competing. There is often duplication and inefficiency in the way that things are delivered. In the case of Cheshire, without imposing a unitary arrangement, we are close to arriving at a potential set of arrangements that will allow unitary local government for its people, based on the proposal that was originally put to us by City of Chester council.
Can the Minister help me on this point? If it is the case that the benefits are so obvious, why did the previous Secretary of State, as recently as July 2006, describe local government reorganisation as a great distraction? If that is the case, what objective criteria—benchmarks and measures—has the Minister put in place against which he can judge the evidence? I think he will tell me, as he has on previous occasions, that it is a subjective process. Is that really an acceptable basis on which to proceed?
The prospect of any change can be distracting, disruptive and unsettling. That is certainly the case for those who are intimately involved with, work for, and serve on, councils in the Cheshire area, which is one of the reasons why I am keen that this House and the other place come to a decision on the proposals. People will then know where they stand. If this House and the other place vote to support the move towards unitary arrangements, it will allow everyone involved—as they are already beginning to do, whatever their initial view of the proposal’s merits—to begin to ensure that from 1 April 2009 we can put in place two effective unitary councils for the benefit of those in the area.
My hon. Friend said earlier that Opposition Members wanted the status quo. The status quo in Cheshire, which would be the retention of county councils and the district councils, was on offer when five of the six districts in Cheshire said that they wanted to retain it. What stopped the status quo being an option was Cheshire county council’s decision to go for a single unitary authority. That is when the districts changed their policy. It is important to note that throughout the consultation, the status quo was never an option after that decision.
My hon. Friend has followed this matter closely from the outset, and throughout previous years. He makes a sound point.
It is not just a matter of the potential gains and how we assess them when judging the relative merits of the two proposals that meet the five criteria; it is also a matter of the consequences of making such changes. To that extent, we considered two things. First, we considered affordability. The hon. Member for Bromley and Chislehurst (Robert Neill) looks for harder criteria and better yardsticks. From the outset, we required the proposals that we looked to implement to deliver realistic savings and to have a payback period within five years. I can confirm that our assessment of the proposals shows that the transitional costs of such a change are more than offset by the potential savings. The payback period falls well within the five-year deadline.
There are seven Members from Cheshire who would like to contribute briefly to this debate, which is about Cheshire. I would like to make a suggestion. Would the Minister agree to make a very short introduction to the debate, and then allow Members to express themselves? Hopefully, Members will then allow him sufficient time at the end to make a winding-up speech. That would be a much more satisfactory way of dealing with the debate because it would allow those Members to express their views.
Since I got to my feet, I have spent more time dealing with interventions than making the remarks I had originally proposed to make. If the will of the House, through any interventions I now take, suggests general assent to that idea, I am happy to take it up. In any case, I will do my best to answer the points raised in the debate. I recognise that the debate is well attended, especially by hon. Members from the area.
At the risk of upsetting the hon. Member for Macclesfield (Sir Nicholas Winterton), may I draw the Minister’s attention to the explanatory memorandum? Bearing in mind the fact that several changes have been made to the figures, it cites estimated annual savings of more than £16 million a year and transitional costs of approximately £25 million. Those figures were not in the proposal, which states that the ongoing savings will be £30.1 million and that transitional costs will be £16.6 million. In other words, the Government do not accept the figures that they presented.
My hon. Friend the Member for Crewe and Nantwich makes an important point and helps me to make the next observation. In my view, it was important, when we considered the financial case and whether the proposals were affordable, not simply to take the figures submitted to us by councils that backed specific proposals. We therefore brought in, through the Chartered Institute of Public Finance and Accountancy and the Institute of Public Finance, independent financial experts who gave me, as Minister, advice on the case.
The figures and main conclusions of the independent assessment were set out—my hon. Friend just read them out. They led the independent experts to conclude that the transitional costs on a prudent basis would be higher and the savings would be lower than those in the proposal once the arrangements were in place. Nevertheless, the savings would be £16 million, which is at the higher end of the restructuring proposals that the House has considered and approved in five other areas. We concluded that the pay-back period would be well within five years—we calculated that it would be just over three and a half years.
Let me make a general point about the requirement for a broad cross-section of support. We said at the outset that we were not looking for evidence that a specific proposal commanded majority support, and that we would not allow any group or interest to have a veto over a proposal. The essential judgment that we had to make was whether there was a sufficiently broad cross-section of support to give us confidence that, if we proceeded with the proposal, it had a reasonable chance of being implemented successfully. That was our approach.
I should like to draw hon. Members’ attention to the main, although not all, elements of the order. We prepared the order, as we prepared those for other areas, through detailed discussion, with agreement as far as possible and certainly with consultation with all the affected councils—those who proposed the two unitary authorities solution, those who opposed it and those who took no view on the competing proposals.
The order provides that, from 1 April 2009, there will be a single tier of local government in Cheshire. Unlike the five other orders that the House has agreed, there is no continuing authority, but a wholly new start. The order provides for establishing two joint implementation committees, one for Cheshire, East, to be led by the current leader of Macclesfield, and one for Cheshire, West and Chester, to be led by the current leader of Vale Royal. They will serve before the elections in the respective shadow authorities, which we intend to set up this year. The order provides for elections in May on the basis of interim warding arrangements for those councils. It also provides for cancelling district council elections, which would otherwise happen in May 2008.
I accept that the time scale for implementing the proposals by April 2009 is challenging. There are good grounds for believing that that is achievable, not least the strong leadership that local government in Cheshire is providing for the work on implementing the proposals. There is practical co-operation, even from those who opposed the proposals, so preparations are well under way. The nature of the support and involvement that we can offer from the centre is also important.
Finally, the order sets out an approach to the transition that will be as effective as possible, minimise disruption to services in Cheshire, give a good deal to the service users, be fair and equitable to the council staff and, above all, help to lay the groundwork for a form of governance for the people, businesses and communities in Cheshire that will serve them well in the future. I commend the order to the House.
I am conscious of the number of right hon. and hon. Members who wish to participate in this debate and will do my level best to keep my comments short. However, I should like to set out one or two important issues.
The Minister and I have got to know each other quite well in this round of local government restructurings. He knows that I have every respect for him, but when he tried to set out the proposition that the proposal somehow walked through the door of the Department for Communities and Local Government, without any prompting and without his wanting or acknowledging it, he did not do himself justice. The fact is that the Government have set up Henry Ford’s consultation: we can have any form of authority as long as it is unitary. The consultation really is as simple as that, and to suggest that the proposal is uninspired by a heavy hint from the Government is, to be as polite as I can be, disingenuous.
Will the hon. Gentleman accept from me that Ellesmere Port and Neston borough council’s all-party policy has for a number of years been to move towards a unitary solution? The council’s original preferred solution was to create three authorities, but it compromised on two.
I have no reason at all to dispute what the hon. Gentleman says, but since we are dealing with the whole county, it might have been a good idea to seek the whole county’s views. That is why it is surprising that, for example, my constituents in Bromley had a say in a referendum when local government was restructured in London, but his do not in this case.
Many people would say that if the consultation were genuine, it is surprising that there should have been no option to improve two-tier working. That is rather odd, since the Government have sought pathfinder bids to do exactly that in other contexts. If that was good and acceptable in parts of the east midlands, I do not see why it is unacceptable in the north-west.
May I tell the hon. Gentleman that in 2002, following a report by the boundary committee for England, all six districts in Cheshire and the county council looked at the viability of two or three unitaries? In 2006, a joint officers working party was established to consider whether to go for two or three options, so the proposals have not been plucked out of the air in the past few months. May I also tell him—
I would have thought that the hon. Lady would make my point. If there were such a divergence of opinion, it would have been better to ask the people to start with, rather than imposing the change through worthy bodies on committees.
My point—we have gone through this many times before, but the principles do not change—is simply this. When we consider the large amount of risk, in terms of uncertainty and cost, that inevitably arises in any restructuring in local government—it is not too difficult to unpick the figures that have been quoted in support of the current proposals by citing the work of academics, such as Professor Chisholm and others—it is not unreasonable to say: first, that the onus of proof should be on those who propose change; secondly, that the burden of proof should be high; thirdly, that it should be based on firm evidence; and fourthly, that that evidence should be judged against clear and objective criteria. I am sorry to say that the conclusion, on balance, that this proposal has a more reasonable chance than the other is scarcely the application of any form of evidence to reasonable criteria. This is a suck-it-and-see form of politics, and it is not fair on the people who live in Cheshire or in any of the other affected counties.
The Government have not managed to make their case, which they have based entirely on one set of proposals. They have not explored the important alternative of improved two-tier working.
I am going to let people from the county respond to that one, while I get on with making the simple point that the hon. Gentleman ought to consider the fact that, at the end of the day, we are left with a set of proposals that will reduce the number of councillors across the whole of the county. They do not set out a coherent framework for what exists beneath the unitary level. Nor do they answer the serious questions about the methodology used to make the initial financial case. Finally, they do not demonstrate a groundswell of opinion. I think that the Minister used that term in relation to the earlier order on Shropshire. There is manifestly no groundswell of opinion here. That view is held by Members on both sides of the House.
This is yet another example of the Government tinkering, with what can only be described as partial motives. I wonder what makes anyone think that parts of Cheshire should be treated in a different way from parts of the other counties that surround our major conurbations. There is no consistency in the Government’s approach. It is not based on evidence, and they do not have an intellectually coherent anchor on which to hang their case. With respect, they would have done better to listen to Sir Michael Lyons, who is not unacquainted with local government in the north-west of England. He said:
“It is my opinion that reorganisation is not, in most cases, likely to provide either a theoretical or practical solution to the challenges we face, and there are other approaches that authorities should seek in preference.”
I think that Sir Michael was right, and it is a pity that the Ministers did not listen to him.
I was astonished at the way in which the Minister introduced this order. Whichever way we look at it, the Department said in 2007 that it was going to look for reorganisation. It is important to understand what it was asking. It said of the bids for unitary status:
“It is wholly at the discretion of a Council whether or not it responds to this invitation. The Government accepts that it is only in some areas that Local Government restructuring is widely seen as the way forward. It will be from Councils in such areas that proposals are made.”
The Department then went on to make it clear that it would take note of local views and expect to consult a vast cross-section of the people involved, and that it would certainly take account of those working in education and social services and in any other areas that would be directly affected by the order.
When it became clear, to people’s astonishment, that the council was actually suggesting a proposal that was not supported by the majority of Cheshire ratepayers, there was an enormous attempt to discover exactly what the council had meant in its letter which stated that it was “minded” to put forward this suggestion, and that it would be based on the criteria that had been discussed. The reality is that it was not based on anything of the sort.
We must be quite clear that, in the discussion on the figures that were put forward for the authorities, there has been a constant shifting of the goalposts, and not just by the Department. A bid based on Chester has constantly changed. The savings have changed, the administration costs have changed and it is very clear that the information given to the Government was not strong enough to support their view—otherwise, they would have been quite prepared to support the request made under the Freedom of Information Act for a copy of the assessment and would not have needed to refuse it. If the report vindicates the decision further to change the financial envelope, why does the Department wish to conceal it? There must be a reason.
We should make it quite clear that when the decision to opt for a unitary basis for the whole of the county of Cheshire was made, it was not done for something as simple as the status quo. A great deal of work went into making it clear that we were prepared to consider a county region, that we were aware of the economic and political costs and that we were very clear about Cheshire’s ability to attract direct investment flows from all around it. We are all aware of Cheshire’s close connections with Liverpool, Manchester, the Potteries and north Wales, which make it unique in its operation.
What is now clear, however, is that no matter whether we look at the independent review of Local Government Futures, the assessments done on behalf of the county or the subsequent assessments by the Department itself, the impact of this reorganisation will be absolutely disastrous. The county will be divided into two, both unitaries will be faced with direct economic problems and they will both lose money.
Under the current needs methodology, the report concluded that west Cheshire unitary would be entitled to £82.7 million of formula grant and east Cheshire £54.1 million; but the proposed two-unitary model, when uplifted to the present settlement figures, allocates only £76.4 million to the west and £60.4 million to the east. The local agreement deprives the west of £6.3 million of formula grant a year—2.5 per cent. of council tax—and the funding is effectively permanently lost in the form of a financial subsidy to the east because in three years’ time, the national grant distribution formula will be applied to the two unitaries using their locally agreed allocation. It is totally unrealistic to assume that one authority will agree to provide a substantial financial subsidy to the other. In fact, it may prove to be unlawful and in breach of the authority’s fiduciary duties to council tax payers.
Although we looked closely into the economics, it is not just a matter of the amounts of money involved. Almost without exception, the education services wrote to Ministers making it very clear that, whether it be the teams built up to deal with special education or social services, they would all face very real difficulties with the reorganisation that was being pushed through over their heads. What happened? The Minister in the other place, Lord Adonis, wrote to them, saying effectively, “Oh well, we are very concerned about what you say, but don’t worry, after you have reapplied for your own jobs you will have to work together”. Well, that is brilliant, is it not? First, we will divide you up; then force you to go through an entire reorganisation; then we say, what is really important for the county is that you work together. Some people may not find that insulting; I find it absolutely bizarre.
We want to know exactly how the Government intend to make up the shortfall in finances. We want to know exactly how they imagine that a carefully planned authority, which has just been given an excellent rating—a better rating than it had before—can be expected to tear itself in two and produce a level of change that will meet the needs of my constituents in any way.
In reaching her decision, the Secretary of State took the view that a single unitary authority would not reflect the
“economic reality that many consultees perceive splits Cheshire between East and West”,
although she was not able to produce the number of consultees or any evidence about them. The existence of the opposite view, however, was very plain—even on the No. 10 Downing street website, which today bore nearly 2,000 signatures defending Cheshire’s status as a unitary whole.
Cheshire is a powerful economy in its own right. It is independent of the surrounding city regions of Liverpool and Manchester, and it requires a strong and coherent strategic approach to development. There is a fundamental misinterpretation of the economic evidence suggesting a split economy in Cheshire, and the decision on the basis of east-west economic flows reveals a simplistic and partial understanding of the economy.
On Monday, the Minister published the results of his Department’s stakeholder consultation, which had resulted in 906 responses. There were 27 responses from local government, 64 from town and parish councils, 67 from the public sector, 35 from the business sector and 35 from the voluntary and community sector, as well as 680 public responses. There were 200 further responses which the Department decided to discount.
The Department’s report describes overwhelming support for keeping Cheshire together. The county council’s proposal was supported by a quarter of town and parish councils, with only a very small number supporting the alternative. Public sector respondents and all the schools were in favour of single unitary status, as were the majority of voluntary and community organisations, and the business community made it very clear that it did not want the change.
I find it extraordinary that although it is clear that only the single-unitary proposal is capable of meeting the “broad cross-section of support” criterion, that fact is to be ignored and we are to be pushed into a “two unitaries” arrangement. The Department has been highly selective in its approach to evidence of stakeholder and public support, which suggests that Ministers were aware that many unitary proposals were unlikely to receive public endorsement. The Secretary of State was entirely wrong not to consult the public directly, especially as the invitation to submit proposals in October 2006 stated explicitly that the Department would undertake consultation before making decisions.
The practical difficulties are such that problems are already being posed to library services for the elderly, to special educational needs teams, to the way in which we plan the development of education for the future, and to children’s care services.
My hon. Friend chooses to ignore the majority of the ratepayers of Cheshire on the grounds that they are all Tories. He may take that view, but it is not reflected in the facts.
Disaggregation of the county council’s engineering services will duplicate activities and increase costs, and the waste problem will increase enormously—quite apart from the difficulty involved in dividing the assets. I could go on to describe the problems that will be caused to trading standards and staff, and the real problems involved in disaggregating county-based services.
I have been alone in this, and it has been convenient for some of my colleagues to suggest that I have been seduced by the arguments of a Conservative county council. I have been here for a long time, and it takes a bit of effort for any man to seduce me, particularly when it comes to politics and economics. I reflect the views of those who have consistently expressed to me their anger and astonishment at the way in which the issue has been handled, and their total disbelief that a Labour Government could proceed with a project that is neither affordable nor supported, which does not provide value for money, and which will not fulfil the criteria that were originally set out.
I can only say that I am astounded by this behaviour. I am astounded that we are putting my constituency and those of other Members through the mangle at enormous speed by telling them that they must run for a shadow authority—that they must come up with conclusions, and that they must then go forward to elections to a shadow authority which is not capable of working together and where the two particular committees that have been brought together will find it extraordinarily difficult to come up with any sensible views.
I believe above all that the Minister should have had the guts to say tonight, “We wanted to do this.” The Secretary of State wanted to do it and took this decision, and has never given a political or economic reason or any argument that would stand up to examination. I cannot believe that this is going ahead, but if it does, it will not do so with my support.
My remarks are to be directed at the issue of time scales, and with that in mind I shall try to keep them brief.
My party is very supportive of the concept of unitary local government where it is appropriate for the area concerned. However, the process that gets us towards that is crucial, and there are a number of issues that we need to bear in mind. The time scales imposed on this particular process have restricted local debate so that consultation has been rudimentary. I welcome the fact that some of the proposals have been discussed for a long time prior to the process, but the time scales set out under the provisions have restricted proper formal consultation.
In many of the bidding processes that have already been debated in the House, one authority has been advancing one case while another has been advancing another, and they have tended to do so in a self-interested way. As time is constrained, the process has not allowed for a more sensible debate, and people have retreated into silos, which is unfortunate. That is a feature of how the process has been set up. Many of the polls, referendums and consultations that have been undertaken have been seen to be flawed and called into question because they have had to be carried out rapidly and there were limitations on what could be achieved.
The short period available to compile bids may lead to having hostages to fortune later on that come back to haunt the people tasked with implementing the bids, when they come to do so. We have also heard that the time scale has influenced some authorities to react to the response of other authorities. For example, a county council might bid, and districts might feel that they have to react in a certain way. That is another feature of the time-scale constraints placed on the process.
What will happen if the order is passed? In contrast with some other areas, including my own area of Cornwall, in Cheshire the proposal is for a shadow council to be elected, instead of having a period in which representatives of existing authorities come together to draw up how things will move forward. There are arguments for and against both those processes. Clearly, where officers are to be appointed, the shadow authority has the electoral mandate to be able to carry that out. However, with two very new authorities, the situation is different from that which pertains in other bid areas where existing authorities cover the area.
I assure the hon. Gentleman that there are joint implementation teams in Cheshire that include officers and members of the six districts and the county council. They are working together extremely well and constructively and are on target to deliver the two new authorities.
My concern is that these are two new authorities, and some councillors who are elected to the shadow authorities might be inexperienced; we know that many existing councillors will not stand for re-election because they are not happy with the proposals. As a result, some councillors might have to get up to speed quickly, without existing councillors being able to deal with the work.
There is a great deal of disquiet, particularly among those who have been involved in delivering services at county level, that the two new authorities may not be able to deliver services and that the efficiencies will not be delivered because services will be divided rather than brought together. That problem is crucial
What could have been a positive process has undeniably been a negative one in terms of some of this debate. It has become divisive, and whatever the relative merits of having a single unitary authority, two unitary authorities or a two-tier option, the way in which the process has directed people in Cheshire to participate is unfortunate. It is ironic that one of the most powerful arguments for having unitary local government is that it simplifies structures and decision making and means that electors have fewer institutions to deal with when they have to resolve a problem with a particular service, because this process is leading to further misunderstanding among people in Cheshire as to exactly what is being proposed. That remains a problem for the county and an important lesson for the Government. Whenever they consider something like this in future, they must allow far greater time scales, so that proper consultation can take place and people can move forward in a far more positive way.
I shall be brief. I want to correct some inaccuracies. A number of hon. Members have said “in Cheshire”. Cheshire is, of course, an historic county. As the hon. Member for North Southwark and Bermondsey (Simon Hughes) will recall, its boundaries included Wirral, Stockport and so on. Those areas disappeared off from Cheshire some time ago. In the early 1990s, Halton and Warrington became unitary authorities. When the hon. Gentleman lived up there, Halton was half in Lancashire and half in Cheshire. The notion that this proposal is splitting Cheshire is fallacious, and we should put that on the record once and for all. Cheshire started to change geographically a considerable time ago.
I have received a number of e-mails telling me that I am destroying 1,000 years of history—I am sure that other hon. Members have received similar correspondence. I have been around the political system for a long time. I was around in the 1974 local government reorganisation, when a substantial part of Cheshire was separated off—that was not quite 1,000 years ago—and in the subsequent reorganisation in the 1990s. This proposal does not split Cheshire; it splits the remaining part of Cheshire. For the purposes for which you and I consider counties, Mr. Deputy Speaker, the historic county remains, although Cheshire is a minor county in cricket.
The second misconception is that the proposal splits the county council—it does not. It is about seven authorities becoming two. That is a matter of fact, and the efficiency gains come from it. The third point that I want to make—I mentioned this to the hon. Member for Bromley and Chislehurst (Robert Neill)—is that it has been the policy of Ellesmere Port and Neston borough council, on the basis of a three-party agreement, to support this proposal. I hope that Opposition Members will accept that that is said with absolute sincerity, because it is an all-party position.
The proposal makes sense because economically Cheshire faces two different ways. The west of the county—my part of the county—is part of an economic unit generally called the Deeside hub which is one of the fastest growing parts of the British economy. We have a little local difficulty with the significance of the Welsh boundary and indeed the Merseyside boundary, but they work, and the area works as an economic unit that transcends the local government boundaries. The reality is that that part of the economy faces into north Wales and into Merseyside. Indeed, when I dealing with the Vauxhall Motors case last year, presenting an argument for support from General Motors Europe, I discovered that more than 1,000 people working at Vauxhall travelled in from north Wales. That is a dynamic local economy.
The relationships with Crewe and Nantwich are almost non-existent. The good folk of Crewe and Nantwich work in that area and towards the Potteries and Manchester. The economy faces two ways—[Interruption.] My hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) has had her say—[Interruption.] I can be even ruder.
There is a fundamental argument in favour of a split somewhere down the centre of the county. I would have preferred it to be slightly more to the west, but that would have been the three unitary solution that was dismissed at a much earlier stage by the county. First, we need to remember the history of the county—this is not about splitting into two, but about seven becoming two. Secondly, there is the powerful argument that the economy faces two ways, which is a sound argument in favour of the proposal. Therefore, I ask the House to support it.
First, I wish to thank the Minister for the courtesy that he extended to me during the consultation period. I am grateful for that.
This latest local government restructuring has been an extremely painful experience. It has set council against council and councillor against councillor. Some of us believe that it is a way for the Government to reduce the number of Conservative councils and of Conservative councillors, so that the Government can take over the Local Government Association, but I am sure that I must be wrong about that.
The process has been painful. I believe that the Cheshire county council and the six borough and district councils should have embarked on a programme to improve the two-tier system. They should have learned from and built on the experience of the pathfinder authorities, and they should have implemented the propositions in “Strong and Prosperous Communities”, which was a Government document. The councils should have developed the devolution of real power and responsibilities to parish, town and community councils. Sadly, they did not do that in Cheshire.
The hon. Member for Weaver Vale (Mr. Hall) is right to say that the councils broke ranks. As a result, when it came to the real consultation, instead of being able to negotiate an improved two-tier system of local government—which would have been overwhelmingly accepted in Cheshire—we were left with two options. One was for a single unitary authority, based on the Cheshire county council, and the other was for two unitary authorities—east Cheshire, and west Cheshire and Chester. The Minister and his colleagues decided that the two unitary proposal was their preferred solution to the problems of local government in Cheshire. On 18 December, the announcement was made that Cheshire would have two unitary authorities, based on the three councils in east Cheshire and the three councils in west Cheshire. I personally regret that, but that is the realpolitik.
I sympathise with the passion with which the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) spoke. In many ways, I share her concern. At the end of the day, I supported the proposal for two unitary authorities because Macclesfield borough council was strongly in favour of it. When the third option of the status quo was removed, and the choice was between a single unitary authority and two unitary authorities, my borough council was strongly in favour of having two. I have to say to the hon. Lady, whose passion impressed me, that I felt obliged to support my council and the people of Macclesfield who—by a majority, if letters in the press and other representations are taken into account—supported the idea that Macclesfield should be part of the east Cheshire authority.
I want to be brief to allow many of my colleagues to get in. I want to say, constructively, that the seven Cheshire local authorities—the six borough and district councils and the county council—have lost no time in establishing joint committees for east Cheshire and for west Cheshire and Chester, as the Minister said. They have also set up related joint implementation teams of officers. That shows a positive attitude. It builds on the preparatory work undertaken by the sponsoring authorities, and is in accordance with the provisions of the draft order that we are considering. The joint committees have met several times informally in advance of the making of the order and a joint liaison committee has also been set up to deal with overarching issues. We cannot always look back on such matters as much as I would personally wish to do so.
The east and west Cheshire joint implementation teams have met weekly since the beginning of this year, with positive and dynamic input, particularly—this will surprise the hon. Member for Crewe and Nantwich— from senior county council managers, who are leading key areas of work, including work in people services, human resources and drafting the implementation plan. Specialists in key services operated by the county council and its partners support that work. In all the arrangements, all seven local authorities and their partners are actively and positively involved with major partners, signalling their desire to be more fully engaged. Good progress is being made.
I regret that the restructuring orders are being introduced. Change is not required, but we were faced with two options. Instead of telling the Government that they would seek to co-operate to achieve a more efficient, improved two-tier system, the six district and borough councils and the county council in Cheshire did not work together. The major part of the county, the county council, broke ranks. As a result, we were faced with the two options. Of those two options, the one that is the subject of the order has my tacit support. I believe that localism in local government is critical. People want to identify with their county councillors—or their councillors, as they will be in the future. That can be better achieved by having the two unitary authorities and a smaller structure, rather than a dramatically large council.
I have every respect for the county council. I have the great honour of being a deputy lieutenant of the county and I want to see much of the tradition of the county retained. Although I deeply regret what is happening, the fact is that we are faced with a fait accompli. Of the two options, I went for the two unitary authorities.
First, I thank the hon. Member for Macclesfield (Sir Nicholas Winterton) for the way in which he has put on the record where we are now in terms of the debate. When I campaigned for unitary local government in Warrington and Halton, Macclesfield should have had unitary status at the same time, and then we might well not have had this debate.
I have been a strong supporter of unitary local government. It brings local government closer to the people, removes the confusion of the two-tier system and places large responsibilities on those authorities that take over. That is the way forward.
I shall be honest with the House: like my hon. Friend the Member for Ellesmere Port and Neston (Andrew Miller), I originally favoured the three unitary authority approach for Cheshire. That was the agreed position of the six district councils in the county, but the Government said that it was not acceptable. The districts considered the matter again and, following an intervention from Conservative Front-Benchers—I make no criticism of them for that—five of the six districts said that they would support an enhanced two-tier arrangement.
That was against their better instincts, as the districts wanted unitary local government, but they were told in no uncertain terms that they were to support enhanced two tier. The districts had been in agreement, but what broke the mould was the vote taken by the county council in support of a resolution that Cheshire should become a single unitary authority. It put a huge amount of money from council tax payers into the campaign, and that forced the districts to go back to the drawing board.
The districts came up with the two unitary authority solution—that is, east and west Cheshire—that my hon. Friend the Minister set out earlier from the Dispatch Box. That is the point at which the campaign became difficult. Cheshire county council embraced the campaign for a single unitary authority, but it also began to do some serious scaremongering, saying that the Government were proposing to call the two unitary authorities “Manshire” and “Merseyshire”.
That was absolute nonsense, but the county council then claimed that it was campaigning to stop Cheshire being split up. As my hon. Friend the Member for Ellesmere Port and Neston said, the county had 15 local authorities in 1974. They were responsible for delivering local government in the traditional shire county of Cheshire, but all that has changed. The county council has now proposed abolishing itself and the six other local authorities to create two unitary authorities, but its premise was that that would save the county council. That incorrect assertion has been repeated again this evening.
My hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) has taken three positions on this proposal. She was in favour of the status quo, then of enhanced two tier, and then of a single unitary county council. I might not disagree if the option before us was enhanced two tier, and certainly not if the proposal was for three unitary councils to cover the area covered by the county council and the six districts. However, I agree with the hon. Member for Macclesfield, for whom I have huge respect, in that I do not want a single unitary authority for the whole area covered by the county council and the six districts.
I turn now to the important question of affordability. The position adopted by the city of Chester was put forward in a report that was backed up by independent accountants. It was that the pay-back period for the two unitary authority solution for Cheshire would be four years, and that money—£100 for each council tax payer affected—would be available to equalise council tax. That is a very important matter, but the report also stated that money would be made available for new services, if the two unitary authorities wanted to spend it. I think that those are fundamental factors in favour of the reorganisation that we are discussing.
I appreciate that other hon. Members wish to speak in this short debate, so I shall end with two final points. The first has to do with how we take the matter forward. An important debate is under way, but Cheshire county council and the six districts have got together and accepted what the Government are proposing. They have not mounted any legal challenge to the order that is before the House: instead, they have got down to working out how to deliver two unitary authorities in the county, and they are doing a fantastic job.
I want to commend two individuals for the work that they have done. It is not often that civil servants get the recognition that they deserve, but the lead two chief executives for the proposed west Cheshire unitary and the proposed east Cheshire unitary have done a fantastic job in taking the agenda forward, and they have not been held back by the debates that have gone on in some parts of the House today. Mrs. Anne Bingham-Holmes, the chief executive of Vale Royal borough council, is a first-class chief executive. She works for a Conservative local authority that is fully behind the proposals that we are debating, and I commend her. Viv Horton, the chief executive of Macclesfield borough council—the council that my hon. Friend the Member for Macclesfield represents—is also a first-class chief executive. She is leading the way for that authority to make east Cheshire a unitary authority. Now is not the time to emphasise our divisions; we should be saying, “This is what we’ll do, and what is in the best interests of everybody whom we represent.” We should take that agenda forward in a positive way.
I shall keep my remarks brief because two of my Conservative colleagues and the hon. Member for City of Chester (Christine Russell) want to speak. I do not disagree with much of what was said by the hon. Member for Weaver Vale (Mr. Hall), who has a neighbouring constituency to mine. We certainly want the east and west authorities to work, if the plans for them go ahead. We want the transition to be as smooth as possible, and we want costs to be kept to a minimum. It is alarming that, since the process began, the Government’s estimates of the cost have nearly doubled, and the estimate of the savings has nearly halved. I join the hon. Gentleman in paying tribute to the two chief executives that I deal with as a constituency MP, Anne Bingham-Holmes and Vivienne Horton. I wish them well in the task ahead.
The hon. Gentleman is right that when the members of Cheshire county council to say on the issue, it began the process that led to tonight’s debate. However, we have an opportunity to stop the process tonight—or rather tomorrow, when we vote using the pink slips. We could stop a process that many people in the county, and many Members present who represent the county, believe is wrong, unwarranted, undemocratic and unsupported by the facts. When the original process began, following the White Paper and the invitation to the councils to submit a bid, the Government said that they wanted any bids for unitary status to command broad support. Indeed, I think that the Minister said something similar to that in his opening remarks.
We are about to proceed with a proposal that was initially supported by only one council group on one district council in one part of the county. That council group lost its position as the leadership group on that council in subsequent local elections. It is true that different district councils—faced with the fait accompli, as my hon. Friend the Member for Macclesfield (Sir Nicholas Winterton) put it, of Cheshire county council’s decision—then worked on their own proposals for two or three unitary authorities in Cheshire, but let us remember that the proposal that we are being asked to support tonight was originally supported by only one council group on one district council.
I assure the hon. Gentleman that when Chester city council made its bid in January 2007, there was a Liberal-Labour administration, but the bid was wholly backed by the Conservative group. That group, which took power last May, has had nine months to overturn that resolution, and it has not done so.
As I understand it, a Conservative group on Chester city council made different proposals from those that the previous leadership—[Hon. Members: “No.”] Well, we could debate the issue at greater length if we had the time, but sadly we do not, because of the timetabling.
I return to the point that the proposal was not originally supported by a large number of councils in Cheshire. On every attempt to test public opinion in Cheshire, it has not been supported by the public; that applies to the referendum held in Crewe and Nantwich and the opinion survey carried out in the county. The Government have refused to hold a referendum, even though when we discussed local government reorganisation just four years ago there was a proposal for a referendum, not just on regional government, but on the local government arrangements in Cheshire.
The House is left to decide whether to impose on the people of Cheshire a form of local government that has not received any public support. We can make many arguments for and against the proposed changes, but striking warnings have been made by, among others, members of the education system in Cheshire—teachers, head teachers and governors. The concern of the fire authority is striking, and it is also striking that the majority of Members of Parliament representing Cheshire oppose the local government reorganisation. We can make all these points, but the central point is surely this: in the end, democratic arrangements and local government structures should be based on identities that people have in their hearts, not in the minds of Whitehall Departments.
The current system is broadly supported by local people. There is the identity of Cheshire. Although bits have been chopped off over the past 30 years, as the hon. Member for Ellesmere Port and Neston (Andrew Miller) pointed out, the historic heart of the county remains and there is a county council based on that. Then there are local arrangements, which in my case mean that constituents can look to Macclesfield or Vale Royal borough council. We are about to throw away these arrangements in pursuit of a proposal that does not command public support. That is not the way to conduct our business in a democratic system.
Of course we will try to make the arrangements work if they are voted through tomorrow, and we will do everything we can to ensure that disruption for local people is kept to a minimum, but in the deferred Division that will come later today, we have an opportunity to stop the proposal in its tracks and get on with delivering services such as education, social services and housing, which people want us to be talking about both in Cheshire and in the House of Commons.
In view of the time, I shall make a few quick points that have not been made by colleagues. I hope I have clarified the position regarding the political stance in Chester. When the bid was put in, all three political parties backed it. The party now in charge of the town hall has not overturned that resolution.
The City of Chester has a proud history that dates back 2,000 years. Up to 1974, the borough council—the city—ran all its public services. As hon. Members have said, there was huge disappointment in the city in 1995, when the previous Government, after consulting on local government reorganisation, decided to award Warrington and Halton boroughs unitary status, but left the rest of Cheshire as two tier. I have been involved in politics in Chester since 1980 and I can assure the House that the aspiration of the people whom I represent and have always represented is for local government to be local in Chester.
The proposals in the order before us complement the current delivery pattern for local services. The Western Cheshire primary care trust entirely supports the policies because its boundaries mirror the boundaries of the proposed City of Chester and West Cheshire new unitary authority. Cheshire constabulary has three command units. One covers Halton and Warrington, one covers west Cheshire and one covers east Cheshire. The fire service is organised on similar lines. My constituents and those of my hon. Friend the Member for Ellesmere Port and Neston (Andrew Miller) and the hon. Member for Eddisbury (Mr. O'Brien) share most of the same local health services. We have a joint magistrates bench. So the delivery of all those services replicates the proposal before us.
I emphasise how confusing the present system is. I say that from the perspective of the Member of Parliament for City of Chester, where there is a visible landmark, the town hall. County hall is only half a mile away, but is invisible to most people. The assumption is that the town hall delivers the services. It is visible and it sends out the council tax bills. But the reality is that 80 per cent. of local service funding comes from the county council.
The present two-tier system is totally confusing, and I could give many examples of that. People are confused by the fact that the city council collects their rubbish while the county council is responsible for waste disposal, and the city council is responsible for granting planning permissions while the county council is the transport authority. That does not make for good local government. One good example of that is that four years ago, the Government awarded Cheshire county council £4.8 million to provide an extra care facility for elderly frail people but, after four years, those two authorities still have not got their act together. I am led to believe that a site has finally been identified, but the present two-tier system does not work. There is no joined-up working.
As other hon. Members have said, the joint implementation teams are already working well together. I hope that all hon. Members recognise that this is a time of anxiety for the thousands of employees who work for the seven local authorities across Cheshire. It has been suggested that we should defer the decision because there has been insufficient consultation, but I can assure the House that people in Chester have been talking about local government reorganisation ever since the last round ended in 1995.
I shall be extremely brief in the hope that my hon. Friend and neighbour the Member for Congleton (Ann Winterton) will have an opportunity to make a brief contribution.
It is clear that Cheshire does not want this worst of all options imposed on it, as testified to by five of the eight Members of Parliament from Cheshire who are present today. They are the majority and they are representing their constituents in showing that they do not want this measure to be rammed through. The only way we will defeat the Government is if the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) has done a wonderful thing and managed to persuade enough of her colleagues to sign the pink form at the deferred Division later today to reject the order, or if the Lords defeat it.
I am downcast and very disappointed.
It is clear that there was no demand for this measure. There has been no identification of anything that has been so bad that it needs to be changed and fixed. Two-tier working has improved over the years and it could have been improved further. According to objective tests, the delivery of services was excellent all round, and education and social services were excellent. Both of those are now at risk because of the confusion of this rammed-through and imposed solution.
I will not give way, given the length of time for which the hon. Gentleman spoke. However, he put his finger on one problem, which was that once anybody admitted that there had to be a unitary approach, not least when the county council voted, the difficulty of maintaining the consistency of the argument for an improved two-tier system was lost. It was a great shame that many people were tempted to support that and fell for the trap that was laid for them by a Labour party, politically driven agenda, which was to halve the number of Conservative activists through councillors in the county, and to ensure that there was a real problem in identifying where there would any kind of local accountability as part of the great aftermath of having lost any ability to impose a regionally elected solution on Cheshire.
This is all part of a political agenda where inevitably no one ever votes for lower pay, lower pay-offs and lower pensions. This will all cost a lot more than the Government are pretending that it will. Therefore, when this happens and the council tax is under pressure, it does not matter who is in charge—I would like to predict that it will be the Conservatives—it will be the Government’s fault, and we will be able to say that with truth, because it is the Government who have engineered this expensive, unnecessary solution. We should reject it and take this last opportunity to stand up for our constituents and not fall for this terrible trap set by the Government, who do not like the idea of good, local democracy operating in Cheshire.
Most of the major points have already been made, but I should like to say a few words on behalf of my constituents, who ask me, “Why Cheshire? Why can it not be like Derbyshire or Staffordshire and not have to go through this dreadful process in which one part of the county is set against another and one set of councillors is set against another?”
There has been no support for the Government’s proposals; most would have preferred the status quo or an improved two-tier system. Frankly, the consultation has been lacking—yes, there is a great long list of so-called stakeholders, but I want to know why the ordinary people have not been consulted. They want to know that too.
A MORI poll revealed that in Congleton constituency, there was 16 per cent. support for a single county unitary authority, only 27 per cent. support for a two-unitary solution, but 55 per cent. support for improved working of the two-tier system. In addition, my council has gone to the High Court about the unlawfulness of the process. It lost its case, but was given permission to appeal. That appeal has been heard and we are awaiting the outcome. We know, of course, that this process will not be stopped.
The cost will be ginormous. When has anyone ever known a reorganisation to cost less? It never has, and that cost will have to be borne by my constituents among other local town council tax payers of Cheshire.
I shall take only that minute, Mr. Deputy Speaker.
The financial and community cases do not stand up and the timetable is far too short. My constituents’ children go to schools in Cheshire and many of my constituents work there. I lived there for 24 years and was an elected representative there for 12. Having said that, I rest my case.
With the leave of the House, Mr. Deputy Speaker, I should like to reply. Tonight, we have heard views from all sides, put with passion, reason and concern in varying combinations depending on the contribution. I should like to correct some significant inaccuracies and try to deal with some important concerns that have come up. The invitation to councils across England was made in October 2006. It asked for both unitary proposals and proposals for pathfinders to improve two-tier arrangements. We received five proposals for improving two-tier working, none from Cheshire.
I should say that we have not disclosed the detail of the independent financial assessment; that was conducted as advice to Ministers and was therefore covered by section 35 as an exemption from freedom of information requirements. However, I have made clear the principal conclusions of the assessment. In the view of the independent experts, the transition costs were certainly greater than those in respect of the proposing authorities, at £25 million. However, the payback comes within just over three and a half years and the annual savings are more than £16 million a year.
Opinion is divided about support, as we have seen tonight. However, there is a cross-section of support, which gives us confidence that if we go ahead we can make a go of the two unitary authorities. Not only the three district councils back the two-unitary solution—important businesses in the region, such as AstraZeneca and the Cheshire building society also do, and six of the 20 parishes that expressed a view do. The chief constable is neutral but marginally in favour of the two-unitary option, essentially because it would be more coterminous with his basic command units. One of the advantages is better strategic leadership; that is why East Cheshire NHS Trust and West Cheshire primary care trust also support the proposal, as does the West Cheshire college, the Highways Agency and Age Concern East Cheshire.
Concerns have been expressed by the Merits Committee, which were reflected in a couple of contributions, about the time scale and about whether we should be allowing more time to prepare for the change. The implementation teams in east and west Cheshire are up and running, however, as the hon. Member for Macclesfield (Sir Nicholas Winterton) and my hon. Friend the Member for City of Chester (Christine Russell) made clear. Officers from all the councils are now working together and have been doing so for some time, with the result that much of the preparatory work is already well advanced. Of particular importance is the increasing involvement evident in Crewe and Nantwich and in Congleton, despite local opposition to the proposal, and the greater involvement of Cheshire county council, especially in terms of some important areas of work led by its senior officers.
When one adds to that the arrangements for support from the centre, the implementation plans set out in the order, the regular meetings with national Government officials, the detailed involvement from the Government office for the north-west, and the fact that Humberside and Avon represent precedents, from back in 1995, for similar reorganisations on a similar time scale being undertaken effectively, we are given the confidence to believe that this proposed reorganisation can and will be done on a time scale to allow the new authorities to be up and running on 1 April 2009. I recognise that the time scales are tight, but they have been set in response to the local authorities, which have all urged us to make the decision and get on with it. The county council has recognised that, which is why it has decided to withdraw its legal proceedings against the Secretary of State. The county council leader, Paul Findlow—I pay tribute to him—has committed to work with district council colleagues, and the leader of the Labour group, Derek Bateman, has also thrown his weight behind the criticism of those who look to try to block the proposal.
The worst outcome would be if the uncertainty that Cheshire has faced arising from previous reorganisation proposals were to continue because no decision was backed tonight in this place and, later in the week, in the other House. We have created this chance for new flagship local authorities to set a new standard for local government—we expect no less.
Division deferred till Wednesday 27 February, pursuant to Standing Order No. 41A (Deferred divisions).
With the leave of the House, I shall put motions 7 and 8 together.
Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Delegated Legislation Committees),
That the draft Charities Act 2006 (Charitable Companies Audit and Group Accounts Provisions) Order 2008, which was laid before this House on 29th January, be approved.
That the draft Immigration and Nationality (Fees) (Amendment) Regulations 2008, which were laid before this House on 30th January, be approved.—[Mr. Roy.]
Question agreed to.
EUROPEAN UNION DOCUMENTS
Motion made, and Question put forthwith, pursuant to Standing Order No. 119(9) (European Committees),
CAP Health Check
That this House takes note of European Union Document No. 15351/07, Commission Communication, Preparing for the “Health Check” of the CAP reform; and supports the Government’s aim that the health check should cut further the trade-distorting nature of the CAP, reduce regulatory burdens, give farmers greater control over their business decisions and direct more public spending towards the delivery of targeted public benefits.—[Mr. Roy.]
Question agreed to.
SITTINGS OF THE HOUSE
With the leave of the House, I shall put the motions on the Easter and April Adjournments together.
Motion made, and Question put forthwith, pursuant to Standing Order No. 25 (Periodic adjournments),
That this House, at its rising on Thursday 20th March 2008, do adjourn till Tuesday 25th March 2008.
That this House, at its rising on Thursday 3rd April 2008, do adjourn till Monday 21st April 2008.—[Mr. Roy.]
Question agreed to.