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Cities and Local Government Devolution Bill [HL]

Volume 764: debated on Tuesday 21 July 2015

Third Reading

Clause 5: Functions

Amendment 1

Moved by

1: Clause 5, page 5, line 15, at end insert—

“(8) An order under this section may be made only with the consent of the appropriate authorities (as defined by section 107B(6)).

(9) Where an order under this section is contained in the same instrument as an order made by virtue of section 107B(3)(b), the non-consenting constituent council is not to be treated as an appropriate authority for the purposes of subsection (8) above.”

My Lords, on Report, I promised to return to this issue of consent. Accordingly, this amendment will ensure that any order to provide that a function of the combined authority can be exercised only by the mayor may be made only with the consent of the combined authority and constituent councils. There are a number of situations in which an order may be made to make a function of the combined authority a function exercisable only by the mayor. Our intention is that in all circumstances the authorities involved need to give consent.

There are essentially three circumstances for this: first, where new functions are given to a new combined authority and where these are to be mayoral functions; secondly, where new functions are given to an existing authority and these are to be mayoral functions; and thirdly, where existing functions of a combined authority are being made to be mayoral functions. This amendment will ensure that in all these circumstances consent from the combined authority and constituent councils is required. I thank the noble Lords opposite for raising this issue. I beg to move.

My Lords, we are pleased to see this government amendment, which requires an order where functions of a mayoral combined authority are exercisable only by the mayor—subject to delegation to the deputy mayor or another member or officer of the combined authority—to obtain the consent of appropriate authorities.

So far as delegation to the deputy mayor and others is concerned, this would appear to be undertaken by arrangement with the mayor although restrictions can be put on this by the Secretary of State by order. These restrictions would preclude certain general functions being exercisable by the deputy or may specifically enable a limited list of functions. It appears to be the case that, to the extent that the Secretary of State is taking the opportunity to fetter the delegation by order, consent of the appropriate authorities would be required. However, to the extent that the mayor is allowed free rein to arrange for others to exercise his or her functions, the consent of the appropriate authorities would not appear to be required. Is that correct and is it intended?

As I hope we demonstrated throughout the passage of the Bill, there has been substantial support and agreement on these Benches but some have expressed concerns over the position and role of a directly elected mayor. That the functions to be exercisable by the mayor will now require agreement of the relevant authorities, taken together with the prospect of some control over the budget, will provide some comfort to those concerned about the potential accumulation of power in the hands of one individual. We are happy to support the amendment.

Amendment 1 agreed.

Clause 8: Other public authority functions

Amendment 2

Moved by

2: Clause 8, page 8, line 36, at end insert—

“( ) Notwithstanding the above, nothing in this Act or the Cities and Local Government Devolution Act 2015 shall preclude provision for some or all of the functions to be exercised in partnership or on a pooled basis with other combined authorities.”

My Lords, I will also speak to Amendments 6 and 8. This is a very welcome but rather complicated Bill. As we are at Third Reading, I congratulate—genuinely—the Minister on her efforts in getting us up to speed on it and the helpful and constructive way that she has responded. I know I speak for the House when I say that I am grateful.

The Bill is complicated because it was originally designed to make possible replications, especially in the north and Midlands, of the Greater Manchester powerhouse model with its mayoralties: cities that together form a natural metro area, unitary cities sharing common histories and usually common political values and views, powering economic growth—they are indeed great cities. However, research shows that medium-sized cities, here and on the continent, contribute proportionately more to economic growth than the great cities. If the Government want to fulfil their objective of powering economic prosperity, which we all share, it is essential that we—the 30 or 50 medium-sized cities—are counted in. We form a key cities group; many of our members are stand-alone cities, whose adjacent local authorities are rural. We power, rightly, our local economies and most of us do not have contiguous urban neighbours.

The concept of northern, geographically coherent combined authorities—CAs—is therefore not easily transposed. In the great urban conglomerations of the north, all the functions that they seek can be devolved to one geographically bounded and defined horizontal authority, sufficiently large to be capable of exercising all the functions that underpin economic growth. That is not possible for us; we are not large enough. Instead, we need different-sized bodies for different functions. This is already recognised in the economic prosperity boards and the local enterprise bodies to which we belong.

To add to this complexity, we also have varying structures, finances and duties. Most of us are unitary; others are still trapped in a two-tier structure following the disastrous reorganisation of 1974. Some have artificially tight boundaries, so their wealth and energy creation leaks outwards. Many of us are university cities with research parks and high levels of skill, where the new industries and technologies of the future are being devised and developed now. Many—perhaps most—are located in the southern half of England, below the Severn-Wash line. We are untidy and Whitehall always wants to tidy us up. However, you need us if we are all to achieve our common goal of economic prosperity that is focused but is also diffused across the country to the south-west, the south coast and East Anglia, as well as to the Midlands and the north.

Finally, this Bill is complicated. It is good that it is a bottom-up Bill with bespoke arrangements, but it is not so good that the Bill is starting in this House well in advance of our ability to see any draft regulations. Inevitably, the Secretary of State does not know what proposals he will finally want or may find to be forthcoming, and we do not know what proposals he might find acceptable. To that extent, we are both finding our way. These amendments are probing, I hope; they are a hook for the Minister to explain as fully as she can how this Bill affects medium-sized cities such as ours and what flexibility and headspace the Bill offers us, because—with very good reason, and to our pleasure—those concerns have been added on to the original push for metro authorities with metro mayors.

I have authority to say that my concerns are shared by—and therefore that, in broad terms, I am speaking for—Plymouth and Exeter; Portsmouth and Southampton; Bournemouth and Southend; Norwich, Cambridge and Peterborough; Wakefield, Sunderland and Preston. I believe that there are many other medium-sized cities, with the short time between Report and Third Reading, that have not had time to authorise me to quote them; the others have.

As the leader of Southampton, Councillor Simon Letts, put it in an email:

“the issue for us is that we wish to establish governance for a separate economic geography (Southampton and Portsmouth) within a wider CA. This will allow us to take powers and responsibilities which can be applied to improve economic development for our urban coastal geography. That may not be necessary for the London-leaning areas around Basingstoke or the rural areas around the national parks”.

Councillor Woodley, leader of Southend-on-Sea, would like,

“the possibility to create different CAs which are not co-terminous (such as Southend and Thurrock)”.

I may know the answers to some of these questions now, thanks to the meeting yesterday with the Minister, for which I am most grateful—but for the record I shall ask some questions, as many local authorities, as my emails have shown, are still very unsure what the offer is, which is none the less going to be essential if we are going to promote, extend and diffuse economic prosperity.

Will it be possible to devolve powers directly to cities within CAs, or will the powers be available only if devolved from CAs? Will the groups of cities be able to form a combined authority within a much larger geographical area that might itself be made up of one or more CAs—for example, Norwich and Cambridge, within two or three counties? Will it be possible to have a CA for economic development, skills, transport and so on, and form another and larger CA for the purposes of pooling health and social care budgets? Would it be possible for geographically separate cities to form CAs around the development of key economic sectors, such as engineering in Sunderland and Coventry, health and life sciences in Norwich and Cambridge, and marine services and marine research in Plymouth, Portsmouth and Southampton? What relationship is expected between LEPs and CAs? Must they be on the same geography, or can they be different? How are the governance arrangements to fit together?

To give a concrete example, would it be possible to have a combined authority of Norfolk and Suffolk, along the lines of our Anglia LEP plus, together with a combined authority of Cambridge and Peterborough, along the lines of their LEP plus, and a joint committee with powers devolved directly or indirectly through the CA, aligning greater Norwich, greater Cambridge and Peterborough around skills and back-to-work schemes? Could we combine that role? This would create opportunities for strategic planning—for example, on rail transport between Norwich and Cambridge; the opportunity to build on city deals between greater Norwich and greater Cambridge; and strong collaboration between the universities at Norwich and at Cambridge. Given the briefing that I had yesterday, I suspect that Norwich could be in only one combined authority, that of greater Norwich, and that Cambridge could be in only one, that of greater Cambridge, but that both CAs and any local authorities within them, or indeed outside them, such as Ipswich, could collaborate and form joint committees for any purpose that contributes to economic prosperity, and that each constituent member would bring its own funding to the table—and to do so would not need the Secretary of State’s approval. That is my understanding of where we are, and I would be grateful if the Minister could confirm that I am reading it correctly.

Perhaps the Minister could address the questions and confirm my understanding. Essentially, how best do we devise appropriate structures—smaller for some functions, larger for others, and non-coterminous for yet others still —for those medium-sized cities, which they need if they are to play their essential part in growing the prosperity of this country, which we all want? I beg to move.

My Lords, I thank the noble Baroness for raising this issue at each stage of our consideration of this Bill. It has been very helpful in identifying the need to maximise geographical flexibility and reflect the needs of the key cities network, those towns and cities that have lower populations than major urban areas. The point has been made very well over the passage of the Bill. I hope that, in a response to these Amendments 2, 6 and 8, we will be able to find our way to structures that will understand the needs of areas with less concentrated populations. I dare say that it will be the subject of negotiations, proposal by proposal. But it does matter that the needs of the rural areas, which are contiguous to the large urban cities in particular, are considered as part of the passage of the Bill.

My Lords, one of the advantages of the Bill—as I have read it and, I hope, understood it—is that it is a receptacle in central government for the proposals coming from local government. There are not really any severe restrictions on that. There was one, on which we had a Division, that may well have resulted in an even more rigid arrangement than was in place or, indeed, than the noble Lord, Lord McKenzie, thought when he moved it. Anyway, I shall not go into that now.

Originally the Bill was intended to be extremely flexible on this question, with suggestions from any size of authority and any combination of authority. I entirely accept what the noble Baroness, Lady Hollis of Heigham, has said, with her great experience of local government. I am sure that there is scope for a great number of different types of co-operation that will have the effect of bringing forward the sort of proposals made by the noble Lord opposite when he was Deputy Prime Minister—at that time it was the north in particular, but this is about the possibility of co-operation throughout the country—that can give life to the economic aspirations of the people of an area.

My Lords, as we have heard, my noble friend Lady Hollis has tabled two types of amendment to enhance the flexibility of the Bill. The first type of amendment, Amendments 2 and 8, seeks to enable combined authorities or individual authorities to which functions have been transferred to pool some or all of these functions with other combined authorities or local authorities. We hope that that in particular will find favour with the Minister, who might not even need these amendments to do that.

The second type, Amendment 6, would give a wide discretion to the Secretary of State to establish combined authorities or economic prosperity boards—we have not debated them much during the course of the Bill—by combining different functions in different areas. That would require the consent of appropriate authorities, and would have to demonstrate the improvement of statutory functions. This amendment in particular would enable local authorities to be part of one combined authority for some functions and part of another combined authority for others.

My noble friend has argued a strong case about the needs of medium-sized cities, particularly those in county settings. As we know now, this is not just a theoretical issue; it has been driven by her own experience in Norwich and by her wide contacts in other areas, which she spoke about today, who have identified with her analysis. As my noble friend has said, we are grateful for the opportunity yesterday to discuss these issues, and we anticipate an encouraging response in relation to Amendments 2 and 8, even if Amendment 6, about the opportunity for someone to be part of one combined authority for some functions and another combined authority for others, may be a step too far at this stage. We look forward to the Minister’s comments on that.

This is about ensuring that all areas have the opportunity to engage effectively with devolution opportunities. I conclude with a suggestion for the Minister about possibly convening a conference for the type of authority that my noble friend has identified to flesh out some of the very important issues that she has raised.

I thank the noble Baroness, Lady Hollis, for her comments and for what was quite a productive meeting yesterday, together with the noble Lords, Lord McKenzie and Lord Beecham. I also thank my noble and learned friend Lord Mackay for clarifying the whole situation in a few sentences although, for absolute completeness, I shall go through the whole thing.

Amendment 2 would enable combined authorities to work in partnership with other combined authorities, and Amendment 8 would enable local authorities to work in such partnerships. Amendment 6 would provide greater flexibility for the Secretary of State to establish a combined authority even if the required geographical conditions were not all met. Following our discussion yesterday, I hope that I can provide clarity and reassure the noble Baroness that the amendments are not necessary.

As my noble and learned friend Lord Mackay said, there are no impediments to local authorities and combined authorities collaborating and working in partnerships, including through establishing joint committees. A joint committee could comprise a number of local authorities, some local authorities and a combined authority, or several combined authorities with or without some local authorities. The power to form joint committees is in the Local Government Act 1972. It is exercisable simply by the authorities concerned deciding to form a joint committee. A joint committee can be responsible for exercising such functions of its members as those members decide they wish to exercise in partnership with others through that joint committee.

On Amendment 6, the Local Democracy, Economic Development and Construction Act 2009 provides that a combined authority can be established across an area covering two or more whole local authority areas, and that a single local authority can be only within the area of one combined authority. In this context, local authority means a district council or a county council, which includes unitaries. The amendment seeks to change that to enable the Secretary of State to establish a combined authority if those conditions are not met and if the authorities consent and the Secretary of State considers it appropriate to enable different functions to be carried out in different areas. That could, for example, enable the area of a local authority to be included within the area of more than one combined authority—in other words, for there to be overlapping combined authority areas. Such overlapping areas would not be appropriate as that would make no sense in terms of our local government law and structures. A combined authority area is a local government area, as we discussed yesterday. Therefore, having overlapping combined authority areas would make no more sense than having overlapping county areas.

However, that is not to say that there is not the flexibility for a council to be involved, if it makes economic sense, with, say, two combined authorities. For example, five districts in Derbyshire and Nottinghamshire are non-constituent councils in the Sheffield City Region combined authority. Those same councils are proposing that they, together with the relevant county councils and unitary councils, form combined authorities. Furthermore, the provisions in the Bill enable non-contiguous authorities —to which the noble Baroness referred at length—to come together and form a combined authority, parts of which area are not contiguous. Yesterday we discussed some ridiculous theoretical examples of that. This flexibility for involvement in combined authorities, when linked with the long-standing flexibilities for forming joint committees, provides, I believe, for an extremely wide range of options for joint working and for councils to collaborate together both on delivering public services and on promoting economic growth, including in the context of devolution-type deals.

We also agree with the noble Baroness that it can be effective and efficient for local areas to work together across different geographies on different issues. For example, a functional economic area over which local bodies should collaborate and work jointly to promote economic growth may not be an appropriate area over which to provide health and social services.

The noble Baroness also mentioned, as did the noble Lord, Lord Shipley, discussions with areas, some of them quite small. I can confirm that there are ongoing discussions with such areas. In fact, last week I met representatives from South West Councils, which includes Plymouth and Exeter, to discuss such matters.

I turn to some specific questions. The noble Baroness talked about the relationship between the combined authority and the local enterprise partnership. It is a partnership between business and local authorities and there should be a very logical relationship between the LEP and the combined authority. She also talked about powers devolved to local authorities. Clause 16 gives powers to devolve powers to county and district councils. That is irrespective of whether the council to which the powers are being devolved is a constituent or a non-constituent council of a combined authority.

I hope that I have explained the flexibility for areas to work jointly with different partners in different geographies according to different needs. With those explanations, I hope that the noble Baroness will feel able to withdraw her amendment.

My Lords, this has been a short but helpful debate. I am grateful to the noble Lord, Lord Shipley. There is recognition that we need the flexibility that the Minister is offering us to make best sense of the geographical diversity and local government diversity that we have in this country and to build on the our strengths. That is important. The noble Lord is also right to remind us about rural areas. Most of the cities that I have mentioned as seeking additional powers and, alongside them, clarification about the use of them from the Minister, are indeed the powerhouses of their local rural economies. That is rightly so; that is a perfectly appropriate relationship between the one and the other. The noble Lord is right to remind us of that and I take his point.

The noble and learned Lord, Lord Mackay, said—in a slightly downbeat way, if I may say so—that the Bill is a receptacle for proposals coming from local government and that the emphasis was on bespoke arrangements. Of course he is right. My worry is that, at the moment, the receptacle is too much of a lucky dip. I am trying to get greater clarity so that we do not send authorities chasing wild horses and coming forward with proposals that will not be acceptable in the light of the Government’s intentions under the Bill.

We would like as much clarity and development as possible from the Minister as we proceed. That loops us back to a point that my noble friend Lord McKenzie made much earlier in our debates about the need for annual reports to show what has been acceptable, what has been agreed and what is the way forward, so that we can learn from each other in a healthy and pluralistic way. I am sure that the Minister has taken that on board.

My noble friend has handled the Bill with his usual skill and support. I welcome his suggestion for a conference of medium-sized local authority leaders so that around a table, together with appropriate support for the Ministers through civil servants and the rest, they can tease out in detail what may or may not be a runner before they devote quite a large chunk of what are fairly modest home resources to putting forward their bid. It is sometimes hard for large unitaries to understand just how limited are the resources of some district authorities. If we were a large unitary authority, we might have resources of about £200 million; as it is, we have resources of about £20 million a year. It is then hard to appoint staff and devote resources to work where we are essentially duplicating what other authorities have already achieved and established, so we want that to be a continuing dialogue.

Finally, the Minister has indeed clarified the position to be as I understood it: you cannot have overlapping combined authorities. The emphasis will clearly be on joint arrangements between combined authorities established by area. My only concern is whether joint committees will be robust enough in their differential contributions for finance and human resources—staff—to develop their shared goals in a way that can take the test of time. I have been involved over the decades in joint committees between various levels of local authorities. They depend too often on the energy of one or two people. Unless they leave structures behind, although the need continues, the ability to meet it recedes.

We will see whether the joint structures or joint committees which the Minister envisages, as opposed to a joint authority, will be strong enough bodies to power through major transport connectivity and economic development issues and perhaps issues around the integration of health and social care. We will see. In which case, I do not doubt that, if the Minister is then in her current post, she will respond to that as sympathetically as so far she has responded to our amendments. Therefore, I beg leave to withdraw the amendment.

Amendment 2 withdrawn.

Amendment 3

Moved by

3: Clause 8, page 9, line 10, at end insert—

“( ) An order under this section may not provide for a regulatory function that is exercisable by a public authority in relation to the whole of England to be exercisable by a combined authority in relation to its area if the regulated function is itself exercisable by the combined authority by virtue of an order under this section.”

My Lords, I shall speak also to government Amendment 4, which will prevent regulatory functions exercisable by a public authority across the whole of England being conferred on a combined authority or local authority which itself can exercise the functions regulated by the public authority; and to Amendments 9 and 10, which make exactly the same exclusion to functions being conferred on a local authority.

The noble Lord, Lord Hunt, spoke to an amendment tabled on Report to amend the provisions in the Bill to exclude the possibility of transferring regulatory and supervisory functions to a combined authority. He outlined some of the regulatory bodies to which he could see such exclusion applying; for example, the Nuclear Decommissioning Authority in Cumbria, the Environment Agency or NHS regulators. As I said on Report, I can see a case for excluding from the scope of what is now Clause 8 the functions of any national regulatory body overseeing the exercise of public functions.

Amendments 3 and 4 do just that. As I have said, Amendments 9 and 10 to Clause 16 do likewise in relation to the conferral of functions on county or district councils. I beg to move.

I welcome the amendments in this group, which, as the Minister said, follows our earlier debate and concerns expressed that services could be transferred to a combined authority plus the regulatory functions which oversaw those services. So I am grateful to the Minister for bringing forward these amendments.

I wanted to clarify with the Minister just one point. We talked about the NHS but we then went wider, and this is a very wide amendment. I want to ensure that the provision would not have a negative impact where there are currently shared responsibilities for regulation. I am thinking of health and safety in particular, where both the Health and Safety Executive and a local authority share responsibilities. I would not want the amendment to get in the way of the flexibility that exists in those arrangements.

I would extend that to the practice of designation of one local authority as a primary authority. Let us take the example of a company such as Tesco, with stores in many parts of the country. One local authority can take a lead responsibility to deal with Tesco under health and safety legislation to avoid duplication and to ensure that there is a pretty standard approach. I take it that the amendment would not get in the way of sensible arrangements like that, where it is clear that the local authority has some regulatory functions. If the Minister is not able to respond now, I would quite understand if she wished to write to me on it.

My Lords, the amendment has no effect on local authorities’ existing regulatory functions. I hope that clarifies things for the noble Lord.

Amendment 3 agreed.

Amendment 4

Moved by

4: Clause 8, page 9, line 20, at end insert—

““regulated function” means the function of carrying out an activity to which a regulatory function relates;

“regulatory function” has the meaning given by section 32 of the Legislative and Regulatory Reform Act 2006.”

Amendment 4 agreed.

Clause 9: Overview and scrutiny committees

Amendment 5

Moved by

5: Clause 9, page 10, line 11, after “committees” insert “and audit committees”

My Lords, I shall speak also to government Amendments 12 and 13. I said on Report that I would have discussions with noble Lords about audit committees for combined authorities and, if appropriate, return at Third Reading. The noble Lord, Lord McKenzie, has had early sight of these amendments, which fulfil that commitment and require that a combined authority has an audit committee. I am grateful to noble Lords opposite for having brought this issue to light.

The audit committee will have an important role in providing independent and high-level assurance on the adequacy of internal controls and the integrity of financial management. While audit committees are not required by law in other local authorities, they are widely adopted and, given the particular structure of a combined authority, we can agree that it is appropriate for audit committees to be mandated in these cases.

The amendments also require a committee to have at least one independent person. The definition of “independent person” is to be specified by order. Effective audit committees are characterised by a membership that is objective and knowledgeable. The inclusion of at least one independent member will help ensure objectivity and the authority may also appoint independent members who will bring additional skills or expertise to the committee. I beg to move.

My Lords, this may prove the last time that I speak on the Bill in your Lordships’ House so I thank the Minister for her work on it, although we have not always agreed. I hope all the amendments that we have passed in your Lordships’ House will be approved in the other place. I am looking forward to the affirmative procedure being followed many times as proposals come forward because the Bill has set a direction and is defining a vision for devolution within England. It will empower local areas and for that it is hugely welcome.

I am particularly glad, too, that we have this final amendment on audit committees. It is the consequence of much discussion, both in debates in your Lordships’ Chamber and in meetings with the Minister. I am grateful that we will have audit committees because they are important for the reasons set out in new subsections (2)(a), (b) and (c) in Amendment 13. It is of crucial importance that there is a committee that is seen by the outside world to be assessing the outcomes of delivering total place spending; that is, public sector reform will be driven so that the different departments of state in Whitehall are joined up at a local level and, as a consequence of being joined up, thereby drive efficiencies and more effective services. I am fully supportive of the ambition and detail of the Bill.

I am particularly pleased about the words in new subsection (4) of Amendment 13 that ensure that,

“at least one member of an audit committee is an independent person”.

That is crucially important for external bodies’ understanding that the audit committee is indeed an independent body. In terms of assessing risk, for example, it is very important that that confidence is available. The appointment of those independent persons—I hope that there would be three on an audit committee—is very important and very welcome.

My Lords, I refer to my local government interests, one of which is being a member of Newcastle City Council’s audit committee. I am particularly grateful to the Minister for accepting the thrust of my amendment that there should be such an independent committee. I join the noble Lord, Lord Shipley, in expressing thanks to the Minister, who is, like me and, I think, seven other Members present in your Lordships’ House today, a member of the distinguished union of ex-council leaders—in my case, very ex.

The Minister has been very helpful and patient as we have gone through the Bill, but I should like to make a couple of points. First, while I welcome the inclusion of a reference to an independent person as a member of the audit committee, which was mentioned by the noble Lord, Lord Shipley, my original amendment referred to having the chair as an independent member. Perhaps that is something that the Government could look at when the Bill goes to the House of Commons. It would seem right for that provision to be made. We will obviously not press that point today, but perhaps the Minister will take it back to colleagues.

The other point is a question that the noble Lord, Lord Shipley, touched on when he mentioned the need to effectively scrutinise the performance of government departments and other public agencies. I think I understand the position but it would be helpful if the Minister could confirm it for the record. The powers of the scrutiny committee to call before it any public body would apply, as it does in local government at present, to the overview and scrutiny committee constituted by a combined authority because there would be government agencies—we have referred several times to Highways England in that context but there may be others and I am thinking of health and social care, the role of NHS England and so on—which at the level of the combined authority may need that degree of scrutiny. I take it that that is the case, but it would be helpful if the Minister could confirm that for the record. I repeat my grateful thanks for all her help, and I am happy to support these amendments.

I thank the noble Lord for those points. Many of the arrangements for combined authorities are simply multiplications of the powers specified for local authorities, so I can confirm that the powers of calling for a combined authority would therefore replicate those in local authorities.

The noble Lord also made a point about an independent chairman. It may well be that the House of Commons looks at this and takes a different view, but we did not think it was right to mandate that the chairman should be independent because in local circumstances there may be an obvious person who could act as that independent chairman.

Amendment 5 agreed.

Clause 13: Removal of geographical restrictions in relation to combined authorities

Amendment 6 not moved.

Amendment 7

Moved by

7: After Clause 14, insert the following new Clause—

“Requirements in connection with establishment etc. of combined authority

(1) The Local Democracy, Economic Development and Construction Act 2009 is amended as follows.

(2) In section 103, omit subsection (6) (combined authorities: area must have been included in a scheme under section 109).

(3) In section 110 (requirements in connection with establishment of combined authority), for subsections (1) to (3) substitute—

“(1) The Secretary of State may make an order establishing a combined authority for an area only if—

(a) the Secretary of State considers that to do so is likely to improve the exercise of statutory functions in the area or areas to which the order relates,(b) the constituent councils consent, and(c) any consultation required by subsection (2) has been carried out.(1A) If a scheme for the establishment of the combined authority has been prepared and published under section 109 the Secretary of State must have regard to that scheme in making the order.

(2) The Secretary of State must carry out a public consultation unless—

(a) a scheme has been prepared and published under section 109,(b) the constituent councils carried out a public consultation in connection with the proposals contained in the scheme and provided the Secretary of State with a summary of the consultation responses, and(c) the Secretary of State considers that no further consultation is necessary.(3) In this section “constituent council” means—

(a) a county council the whole or any part of whose area is within the area for which the combined authority is to be established, or(b) a district council whose area is within the area for which the combined authority is to be established.”(4) In section 113 (requirements in connection with changes to existing combined arrangements), for subsections (1) and (2) substitute—

“(1) The Secretary of State may make an order under section 104, 105, 106 or 107 in relation to an existing combined authority only if—

(a) the Secretary of State considers that to do so is likely to improve the exercise of statutory functions in the area or areas to which the order relates,(b) the constituent councils consent, and (c) any consultation required by subsection (2) has been carried out.(1A) If a scheme has been prepared and published under section 112 the Secretary of State must have regard to that scheme in making the order.

(2) The Secretary of State must carry out a public consultation unless—

(a) a scheme has been prepared and published under section 112,(b) the authorities that prepared and published the scheme carried out a public consultation in connection with the proposals contained in the scheme and provided the Secretary of State with a summary of the consultation responses, and(c) the Secretary of State considers that no further consultation is necessary.(2A) In this section “constituent council” means—

(a) a county council the whole or any part of whose area is within the area or proposed area of the combined authority, or(b) a district council whose area is within the area or proposed area of the combined authority.””

My Lords, Amendment 7 modifies the processes for establishing a combined authority to provide, where the circumstances warrant it, a fast-track process that maintains all the necessary safeguards. We discussed a similar amendment on the first day of Report, and explained the Government’s rationale for streamlining the process for establishing a combined authority. We returned to that amendment on the final day of Report, particularly to consider it in the context of the Delegated Powers and Regulatory Reform Committee’s report of 14 July. I explained in depth the background to the amendment, the need for it, and the safeguards that we were providing.

Noble Lords will recall that the noble Lord, Lord Tyler, sought further time both to consider my detailed explanation and for the House to consider the Delegated Powers Committee’s report. I withdrew the amendment and promised to return to it at Third Reading. In moving Amendment 7, I have considered the Delegated Powers and Regulatory Reform Committee’s report and I have had discussions with the noble Lord, Lord Tyler, and considered his concerns. I have retabled the amendment with certain modifications, which I consider address those concerns.

The amendments that I tabled on Report provided for a fast-track process, which removed the requirement for councils to undertake the lengthy process of preparing a governance review and scheme, where the substance of these had been undertaken in a different way—for example, through agreeing a devolution deal. In this case, the requirements on the Secretary of State to apply the statutory tests and consult would remain. The amendments tabled on Report also enabled an alternative streamlined approach where the councils develop a governance review and scheme, while the requirement for the Secretary of State to consult the councils that have prepared the scheme would be replaced by requirements that the Secretary of State must have regard to the scheme and the councils must consent to the establishment of the combined authority.

I have now tabled a modified amendment, Amendment 7, which removes the unnecessary duplication within the statutory process for establishing a combined authority, while ensuring that there is always a public consultation before a combined authority can be established. If the councils have prepared and published a governance review and scheme, including carrying out a public consultation, and if the Secretary of State considers that no further consultation is necessary, the Secretary of State can proceed without undertaking a further consultation. However, if councils have not prepared and published a governance review, including a consultation, or if the Secretary of State considers that the local consultation is not sufficient, the Secretary of State must undertake a public consultation. We consider that this streamlines the process for establishing a combined authority by removing the duplication of requiring both a local and a Secretary of State consultation without losing any of the safeguards inherent in the process. I beg to move.

My Lords, I am extremely grateful to the Minister. Not only did she make it possible for me to meet her and her officials when she was looking at the detail behind her new amendment; she has also admirably explained its purpose. It is a huge improvement. All Members of your Lordships’ House who have been involved in the discussions on this Bill will agree that one of the central issues we have been looking at all along is to ensure that there is not just public consent, but genuine enthusiasm for these new structures. By ensuring that there will be adequate consultation at the local level, and that if there is not, the Secretary of State will make sure that there will be before any new scheme or arrangements are put in place, she has done the House and local government a very considerable service.

I think that other Members of the House felt that there was an underlying suggestion that streamlining and fast-tracking could be taken by a small group as a short-cut to avoid public consultation, and in that way, a small and relatively exclusive group could find itself taking decisions without that degree of public consent. We now recognise that the amendment is a great improvement. But it lays a responsibility, if I may put it like this, on the constituent authorities which come together to try to form a combined authority to deal with this issue expeditiously. I think that the noble Lord, Lord Heseltine, whom I regard as the godfather of this Bill—in the nicest possible sense; in the ecclesiastical manner rather than in the sense of a Sicilian godfather—will agree that while we want to try to make sure that people respond to these opportunities with enthusiasm, they should not hang about unnecessarily. As I say, the amendment is therefore a great improvement.

Perhaps I may remind your Lordships of the original recommendation made by the Delegated Powers and Regulatory Reform Committee because it goes to the heart of this issue:

“We see the scheme process, which involves local engagement and consultation, as being wholly different from the process of discussion and negotiation which takes place only between the local authorities and the Secretary of State. One engages wider local interests; the other does not. The House may therefore wish to press the Minister to provide a fuller explanation for the amendments, and, in particular, to explain how wider local engagement will be ensured, if the existing statutory processes for review and publication of a scheme are no longer a pre-condition to the making of an order by the Secretary of State”.

The Minister has gone further. She has not just explained, she has responded to the recommendation, and we should be extremely grateful that she has done so.

Since this will be my last opportunity to contribute to the debates on the Bill, I congratulate the noble Baroness and thank her very much indeed for the way in which she has carried out her great responsibility for the Bill; indeed, I must express my huge admiration for the way in which she has done so. I have also been enormously impressed by the hard work of Members on all sides of the House, not least the noble Lords, Lord McKenzie and Lord Beecham, on the Labour Front Bench, and especially my noble friend Lord Shipley along with his team. I repeat what I said earlier: I still regard the noble Lord, Lord Heseltine, as the godfather of the Bill.

My Lords, this amendment is the promised revisit of what was originally Amendment 62 —a fast-track process for establishing a combined authority or changing matters affecting an existing authority. We are grateful to the Government for facilitating this revisit, prompted by the noble Lord, Lord Tyler.

Consternation was caused by the fourth report of the Delegated Powers and Regulatory Reform Committee, which of course reported just the day before we last considered this matter on Report. The committee commented on the removal from the process hitherto of local engagement and consultation. As the noble Lord, Lord Tyler, has just pointed out, it differentiated the process of discussion and negotiation between just the local authorities and the Secretary of State from the need to engage wider local interests. So we welcome the fact that the Government have brought forward revised arrangements for a fast-track process, but one which requires a public consultation where the constituent councils have not produced evidence of a satisfactory one either by virtue of the Section 109 or Section 112 schemes, or otherwise. This is a welcome acceptance of the fact that a fast-track process does not need to be in conflict with proper community engagement and consultation.

Perhaps I may say a brief word here about the other amendments which were the subject of criticism by the Delegated Powers and Regulatory Reform Committee in the same report. They related to the opportunity for the Secretary of State to confer public authority functions on individual local authorities. As for what is now Clause 8, the committee concluded, and we agree, that there is no reason why legislation giving wide discretion as to the conferring of functions should not at the same time give a clear indication of what those functions might be.

We contemplated an amendment to this effect, but frankly, we discussed the issue on several occasions and brought forward amendments which were rebuffed. At this juncture we see no point in marching through each other’s ranks again, so we will leave it for further debate in another place. But I think we recognise that over time, with an annual report and the robust individual reports which have been offered when orders are progressed, a picture will emerge of the broad parameters of what is possible.

Amendment 7 agreed.

Clause 16: Power to transfer etc. public authority functions to certain local authorities

Amendment 8 not moved.

Amendments 9 and 10

Moved by

9*: Clause 16, page 16, line 4, at end insert—

“( ) Regulations under this section may not provide for a regulatory function that is exercisable by a public authority in relation to the whole of England to be exercisable by a relevant local authority in relation to its area if the regulated function is itself exercisable by the relevant local authority by virtue of regulations under this section.”

10*: Clause 16, page 16, line 13, at end insert—

““regulated function” means the function of carrying out an activity to which a regulatory function relates;

“regulatory function” has the meaning given by section 32 of the Legislative and Regulatory Reform Act 2006.”

Amendments 9 and 10 agreed.

Amendment 11

Moved by

11: After Clause 17, insert the following new Clause—

“Devolving health service functions

Notwithstanding the provisions in sections 8, 16 and 17 enabling the Secretary of State to transfer health service functions to combined authorities or other public bodies, the Secretary of State responsible for the health service—(a) must remain able to fulfil all statutory duties placed on him under health service legislation in force at the time of transfer;(b) must not transfer health service regulatory or supervisory functions vested in national bodies responsible for such functions; and(c) must ensure that authorities or bodies to whom health service functions are transferred adhere to the national service standards and the national information and accountability obligations placed on all health service bodies responsible for functions of the kind being transferred.”

My Lords, before speaking to this amendment tabled in my name and those of the noble Baroness, Lady Walmsley, and the noble Lord, Lord Patel, let me declare my interest as an adviser on health and care to Capsticks Solicitors.

This is the last time that the Minister will have to listen to me banging on about the NHS, which is no doubt a cause for celebration in DCLG. The amendment brings us back to the issue of safeguards for the devolution of NHS functions. Our earlier discussions on this issue have tended to generate more heat than light, and I think the problem lies in the fact that the Bill was never designed for the devolution of NHS functions. It is a Bill for devolving essentially local government functions away from central government. It is not designed for devolving functions from a 67 year-old iconic National Health Service, with a large number of statutory duties placed on a Minister, supported by a bevy of national bodies and requirements, and strong public expectations of adherence to national standards and rules. So far, the Government have struggled to come up with a formula that reconciles the centralised characteristics of the NHS, which is held in great public affection, with a move towards the greater devolution of the delivery of health services and health service functions that many of us would like to see.

Let me reiterate that I am not opposed to using the Bill for devolving NHS functions to properly accountable combined authorities or new public bodies. I just want the Bill to contain clear safeguards which recognise that some essential national characteristics of the NHS should continue to function. I do not think it sufficient, as many of us have tried to explain to the Minister, to use individual transfer of function orders to reserve certain functions to the Secretary of State. That pays insufficient attention to the statutory NHS duties placed on the Secretary of State for Health that he simply cannot offload on to other bodies. At the same time, as we have said before, it is an approach that is likely to fragment the national, cohesive nature of the NHS, leading to a ragbag of local devolution arrangements.

I have tried to distil from our earlier discussions a short clause setting out the three health service issues that have to retain national characteristics. First, the Health Secretary,

“must remain able to fulfil all the statutory duties placed on him under health service legislation”.

That has simply not been clear from the Government’s explanations. In framing this provision, I have been much helped by the contribution of the noble and learned Lord, Lord Mackay of Clashfern, in our previous discussions.

The second issue is to stop the transfer of,

“regulatory or supervisory functions vested in national bodies”.

This goes wider than the prohibition of transferring regulatory functions in Amendments 3 and 4 that the Government have now introduced. The natural character of the NHS means that there are bodies that can be both regulatory and supervisory. For example, Monitor is not just a regulator but a supervisor of failing trusts. CQC is both a regulator and, I would suggest, a service improvement agency. There are other national bodies that make NHS services safer for patients without being full-blown regulators within the terms of Amendments 3 and 4. If anyone thinks the NHS does not need national supervisory bodies, they should read yesterday’s Healthwatch report on hospital discharges.

The third prong of my amendment requires the Health Secretary to,

“ensure that … bodies to whom health service functions are transferred adhere to the national service standards and the national information and accountability obligations placed on all health service bodies”.

That is particularly important for patient access to information and exercising their freedom of choice over service access outside the area of a combined authority.

I am grateful to the clerks in the Public Bill Office for their technical help in framing this amendment, and to colleagues for their assistance in drafting it. I have also been assisted in pursuing this matter by briefings from the BMA—I often do not take credit for advice from the BMA—NHS providers and the specialist services commissioning group.

The Bill needs an override provision such as this if the essentially national character of the NHS is not to be lost. I hope the Minister agrees that it needs to be in the Bill as part of this House’s scrutiny of the Bill. I beg to move.

My Lords, I do not think that I need to say very much because this amendment has been very ably introduced by the noble Lord, Lord Warner, but I do support it. I thank the Minister for introducing Amendments 3 and 4 today because they address part of the concerns we have had. However, many concerns remain, regarding accountability, information service standards and, of course, supervision. There are many functions that would never be appropriate to devolve to a local authority, such as the duty to ensure a supply of appropriately trained personnel in the health service, a matter for which Public Health England—which is answerable to the Secretary of State—has responsibility. It would never be appropriate to devolve those functions, and there are many of them. The noble Lord, Lord Warner, has crafted a very clear statement of what is required. Although the noble Baroness did her very best on Report to assure us that the Government share this amendment’s intentions, we need the amendment on the face of the Bill. Legislation needs to be clear, and that is what this is.

My Lords, I shall be brief. I said on Report, and say again today, that I support the Government’s intention to devolve NHS functions. I think that a lot of good will come out of it. For a start, we might explore a possible model of integrating primary, secondary and social care, which may lead to useful innovations elsewhere in the NHS. However, what is important, and as the noble Lord, Lord Warner, said, is that certain key characteristics of the National Health Service have to be maintained, particularly when it comes to regulatory and supervisory functions. I agree with the noble Lord that the proposals should not inadvertently lead to fragmentation and variation in healthcare. The risk is that individual transfers of functions will do exactly that.

The noble Baroness, Lady Walmsley, and I appear on the Marshalled List as supporters of Amendment 11, which was tabled by the noble Lord, Lord Warner. I shall not comment on paragraph (a) of the proposed new clause because it has been adequately referred to, particularly in the intervention by the noble and learned Lord, Lord Mackay of Clashfern, on Report, which was very helpful. Paragraph (b) states that the Secretary of State,

“must not transfer health service regulatory or supervisory functions”.

The noble Lord has mentioned NICE, the CQC and Monitor, but there are many other bodies, including the key one, Health Education England, in terms of training all healthcare workers.

Paragraph (c) of the proposed new clause refers to national service standards. I would mention patient safety issues in particular, as those have become paramount in our National Health Service following the Mid Staffs fiasco. I would also mention the requirement to report on mortality ratios in all hospitals and health authorities, to report on unexplained deaths and the need to reduce the excessive number of deaths that are occurring from cancer, diabetes and other diseases.

I had hoped, as I have said, that government Amendment 3 would cover all those issues, but it does not. The amendment does not in any way stop devolving NHS functions, as proposed in the Bill; it just clarifies the functions that a devolved authority itself cannot change because they are national, regulatory and supervisory. It is for those reasons—to protect those functions—that I support the amendment.

My Lords, as the noble Lord said, we have discussed this amendment since Report, and I think that it is an excellent amendment that puts in a nutshell what we think is necessary as a way of controlling the operation of devolution so that it does not break up the health service.

Local issues in relation to the health service require very careful handling, as noble Lords know. For example, in order to get sufficient expertise in a particular technique there have to be enough operations—if it is an operation technique—to give the people doing it experience and confidence. If there have to be operations in every locality, you cannot do that. There is a tension between localism and a degree of centralisation in running the health service which is absolutely essential. I agree with the noble Lords, Lord Patel and Lord Warner, and the noble Baroness, Lady Walmsley, that it is entirely right for the operations of the health service in a locality to be under the supervision of the local authority. It manages that in the particular locality rather along the lines of the Greater Manchester proposals that we have seen. I do not think that there is any question that the Secretary of State was intending to do more than transfer these particular functions that are in the local area to the control of the local authority or combined authority—the authorities relevant to localism—rather than have separate health authorities as we have seen in the past. As has been said by the noble Lord, Lord Patel, who has very much more experience than I do in this area, that has a very good potential for improvement and innovation, and therefore I sincerely hope that this can be agreed.

It has been extraordinary to see this Bill come forward with so much agreement. The noble Lord, Lord Prescott, originally had the idea of a powerhouse in the north—although I think he called it something different—and that idea has been championed by my noble friend Lord Heseltine in the report that he wrote for the Government some time ago. I am delighted to see this Bill come out of all that, with a degree of co-operation and origination from different parts of the political system. I find it extremely good that all the parties are able to agree about this sort of thing, and it strikes me as a good way forward for our country that experts such as the noble Lords, Lord Warner and Lord Patel—I think that the noble Baroness, Lady Walmsley, is also an expert in this area—should contribute immensely to that happening.

As your Lordships will have noticed, this Bill is promoted not by the Department of Health but by a different department, so it would not surprise me if my noble friend is not able to accept this amendment today, but I am sure that there is good will towards it—certainly, I undertake to do all that I can to ensure that an amendment or something very like this will go into the Bill at some stage. I certainly strongly support it, but I think that an element of agreement may be required—this was discussed at Report stage after all, and in a way it is quite a privilege to have this amendment following Report, as we have only been able to formulate it clearly following Report—and I hope that we will be able to deal with it on that basis.

My Lords, may I just remind your Lordships with this particular concern that health visitors have recently been put under the responsibility of local authorities, so this may be an opportunity to have a little test of how well local authorities manage health provision? I am sure that health visitors would be very grateful if your Lordships would keep a close eye on their development in the new circumstances, because we do not want to see a falling off, as we have seen in the past, in health visitor provision.

My Lords, I start by echoing the noble and learned Lord’s comments about the co-operation that has clearly been evident during the passage of this Bill, and I hope that the noble Baroness might be prepared to accept the amendment. It may not be absolutely perfect, but of course the Government would have the opportunity of bringing amendments in the other place. I think that it is clear that the House would like the noble Baroness to do that.

It is clearly important that the NHS remains a national service, comprehensive and free at the point of use, where broadly we can get the same quality of service wherever we live in England. Equally, I think that most of us want the NHS to contribute to this new devolution world, and clearly the integration of health and local authority services offers much in itself.

Often, the NHS is the largest local employer in any local authority area, so it has an important contribution to make to the local economy. In my own city of Birmingham, the NHS is responsible for huge inward investment in R&D, and it will be the same in Greater Manchester and in other parts of the country—particularly where you combine medical schools, teaching hospitals, academic health science networks and the encouragement of local industry. One of the things that we all want to see is the NHS being prepared to invest in innovative new products and medicines that have been developed in the UK, which we have been slow to adopt generally.

What we are trying to do here is to take both the huge advantage that devolution gives us and the integration of health and local government but without undermining the essential, national nature of the NHS. Noble Lords have mentioned four areas where that is important. First, in the reconfiguration of services, we cannot have combined authorities getting in the way of the necessary centralisation of specialist and tertiary referral services. Secondly, when it comes to training doctors and nurses, the reason that we have seen a crisis in recruitment and high costs from agency nurses is that a decision was taken in 2010 to reduce training commissions; we have to have national planning and decisions about the number of doctors and nurses that we train. We cannot have local authorities opting out of their responsibilities in that regard.

The noble Earl mentioned health visitors, which is an excellent example of where there has been a transfer of responsibility of public health duties to local authorities. Those health visitors were given a guarantee that they would be employed when they went on their training courses, so we cannot have local authorities now saying, as some are doing, “We can no longer afford to employ you”. Those health visitors were given a guarantee, and as a national service we have to ensure that they are found a job.

What we need to do is ensure that the national characteristic and nature of the NHS—the national rules, the standards and, particularly important, the Secretary of State’s accountability to Parliament for the NHS—are retained in this new devolution package. That is what my noble friend Lord Warner is seeking to enshrine in statute: some clear safeguards that reflect those national characteristics. I hope that the Government will be prepared to accept his amendment.

My Lords, Amendment 11 makes specific provisions in relation to a transfer of health functions from a public authority to a combined authority or other public body. It requires that the Secretary of State responsible for such services must continue to be able to fulfil his statutory duties conferred by existing legislation. It also requires that the combined authority or other public body to which the functions are transferred should adhere to national standards and accountabilities which are attached to those functions under existing legislation.

As I have said in previous debates, and as is set out in the Greater Manchester memorandum of understanding for devolution of health and social care, there is absolutely no intention through this Bill to remove or undermine the core duties on the Secretary of State, or to dismantle accountabilities for health services as enshrined in existing legislation. Whatever bespoke devolution arrangements are agreed with a particular local area, that principle will remain.

I state this as a clear commitment to this House. Thus, nothing in the Bill changes the position of the Secretary of State under Section 1 of the NHS Act 2006, which provides that,

“The Secretary of State must continue the promotion in England of a comprehensive health service”.

The Secretary of State retains in all circumstances ministerial responsibility to Parliament for the provision of that health service.

Likewise, the Secretary of State must always adhere to the core NHS duties. These duties include, when exercising functions in relation to the health service: a duty to secure continuous improvement in quality of services; a duty to have regard to the NHS constitution; a duty to have regard to the need to reduce inequalities; and a duty to promote autonomy. These duties are set out in Sections 1A to 1F of the National Health Service Act 2006.

As I have made clear, there is no intention or possibility of the Bill changing these duties of the Secretary of State. Further, as I have said in previous debates, any decision the Secretary of State takes about using the order-making powers in this Bill to confer health functions must be taken in conformity with these duties. Without in any way affecting these duties of the Secretary of State, if a combined authority were, for example, to have conferred upon it a function to commission certain health services, the provision in Clause 8—which the House agreed on Report about conditions and limitations when conferring functions—would allow us to require that the combined authority, when exercising its commissioning functions, must likewise be subject to these core NHS duties, such as to promote the NHS constitution.

On Report, the noble Lord, Lord Hunt, commented that the issue we are discussing is more about symbolism, but he also recognised that one should avoid unnecessary legislation. I agree that this issue is one of symbolism. I am also very clear that symbolism is important and tempting. However, legislation is not the place for symbolism. The place for symbolism is in the discussions we are having and the commitments given to this House. For this reason, while I understand and strongly support the intention behind this amendment—that is, to make clear to all that the vital principles for the NHS will be upheld—I do not believe that it is necessary, nor do I consider that it is appropriate. As I have said a number of times, this Bill is an enabling Bill which includes general rather than service-specific powers. If this amendment were to be accepted, health functions would be specified on the face of the Bill, which would change the whole approach we have taken.

Noble Lords asked some specific questions—for example, on how to retain national standards where health powers are devolved. It is important to note that, when transferring functions to a combined authority or conferring functions on it, the Bill allows us to additionally place on a combined authority duties such as those held by the Secretary of State under new Sections 1A to 1F of the relevant legislation, as I have mentioned previously, or other duties held by NHS England or CCGs.

The noble Lord, Lord Warner, talked about the purpose and design of the Bill. We see it as a broadly enabling Bill, as I have just said. We have always said that we will devolve powers only where there is a clear accountable body. This applies equally to any health powers as to other powers that are devolved.

My noble and learned friend Lord Mackay and the noble Lord, Lord Patel, asked specifically about Amendments 3 and 4 as applying to regulatory functions such as those of the Care Quality Commission. Amendments 3 and 4, which we have just approved, mean that the regulatory functions of a national regulator such as the CQC cannot be devolved to, say, a combined authority exercising functions that the Care Quality Commission would have regulated.

The noble Lord, Lord Hunt, mentioned the importance of health in devolution. Health is absolutely an important element of devolution. As the Chancellor has said:

“We will hand power from the centre to cities to give you greater control over your local transport, housing, skills and healthcare”.

That is our aim and we will do that within a strong NHS. A strong NHS relies on a strong local economy and devolution will enable strong local economies with strong local governance. In areas with such accountabilities in place, such as Manchester, health devolution is something we support.

Given that I have placed those comments on the record, I hope that the noble Lord will feel able to withdraw the amendment.

My Lords, the Minister’s response is deeply disappointing. There is a simple problem with this Bill and the way in which the Minister and her department have approached it: they simply do not understand the National Health Service’s national characteristics. It is not uncommon for Bills to contain statements of principle. That is not an unusual phenomenon. I have been in this House 15 years and I have sat through debates in which statements of principle have been put into Bills, so the idea that that is something we never put in legislation is simply untrue. We have to put this on the face of the Bill. It is what the NHS expects and what many of us think is essential if we are to successfully pursue the Government’s admirable policy of devolving more functions down to the local level. If the Government want to do that successfully and to take the NHS with them, I suggest to the Minister that they need to think again about this issue.

Throughout our deliberations on the Bill I have worked on the assumption that the Government did want to take the NHS with them. Certainly, the briefings I have received strongly suggest that the NHS is confused and baffled about precisely what the Government are up to. Simply relying on assurances from the Front Bench and a memorandum of understanding in Manchester is not good enough. I do not want to go banging on about this but I am unconvinced by what the Government are saying. There needs to be on the face of the Bill a provision of the kind included in this amendment. I wish to test the opinion of the House.

Schedule 3: Overview and scrutiny committees

Amendments 12 and 13

Moved by

12: Schedule 3, page 28, line 22, after “COMMITTEES” insert “AND AUDIT COMMITTEES”

13: Schedule 3, page 31, line 48, at end insert—

“Audit committees4 (1) A combined authority must arrange for the appointment by the authority of an audit committee.

(2) The functions of the audit committee are to include—

(a) reviewing and scrutinising the authority’s financial affairs,(b) reviewing and assessing the authority’s risk management, internal control and corporate governance arrangements, (c) reviewing and assessing the economy, efficiency and effectiveness with which resources have been used in discharging the authority’s functions, and(d) making reports and recommendations to the combined authority in relation to reviews conducted under paragraphs (a), (b) and (c).(3) The Secretary of State may by order make provision about—

(a) the membership of a combined authority’s audit committee;(b) the appointment of the members.(4) Provision must be made under sub-paragraph (3) so as to ensure that at least one member of an audit committee is an independent person (as defined by the order).”

Amendments 12 and 13 agreed.

A privilege amendment was made.


Moved by

My Lords, I thank all noble Lords, even the noble Lord, Lord Warner, for the part they have played during the passage of this Bill and for being so patient with me, this being my first Bill. Thank you.

My Lords, as we have come to our “Auld Lang Syne” moment, I thank the Minister and her team for their engagement with this Bill. We should congratulate the noble Baroness; this is her first Bill and she has approached it with humour, patience and a willingness to engage. I also thank the noble Lord, Lord Shipley, as our deliberations have been particularly advantaged by him and his team; the Bill team for its willingness to engage; my Labour colleagues; my noble friend Lord Beecham and his continuing infectious humour; the noble Lord, Lord Kennedy; and the vital input from my health colleagues, my noble friends Lord Hunt, Lord Warner and Lord Bradley. I believe that we have collectively done our job in scrutinising this Bill and we wish it safe passage in another place. It is a worthy Bill which could herald great change.

My Lords, from these Benches, I thank the Minister for—as the noble Lord, Lord McKenzie, said—her good humour in the passage of the Bill, despite the several defeats the Government have had. As I said, I hope that there may be an opportunity for the things on which we have a different opinion from the Government to be looked at very closely in the House of Commons, because there is a lot of merit in the amendments that your Lordships’ House has decided to pass. I also thank the noble Lord, Lord Heseltine, who the noble Lord, Lord Tyler, referred to as the godfather of the Bill. He is certainly its architect, and the vision that the noble Lord has shown over the years in driving this agenda forward has been hugely important. Finally, I thank the Members of the Labour Front Bench and the Bill team for a very happy process, which has addressed all the issues that have been of concern to us—many thanks to the Minister for that collaborative approach. I very much hope that we see many affirmative procedures as new proposals come forward in the months ahead.

Bill passed and sent to the Commons.