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House of Lords Hansard
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Grand Committee
17 July 2019
Volume 799

Grand Committee

Wednesday 17 July 2019

Arrangement of Business

Announcement

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Good afternoon, my Lords, welcome to Grand Committee. There will be Divisions in the Chamber, when I will adjourn the Committee for 10 minutes.

Devolution: English Cities

Motion to Take Note

Moved by

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That the Grand Committee takes note of devolution to English cities in the light of Lord Heseltine's report Empowering English Cities, published on 2 July.

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My Lords, our country faces a constitutional crisis unparalleled in peacetime. No one knows how the debate about our relationship with our European neighbours will change in the months and years ahead. Feelings run deep and penetrate every corner of society and we each have our views. I have no intention of pursuing that issue today. I have one very clear reason for that decision.

Whether we leave the European Union, form an accommodation with it or remain within it—whichever way—our future depends principally on the success of our great cities. They are the engines of our prosperity and the rock of our stability. They made this country what it is, and all our tomorrows are dependent on their strengths and are challenged by their weaknesses. Of course, London is one of the world’s greatest cities, but government defined and imposed in detail from London can never match the pride, motivation and—yes, let us be frank—self-interest of people who live, work and enjoy their leisure in our other great cities.

I joined this debate as a junior Minister in 1970. Throughout that time, as a nation, we have failed to reform our institutions and administrative systems to match the ever-escalating rate of change. The hurdles facing our political parties were just too high. The human instinct to protect the status quo was simply too strong. The consequence has been to change at the speed of the slowest ship in the convoy. Progress required compromise, consensus, fudge.

Let us again be frank—we can go on in the same old way. It is less controversial, more comfortable and the consequences will become apparent long after we, the present generation, have moved on. I ask your Lordships to reject such dereliction of duty, so careless a discharge of the legacy that we will bequeath.

My report, Empowering English Cities, attempts to portray a vision and sets out the detailed policies to achieve it. It is a tale of two cities: two interwoven cities, linked, interdependent and entwined. There is the city of excellence: great entrepreneurs, world-class companies, excellent universities, outstanding public servants, dedicated carers and social cohesion—a nation prosperous and at peace with itself. Of that city, much is heard, of which we are legitimately proud.

But there is another city—a city of the postcode lottery, the forgotten fringe, the lurking shadow. There is that place on the other side of the road, so easy to pass by: the failed school; the excluded child; and the gangland, where the moralities to which most of us subscribe and the philosophy in which we believe are objects of contempt, more appropriate for a television soap opera than the realities of everyday life. Knife crime is a symptom of social breakdown—a response requires an approach much more comprehensive than simply removing their blades.

It is nearly 40 years since I first walked the streets of Liverpool in the aftermath of the riots. Everybody there knew exactly what was wrong; you, him, them, it—everybody else, never me. But I knew what was wrong: there was no one in charge. Since then, in many of our great cities we have put somebody in charge: mayors, locally elected and publicly accountable. But it is a job half done. The fudge and compromise of politics is the DNA of the journey of reform: powers unevenly distributed, leadership constrained, Whitehall unreformed.

I want a programme of empowerment to unleash the ambitions of the British people. I want to empower them to rise to the challenges of today. We will never inspire such a vision with empty phrases or lofty exhortations. Cities are so much more than a coincidence of functional disciplines; they are so much more than the statistics of housing, education or wealth. They are the multiplication of myriad different enthusiasms, personal talent, boundless energy and the dynamic of community and partnership.

To unleash this torrent of human creativity, we need a plan of action—detailed, practical and based on experience. We need a programme of national rejuvenation. We should certainly start with our cities, but the same spirit and concepts should embrace our towns and spread the benefits deeply into the countryside and villages.

Let me set out some of the most important actions that I believe to be necessary. The Government must lead—change of the scale and urgency required simply will not happen unless the Prime Minister and the Chancellor of the Exchequer believe in it and drive it. First, a new department of the regions should be established. It should bring under one ministerial control the essential features of the devolution programme, including planning, public housing, transport, skills and the employment agenda. Secondly, all government offices outside London should be brought together in regional offices under an official at director-general level. Thirdly, Select Committees should be established in both Houses of Parliament to comment on, advise and review the devolution programme. The Government should take all necessary steps to ensure that their departments and all relevant quangos co-operate with combined authorities in the discharge of their responsibilities. Finally, the Government should publish an annual report showing the powers and resources available to city mayors in competitor countries.

Once the Government have demonstrated their commitment, mayors should be empowered to do the job properly and effectively. First, it should be the duty of each mayor of a combined authority to produce five-year rolling strategies with detailed implementation programmes. They should cover its spatial strategy, local economy, transport, housing, education and skills, and environmental policy. These policies should be given statutory status and incorporated into national policy.

In addition, each mayor should publish a “condition of the people” report. That would analyse social imbalance, health statistics, and quality of life. The job of the local police commissioner should be merged with that of the elected mayor. With immediate effect, the Government should transfer to the mayors day-to-day responsibility for the quality of education, the skills budget, and the unemployment and employment programmes. The existing European funds and a reintroduced topslice fund, as first created by George Osborne, should be allocated to the combined authorities by competitive bidding that reflects the quality of their outputs, local contributions and public support. The Treasury should agree local tax-raising powers to combined authorities, particularly a tourist tax and charges for cultural exhibitions. The role of mayor should be strengthened. The ultimate accountability must rest with the people in elections every four years. Finally, the Government should hold urgent discussions with representatives of the private sector, and legislate, if necessary, to create support for companies with the resource available to their equivalents overseas.

Yesterday I went to another great British city, Cardiff. The devolution agenda is now enshrined in our constitutional assumption. Indeed, the debate today is not about restoring power to London but whether the United Kingdom itself can withstand the stress of Brexit. No one feels the imperative to do so more strongly than I.

But alongside this debate runs another. The question is posed: why should the economies of Scotland, Wales and Northern Ireland have such empowerment, when often more populous and wealthier cities in England are denied them? I believe we need response and enthusiasm from every corner of our land as the escalating pace of change across the world overwhelms the tradition and assumptions of yesteryear. Power shared can become power enhanced. Let us breathe life into the devolution agenda. I beg to move.

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Hear, hear.

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My Lords, Parliament and the country owe a huge debt of gratitude to the noble Lord, Lord Heseltine, for his long-standing and single-minded pursuit of this subject, reflected in this great report and, indeed, by the speech he has just made to your Lordships.

I can claim an affliction that is similar to what might almost be described by the noble Lord’s party colleagues as his obsession. As long ago as 1968, I was a co-author of a political pamphlet called Power to the Provinces. We had a number of themes which are as relevant today as they were then, and I will touch on them briefly. In doing so, I hope that the noble Lord will accept that my colleagues and I are here not to dilute his message, but to enhance and empower it still further. We believed then, and believe now, very strongly in the principle that decisions in a mature democracy should be taken as close as possible to the people they will affect. That has become known as subsidiarity. Devolution implies a degree of decision-making that is more extensive and holistic than simple delegation or decentralisation, however desirable they may also be.

I would draw the important distinction between, on the one hand, the delegation of funds—which, by its very nature, is a short-term decision—and devolution of fund-raising powers on the other: once that responsibility has been given it is extremely unlikely to be removed again. Allocation of a central government funding stream, by contrast, can be at the mercy of individual Governments and Chancellors. I am not sure whether this report clearly distinguishes between these two quite separate objectives and exercises: one can lead to the other, but the evolution does not happen automatically. It also follows from our starting point of principle that devolution does not stop at one sub-national or sub-federal level. Taking power from Whitehall or Westminster to national parliaments in Holyrood, Cardiff Bay, Stormont and, indeed, to the metropolitan cities in England does not absolve them from distributing powers and resources to lower levels of governance.

As my noble friend Lord Purvis observed in a recent debate, a truly federal UK constitution would necessitate democratic accountability at all levels, and we believe that double devolution has been as systematically pursued as it should be. More local levels of governance have not received the same amount of attention; for example, I believe that town and parish councils can be very effective in hands-on representation and in management of local facilities. There has always been a good case for intra vires, enabling all authorities to exercise all powers not specifically excluded, rather than the other way round.

As a general principle, I am worried by the implication in the Heseltine report when it appears to share the criticism of mayors that,

“the powers and resources that our conurbations have are uneven and bespoke”.

Given the remarkable diversity of our country in every conceivable area of challenge and opportunity, that is exactly as it should be. When we extend the basic principles beyond the larger cities of England, this becomes even more essential.

It is surely axiomatic that more rural parts of the country cannot be shut out of the advantages of more democratic self-government. The noble Lord referred to the countryside in that context. I appreciate that this report does not purport to extend its remit beyond the major English cities, but the Minister must acknowledge that there are lessons here for more rural parts of England as well. I have no doubt that he has read The future of non-metropolitan England recently published by the LGA. I hope that he will accept that that is a very timely antidote to overconcentration on the major conurbations.

I acknowledge that my experience as a Devon county councillor and then as a Cornish MP reinforces my conviction that the urban case has been more effectively pursued than that for rurality, not least by the noble Lord, Lord Heseltine. The recent Lords Select Committee on the rural economy made a similar point, and if time permits I may return to the Cornish experience later.

A persistent concern has been the lack of demonstrably effective scrutiny and accountability. We were dismayed by the overcentralisation of power implicit in the Cities and Local Government Devolution Bill in 2015. We warned then of the possibility—even the likelihood—that we might be legislating for new one-party fiefdoms, with the mayor, the appointed deputy mayor, and a firm majority of the only body to which they would be answerable in the combined authority, all from the same political party. Without wider accountability, the risk of partisan patronage and petty corruption is increased. Democracy must not only be done but must be seen to be done.

The noble Lord, Lord Heseltine, expressed similar concerns in those debates. He said:

“We hear about accountability. What accountability is there in local government today? … In a vast number of councils in this country, the councillors never change from one party to another. A significant number of councils do not change allegiance either”.—[Official Report, 22/6/15; col. 1397.]

Fortunately, a few weeks ago, largely as a result of the local government revival of Liberal Democrats, that was put to the test.

We also argued in 1968, and have argued ever since, that the democratic deficit has been dangerously developed still further by the tendency of Whitehall towards top-down imposition of structures, with limited menus of permitted powers and boundaries. We Liberal Democrats, like the previous Liberal Party, have always argued for bottom-up initiatives, giving the people in identifiable areas a role in deciding how, when and in what form they are to benefit from increased subsidiarity. This has led to our concept of devolution on demand, with elected authorities bidding to take on responsibilities from a menu of options. For example, current bids might start with the current powers of the Welsh Assembly or Scottish Parliament.

That brings me back to the Cornish experience. The coalition Government, especially my Liberal Democrat ministerial colleagues, were determined to demonstrate that the city deals were not the only model for decentralisation or devolution. No longer a county council and with its newly formed unitary authority, Cornwall was judged to be ready for a degree of devolution. Although this was very modest—perhaps more delegation than full-blooded devolution—it has recognised a level of separate identity and historic self-determination. Democratic accountability has been preserved by a more traditional leader and cabinet structure, avoiding the “elective dictatorship” of an elected mayor. It has proved a popular and well-respected model, giving real leadership through the Brexit crisis. Other more rural English areas are queuing up to follow the Cornish lead, with a unitary authority being seen as the key to progress.

Inspired by Cornwall’s example, a number of upper-tier authorities—mainly rural and with no major cities—have come together to form Britain’s Leading Edge group. Their latest report both demonstrates the value of bottom-up initiatives and displays a healthy approach to non-metropolitan devolution aspiration.

In this debate, my Liberal Democrat colleagues will follow up a number of these more general points with some specific examples of the direction in which we hope the devolution process will go next. In the meantime, I repeat my personal thanks to the noble Lord, Lord Heseltine, for leading us in this direction and giving us this great debate.

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My Lords, the noble Lord, Lord Heseltine, and I go back a long way. I was the leader of Newcastle City Council during both periods in which he was Secretary of State at the Department of the Environment with responsibility for local government. We were by no means always in agreement, but his interest was genuine. I recall being invited by him to dinner on one occasion. I accepted with some trepidation: the venue was the Tower of London—not, I hasten to add, in the Beauchamp Tower. His concern for English cities is long-standing and welcome, but I have to say that I have reservations about some of his proposals.

One major component of the noble Lord’s programme is the requirement of elected mayors for what in many areas would be not just individual cities but city regions. Newcastle was one of a number of councils required to hold a referendum in 2012 on whether to have an elected mayor. As in a number of other places, the electorate rejected the idea. Now, we have an elected mayor for the North of Tyne Combined Authority, established this year as the price for what is a modest step towards a measure of local government reform, to which our neighbouring authorities south of the Tyne declined to subscribe.

The reward for the creation of this new body is very limited from a financial perspective; a much vaunted £600 million over 30 years amounts to little more than £6 million a year for each of the constituent authorities. As I have frequently pointed out, Newcastle alone has suffered a financial loss amounting to £280 million a year since 2010, rising to £330 million by 2022, from a combination of government cuts in funding and rising costs. As in other places, this is a 60%-plus cut in the council’s budget.

Nationally, since 2010, government core funding for local authorities will have been cut by £16 billion a year by 2020. Welcome though the Transforming Cities Fund is to its recipients, the amounts referred to in the noble Lord’s report are, to put it politely, modest, ranging from £250 million for the West Midlands to £59 million for Tees Valley. In addition to the Transforming Cities Fund, the Government have announced a Stronger Towns Fund. Perhaps the Minister could tell us whether a “supporting villages fund” is envisaged. The Stronger Towns Fund will dispense all of £1.6 billion up to 2026, with amounts ranging from £281 million for the north-west to £25 million for the east of England. That is hardly likely to make a significant impact. The very fact of there being two separate funds raises questions about the Government’s approach. It implies a two-tier approach to addressing the needs of our regions, instead of looking at the issues across whole areas such as the north-east, let alone between regions.

We hear references to the northern powerhouse, but there appears to be very modest progress in improving the appalling trans-Pennine rail route connecting the north-east to Yorkshire and the north-west, with the emphasis on HS2 coming at enormous expense and with highly questionable benefit to the north-east. Newcastle MP Catherine McKinnell, who chairs the East Coast Main Line All-Party Group, has pointed out that,

“there is no confirmation from the Government that the line north of York will be upgraded, which will make parts of the north even further away from that national infrastructure investment, rather than benefiting from HS2”.—[Official Report, Commons, 5/3/19; col. 331WH.]

Local councils estimate that the line needs at least £3 billion to provide a good service and be ready for the arrival of high-speed trains. This suggests a failure on the part of relevant government departments to work together on developing a strategy. It also underlines the need for local government to be engaged in the process. This could, of course, include elected mayors, but should not depend on an enforced change to adopting that mode of leadership.

Devolution should not be confined, critical as it is, to matters affecting the local economy. There should be an enhanced role at the regional level at the least in the oversight of health and further and higher education, transport and the impact of climate change and of custodial services, but devolution must go beyond merely delegating the responsibility for the provision of local services and the health of the local economy to local government in general or to cities in particular. It is essential to ensure that adequate financial resources are available.

The plight of local councils is also exacerbated by the local government finance system. The savage cuts of the past nine years have clearly damaged the capacity of councils to address the needs of their residents and protect and promote the local economy. In fairness to the noble Lord, Lord Heseltine, he replaced the Thatcher poll tax with council tax, but after 27 years, including, I regret to say, during the years of Labour Government, little has been done to update it. Thus the residents of a small house in the ward I represent as a councillor in Newcastle will be paying for a band A property worth £40,000 one-third as much as the residents of homes worth more than £1 million.

It is impossible to empower English cities without ensuring that they have the resources to tackle the problems they and their citizens face and, importantly, to promote the local economy. A system in which council tax increases are limited to the same percentage, albeit yielding widely different sums between a council such as Newcastle and its counterparts in the south-east, is inherently unfair since the gap is not closed by central government support. The noble Lord makes a welcome call for more capital funding for local government and a power for mayoral authorities to raise local taxes and charges, interestingly including a tourist tax. Such changes in my view should not be confined to mayoral authorities.

I welcome the noble Lord’s proposal to establish a department for the English regions and his call to reinstate the government regional offices, abolished by Vince Cable during the coalition, and the suggested dispersal of government offices into the regions. We always found the regional office to be extremely supportive and helpful, while it existed. I confess that I am less enthusiastic about proposals to transfer responsibility for schools’ performance to combined authority mayors. It should be returned to local councils, from which it has been effectively removed for many years and where local councillors have a significant interest. This indeed reflects a concern among some of us who strongly support the case for a regional approach to such issues as economic development and transport but have reservations about other services which are closer to local communities and which need to be accessible to local elected councillors as well as to residents. The concentration of multiple roles in the hands of elected mayors could be problematic, as we are likely to see in the potential forthcoming elevation of one, at least, noble former holder of the position.

I should declare an historical interest in Richard III, a most maligned English monarch, who presided over the Council of the North formed by his brother Edward IV. It would be good to see the revival of such a body and the creation of similar ones, not to displace existing councils but to ensure that the needs and aspirations of the regions and their constituent authorities are adequately reflected in and through their local government structure.

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My Lords, while reading the excellent report by the noble Lord, Lord Heseltine, I was at times overcome by nostalgia, having followed the history of local government finance, functions and boundaries since I joined the Treasury in 1970. I remember in the early 1980s the Treasury was proud to have got local authority self-finance expenditure—LASFE to the cognoscenti—up to more than 60%, but only a decade later it was down below 25%. Local authorities have been stripped of functions and taken out of social housing and their boundaries are constantly reshuffled. How did this happen?

There was a narrative in Whitehall and Westminster that local authorities were incompetent and wasteful, out of touch with the interests of local residents, meddling in national politics, anti-business and anti-development. Was that a fair description? It was certainly not in all cases, but there were prominent examples that fitted the bill, such as my home borough of Lambeth, Brent, the GLC and Liverpool. One response was the introduction of a poll tax on the premise that business, which contributed much of local taxes, had no vote and many voters paid little in rates. The unwinding of the poll tax led to business rates being sequestered and captured as a national tax, and rates replaced by council tax, which was less buoyant and less progressive.

The Whitehall/Westminster narrative continued for several decades and to some degree lives on. Recently, education has been taken away from local authorities and cuts in spending imposed on them have been more severe than on government departments. The first thing that strikes one about the narrative is its sheer hypocrisy, the pot calling the kettle black, as though central government never had any major failures of policy or delivery. When I joined the Departure of the Environment as Permanent Secretary in 1994, with the noble Lord, Lord Deben, then Secretary of State, it was apparent even then that the narrative was outdated. I met many local government chief executives and found them impressive, possessing skills often lacking in Whitehall, which explains why, when senior civil service positions were opened up to open competition, many of them were successful. I also found that they were keen—desperate, even—to develop their communities.

In 1997, the noble Lord, Lord Deben, was succeeded by the noble Lord, Lord Prescott. I am sorry that he is not well enough to be with us. He changed the name of the department to the Department of the Environment, Transport and the Regions, recognising explicitly the regional dimension of its work. His commitment to the regions was strong and unwavering, but in retrospect I think he took a wrong turn in trying to develop a greater regional dimension by championing the creation of regional assemblies. These never took off. Most of the subsequent development of local authorities has been focused on stronger executive action with the creation of elected mayors overseen by small assemblies—more power to act, rather than power to debate.

The report from the noble Lord, Lord Heseltine, makes a powerful case for city regions with elected mayors on the London model. One can spend a lot of time obsessing about the optimal size of the local authority, but we are close to a reasonable outcome. Where it is possible to make unitaries work they should be the first choice, bringing housing and planning alongside other major services. But that still leaves some functions that are too broad even for the larger unitaries, such as London boroughs and the met authorities around our big cities, such as transport, infrastructure, business development, regeneration, skills and further education, and the development of affordable housing. By the latter, I mean principally land assembly and planning, rather than the landlord function, which needs to be at a more local level, perhaps left to housing associations. It is for these wide-ranging services that the city regions are best equipped. I also endorse the recommendation that mayors absorb the unloved police commissioners, as in London.

When I arrived in the Departure of the Environment in 1994 there were still two important components of the Heseltine legacy: urban development corporations and the regional offices. The noble Lord, Lord Heseltine, notes that there was opposition to urban development corporations as they were taking away responsibilities from local authorities, but where they were reviving derelict industrial and port land in areas with few residents I thought that was appropriate. Indeed, the centres of our major cities are much more prosperous and completely transformed from where they were 30 years ago. The problems now lie elsewhere, in the suburbs and smaller cities. Going forward with UDCs on the original model is probably not the right vehicle. The particular structures should be for mayors to decide.

The other piece of machinery was the regional office network, which strangely the noble Lord gets to only at page 52 of his report. This was a consortium of Whitehall departments—the DoE, the DTI, employment and so on—which came together to act at a regional level. They were an essential counterbalance to the vertical structures of Whitehall. It was a big mistake to abolish them and I hope they can be quickly reconstructed.

There is one issue where I queried the noble Lord’s proposals. He proposes a separate department of the regions with its own Secretary of State and Permanent Secretary. In the 1990s the DoE and the DETR, while retaining their responsibilities for housing, planning and regeneration, were, in effect, the conveners of the network. Creating a department that has a co-ordination function but no services of its own—no skin in the game—is likely not to be effective. A department of everything that would be the DETR, which was already a monster department, plus skills and employment might be too much of an ask.

The belittling of local government has done immense damage to England, politically, socially and economically, exacerbating divisions rather than closing them up. We should welcome the mea culpa of the noble Lord, Lord Heseltine, and his conversion to strong and effective local government, but to achieve that Whitehall/Westminster has to cast off its inbred sense of superiority.

I have one final thought: 30 years after its introduction, council tax is due for revaluation. It takes no account of changes in relative property values across the country and, without that, we will find no proper solution to local government finance.

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My Lords, I congratulate my noble friend on his powerful follow-up to his original 2012 report, No Stone Unturned. I make it clear at the beginning that I have no great experience in local government. My contribution to today’s debate flows from four—or maybe three and a half—episodes. The first is the year that I spent chairing a Select Committee of your Lordships’ House looking into citizenship and civic engagement. My noble friend Lady Eaton, who was a doughty member of the committee, will speak later. We looked at some of the underpinnings of the issues that my noble friend referred to in his remarks. The second is my chairmanship of several companies, both in the English regions and abroad—they are all declared in the register of your Lordships’ House—which has given me some economic thoughts. The third is my personal belief that we have created and are creating two nations: London, with its environs in the south-east, and the rest of the country. If that trend continues for the next quarter of a century, we will create strains to our social cohesion that we will come to regret. The last—this is maybe the half—is the fact that, for a very few years, I was the Member of Parliament for Walsall North. This gives me an opportunity to thank my noble friend, who came to speak for me in my by-election all those years ago.

I share the view of my noble friend that, unless we find a way to create at Whitehall a central focus for the regions, the possibility of developing the vision that he has is doomed. There is far too great a danger that critical issues either fall between the departmental cracks or become the subject of departmental turf wars. In the civic engagement committee, we saw this in spades. Our recommendations went to the Department for Education, the Home Office and the Cabinet Office. Indeed, my two noble friends on the Front Bench have in turn replied to them in different ways. We recommended that there ought to be a Minister with overarching responsibility for this matter. I regret to say that all that we have achieved so far is an interministerial working group and we feel relatively neutered.

A second challenge that arises from having no Minister with overarching responsibility is what we came to see in the committee as “initiativitis”. A new Minister arrives. He or she is very keen. They start up something and, a year later, they are moved on. The initiative drifts into oblivion. Nobody checks whether it worked. Nobody sees where there are lessons to be learned that could be deployed across other parts of the firmament and nobody sees whether taxpayers’ money is being wasted. There is a need to find a way to build up the institutional memory, as one might call it, of what works.

In my view, it will not be sufficient for individual regions to go it alone. The noble Lord, Lord Beecham, talked about the northern powerhouse and the rail link between Hull, Leeds, Manchester and Liverpool. If that is to go ahead, it will require a carefully co-ordinated interregional programme of promotion. The cities that form the heart of the region will need to be supersensitive about how actions taken at the centre will be seen in their constituent parts.

In his report, my noble friend refers to Walsall’s worldwide reputation for the leather industry. Walsall and the other towns that make up the Black Country, all with their own specialties, will need reassurance that their concerns are always being fairly addressed. For example, I chair a company based in Manchester. We can recruit people from Manchester and the immediate surroundings but from further away in that geographic area we cannot. Why not? Because the transport links are insufficiently good, the commuting times are too long and people do not want to move to work for the company as they do not want to spend an hour and a half or two hours sitting on a bus or a tram.

My noble friend will understand from my remarks so far that I support the strategic thrust of his report. I hope he will forgive me if I urge him not to try too much to cram together the uncrammable. For example, he and I have some knowledge of the county of Shropshire. Shropshire makes up part of the West Midlands Combined Authority. Take the small town of Clun, west of Shropshire on the Welsh border, on the one hand, and Nuneaton, on the eastern border of the authority, on the other. Those two places are 90 miles apart. According to Google, it takes two hours to drive from one to the other, and the environmental and societal differences between the two of them are self-evident. I hope very much, therefore, that although we are discussing the important subject of devolution from the centre of the regions, as the noble Lord, Lord Tyler, pointed out, there is a need for the regions in turn to be thinking about how they are sensitive to the devolution responsibilities that they have—in this case, to Clun and Nuneaton.

That takes me to my final point. Much of my noble friend’s report is focused on economic activity and performance; and the importance of those metrics cannot and should not be overlooked. If there was one overwhelming thread, however, in the evidence we received at the civic engagement committee, it was that people wanted to belong. They all feel that the developments of recent years have left them uprooted and their sense of community undermined. There is a series of qualitative aspects, some of which my noble friend referred to, which need to form part of any devolution settlement. They are not easy to measure, but are critical none the less.

As an example, when I see, on page 62 of the report, the proposal to transfer responsibility for affordable housing to the combined authority mayors, I have my concerns. It is not that I oppose the idea of finding housing for our fellow citizens, but because, far too often, “affordable” housing has come to mean bad housing: poorly designed, poorly constructed and crammed in, with no sense of community involved. In my view, too often we are in danger of creating the slums of 50 years from now. The housing market has become dominated by a handful of housebuilders who, by careful pricing, impose standardised designs all across the country. The glory of the country, and the glory of our communities, lie inter alia in vernacular, distinctive buildings. Today, if, blindfolded, one is taken and helicoptered into a modern housing estate and the blindfold is then removed, one cannot tell whether one is in Truro, Norwich or Stockton-on-Tees.

The need to create communities to which people feel committed and in which they feel proud to live is a vital part of any devolution settlement—and, indeed, as my noble friend said in his opening remarks, vital in the future creation of a society at ease with itself.

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My Lords, the noble Lord, Lord Heseltine, has done the House a service in securing this debate so soon after the publication of his timely and visionary report, which I read with great interest. I agree with his description of the challenge facing us here today: to harness and unleash the talents of people across England and ensure that communities nationwide feel the benefits more deeply. I declare an interest as the chair of the National Housing Federation, the trade body for housing associations.

Devolution has empowered a new can-do spirit in our city regions, enabling local people to tackle local challenges through partnerships and policies which make sense for them. It has been uplifting to witness regions confront issues such as housing, social care and transport in a way that makes the most of the strengths of their region. However, there is of course more to be done. Many city region mayors and combined authorities remain beholden to Westminster for the critical investment and decisions that their local communities need. Many more areas are yet to benefit from any of the flexibilities enjoyed by combined authorities. I hope, therefore, that in his response to the debate the Minister will agree that the benefits of devolution should be extended more deeply where they already exist, and more widely where they do not, so that every place is given the opportunity to thrive.

As chair of the National Housing Federation, I am well aware of the value of empowering cities and regions. Housing associations are not-for-profit providers that invest any operating surplus into their local communities. They are shaped by the communities they serve and, in turn, shape the homes and services they provide to meet the needs of their community. They are busy putting into practice the principles of empowering people and communities across England every day.

The report by the noble Lord, Lord Heseltine, observes that reform of our local political institutions has taken place,

“at the speed of the slowest ship in the convoy”.

I would like to talk about the flagships of the convoy: the pioneering partnerships between housing associations and local authorities. There are many lessons to be learned on the opportunity and benefits that these can realise. I draw the House’s attention to Manchester. It is here that the flagship of our convoy in England can be found: Greater Manchester Housing Providers. Founded in 2010, this group of more than 25 housing associations and ALMOs manages one in every five homes in Greater Manchester. It works closely with the Manchester mayor and the Greater Manchester Combined Authority to ensure that the region’s housing need is met and to offer services far beyond homes. The results of this partnership are impressive. Last year, it helped nearly 2,000 homeless people in the region into homes, supported another 2,000 residents into employment, and helped more than 1,000 community groups in the region.

Manchester has very ambitious plans across housing, driven partly by need but also by the acknowledgement that housing provides wider community and economic benefits. Secure housing is the bedrock of a thriving entrepreneurial community. There can be no stronger evidence of the real human impact that empowering our cities can have. However, neither the GMCA nor the GMHP are resting on their laurels. Last year, a new partnership was announced that will create a joint venture housing developer, which will add 500 homes to the region each year.

Co-operation between housing associations and public sector housing providers is not restricted to Manchester. Across England, housing associations, local government and private developers are partnering to meet the needs of local areas. Look to East Anglia, where the Iceni Partnership of three mid-sized housing associations has delivered 3,500 affordable, high-quality homes over 15 years; to Gateshead, where a partnership of Gateshead Council, the Home Group housing association and private developer Galliford Try will deliver 2,000 homes over 15 years; and to Brighton, where the Hyde Group housing association and Brighton & Hove City Council established a joint venture to deliver 1,000 new homes by 2020, of which 100% will be affordable.

The benefits of this partnership working are clear: local organisations empowering local communities, delivering the services and support that benefit local people. But there is potential for much more of this type of working. The good news is that housing associations stand ready to work more closely with private partners and local government; indeed, they report the difficulties they face in partnering with local authorities as a key obstacle in increasing housing supply. The National Housing Federation is already convening representatives of local government and housing associations to find ways of working together more closely. It would be of great benefit if the Minister could commit to supporting local authorities to do more of this type of working.

Housing associations are learning first-hand the effectiveness of partnership working, but they could achieve so much more with the right support from central government. The National Housing Federation’s submission to the comprehensive spending review calls for a £10 billion national regeneration fund over 10 years. The noble Lord, Lord Heseltine, said earlier that the Government must lead. I hope the Minister can assure the Grand Committee that the Government support such a regeneration fund as a clear indication of that leadership. Ultimately, effective partnership working relies on mutual trust and understanding. Will the Minister commit to supporting this by providing local authorities with a sustainable future funding settlement, thus enabling them to lead and co-ordinate place-making in every one of their communities?

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My Lords, I pay tribute to the work of the noble Lord, Lord Heseltine, whose focus on the economic futures of cities, particularly across the north of England, has been crucial to their revitalisation. From the 1980s, they have in many cases become places with a new vibrancy, often related to the expansion of their universities and the achievement of the Urban Development Corporation. I strongly support the recommendations and conclusions reached by the noble Lord on a new department for English regions, how to replace EU structural funds, the allocation method of capital funding by the Treasury, the need for new Select Committees in both Houses to review devolution and the dispersal of the offices of Whitehall. These are all fundamental to delivering the success that we all want.

On Monday, I was asked to meet researchers from the OECD who were investigating why productivity in UK cities and their surrounding city regions is not higher. I suggested that if they simply read the reports of the noble Lord, Lord Heseltine, over the years, they could save themselves a great deal of time in writing their report.

I concur with very many of the conclusions that the noble Lord has reached. However, if I may, I want to correct a small error on page 20: my noble friend Lord Goddard of Stockport was the Liberal Democrat leader of Stockport as opposed to the Labour leader. This is clearly a typing error.

There has been other work carried out, such as that of the noble Lord, Lord Adonis, and the Institute for Government, which, with the Centre for Cities, produced a report in 2011 subtitled How Elected Mayors Can Help Drive Growth. The noble Lord, Lord Kerslake, has just produced a report of the UK2070 Commission, and there have been many reviews and reports on the northern powerhouse.

This is not a new issue. In 1962, then Prime Minister Harold Macmillan said that he was determined to,

“prevent two nations developing geographically, a poor north and a rich and overcrowded south”.

A hundred years ago, the population of the north was 35% of the UK; it is now 25%. According to the BBC, one in three new jobs created in the UK in the last decade is in the south of England. We talk of the need to rebalance the UK economy, and that certainly needs to be done.

Let me be clear: this is not about reducing the success of London, because that is where some of the tax revenues come from that are spent elsewhere in the UK. However, we need to be careful. I keep reading in the London press that London seems to want to keep more tax income, when it should be seen as UK tax income generated through London. It is not just London’s tax income.

On the publication of the industrial strategy, the Secretary of State said that:

“For centuries, British innovation and ingenuity have been firmly rooted in our regions and our nations”,

and that:

“Government is working with regions, towns and cities to help them build on their unique strengths”.

That is clearly the intention of the industrial strategy, but the UK spends only 1.7% of GDP on R&D, compared to an OECD average of 2.4%. It is between 3% and 4% in countries with a higher manufacturing base, higher skill levels, and higher productivity and wages. Low R&D spending means less investment in businesses improving their products, leading in turn to a lower manufacturing base, and then to lower R&D spending because of the smaller size of that manufacturing base. We have to reverse that trend.

It is of little surprise to me that, despite all the fine words about the north, huge plans are being developed for the Oxford-Cambridge-London golden triangle. Where are the golden triangles proposed for the Midlands and the north?

The noble Lord, Lord Heseltine, talked of the role of government as being first and foremost about leadership. I absolutely agree with that. There has to be trust of people outside London. He has talked of removing the “dead hand” of Whitehall.

Sitting suspended for a Division in the House.

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Please continue, Lord Shipley.

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I was talking about the decentralisation of Whitehall departments. A few years ago, I called for the Department for Transport to move out of London in its entirety, other than a small head office. I want to repeat that call because there is no need for the Department for Transport to be located in London when Transport for London is here. Indeed, if Channel 4 can move out of London, so can the Department for Transport, and so might other departments.

We have to allow localities to merge budgets from Whitehall to effect savings and, as a consequence, to deliver better services. If Whitehall is not joined up—and it is not—it can be joined up only at a local level. It is very important that infrastructure funding is transformational in its allocation. It is important for the Treasury to invest its infrastructure moneys in places which may not give as fast a return as places which are already better off.

I have been in the past, and still am, a supporter of the mayoral structure. I campaigned for a mayor for the city of Newcastle during the referendum. My reasons were that the powers of the leader were altered in the period just before 2010 so that a council leader had broadly similar powers to a mayor. I felt that council leaders should derive their power from all residents and electors, not just a party group.

Finally, I support very strongly what the noble Lord, Lord Heseltine, said about the role of the private sector. I was very pleased to hear his words about the Government working with the private sector to identify companies that can expand in those places where we want greater private sector expansion.

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My Lords, I thank the noble Lord, Lord Heseltine, for securing this debate on an important issue. I congratulate him on his fascinating and significant report.

I speak with some trepidation because many of the noble Lords taking part in this debate bring to it so much experience of government, both local and national. I do not have any of that. What I hope to bring is experience of over 30 years in ministry, where, unlike many professions, I live where I serve. It has been my privilege to have been involved in the lives of people in Stevenage in Hertfordshire, in south-east London and now most recently as a bishop in the north-east.

I have loved reading this report. That is something I do not say very often about reports of this nature. At the heart of it for me is the noble Lord’s reflection on the three weeks he walked the streets of Liverpool following the Toxteth riots in 1981, to which he referred in his opening speech. He said that that journey opened his political eyes. He saw the unhappiness and lack of ownership and engagement of people in their communities. He saw the frustration and despair of people whose futures are decided by people who live 200 miles away and who, as the noble Lord writes,

“have never experienced your life”.

Out of this experience the urban development corporations were born, and in Newcastle, as beneficiaries of this in 1987, many of us rejoice today in the transformation this brought about on the quayside in the heart of our city. The mechanisms of investment and leadership through the UDCs and investment and leadership through devolved combined authorities are very different, but underlying both initiatives is a concern to address the effects of the chasm between London and the rest of the regions in England—a chasm which the noble Lord believes, and I agree, contributed to the social unrest and riots in Liverpool in the 1980s and which in our time is contributing to the toxic divisions in our country over Brexit.

I support the noble Lord’s 20-point plan and vision to empower English regions, and I am pleased that since its inception in November last year the North of Tyne Combined Authority gives my part of the world a chance to be a part of this. I will be even more delighted if the combined authority can reach its full potential, with the inclusion of Gateshead, South Tyneside, Durham and Sunderland, which I hope will happen. As the noble Lord, Lord Beecham, said, the investment by the Government that the combined authority has attracted, although welcome, is very modest. The private sector is making a greater impact and showing greater confidence. In the North of Tyne area, which is the one I know best since it is exactly coterminous with the diocese of Newcastle, we have over 30,000 businesses that provide 415,000 jobs between them. To give just one example of this private sector confidence, at the beginning of this month technology giant Sage announced plans to move its flagship offices to Cobalt Business Park in North Tyneside, which is the largest out-of-town letting ever recorded in the north-east.

However, the story in the public sector is much less encouraging. The extra funding afforded to the northern powerhouse has been more than offset by the reduction in public sector jobs. Research from IPPR North marking the fifth anniversary of the northern powerhouse shows that across the north of England we have experienced a 2.8% fall in public sector employment since 2014. The north has suffered a £3.6 billion cut in public spending, leaving 200,000 more children in poverty. Office for National Statistics data shows that between 2012 and 2018 the number of civil servants in the UK as a whole fell by 7%, but in a stark example of the chasm between London and the rest of the country, this cut has not fallen uniformly over the country. The number of civil servants in London over this period rose by 12%.

In the light of this, I was encouraged to read John McDonnell’s interview with the Manchester Evening News in which he advocated moving a Treasury unit to the north of England. As the report written by the noble Lord, Lord Heseltine, points out, it has often been in the power of the Treasury to help or hinder continued devolution, so it would seem fitting if that department took the lead in encouraging devolution in this way. At present, as the noble Lord, Lord Heseltine, notes, London is too powerful and takes too many everyday decisions. This report offers a cogent and imaginative plan to change that. I urge the Grand Committee to note it.

I hope that the Government will consider the recommendations very seriously indeed. This report and vision speak not just to economic flourishing, which is important and we must have at least that, but go beyond it to the very nature of the society we seek to build.

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My Lords, I am very pleased to contribute to this debate and to join others in expressing warm thanks to my noble friend Lord Heseltine for this report. Like the right reverend Prelate, I rather enjoyed reading it, and not simply as an exercise in nostalgia. It was asserted, perhaps on this side, that we sometimes think of this as an obsession on the part of my noble friend. In fact, we do not; we properly regard it as a mission which he has not given up, and all credit to him for that.

I feel a bit like a Johnny-come-lately. Starting in the 1980s, I have been engaged in these issues for only just over 30 years, rather than going back to the 1960s and 1970s. Before I talk about them, I wish to draw attention to two of my interests. I am chair of the Cambridgeshire Development Forum, and I shall talk about the Cambridgeshire and Peterborough Combined Authority, and I was the deputy director-general of the British Chambers of Commerce, and I shall talk about private sector involvement in devolution, which also goes back to the 1980s.

At the end of the 1980s, when I was deputy director-general, we very nearly succeeded, on the basis of an understanding on the part of government that comparisons with other countries included an adverse comparison of the relative strength of the business community to generate infrastructure and investment and a focus on private sector decision-making at a local level, which we lacked. Part of the argument, which my noble friend was engaged in, was that we should have public law chambers as they do in most parts of Europe and around the world. We did not take that view. We took the view that we could achieve some of the benefits that public law chambers of commerce achieve while retaining private law status but taking responsibility for public functions.

I know from discussions with colleagues at the British Chambers of Commerce today that, in a sense, that is where they still are. They do not want to become part of government. They want functions that impact on the business community—including business investment, the promotion of trade and exports, and the development of skills—to be something that the business community can take responsibility for, including a responsibility for funding that activity. Back in the 1980s, we did it on the basis that one penny on the new national non-domestic rate would be available principally for the business community to invest in the training and skills of their community. In that sense, it is not unlike taking responsibility now for the apprenticeship levy or something of that kind.

I know that the chambers of commerce would want to take on this kind of responsibility. In the past, when the Birmingham Chamber of Commerce and Industry was working hand in glove with Birmingham local authorities, it was able to achieve dramatic things; including, for example, the establishment of Birmingham Airport, the National Exhibition Centre and so on. It can do more of these things in future. The problem is that government does not trust local bodies, and that extends to local business bodies.

That is where we were in the 1980s. The then Government had established local enterprise agencies, which should have been part of the responsibility of chambers of commerce, and then let them go and stopped the funding for them. We were in discussion with the Government about supporting the chambers of commerce to do training and enterprise promotion. They said that chambers of commerce were variable across the country and patchy, with quality differing from place to place. They therefore set up training and enterprise councils, which took all the money and employed all the people—who coincidentally were most of the people who used to work for the Manpower Services Commission. About 10 years later, training and enterprise councils were abolished on the grounds that they were variable in quality across the country and not reliable. That is exactly what happens time and again. It happened to local employer networks; it happened to training and enterprise councils; and it happened to Business Link in due course, which my noble friend established.

At some point in the past 30 years, we should have had the confidence to say that if the Government give the responsibility, funding and accountability to the business community, it will step up to the plate. We should not be surprised if it does not step up to the plate, when we do not give it the responsibilities and the funding. That is what I think we should do.

Cambridgeshire and Peterborough have a combined authority that embraces cities and countryside. It is not large; if anything, in my book it is sometimes too small for the 30-year vision required to be achieved. Arguably, for the Cambridgeshire-Peterborough city region to be looked at holistically, it is always a good idea to think about Suffolk and Norfolk alongside them to achieve scale. None the less, we are where we are. However, what should not have happened is that we ended up with one more tier of government. Parts of my old constituency have a parish council and the district council, and then there is the county council and the combined authority. People wonder what on earth they need all those tiers of government to do.

To echo what my noble friend said, at the very least the responsibilities of the county council and the combined authority must be put together—perhaps with those of the police and crime commissioner, as my noble friend suggested. Certainly, we must do that, because otherwise we are asking the combined authority to set out its vision—for example, in the non-statutory spatial strategy—without it being able to deliver it; it does not have the wherewithal to make it happen. The same is especially true of the local transport plan, and to some extent true of training and skills. If we give the combined authority and the mayor those wider responsibilities and the capacity to deliver, we will be impressed by what Cambridgeshire and Peterborough can achieve.

We are benefiting from the rebuilding of the A14 and the Government’s sponsorship of the east-west rail link from Cambridge to Oxford, but we are not asking in the long run to have more money from a limited government pot. What we want in a place such as Cambridge, which has the highest employment rate for a city in Europe, is to be able to invest for ourselves and through tax increment financing to demonstrate that the private sector borrowing that supports that can be repaid with interest. I hope that we can tackle that.

As my noble friend illustrates on page 67 of his report, we know that it is down to us to deal with the deep inequalities that continue to persist, literally only a few miles apart, in a city such as Cambridge. We know that we have to deal with that and that it is not somebody else’s responsibility.

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My Lords, I am very pleased to be able to support the noble Lord, Lord Heseltine, in this debate on his latest report. I start by highlighting some key sentences that jumped off the page as I was reading it. On page 13, he writes:

“I now believe I was wrong”.

On page 15, as the right reverend Prelate said, he writes:

“The three weeks I walked the streets”—

of Liverpool—

“opened my political eyes … There was no one in charge”.

On page 18, he writes:

“Political philosophy must be tempered with common sense”.

On page 20, he writes:

“One lesson learned was simple. If the only route to success was voluntary, then there had to be a deal with prizes!”

On pages 25 to 27, there are lots of examples of leadership and partnership bringing about success.

I know first-hand the esteem in which the noble Lord’s work is held in Liverpool. Until his sad death five years ago, I had a 50-year friendship from our Aston University days with a Liverpool-based journalist, Ian Hamilton Fazey, who was at one time the managing director of the Liverpool Post and the Liverpool Echo, and then for many years was the northern correspondent of the Financial Times. He followed the forensic dedication shown by the noble Lord to Liverpool, both before and after the 1981 riots.

During some of those years, I was the shadow housing and environment Minister in the other place. I was really grateful to those appointed by the noble Lord who took me on visits to, for example, the former Cantril Farm, now renamed Stockbridge Village, and explained what was going on in considerable detail. This morning, I re-read his famous minute to the Prime Minister from August 1981: “it took a riot”. It is easy to see from re-reading it why he took the view he did then about the met counties, but in all other respects, the themes in his latest report are set out in that note, which is nearly 40 years old.

The noble Lord’s proposals are a package that I, for one, can support. Whitehall finds devolution very difficult, as I know from my experience as chair of the Food Standards Agency. It will therefore need a drive from the centre, with support from the top, to deliver the change needed to allow English cities to breathe. Like him, I do not support a wholesale reform of local government, but we need to learn the lessons from recent years and see where reform to the combined authority boundaries and some of the city boundaries is needed.

I support close and detailed parliamentary scrutiny in the form of Select Committees, but should it be committees in each House or a Joint Committee? I am not sure. There is more experience in this House, but accountability of course lies with the Commons. I do not have experience of a Joint Committee of both Houses and do not know whether it would work: would the Lords be the junior partners, or would we have a free-standing committee of both Houses? I am open on that. It is also true that now that we have a form of fixed elections—whatever might happen with the Fixed-Term Parliaments Act—it makes good sense to review the clash of dates in the electoral cycle. Good accountability requires a degree of stability. That is important in both the private and the public sector.

I have also come to the conclusion, to which I had been opposed, that the role of the mayor and the police and crime commissioners should be combined. I understand that that was the original plan. However, it would be a retrograde step if the 2017 Tory manifesto was followed and the elections returned to first past the post. That was the commitment, and it would be a disaster. The present electoral arrangements have given us a range of police commissioners that we would not otherwise have had.

We will return to a modern form of skills training only with enhanced further education. When I last counted, this House included 40 chancellors of universities but not one boss from further education—not one. I freely admit that I was a child of FE; for three years in the late 1950s, after I left school and before I entered higher education. It is a completely different world. If you have not been in FE, you do not know about it. If you went from school to higher education, you have no idea what was happening in the 1950s and 1960s with further education in this country and the opportunities it gave to a range of people that are simply not available today. We need not to turn the clock back but to have a more modern version.

Buried deep in proposal 14 is the plan for, among other things, a tourist tax. I will leave most of the detail to my noble friend Lord Hunt, but a good test bed would be the 2022 Commonwealth Games in Birmingham. A pilot scheme could be set up. The Treasury will never like local taxes and charges, and so will wreck most good ideas. Therefore, we need a Chancellor with the confidence to change. If you have the confidence in what you are doing and the policy, you can embrace change and take a risk that might not work, but if you do not have the confidence, nothing will happen.

Having someone in charge is crucial, as the noble Lord said throughout his report. In my view, while not unfettered, the mayors should be able to explore different ways of working with the support of combined authorities, and the noble Lord gives examples of what could be done. It does not have to be the same in every combined authority; that is the beauty of it.

The report’s final key point is that the recommendations and observations strike at the heart of the way in which we run the country. That is pretty crucial, and it is a positive point rather than a negative one. We are where we are, and next week we will see a new Government formed. In my view, it would be a dereliction of duty to the country if this report were not used as a central tool of domestic policy while the Government continue to grapple with Brexit. I think it is a fantastic report

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My Lords, I add my thanks to the noble Lord, Lord Heseltine, for the report and for giving a good profile to this issue, which I think has faded a bit in recent months—not surprisingly, with the attention being on Brexit. There have been myriad reports from organisations that have been working to promote greater devolution to cities. The spotlight has also fallen on this idea through the experience of some of the people that we have heard about through Brexit. In our own cities we have seen disenchantment and disillusion, often symbolised by boarded-up high streets, no local facilities to support people in poverty, food banks and all the other things that tell us that parts of our country are in great need of attention.

The whole issue of devolution, as my noble friend Lord Tyler has said, is one that we very much support but, as he also said, we mean devolution, not delegation. We have seen that through all parties’ attempts to give powers, such as the recent assemblies. I served on one in the south-west and actually it had no powers, so no one could really see the point of attending it. What happened was that all the powers went to the RDAs and the assembly, as the noble Lord, Lord Turnbull, has said, was given powers to discuss rather than to act. In my view it is essential that any devolution is about transferring powers.

I know that in my city, Bristol, when I have gone out for election, all the matters that people raise on the doorstep are things that we have very little power to do anything about. Transport is the biggest but there is also housing, schools—they are not in democratic control locally—and social care. One of the issues that we felt was important was that taxes should raise money locally. The noble Lord, Lord Turnbull, talked about this: in France, three times more finance for local government is raised locally, while in Sweden the figure is 12 times as much. As the noble Lord, Lord Lansley, was saying, the money coming from the Government is not so much what people are looking for from devolution, although there would have to be equalisation as some parts of the country are much wealthier than others.

Some devolution has taken place but if you are a city leader then my suspicion is that you feel that the most enormous amount of time, attention and resource has been put into devising schemes where very little power is actually handed over to elected representatives, whether mayors, city leaders or councillors, along with a whole panoply of contracts with rules, conditions and teams of lawyers to ensure that these are adhered to. A lot of this stifles local imagination, local creativity, and local solutions to local problems. As the noble Lord, Lord Lansley, said, local business finds exactly the same thing.

The noble Lord, Lord Heseltine, talks about other European cities. I used to represent my city in EUROCITIES and heard about the powers that other European cities have. They are astounded, and some are bemused, to hear that the Mayor of London has to go to the Government cap in hand and ask for money to support essential infrastructure. As for provincial cities, they have even fewer powers; London has actually not done too badly out of it. It would be ridiculous to expect the mayors of Hamburg, Toulouse or Lyon, as in the report, to have this much sticky tape, as I always think of it, from central government preventing them finding local solutions, unleashing energy and harnessing the creativity of their own areas.

I welcome the fact that some local tax-raising is mentioned in the report. However, until locally elected representatives—whether they be mayors, councillors or leaders of combined authorities—can raise their money and be accountable for it, borrow money locally and raise taxes to pay for it, we are seeing only a delegation from central government and not true devolution. I very much welcome the report and hope that it is a long stride on the road to what I see as real devolution.

In my city of Bristol, we have five mayors over the whole combined authority, which the public sometimes find quite difficult to understand. With accountability must come clarity of roles, transparency of powers and the recognition that one elected individual, although they may be accountable to government, cannot be the only person accountable to the people. The big responsibilities of education, social care, the environment and all the services that underpin the least well off, cannot be managed by only one person. They must have a properly accountable team, enabling decisions to be taken to provide the resources to provide that. As many organisations have said, not least Core Cities, of which I used to be a member, the enormous power to the economy that our cities could give, the pride of ambition, the feeling of recognition by people in those areas that they are not secondary to London and do not see all the money going back there, is essential and, I believe, will motivate people. The noble Lord, Lord Heseltine, goes into this, too, in his report. “Breathing life into devolution” is essential, and I totally agree that we need government confidence to take this forward. The only way that unleashing local energy will really happen is if there are real powers—if people feel that they are in the driving seat and have a say and, if they do not agree, can throw people out.

I am very encouraged by the noble Lord’s report and hope that we are going to advance further on this agenda. I look forward to seeing the effect, which I believe will be transformational.

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My Lords, the report of the noble Lord, Lord Heseltine, is excellent, and if we were not wasting our time on Brexit, as a country we would be getting on with implementing a lot of the recommendations he has put forward. What stands out so strikingly from the noble Lord’s career is that he not only exhorts us with his great reports, but by his example. To my mind, the noble Lord is one of the two most effective Ministers that this country has produced in the last generation, the other being Roy Jenkins. It is very fitting that we are debating the noble Lord’s report in this Room this afternoon and, in the other Chamber, we are debating until a late hour the extension of rights in respect of abortion and equal marriage to Northern Ireland, which in many ways is the completion of Roy Jenkins’s work. His work will live on long after him, and nowhere more so than his own example in how to create a city; the noble Lord, Lord Heseltine, substantially created modern London with the creation of Docklands, which was a phenomenal achievement. Docklands employs more people now than it did in the docks in the 1960s. It is the powerhouse not only of the London economy but in many ways of our national economy. As an exercise in both economic and infrastructure planning and sheer vision, it was a phenomenal achievement. Docklands is still a work in progress. Massive housing provision is now being added to the business communities there, and that will add to its success.

When I was Transport Secretary and planning HS2, I visited the Chinese Transport Minister in Beijing because China has more high-speed rail than the rest of the world put together. The Chinese were trying to persuade me to buy Chinese technology for the building of our high-speed line, which I said was a bit premature because we had this thing called Parliament, which had to agree to all the plans before we could do it. A senior British businessman in China said to me, “You have to understand, Andrew, that R&D in China stands for ‘rob and duplicate’”. I have always thought public policy is very straightforward: it is rob and duplicate, but you have to know what to rob and duplicate—what to copy. It is a very good rule of thumb that what one should do if one is looking at urban policy and the development of big infrastructure is to rob and duplicate as closely as possible from the schemes which the noble Lord, Lord Heseltine, has developed over the years, and then one cannot go wrong.

For the leader of any city to look at and understand the story of Docklands is the best possible initiation in how to plan a great city—the noble Baroness just referred to Bristol. One could go through the big challenges of all the major cities in England, and the noble Lord, Lord Heseltine, has in many ways laid a path that others should follow.

On the recommendations of the report, which the noble Lord summarised in his speech, I agree with them all. I agree with a department for the regions, government offices outside London being brought together and Select Committees on devolution, whether they be joint or individual—I do not think it matters. I am very struck by the fact that the Select Committee efforts of your Lordships’ House are overwhelmingly focused on Europe. That is a very worthwhile thing for them to have focused on, but they should be much more engaged in the life of the domestic departments, and having a Select Committee on devolution would be a good step forward.

The annual report on cities, benchmarking them against their competitors abroad, is a great idea. Bringing police commissioners together with mayors is an absolute no-brainer. It is ridiculous to have these two great public services being managed in cities by two different elected public officials. Perhaps the Minister can tell us the Government’s thinking on that, because it would be a very simple and straightforward reform that could be transformational. Pressure on skills and strengthening the role of mayors is also important. Making business support equivalent to the best business support provided internationally, again, is a no-brainer. The remarks of the noble Lord, Lord Lansley, are very pertinent in this respect. Essentially we have reinvented our business support networks every 10 years, when what we should do is tie them very closely to our city institutions. I think chambers of commerce should be the basis—that is another of the noble Lord’s themes going back over many years. With respect to rob and duplicate, we should just have a chamber of commerce system like the Germans. It is not complicated—we could just get on and do it.

In all these respects, the noble Lord’s report is right. But always focusing on practical objectives is the big thing. One of the biggest crises that we face in most of our cities is communities, and in many of our cities, it is housing—the remarks by the noble Baroness, Lady Warwick, were extremely pertinent in this regard. We need the combination of strong leadership, which is where the mayors come in, and much greater powers. As the Minister knows, I am always constructive, even when dealing with the Government, most of whose work I profoundly disagree with. However, there is one thing that the Theresa May Administration have done in the field of local government which I strongly support: the lifting of the borrowing cap for social housing. My Government failed to do it, as did the Cameron Government, but it has happened now. Can the noble Lord give a progress report on what has happened since the borrowing cap was lifted? Has it unleashed a new wave of investment? What is happening on the ground? This is a huge opportunity for mayors and local authorities to get on with what needs to be a new generation of social home building after a generation where there has been practically none, dealing with the huge social crisis that we have in many of our cities.

I will quickly highlight three other points. On the “rob and duplicate” principle, urban policy in most of the rest of England is not too complicated if you look at what is required in city leadership. The “rob and duplicate” principle should be, to be very blunt, to copy London, the city where we have developed the most successful models and institutions of leadership and powers, certainly over the last generation and in many ways going back to the London County Council and the Greater London Council in the 1880s and 1890s.

London has been the leader. The strongest city in this country has also had the strongest and most credible institutions, and we need to extend the model of those institutions to other cities. The great problem with the mayors outside London, whom the noble Lord quite rightly champions, is that they have only a fraction of the powers of the Mayor of London. They have none of the powers of the Mayor of London in respect of public transport, such as the capacity to integrate transport or regulate buses. Buses are hugely important in cities up and down the country. Far more people travel on buses, particularly lower-paid people, than on trains. Twice as many people each year travel on buses as trains. The average bus fare outside of London is twice the level within London, although wages are much lower. Levels of regulation are much lower. My noble friend is nodding her head.

When I was in Newcastle recently—I travel on buses wherever I go because it is quite an important way of seeing what is going on—I noted that one-third of bus fares there are still cash fares, which takes ages to load buses. The average cash fare, from memory, is £2.50. In London, it is £1.50. London abolished cash fares, as it has electronic ticketing, five years ago. The big cities outside London are literally a generation apart in terms of technology, level of service and regulation. I cannot think of anything more important for mayors to get involved in than buses, houses and giving them the powers.

I had a lot more to say, but I have run out of time. In concluding, I want to make one remark about the mayors. It is hugely important that the mayors have a lot of clout in London. The Mayor of London has clout in London by definition, because he is located in London, but mayors from outside, by definition, will not have the same clout which comes from geographical proximity. However, when the time comes to reform your Lordships’ House—in the great constitutional crisis we are engaged in at the moment, it may be quite soon—it is high time we move towards a federal second Chamber. The big issue in creating a federal structure for the United Kingdom has always been how you deal with England. A key element in dealing with England, following on from the noble Lord’s report, is that the mayors of our great cities and city regions should play a part. As part of that, like the Bundesrat in Germany—the German second Chamber which represents the states—the senate should represent the cities, city regions and nations of the United Kingdom. Having the mayors as members would be a big step forward.

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My Lords, like other speakers I begin by congratulating my noble friend on his report, not only for what he concludes but for the way in which he has described the journey he made in getting to those conclusions.

Before going on, I should declare an interest. I am chairman of the Cumbria Local Enterprise Partnership; I have represented the area I live in in the European Parliament and have chaired a number of businesses there. This is relevant to what I am going to say, because I am sympathetic towards and a supporter of my noble friend’s concerns, but I will focus for a moment on places such as Cumbria, which are not in a city or its direct economic and social hinterland. This is because I do not want them to fall between the gaps which the project, as described by the noble Lord, might lead to.

First, I go back to cities. I spent 10 years in the European Parliament about 20 years ago. I was struck then by the vigour and profile of the great European cities when set in contrast to our cities. They seemed to have an identity and confidence which went beyond that of the country in which they were situated. What struck me at the same time was that when the European political institutions made overtures to the great cities of this country such as Newcastle, Manchester and Liverpool, they appeared to be rebuffed by the United Kingdom Government in London. I think the reason for that was a fear of some kind of independent supranational attribute that might be generated by participating in all this.

This is a matter that does not really concern the younger generation, given that they are so much less worried by matters of nationality and jurisdiction. For them, Berlin, Lisbon, Munich, Madrid and Milan are simply places to go to and places where football is played. I do not know whether any of your Lordships noticed but, during the recent UEFA Champions League final in Madrid, everybody went to Madrid, not to Spain.

In some ways, perhaps the most prominent of all cities in Europe is London; it is, after all, one of the great global cities. For many people from abroad, it is almost a detail that London is in this country. The point of London is that it is a global city and one of the financial capitals of the world. As an aside, we ought to be aware that in this age of telecommunications, the financial centre can move from London just as the centre of European finance moved to this country from the Low Countries in the late 17th and early 18th centuries; indeed, it moved there from southern Germany and northern Italy. We should not take for granted any of the characteristics which are successful in this country. We should remember that the vanished pomps of yesterday are,

“one with Nineveh and Tyre!”

It seems to me that during the 20th century our great cities lost the domestic, commercial and political provincial dynamism—and I use the word “provincial” in an approving and not disparaging sense—that created Manchester, Liverpool, Newcastle and Glasgow. We can see this elsewhere in the world, including in China, which, whatever its other problems, displays dynamism. Where there is such dynamism, there is civic pride, energy and commitment. That is what made these cities great in the past, as can be seen by looking at what remains. The noble Lord, Lord Heseltine, is quite right to want to re-instil this into our country, but it has to be recreated; it cannot happen by itself. It is no good to declare ourselves optimists and assume that that will lead to a better tomorrow. There has to be substance, vision and detail to enable us to get there.

As I said in my opening remarks, this is not for everywhere. In particular, there are two areas we need to consider in this context. First, in this country there are a number of large but nevertheless smaller cities, relatively speaking. I am thinking of places such as Preston and Bolton, which are in the solar system of great metropolitan cities but tend to be overshadowed by their bigger neighbours. They are proud places and they offer a lot of potential.

Secondly, there are areas such as my own, Cumbria, which is sometimes described as the north of the north. It has half the land mass of north-west England, is at the centre of Britain and has a population of about half a million. It is not part of the economic system of any of the great metropolitan cities but is nevertheless affected by them, and by Scotland. I would like to put on record that the development of the Borderlands growth deal is an important initiative because, while we are all in the United Kingdom, England and Scotland are different countries. This initiative transcends the border, and there are not very many that do. In Cumbria, we look to the north of England, London and Europe, which is, at least for now, very important for our domestic market. Independent analysis carried out by the LEP shows that the impact of no-deal Brexit will be very serious indeed, as was corroborated by a separate piece of work carried out by the CBI.

One aspect of the report that I found most interesting was the chapter written by Tony Travers, outlining the history of local government. Things change as the world changes and, as a number of speakers have said, we are in the middle of a revolution and so things are going to have to change. The question is how. The experience we have had in this country appears to suggest that we tend to start with structures but that that will not necessarily lead to a successful result. I sense that we are seeing the beginning of a change of approach: we are starting with function. If we can change the place in the system of governance where decisions are made—and make sure that changing it does not merely mean decentralisation by moving Whitehall somewhere else but moves decision-making nearer to those who will be affected—that will encourage participation and civic pride in the communities that are going to benefit. If we can do that, it will in turn generate dynamism, regrowth and prosperity and will encourage able people from all walks of life to become engaged.

In the north, we see that the Government are now trying to re-engage through their Northern Powerhouse 11, as opposed to the Northern Powerhouse Partnership, to which Cumbria LEP is fully committed as a full partner. The very different members of the group have very different contributions and have a different emphasis on what they do. Nevertheless, it is an important initiative in which I hope that all those engaged, from the smallest to the largest, will be treated equally, in the same way that Austria and Germany sit on the European Council as equals.

Changes appear to be happening, and they are happening incrementally. It may well turn out that change of this sort will be more successful than the imposition of structures from outside, from Whitehall. Form follows function, and if functions change then I believe that the appropriate form will follow and change with it. I hope the report by the noble Lord, Lord Heseltine, is an important milestone on the road to rebalancing the ways in which things are done in England.

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My Lords, I find myself echoing the words of the right reverend Prelate in saying that I have no interest that I can declare. My pathway in politics includes no inside experience of local government and I therefore feel that I can speak on its structure without prejudice although, many people might feel, without sufficient knowledge.

I was born and brought up in South Yorkshire. I lived for a large part of my life in the city of Birmingham in the immediate postwar years. In the House of Commons I represented a seat in Greater Manchester and subsequently, for much longer, a seat in rural Essex. Over those years I have gained certain impressions that have led me to feel extremely well disposed to the report by the noble Lord, Lord Heseltine.

I became the prospective candidate for the constituency of Middleton and Prestwich. At the time, as one had time in those days, I actually read the Redcliffe-Maud report. I thought it made a good deal of sense and was easy to understand, whereas I found myself dealing with a constituency containing two boroughs and one urban district overseen by a county council. I began to understand then the confusion of local taxpayers about who did what, a confusion that survives to the present day. That was a structure that led in democratic politics to a blame game in which the people who were dispossessed of their seats in an election accorded the blame to members of another authority who had apparently acted out of step with what they felt was right. I am afraid that that attitude also survives to the present time.

The next lesson that I learned was about people’s passion over boundaries. I was amazed by the extent to which people would fight and scrap over whether one particular neighbourhood should be this side of a border or the other. When reforms were introduced by the Heath Government, in which I think the noble Lord, Lord Heseltine, would have been involved, all three local authorities in my then constituency wanted to be in a different local government organisation, and all succeeded in getting their position changed. That was the level of criticism that they felt about any reform, and I suspect that there is deep conservatism attached to all sorts of changes that are now introduced.

The underlying argument behind reform that has taken place at various times was size, on the basis that bigger was better. In terms of efficiency that is probably correct, but there was also a feeling that more people would be drawn into standing for office in local government if there were really worth-while decisions to make. I do not think that hope has been particularly borne out. People’s civilian lives have become very much busier and they feel less able to devote time to the increased burden that applies to any elected council these days, which has made them turn away from the prospect.

The general trend towards enlargement has continued and is of course in the Heseltine report. It is true that the smaller the units of local government, the more choice there can actually be said to be for people. However, I found, in what is a more mobile society, that people would move into Essex from, say, Gloucestershire or Wiltshire and then start complaining about the level of services they were getting in the matters that interested them. There was almost a desire that a national standard should be observed.

My other impression is that there is a battle, or has been, between London and the provinces. I sympathise with what my noble friend Lord Hodgson said on that subject. There are increasing concerns about the north/south divide, but I believe it is really about London and the rest. The question is whether this problem can be overcome best by a form of devolved government that emulates and rivals London. I am very sympathetic to the idea that that is the way forward, however long it takes.

Based on experience to date, the combined authorities concept seems the most promising thrust in the direction we need to go. These are early days. There is variation between combined authorities, but nevertheless for the most part there is a common core of devolved powers, which is also true in the other cities cited in the Heseltine report. On the basis of trying to borrow from the best, it might be that we can perfect a model that would command wide acceptance on the basis of it being proved how effective it can be. The test will be whether it will be easier to build houses, where these days one finds opposition from people who are themselves well housed, develop skills, improve transport, attract investment and better identify priorities. A challenge has been laid out for us extremely skilfully in my noble friend’s report. It is one we should not ignore.

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My Lords, I too congratulate the noble Lord, Lord Heseltine, on his report and on the strong commitment shown to our regions and cities over many years. He began his remarks with a reference to Brexit. Since he mentioned that subject, I congratulate him on his stance on that as well, with which I strongly agree.

I have an interest to declare in that I am chair of Tyne and Wear museums, which is largely local authority funded and now rather oddly finds that half the area it covers is in a combined authority and half is not, which is a strange situation. Certainly, given the importance of our wonderful museums and the culture sector to local and regional economic regeneration, this is a role I am very strongly attached to.

I was struck by the debate in this Room some time ago on the order to create the North of Tyne combined authority. I very much agreed with the comments made by my noble friend Lord Beecham on that occasion, and by the right reverend Prelate the Bishop of Newcastle, who said that,

“nobody … will feel that this is anything like a sufficient answer to the critical lack of investment in the north-east”.—[Official Report, 30/10/18; col. GC 116-17.]

I was sorry that there was not agreement on a proper north-east combined authority, but I can understand it. As my noble friend Lord Beecham said, in some cases elected mayors were being foisted on areas that specifically voted against them. We were faced with a very uneasy situation. I remain an unrepentant regionalist, because I believe the regional structure suits the north-east better than anything else. However, I completely agree that one model does not fit all circumstances, and we have to look across the country at the spatial and economic realities of the situation. Indeed, that was a phrase in the noble Lord’s report that struck me very strongly: the,

“need to reflect economic and spatial reality”.

In the north-east, despite the fact that a regional assembly was voted down by a large majority some years ago now, I believe that the need for a regional assembly and a regional structure is still very strong in that part of the world. Perhaps I can take some comfort in the fact that, when the idea of a Welsh Assembly was first put forward in the 1970s, that was defeated with a majority that was rather similar to the one in the north-east referendum. Of course, the Welsh Assembly was passed by a whisker in the successful referendum 20 years later, but now, as the noble Lord, Lord Heseltine, pointed out, it seems to be very firmly established and supported across Wales.

The regional campaign in the north-east was led by a group of people who campaigned on the theme of, “Who wants a lot of useless extra politicians?” They were helped beyond their wildest dreams by a couple of events: the announcement that the Scottish Parliament building was going to be 10 times more expensive than was first estimated—that happened during the campaign —and, secondly, when MP’s expenses were published. Many newspapers totted up the total amount claimed for staff, offices and so on, and made it look as though that was the huge amount of money that each MP was individually getting in their pockets. However, the north-east has a lot of economic cohesion, and I believe that a regional government and regional assembly would give it much-needed political clout, as well as allowing it to address economic needs and build on its economic strengths.

In many respects, where we are at the moment with the current combined authorities does not make sense. The main example I would give is that of transport. When the metropolitan counties were originally created, the Tyne and Wear area wanted to have an integrated transport system, but that rather fell by the wayside with the abolition of the metropolitan counties. It was not helped by policy decisions such as that of bus deregulation. We now seem further away from that integrated system than before. As the right reverend Prelate and my noble friend mentioned, the Tyne and Wear metro system is desperately in need of investment. When I travel on the Tube, as I do practically every day when I am attending your Lordships’ House, I am always struck by the amount of investment there has been, and how one normally needs to wait only a minute for a train. I contrast that with the 12 or 13 minutes that I regularly wait when I am trying to travel on the Tyne and Wear metro. My only consolation is that, despite the failure to get agreement between the north and south of the Tyne on the combined authority, there still seems to be a strong recognition by the local authorities concerned that co-operation between them is vital. I hope that that willingness will be translated into action.

The noble Lord’s report has many recommendations that I strongly support, including the creation of a central government department of the regions and combining departmental work in the different regions in the kind of way that was very successful with the former government offices. I think that the noble Lord is quite right to address structures at the centre as well as the need for new structures in the regions and localities of the country. I agree with the proposal about Select Committees and with the idea of a committee of combined authority mayors—and the necessary co-operation of the combined authorities with other bodies, whether it is the Environment Agency, Network Rail, or the other bodies that the noble Lord mentions in his report.

Some recommendations could work for some authorities, but perhaps not the one that we currently have in North of Tyne. For that reason, I would not be keen on strengthening the powers of the mayor until the boundaries are more satisfactory and we have a more viable organisation in that area. I am also not totally convinced about the idea of combining the role of mayor with that of the police and crime commissioner, and I have some concerns about admission charges for local cultural facilities. I think there are various ways in which you can encourage donations which should be looked at before charges.

Finally, structures are important but trust and leadership are also very important. Sometimes it is quite difficult to decide what makes a successful authority in terms of leadership. We recognise it when it occurs, but it is not always easy to design it into a system.

I shall conclude by mentioning my pride in Gateshead council, and all the wonderful projects that it has fostered and encouraged—the Angel of the North, the Gateshead Millennium Bridge, Sage Gateshead, the BALTIC Centre for Contemporary Art, the Gateshead International Stadium and so on. It is an astonishing achievement which should be trumpeted; I agree with the noble Lord, Lord Turnbull, that we need to recognise when local authorities have achieved things and applaud them for it. The Conservative businessman Sir John Hall, who is known to many people, described Gateshead council as a “public entrepreneur”. I thought that was an excellent description. It seems to me that the report published by the noble Lord, Lord Heseltine, will help to unleash that public entrepreneurship, and for that reason he deserves all our thanks.

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My Lords, like the noble Lord, Lord Heseltine, I believe in the importance of cities. I look at the great northern cities of our country and at how they languished. They could have been the engine of growth for the whole country. Thanks to the noble Lord and others, we now realise the importance of our cities and our city regions.

The noble Lord, Lord Rooker, reminded me of the Toxteth riots. My house was at the top of Lodge Lane. The riots were not about race; they were about policing. Locals joke and say it took a riot for Margaret Thatcher to come to the city of Liverpool. She came, and the noble Lord, Lord Heseltine, came with her. I was quite taken with Eric Sorensen, as I remember. I was also quite taken with the comments of the noble Lord, Lord Heseltine, at another event I went to where he said, “I stood and looked at the Mersey from the Liver Building with a glass of wine at the end of a difficult day wondering what had happened to this great city and what had gone wrong”. As I think he said, he spent three days listening to people and then he put some of those thoughts and ideas into practice. That listening is so important, as is having a vision about where you are going to go.

I became leader of Liverpool, that great city, in 1998. There were 99 councillors and we won 52 seats. The following year we won a further 10 and we won a further nine the year after that. Trying to lead 71 Liberal Democrats was the hardest job in the world. I though, “What do I do here? Where do I go?”. I thought, “Why don’t I visit two cities which have had very difficult times and talk to the leadership?” I went to New York and Dublin. The mayors of those cities separately said exactly the same thing. They said it is about having a vision of where you want to go and confidence—I think an earlier speaker mentioned confidence—and that even if the cupboard is bare you should talk up your city and your region and then count the number of cranes on the skyline. I did that, but I soon realised that the structure of local government made it very difficult indeed. We had a committee structure. A decision would go the sub-committee, then it would go to the main committee, then it would go to the performance review committee and then to the policy and finance committee and finally at the end of a 10-week cycle it might come out of the sausage machine at the end.

New Labour was looking at the idea of the modernising agenda for local government. In Liverpool, we embraced that with an executive board, scrutiny panels and councillors having a powerful role in their communities. Then the modernising agenda, which I think Hilary Armstrong—the noble Baroness, Lady Armstrong of Hill Top—brought in, meant that local authorities could adopt it if they chose.

I probably agree with everything on the 10-point or 20-point plan, with a few little changes here and there, but what is perhaps missing from it is this. You can have all the vision and powers in the world, but if you do not have the quality of the leadership it does not happen. One of the proposals is that the mayors should,

“establish a leadership academy for city governance”.

That is crucial.

Secondly, and I do not think the noble Lord, Lord Heseltine, will agree with me completely on this, it is about accountability. Noble Lords will recall that the Localism Act allowed local authorities to establish elected mayors. Of the 10 that had a vote, only one—Bristol—decided to have a mayor. Doncaster decided to retain its mayor. In Liverpool, we never had the opportunity to vote on whether to have a mayor. I think there was an agreement between the city leader and the noble Lord, Lord Heseltine, to establish a mayor in Liverpool. I regret that, because it would have given more strength and power to the mayor of Liverpool.

Accountability means that you have to listen to people. It is very alarming that the scrutiny panel in Liverpool has been abolished by the mayor. There is no scrutiny of his decisions. For example, it takes 60,000 people to sign a petition to stop their park being sold to Redrow developments. The mayor does not want to listen to them , so they have to go to the High Court to get an injunction to stop that development. That should not be the case.

I was very taken by the briefing, which perhaps all noble Lords saw, from the London Assembly. It said:

“London has made a success of devolution … Devolution works. It makes government more open, more accountable and more relevant to local voters”.

I agree. It also says that there needs to be overview and scrutiny to be effective and hold the Executive to account to contribute to better public policy and decisions. To my mind, that is the other key element we must never forget. We have a system of elected local councillors, and they need to have an important role in the work of the council as a whole. They should not be there as sheep that just follow the leadership. They should have a clear role and be able to hold the leader to account.

I went to the presentation of a book by Professor Michael Parkinson from Liverpool University. At the time of the Militant tendency in Liverpool, he wrote a book called Liverpool on the Brink. He has now written a new book called Liverpool Beyond the Brink. The noble Lord, Lord Heseltine, was the guest of honour there. One of his great legacies will be not only the huge contributions he has made to Liverpool: we now have the Heseltine Institute in Liverpool to carry on his work, which is hugely important.

The importance of cities to the national economy must never be forgotten. The challenge, as the noble Lord, Lord Heseltine, points out, is that we need more of our cities to be successful. It should be not about problems, but about solutions, wealth creation and entrepreneurship. Cities do not create jobs; they create the conditions where jobs can be created and businesses can be successful. We need to devolve sufficient powers and policy, because we continue to live in a very centralised society.

Professor Parkinson also talked about the noble Lord, Lord Heseltine, as I have. He said, “Trust the people”. They deserve nothing more.

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My Lords, I congratulate the noble Lord, Lord Heseltine, not only on the content of his report but its presentation, which makes it a pleasure to read. I should not have been surprised about that latter aspect because he has access to a good firm of printers.

I take part in this debate with diffidence. Unlike my noble friend Lord Turnbull, I never served in a local government department, and I lack the local knowledge that so many of today’s speakers have shown, but there are some aspects of my experience in government which bear on the report by the noble Lord, Lord Heseltine. First, from my experience, I confirm that you cannot make things happen in local areas from a desk in Whitehall. The second thing I am sure the noble Lord is right about is that the best way to get something done is to make an identified person on the ground accountable for making it happen and give that person the necessary powers and resources to do so.

When I became Head of the Civil Service, I inherited a programme of reform called “Next Steps”. Its essence was that the delivery of services—for example, issuing passports or driving licences—was set up in the form of an agency under a chief executive. The agency was responsible to a Minister—it was not a quango—but the chief executive was given a budget, which he or she was empowered to use with wide discretion to achieve objectives set by the Minister. Despite initial opposition by the Treasury, I believe that this structure not only raised the morale and the sense of responsibility of civil servants delivering services but produced a real improvement in the quality of the services they gave to the public. The same principle should be applied to decisions about local infrastructure. Local people will be the best judges of where infrastructure is needed.

The million-dollar question—as shown in the chapter by Tony Travers—is how one gets the balance right between local services controlled locally and local services controlled centrally. There have to be some locally delivered services that are controlled centrally. Social security is an obvious example. People think it unfair if the benefit received in one area differs from that received in another. A difficult current example is community care, where there are now complaints about a postcode lottery following central government’s devolution of responsibility to local authorities.

We should not disguise from ourselves the fact that centralising pressures are very strong, not least because when voters are dissatisfied with the quality of their life, it is on central government that they wreak their revenge, and then excessive centralisation demotivates local people. That is the essence of the problem. Moreover, when responsibility for services is centralised, it leads to silos. Those responsible for education policy become distant from those responsible for health policy, who are in turn distant from policing policy and so on. Yet on the ground, local problems—for example, drug dealing—often can be dealt with only by a combined effort from all these services.

What does this amount to in relation to the proposals in the report by the noble Lord, Lord Heseltine? I support the proposal for more combined authority mayors with greater powers and resources delegated to them. I like the idea of delegating to them responsibility for affordable housing, schools’ performance, the skills budget and unemployment programmes. I also like the idea of the requirement for each of them to produce five-year strategic programmes for their regions. However, like my noble friend Lord Turnbull, I am sceptical about the proposal in the noble Lord’s report for a super -department of the regions on the lines of the Department of Trade and Industry and the Department of the Environment in the 1970s. Such a department, combining responsibility for planning, local government, housing, transport and employment, would be too cumbersome for a single Secretary of State, as the experience of the 1970s showed.

However, like my noble friend Lord Turnbull, I strongly support the reinstatement of collocated regional offices led by a single official. In 1994, when my noble friends Lord Wilson and Lord Turnbull were successively Permanent Secretaries at the DoE and the noble Lord, Lord Heseltine, was President of the Board of Trade, a structure of regional offices was established, containing representatives of a wide range of Whitehall departments. The aim was that they should work together with local government in co-ordinating the central government responsibilities for which they were responsible to make the most effective impact on local problems. In my view, which my noble friend Lord Turnbull shared, it was a great mistake when in 2011, as part of the austerity programme, those local offices of central government were abolished.

I believe that the outgoing Prime Minister cares about the matters covered in this report. Sadly, preoccupation with Brexit and, I suspect, an innate caution have prevented anything effective being done in the past three years. The resolution of Brexit, which we all profoundly hope for—by which I mean resolution of the question of whether we go or stay—together with the arrival of a new Prime Minister, offer a fresh opportunity. The leading candidate for the post of Prime Minister, whatever his other characteristics, has the ability to enthuse and inspire. The noble Lord’s report provides the fertile field on which enthusiasm and inspiration can flower, together with a number of very useful practical proposals. It is important to the future of our country that the new Prime Minister takes advantage of it.

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My Lords, I declare my interest in local government as a Local Government Association vice-president. I add my thanks to the noble Lord, Lord Heseltine, for initiating this very interesting debate.

Giving people greater control to shape their communities is a good thing. It makes decision-making more accountable, allows for local discretion and delivers better value for money. Councils, as leaders of their communities, are best placed to bring communities together and transform lives for the better. Local government already provides more than 800 different services to local communities, supporting residents each and every day. As well as supporting vulnerable and elderly residents, councils also help build vibrant local economies that create the conditions for businesses and communities to prosper.

Frankly, councils continue to do a great job, but local government is ambitious to do more and can do more. Give councils the freedom to decide, certainly over the future and new funding, and local government will build great communities. I welcome the report of the noble Lord, Lord Heseltine. Importantly, it supports the LGA’s case that we have an opportunity for change, so that the most centralised country in the western world, which we are, could become more devolved.

As the noble Lord, Lord Heseltine, and the LGA both recognise, we need to empower local leaders to deliver better outcomes for their communities. That is why the Government must show more ambition than they have done to date. The combined authorities have demonstrated the real, tangible benefits of devolution, but the combined authority model does not suit everyone. We need a flexible devolution settlement that all areas of England can get behind so that no part of our country is left behind. Put simply, if we are to tackle the challenges and seize the opportunities, we need devolution to be made available right across England, including to non-metropolitan areas as well as to our great cities.

At its conference in Bournemouth earlier this month, the LGA launched its manifesto for change, #CouncilsCan. As the LGA’s new chairman, Councillor James Jamieson said in his speech to the conference, this manifesto is a bold call to arms asking the Government for the powers, freedoms, flexibilities and funding to deliver great communities. With the Government absorbed by responding to the demands of EU exit for the foreseeable future, there will not be capacity at the national level to negotiate individual devolution deals. A new localism settlement is needed, a step change in the way we think about devolution that looks to a package of sustainably funded, locally led service reform. #CouncilsCan sets out a positive case for a new localism settlement underpinned by a devolution Bill and a local government finance Bill in the next Queen’s Speech. Of course, by closing the £8 billion funding gap facing councils by 2025, the spending review can deliver financial certainty to hard-pressed councils up and down the country.

It is not just the noble Lord, Lord Heseltine, and the LGA who are making the case for devolution. I am pleased to say that the All-Party Parliamentary Group on Reform, Decentralisation and Devolution, of which I am co-chair, is bringing together parliamentarians and those working on public service reform to look into these issues and build cross-party support for the new devolution settlement the country needs, from a devolved and integrated approach to skills and careers to a revolution in broadband and transport infrastructure, from reform of the common agricultural policy to the future of local industrial strategies. Our group is asking the big questions and helping form the big ideas that will ensure that the LGA’s new devolution settlement becomes reality. In recent years, the pace of devolution has slowed. We need to bring our focus back to this agenda and realise the long-held promise of devolution. This means devolution to all areas of the country, with bespoke arrangements that give us postcode choice, as I much prefer to say rather than postcode lottery.

I bring my remarks to a close by noting that the noble Lord, Lord Heseltine, and organisations such as the LGA, have provided us with a roadmap to achieve the goal of devolved services. I commend them for this. I also support those local leaders, represented through the LGA, who are calling on our new Prime Minister to use the next Queen’s Speech, Budget and spending review to deliver a new localism settlement. I hope the Minister and the Government will act on their advice, thereby ensuring we renew our efforts to empower communities through local government.

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My Lords, I join other noble Lords in congratulating the noble Lord, Lord Heseltine. He has tirelessly worked on decentralisation and the improvement of urban life in this country and this is another a great step. He started by saying that we are in a constitutional crisis. I shall take up that theme because, as my noble friend Lord Adonis said, a crisis is also a time of opportunity. The crisis is the crisis of Brexit. To make a long story short, I believe that Brexit is an English crisis. It is because England is the only non-devolved region in the union, because we are one of the most centralised administrations in the world, as the noble Lord, Lord Heseltine, and other noble Lords said, and because the other places are devolved that England faces the full burden of centralisation. That is why we have created mayors, combined authorities and so on. The power to decide what they can do and what they will have by way of money is very much in Whitehall. You may want to decentralise by putting Whitehall ministries all over the country, but the power will still remain in Whitehall. Therefore, one of the issues to tackle would be how we can devolve and decentralise England.

That is what I want to speak about, because I believe it is a challenge. My link is going to be reform of the House of Lords, which is one of my hobbies. The last time we had a House of Lords Reform Bill we had a Joint Committee of both Houses of Parliament but the Bill came to nothing, for reasons that I will not go into. However, at that time I submitted a note to the Joint Committee saying that what we needed was the three devolved regions, plus England being carved up into 10 regions, each sending 30 elected representatives to the reformed House of Lords. Each region would send those 30 representatives on a list system, so that MPs would not feel threatened that in their constituencies they had rival representatives. The House of Commons could remain the House of Commons, and the House of Lords could be changed into a federal Chamber. The idea was that some of the representatives would be mayors, for example.

We need the regions to be able to come here and exert direct influence on the Westminster Government. If that process could be furthered, we could reform a lot of these top-down reforms and all this ordering about, especially the dependence of local authorities on central government for finance, and so on. For example, we could allow different regions to have different tax systems. As was mentioned, we have an unreformed council tax system, because although house prices have risen, we have not revalued those houses. That was the crisis on which the poll tax was created. If different regions could revise their local house prices in the way that they like, that would in some cases relieve their financial problems.

I do not want to go on because I am the 19th speaker and people must be getting pretty tired by now. We need to crack the problem of over-centralisation without devolution in England. If we can tackle that, we shall make a lot of progress.

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My Lords, it is a great delight to take part in this debate and to have listened to the energy and passion that the noble Lord, Lord Heseltine, still brings to this, decades after he first started his work. Of course, it is not just the reports; it is a record of success, not just in London but, in particular, in Liverpool. As somebody who represented a constituency in the north-west—in Greater Manchester—I am well aware of the breath of fresh air that he brought to the whole region by his work and the commitment he showed there.

When we look at the pattern of devolution activity in the United Kingdom, it is very much something that a new Government do for their first three years, and then it peters out. In 1997 the incoming Labour Government proceeded vigorously, with Liberal Democrat and other support enthusiastically given, with Scottish and Welsh devolution. However, their reforming rather sputtered out when it got to the north-east regional referendum, and not a lot happened on that for another 10 years. In 2010, there was a three-year burst of activity by the coalition Government. I must admit that after two and a half or three years, that petered out as well. I will say something about the Localism Act and its implications in a moment.

Time after time, after the initial burst of activity, Governments take fright. Avoidance of mistakes becomes more important than promotion of change and regimentation becomes more important than innovation. The simplicity of imposing national norms trumps the complexity of having local solutions for local challenges. The antithesis of the devolution of power is the one-size-fits-all event, which freezes the reform process.

I shall give an apparently irrelevant anecdotal example of exactly that. Running through my old constituency of Hazel Grove is the A6. At the time I am talking about, it was a trunk road with a terrible accident record, particularly at one junction controlled by traffic lights. The solution seemed obvious—to have a right-hand filter on the A6—but that was impossible because somebody in Whitehall had decided that the criteria were not met. Accident after accident occurred. Petitions, debates and all sorts of representations failed to produce an answer. An answer came eventually when the A6 was detrunked and became the responsibility of the local highways authority, which promptly installed a right-hand filter traffic, since when the accident record has been very good.

I hope to make the point by a simple anecdote that the idea that people behind desks 200 miles away have the solution to local problems is completely mistaken. That brings me to the Localism Act. I was one of two Ministers in the other place who steered the Localism Act on to the statute book. I will not speak a great deal about it, but I will pick out just two further snapshots. One is about neighbourhood plans. The planning system in this country consists far too much of a two-stage process where developers propose and the community opposes. Neighbourhood planning is designed to be the community proposing and the developer delivering. It has so far been surprisingly successful—surprising even to me, never mind the civil servants who thought it was preposterous. Neighbourhood planning areas are self-defining, a theme that I want to pick up in a second or two. Funnily enough, it has resulted in more homes being designated for planning, not fewer. When the community has the chance, it shows the responsibility necessary.

My second brief example is local enterprise partnerships. One very small flaw in the report of the noble Lord, Lord Heseltine, is that he refers to LEPs as conforming to government boundaries. That is exactly not the case: they were self-identifying and have a wide variety of configurations, from the 10 unitary authorities of Greater Manchester as one LEP to Cornwall County Council and the Isles of Scilly as another. They are of all sizes and shapes. They are not limited to the then existing regional structures. On the Midlands and south-east England boundary, one LEP crosses three pre-existing regions. They have been bafflingly successful in many cases.

The idea of leaving it to local organisations to decide how to organise themselves stunned the bureaucratic mind. Devolution is about treating people as grown-ups, capable of making good choices, not treating them like three year-olds who cannot be trusted with a bag of sweets. Power must move down to localities because there are get better outcomes when it does: the A6 kills fewer people. When you have neighbourhood plans, you get more homes. I thoroughly applaud the report’s analysis and strongly support the many recommendations in it that can lead to stronger and more effective local democratic leadership and economic growth.

However, I have some queries. First, what use would a regional government office for the north-west be? It did not help with the A6 problem. We have to be clear about whether we are talking about devolution or decentralisation. An idle regional office will be very much more tempted to meddle in combined authorities and mayoral activities than the present fragmented structure in central government.

My second point is that I am puzzled by a wish to synchronise elections, thus maximising the risk of catastrophic discontinuities in taking local strategic decisions and direction. Maybe this May’s local elections are an illustration of what can happen when that happens.

My final point is that I detect a lingering hankering after the creation of a uniform system of equal powers and competencies. History and all the evidence and experience show that diversity and pluralism are more likely to produce better outcomes for local communities than a centralised system and structure. I wish the report well and I hope very much indeed that it is taken forward in large measure by whoever turns out to be the next Prime Minister but, bearing in mind that it is something that will happen only in the first three years of a fresh Government, perhaps we might not hold our breath.

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My Lords, I was born in Preston—proud Preston, I say to my noble friend Lord Inglewood —in Lancashire, went to school in Wakefield in Yorkshire and in my first incarnation in the House of Commons was Member of Parliament for Gateshead, so I am a fully paid-up northerner and therefore inevitably, to some extent, a regional policy junkie. I even managed to persuade the good burghers of Orpington, who I later represented in Parliament, that it had some merits as an approach to policy.

I too pay my respects and send some gratitude to the noble Lord, Lord Heseltine, for his lifelong championing of regional policy. No one will ever forget his intervention in Liverpool after the Toxteth riots. I am sure, as he will understand, that he is not quite on a par in the Liverpool pantheon with Bill Shankly, but none the less there is still a great deal of respect and affection for him in Liverpool. Of course, as the noble Lord, Lord Adonis, pointed out, there was also his work in the Docklands.

Collectively, I am afraid, for Governments over the years, Labour or Conservative, the results of regional policy are very mixed indeed. There are, as the noble Lord, Lord Turnbull, pointed out, vast improvements in the city centres of our big cities, but too often there are long strands of dreary suburbs and sad small towns that have lost their purpose. There is still far too great a gulf between London and the extremities of the United Kingdom.

I go to Germany quite often and, remembering that it started from what it calls “Stunde Null”—ground zero —when it was a mountain of rubble, what it has done in the intervening period is remarkable. It also went through the refrigeration of East Germany for part of that time. Going from Stralsund in the north to Munich in the south, there is a much greater sense of modernity and equality between the various cities and towns.

I welcome the report from the noble Lord, Lord Heseltine, which is another brave, considered stab at doing better next time. First, I totally agree with the need to have someone in charge. Historically, the model is Joe Chamberlain in 19th-century Birmingham, but now we have Andy Street, Andy Burnham, Ben Houchen in Teeside and so forth. I hope that they can become the model for a new period of dynamic mayors. As the noble Lord also said, we need drive at the centre to match up the drive at the regional and city level. He was such a person when he was in government. I served with him in the Cabinet Office and well understood the drive he put into it so successfully. That is essential.

The second thing is skills. We have lots of graduates with lots of skills but we do not have enough non-graduates with plenty of skills. As the noble Lord, Lord Layard, pointed out in a debate the other day on apprenticeships, secondary education and further education, we need a way through, an uncapping of the further education side of our educational system so that it is on a par with university education, which we have done so well in. Until further education becomes an equal and sensible course, we will not get the skills we need in our non-academic young people.

Infrastructure is the third thing. Of course we need the right things in transport, housing and so on, but we must not forget the value of cultural spending in our regional and city developments. Who can deny the impact of Frank Gehry’s Guggenheim Museum in Bilbao? It was transformative and an example of how sensible and frankly gigantic spending has reaped rewards on a massive scale. All this will cost money, but as Paul Johnson of the Institute for Fiscal Studies pointed out in a very good article in the Times the week before last, there is at the moment a particular space for more public spending. After seven or eight years, the deficit is now quite low, thank heavens, although the national debt is high. Interests rates are extraordinarily low and will remain low over the next two or three years as a result of the Bank of England’s term funding scheme. We can therefore increase public spending. We should do that much more than reducing taxation which, particularly for the rich, is a very bad idea at this time. The state needs every penny of income to finance the expenditure we need not only in this area but in other areas as well, not only on regional issues but on the police, social care and justice which have become underfunded. If we do that, and if at the same time we look to devolving more powers to our city regions and to our cities, we will be doing the right thing. If that shows that we are becoming more European, how ironic it is that on leaving Europe we should be becoming more European. I am afraid that whether we like it or not it is the right thing to do socially and economically as well as regionally.

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My Lords, it is a great pleasure to wind up the Back-Bench speeches. I am not sure whether the Whips are punishing me or rewarding me by giving me this position. Like every noble Lord who has spoken, I welcome the report by the noble Lord, Lord Heseltine. He analysed the historical role of cities in driving this country’s development and economy. If we compare English city regions to the devolved authorities, they have less clout and less resource. Yet, if we are to make progress in very difficult times the noble Lord is surely right that the potential for city regions, like mine in the West Midlands, to help drive forward the economy of the country again is very powerful.

I do not think that all noble Lords quite agree with the structure the noble Lord, Lord Heseltine, proposed, with a very powerful department of the regions in Whitehall and mayors and combined authorities locally that will take this forward, but I do not think we have to agree with the structure to agree with his powerful premise about the role of city regions. The noble Lord, Lord Turnbull, put his finger on it when he said that it will not happen unless we change Whitehall’s view that it is superior in every way to local government and local public bodies. Having spent 10 years as a Minister espousing the Whitehall supremacy philosophy, I recognise the challenge that we face if we are to see changes. As the noble Lord, Lord Butler, pointed out, centralising pressures in this country are very strong. Most pressure groups are nationally based and put huge pressure on Ministers to intervene and make sure there is no variation at the local level.

The noble Lord, Lord Butler, mentioned social care. Health and social care are the areas for which I had the most responsibility. The noble Lord, Lord Heseltine, did not mention health and social care in his speech, save, I think, in relation to the “condition of the people report”, which he wants mayors to publish and which would have stats on health, social care and well-being. The National Health Service presents in a nutshell some of the dilemmas about what we mean by devolution. The NHS is a huge employer. It has major responsibilities for the health of a population and has links to R&D investment, life sciences and the pharmaceutical sector. It is crucial to our economy. Any mayor must want to embrace health and social care in any development plan they have; they would be very foolish not to do so. On the other hand, we know that the public regard the NHS as a national service. We know that if we were to suggest the devolution of the NHS and that we could change it from being free at the point of use—that is the implication of devolution —there would be major opposition. We also know that concepts such as postcode prescribing are deplored by the public, pressure groups and just about everyone.

If we think that devolution will really cover most of our great services, we then come to the issue of how we would deal with the NHS. Greater Manchester has made a start and it is a useful model. Interestingly, in the report by the noble Lord, Lord Heseltine, the submission from Greater Manchester claims that health and social care was devolved in February 2015. In fact, nothing was devolved to Greater Manchester relating to health and social care. What happened was that the responsibilities of the Department of Health and Social Care were delegated to Greater Manchester. Greater Manchester has some responsibilities related to budget and some to operational management, but it has to carry them out within the rules set by the Department of Health and Social Care. That seems a very sensible first step because it maintains the concept of a national NHS but gives the mayor and combined authority more say over strategy and how it is to be run. If we extend this, it may well be that the national aspect of some services means that we cannot devolve them in a way that we could other parts of the economy. At PMQs today the Prime Minister answered a Question about the reconfiguration of services in Shropshire. It brings home that, while devolution sounds great in principle and is a route worth taking, when it comes to actual services it will be hard to work through.

I finish on a point raised by my noble friend Lord Rooker. Of course the report by the noble Lord, Lord Heseltine, has no chance of implementation unless there is a new financial settlement. The noble Lord, Lord Lansley, rightly pointed out an example in Cambridgeshire of why greater flexibility is needed if we are to make sense of the combined authority there and the huge potential for developing the economy that there clearly is. At one point in his report, the noble Lord, Lord Heseltine says,

“the government should allow mayoral authorities to raise local taxes and charges”.

He then says,

“it is ludicrous for British tourists to pay to visit historic collections and buildings abroad while millions of visitors to this country enjoy free access”.

I am so keen on this because we have the Commonwealth Games coming to Birmingham in 2022, and 75% of the costs will be met by the Government and 25% by the City of Birmingham, whose finances are not as strong as one might wish. It would like to be allowed to set hotel tax to help contribute. I understand that Edinburgh will be allowed to go down this route. I know that, traditionally, the Treasury will be opposed to this, but, just as a pilot we ought to allow Birmingham to have a go at it and see if it has an impact on tourism and hotel usage. If we are serious about devolution we should take a living example where a city council needs to rate some resources and give it a go. I hope the Minister will at least be able to give some positive words on that.

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My Lords, we have all enjoyed this fascinating and detailed report. It has formed the basis of a very worthwhile debate. I will start, if I may, by looking at one or two of the tensions within it—most of all, the tension between the mayor as a model for efficiency, leadership, effectiveness and regeneration and what the noble Lord, Lord Heseltine, refers to in his conclusions as the need for this to be based on,

“our families, our schools, our communities, our social services”,

so that government at all levels must work,

“in partnership with communities and businesses”,

and individuals.

That is part of the difficulty we have in Britain at the moment. I was very struck by a long article in the Financial Times yesterday looking at those who voted for Brexit three years ago and who still feel left behind now—why they voted as they did and why they still feel immensely discontented not just with Brussels but with London. The article said that they are as much against London as they are against Brussels. There is a sense of hopelessness, a fear that there are no decent-quality jobs, poor education, deeply inadequate skills training, obstacles getting to work and shrinking public services. As a result, as they see less government—I certainly see this in Bradford—and as local government and local services shrink, ordinary, poor people have less and less contact with it. It is there in London, not providing you with local services which you see—or even with police whom you see, as community services deteriorate.

If we are going to restore confidence in democracy and government, we must care about that as well as fundamental and essential regional regeneration, which is the core of this report and with which I strongly agree. I have spent much of my career teaching and researching European international politics. I am deeply conscious that those who designed the European Economic Community, Jean Monnet above all, believed that it would receive legitimacy by providing results and did not need a whole complex of democratic accountability and scrutiny. We all know where that got us. It provided results, but it did not achieve legitimacy. My worry about the strong mayor model, particularly without the scrutiny, is that we risk reaching that point of continuing alienation among much of the population, even though the effectiveness is there.

As a number of speakers have said, we face a deeply divided country, with deep regional inequalities and deep mistrust. The country has become increasingly centralised over the last 40 or 50 years. The noble Lord, Lord Lansley, talked about the problem of Whitehall attitudes. They are also Westminster attitudes. When my daughter was in the Department of Health, I remember being very struck when she said that most of her colleagues did not think it at all attractive to go up to York and visit the outstation of the department that was there. She was very happy to do so, because she could come to Saltaire at the same time.

I also remember an astonishing conversation on educational matters I had some weeks ago with a Minister. When I started in politics, the West Riding education authority was one of the best in the country. It did things that people in the rest of the country did not and experimented with new attitudes. Now I represent a music education charity of which I am a trustee. I went with the heads of our education programme. I found myself having an argument with the Minister about the detail of initial musical education in primary schools around the country. That is the extent of centralisation. It is also why the Department for Education is much bigger than it needed to be in the 1960s.

It is also, incidentally, why I am sceptical about the need for the restoration of regional offices of central government. If we have effective city government and regional government, we do not need central officials checking on them to ensure that they do the right thing and do not put the filter light in on the A6, or whatever it may be. I am not sure whether the UK Government need a large embassy in Edinburgh and Cardiff to keep watch on what they do. If we have effective city and regional government, they ought to be able to manage on their own. Whitehall officials can come up to visit them from time to time and learn how well they are doing.

The Heseltine model, which I on the whole approve of, is a regional revival through concentration on the cities as the hubs for regeneration. It is a far more substantial devolution than the Government have yet been willing to accept of infrastructure, skills education and training, land use, planning, industrial strategy et cetera, and partnership between political and private sector leadership.

I shall focus on some of the obstacles we face in reaching that excellent model. Let us recognise how much we have to change if we are to achieve that vision. First, there is finance, as several noble Lords have said. There is the depth of cuts in local finance and the shortage of resources. Local government in Bradford started with public sanitation in the early 1810s to 1820s. Last year, Bradford closed 42 of its 49 public toilets, so it is going out at the point where it started. It also involved the provision of clean water. That is of course privatised and mainly owned by Australian and Canadian pension funds. Yorkshire Water is now in trouble because it is releasing raw sewage into the wharf upstream from where people bathe.

We have lost our sense of control and some of our local private as well as public leadership. As I look around the Aire Valley, where I live, I am conscious that we have lost a lot of our small companies and that when new small companies develop—we had had two in Saltaire 15 years ago—they get taken over by multinationals. Salts Mill is now owned by an American multinational. That means that we do not have the local industrial or financial leadership that we need to help with the regeneration. The regional CBI and the regional Institute of Directors represent the regional branches of a large number of multinational firms. That is a problem.

It is also a real problem with banks and the financial sector. My father spent his career working for Barclays Bank dealing with funding for small companies and reporting to his local head office in a federal bank, as it was organised. Banks are now very much national and multinational and do not retain that link. We must rebuild a whole host of things that we have lost at the local or regional level. We are about to lose EU structural funds. Perhaps I could persuade the Minister to say a little about the shared prosperity fund, what he sees it doing and whether it will be entirely direct from Whitehall or whether the regions will have some say in how it is distributed. That is of real concern to the less prosperous regions of England. Perhaps we ought to begin to discuss whether financial equalisation across England is something that ought to be much more public and much more politically debated. When I look at Germany, I am struck by how Finanzausgleich is one of the things that is most bitterly argued between the different Länder—quite rightly, because the rich areas do not like transferring funds to the poorer, although it is one of the things that has to be done within a national community. Let us have that argument out in the open rather more. We have it on the Barnett formula; we do not have it for the English regions. As the noble Lord, Lord Horam, said, this is absolutely no time for tax cuts. What we need now is long-term investment.

I am not entirely sure that city regions are the answer and I am very struck that the noble Lord, Lord Lansley, the right reverend Prelate the Bishop of Newcastle and others have suggested that larger regions may in some ways be what we need. In Yorkshire we are stuck in our devolution with the Government because, as the Minister will know, the majority of local authorities prefer a one Yorkshire model. The Minister for the northern powerhouse is trying to make us accept a three-city region model and a sort of rural powerhouse—whatever that means; he could not explain it—for north Yorkshire. A one Yorkshire model is preferred because our city regions overlap, the city boundaries are very difficult to draw and that is what suits the people in the region. I hope to hear a little more from the Minister about whether there may possibly be a little movement at some point on that, although perhaps it will not be until we have a new Government.

The damage to confidence in democracy that has been done over the past two generations, inflicted by repeated reorganisation of local government and increasing Whitehall interference, is a real problem that we face in this country. We need a new settlement, one that can be agreed between the parties and between successive Governments. Devolution to city-led regions is key, but is not enough on its own to restore confidence in democracy and close the gap between people in the provinces and our governing elite. We desperately need action to narrow the gap between the prosperous metropolis and the regions and cities outside the south-east.

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My Lords, first, may I say how pleased I am to be able to respond to this debate on a motion in the name of the noble Lord, Lord Heseltine? I commend the work he has done in this report and also over many years to empower our great cities, support communities and enable them to face up to the challenges in our world. That is not to say that I agree with every word in the report; but, like my noble friend Lord Rooker, I say that it is an excellent report and an important contribution. There are many recommendations in the report that I fully agree with and would want to take further.

When he introduced the debate, the noble Lord talked about two cities. You could feel that you are living in two different worlds, but actually be living close by the other. In my own borough of Southwark, we have the very prosperous south of the borough, which is a wealthy and nice place to live in, and we now have a much more regenerated north of the borough. There are lots of tourists there and things have improved dramatically in the last 20 or 30 years. In other parts, though, in Walworth, Camberwell and Peckham, the borough is still struggling and there are all sorts of problems in terms of drugs, knife crime and housing. You really could be living in a different world in the same borough, so that was a very important point that he made.

I should also at this point declare that I am vice-president of the Local Government Association—my usual declaration that I make on the numerous times that I speak in this House. Among other things, I am a Londoner, as you can probably tell; but for many years I lived in Coventry, Leicester and Nottingham, so I know the east Midlands very well. It is a great place to live and needs to have power to be developed and to move forward. As the noble Lord said in his introduction, such places have to be able to compete in a world that is changing at a pace unprecedented in our history. Things are moving so fast now; new technologies arrive in our country, become obsolete and then something else moves in, whereas before, things used to never change. We need to address this bigger picture to ensure that our great cities and institutions are fit for purpose.

I have raised several times in the House the issue of the combined authorities. We seem to be creating a confused patchwork for local government, and for me that is not good. We need a sense of what is going on in each area and who is governing it. The noble Lord, Lord Lansley, mentioned the Cambridgeshire and Peterborough Combined Authority, and I am conscious of the number of different bodies that potentially can be involved in taxation and so on. Not too far away is Bedfordshire, which is a very different operation. We need to understand how places are governed. Perhaps the noble Lord, Lord Bourne, does not agree with me on that but it is my view, and the report gives some welcome structure to the combined authority model.

My noble friend Lord Beecham made a point about the sums of money made available by the Government to the combined authorities, and I agree that they are still quite small sums of money over 30 years or so. If any of the suggestions made by the noble Lord, Lord Heseltine, are to be taken up by the Government, much greater sums of money will have to be made available. If we contrast the money presently available with the money that has been lost to local government since 2010, we see that there is a huge gap.

I agree with the point made by the noble Lord, Lord Butler of Brockwell. If we want something to happen in a local area, it is not going to be delivered from behind a desk in Whitehall. The noble Baroness, Lady Eaton, made a similar point when she called for further devolution. Local people have a much better understanding of the problems and challenges in their area. If they can get that job, they will do it well. The noble Lord, Lord Horam, said that we need people in charge, and one thing I have learned in my life is that if there are not people in charge to make decisions, you get drift; nothing happens, and there is a lack of focus and then failure. Having people in charge is very important.

Looking at the proposals in the report, I agree that reform of government and of Whitehall is a crucial first step. I like the idea of a department for the English regions, but it would involve significant restructuring and there must be reform as to how Parliament and elected MPs would relate to any new department with such a clear focus. Others might not, but I would welcome the return of the government regional offices; it is disappointing that they were abolished. I have no problem with the Boundary Commission looking at local authority boundaries and at what the authorities do.

The noble Lord, Lord Inglewood, made a good point about how some of our cities work. The noble Lord, Lord Tyler, made a fair point when he talked about city boundaries. I have served on a number of local authorities, including one with 59 Labour members, one Green and a Labour mayor—to be honest, that did not always make for the best government. It does not matter which party it is, we need people on councils to say when a budget is not very good and what should be done instead. If you do not have that, you need it, so we need to find a way for that to happen. I am not an advocate of PR, but in many towns and cities we now have one party dominant in the council chamber. That is not good. I do not know whether we can do anything about that, but we need to find a way of getting somebody else into the chamber—but I do not know how. There is an issue there.

Select Committees of both Houses have an important role to play, but as I said earlier, we need to think about how Members of the House of Commons engage with the governance of English regions. We might not like it, but the world did not come to an end with a Conservative Government in the UK, an SNP Government in Scotland and a Labour Government in Wales. Clearly, parties of different perspectives can work together and function. We need some broader thinking they are about where we are in England. My noble friend Lady Quin talked about what we do there as well.

There is also the point about bringing the heads of the combined authorities together with the Prime Minister and the Chancellor. That would give a good focus, but if that happened, it should be expanded to some of our bigger cities, such as Nottingham, Derby or Leicester, where the mayor there, Sir Peter Soulsby, makes a big contribution. Getting them wired into the policy challenges and the policy solutions nationally would be a good thing to do.

I very much liked the idea of looking at what goes on in cities around the world. We can learn much from our partners abroad, and it is a very good thing to do. The noble Lord, Lord Inglewood, mentioned that. I was not so keen on his football analogy, though. As a Millwall supporter, we do not get any European football. Our trips are normally up to Birmingham to play Birmingham City, or perhaps to visit my noble friend Lord Beecham in Newcastle. Getting together and working with other cities is an important thing to do.

Greater Manchester, which in many ways is the most developed of all the combined authorities, is a very good example. As a noble Lord said in a previous debate, many of the authorities in Greater Manchester have changed control in recent years, but they still work together very well as a group. There is clearly maturity there. It is a really good model and other parts of our country can look at what goes on in Greater Manchester: even when political control changes, there are still the same problems and challenges, yet they work very well together. It is important that that happens.

I can see the logic of combined authority mayors taking over the roles of the police and crime commissioners. That would be a very good thing. Again, I am not convinced, and many other noble Lords were not, by the idea of transferring various services, such as affordable housing and schools, to the combined authority. I do not necessarily see the merit in that.

I agree with the comments of the noble Lord, Lord Hodgson of Astley Abbotts, who spoke about housing. We have debated this many times. Housebuilding is in the hands of four or five developers. It does not always necessarily get us what we need. As my noble friend Lady Warwick of Undercliffe said, partnership between local authorities, housing associations and builders could get the housing we need built. We need to build more social housing in this country. For all sorts of reasons, that would help all of us deal with the problems we have to face.

I agree with the comments of the right reverend Prelate the Bishop of Newcastle about the northern powerhouse and the need to provide additional funding and support for the north of England. I am also conscious that we often debate transport. Try to get from Bradford to Manchester: it is impossible. That is really important to talk about as well, as there are important issues there.

My noble friend Lord Beecham made a welcome call for more funding and power for mayoral authorities to raise taxes and charges, including a tourist tax. I very much support the call from my noble friend Lord Hunt of Kings Heath in that respect regarding the Commonwealth Games. I also agree with his point about the NHS. Again, this is something where Greater Manchester is certainly ahead of the game.

Finally, I was a very young councillor in the 1980s in Southwark. It is fair to say that we were not that happy with the setting up of the London Docklands Development Corporation. It was not universally popular locally, but looking back it is fair to say that what the noble Lord, Lord Heseltine, did there was absolutely right. Much good was done in the area. Significant regeneration happened and lots of money was brought into the area, with new housing, better transport, with the Docklands Light Railway, and a new financial sector in Canary Wharf. That might not have happened if he had not pushed those things forward. We are very grateful to him for that. In north Southwark, maybe William Shakespeare and Sam Wanamaker had a bit of a role in that too, but we were very lucky with what happened there and what he did. We are grateful for what he pursued there.

I am also really pleased, because the early 1980s were a difficult time for local government: there was a great fracture between central and local government. For all our difficulties, local and national government have a much better relationship nowadays, and we should all welcome that.

In conclusion, I thank the noble Lord, Lord Heseltine, for bringing this Motion to Grand Committee today. It has been an excellent debate. He started off by mentioning Brexit, so I will finish on it as well. I agree entirely with his remarks on Brexit. I had the privilege of being in Parliament Square when he addressed the People’s Vote rally. I believed every single word he said then, as I do today.

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My Lords, I thank noble Lords immensely for what has been an excellent debate. Most importantly, I thank my noble friend Lord Heseltine for bringing this forward and for a thought-provoking report with excellent ideas—making this a full house of compliments from every single speaker, which is a rare event in any debate—and for a first-class introduction to this debate.

I do not necessarily always agree with the noble Lord, Lord Adonis, but I do on the point about my noble friend’s lasting contribution to British life and the impact he has made. It is singularly rare for somebody to make the sort of impact across the board that he has made in British life, both at the Board of Trade and in the massive impact he has made on regional policy, particularly during his time in Liverpool. I had the privilege of being in Liverpool about three weeks ago, in Berry Street in Toxteth—it is not necessarily an area where people would always vote Conservative, but my noble friend is held in massive affection there, as he is throughout that great city.

As the noble Lord, Lord Kennedy, just said, his contribution to the Docklands area of London is immense. In Wales, I remember the opening of the National Botanic Garden in Llanarthney, which my noble friend did so much to help with. He was there with Lady Heseltine on that occasion. In terms of lasting contributions, the same is true in Wales.

Turning to the debate, I will make some general points and then try to go through and pick up on the contributions made by noble Lords. I should say in advance that I will make sure that a record of this debate is sent to all relevant government departments, because there is a great danger of silo thinking here. This is not just about the Ministry of Housing, Communities and Local Government. Probably every single government department needs to see this debate, not least the Treasury. If I miss any points in replying to the debate or run out of time I will make sure that all the points that have been raised are answered in correspondence.

There have clearly been differences over some issues in the excellent contributions—whether people are in favour of having a department of the regions or of having regional offices. There has not necessarily been uniformity on that issue. Where there has been complete agreement is that this is unfinished business in England. I happen to think that responsibility should lie with a metro mayor; not everybody does, but everybody accepts that there has to be somebody there. There has to be accountability for this to move forward. I believe strongly in having someone at the helm, such as Andy Burnham. He is politically different from me, but I do not think one could argue that he has not made a good fist of carrying things forward for Manchester. He is there at the helm, and that is important. The same is true of Andy Street in the West Midlands. I happen to believe that that is important, and so do the Government.

There is also the importance of localism, trusting people locally with things that should be decided locally. As I go around the country—this morning I was in Oakham and then Peterborough; as I have said, I have been in Liverpool, Leeds, Bradford, Manchester and Cornwall within the last month—what consistently comes across is that people want that sense of belonging to something and being able to help decide things locally. The most responsive way of doing that in most cases—clearly some decisions have to be made at a different level to the most local—is having people doing it locally. That sense of localism is important.

I also believe that we cannot go for a rigid blueprint. We have heard very different stories from different communities, partly because of their size and partly because of the nature of where they are in the country. A town of 50,000 people just outside London is very different to a town of 50,000 people in Cumbria or Northumberland; their needs will be very different.

We are at a pivotal point for the country, with a new Prime Minister and a new Government, and clearly there are decisions to be made—the in-tray will be substantial. I agree with a sentiment that has come across that because of Brexit, whatever view one takes of it, our eyes have been taken off the ball as a country, and probably as a Government, on all sorts of decisions that need resolution. Again, there is a very real sense of that up and down the country when one visits communities, whether people are for remain or for Brexit. There are things that they say the Government and Parliament should be getting on with. There is a sense of alienation—that might be too strong a word, but there is certainly a sense that, as a Parliament, we are perhaps losing the plot. This is something that a new Government must grapple with.

I will turn to individual contributions and once again thank noble Lords for a very wide-ranging debate. The noble Lord, Lord Tyler, spoke of Cornwall, with which he has a close connection and expertise. As he well knows, we have a devolution deal in place for Cornwall. It is the one area in England where we have a devolution deal where there is not a metro mayor. I agree with the noble Lord that there are issues relating to Cornwall that are very different from other parts of the country—I had better not say other parts of England because one thing that much of Cornwall is united on is that it is not part of England. There are issues of language and culture; I was down there last week and understand very well their importance. It is very different from metropolitan Britain, and we must not forget those important distinctions.

The noble Lord, Lord Beecham, reminded us quite rightly that this is not just about the money; it certainly is about the money, but that is not the only point of regional policy. I very much agree with that and the point he made about levering in private sector funding—a point also made by the right reverend Prelate the Bishop of Newcastle. I also agree with the noble Lord on Richard III, but that is perhaps by the way; we can discuss that at leisure at some other time.

The noble Lord, Lord Turnbull, spoke of nostalgia and welcomed by and large the report and the sense of direction from it. He had some doubt about a department for the regions but agreed with the main thrust of what my noble friend Lord Heseltine says in his report.

My noble friend Lord Hodgson spoke with great authority from different perspectives—from the committee perspective, from being MP for Walsall North and from his commercial experience. That was extremely useful. He referred again to the need to belong and the sense of alienation, which I think was referred to as well by the noble Lord, Lord Wallace of Saltaire. There is a great danger of alienation, not just from Brussels. Perhaps alienation is too strong a word, but there is a turning away from London and wanting things to be done more locally and pride in the local area. That is something we need to be aware of, as well as the sense of two nations. We need to be wary, as we always have been, as a party and as a country, of the danger of the two nations to which Disraeli referred in Sybil; we do not want that in any shape or form.

The noble Baroness, Lady Warwick, whom I thank very much for her contribution and her expertise from the National Housing Federation, asked whether we were going to be doing things more deeply and more widely. To deal first with the “more deeply”, it is very much unfinished business as far as the metropolitan areas are concerned. If they want to come forward with proposals for further devolution, we are very open to that. Touching on the issue of police and crime commissioners, that too could be brought forward by the areas that already have devolution. There is, of course, one example other than London where we have a police and crime commissioner who is also the metro mayor: Manchester. The issue of coterminosity of boundaries would need to be looked at in that connection, but that is certainly a point.

As for the “more widely”, certainly there is unfinished business, as we have heard quite rightly from the noble Lord, Lord Wallace, on Yorkshire. There is unfinished business in South Yorkshire, where, having had authorities sign up to the agreement, we have not got all of them over the threshold to carry things forward. That has caused frustration across parties. We have been doing what we can, and we will still do that across parties to try to achieve that. In Tyneside as well, we have heard that there is unfinished business. I think we all would want to end what is a patent absurdity of devolution north of the Tyne but largely not south of the Tyne, except for transport.

The noble Baroness, Lady Quin, referred to the great things achieved in Gateshead, which is absolutely true, including the Sage, the BALTIC and the bridge. However, for them to be part of the agreement with Newcastle must follow, as night follows day; it is crazy for one part of the Newcastle area to be devolved and not the other part.

The noble Lord, Lord Shipley, said that this was not to detract from London, but that the aim must be to bring economic development elsewhere—although that is not the only aim of what we seek to do. However, I hope the noble Lord will forgive me for saying that he then seemed to round on Oxford and Cambridge. Following on from what my noble friend Lord Lansley said, by the same token, they are not seeking money and this is an area of growth that helps the whole country. The aim must be to help all areas flourish, and that is what we are seeking to do.

The noble Lord raised the question of the northern powerhouse. The north in general is benefitting from £3.4 billion of investment going to locally determined projects, and specifically £337 million going to transport in the metro area of Newcastle, an area that includes places south of the Tyne. Government money does find its way to the north, but I understand that people will want to argue the case for their own area.

I thank the right reverend Prelate the Bishop of Newcastle for her positive and powerful contribution, as always, on behalf of her area and more generally. She cautioned against the creation of two nations and alienation, which is absolutely right.

I thank my noble friend Lord Lansley for his point about the chambers of commerce. I will take that away and underline it with BEIS. It is a very important point in carrying this forward. We must note the concrete examples he gave from Birmingham of the NEC, the airport and so on. I thank him for that. He also talked about the nature of Cambridge, the most prosperous city in Europe, which is something that should benefit the whole country.

The noble Lord, Lord Rooker, was very supportive of the report and referred to the transformation of Liverpool. He said quite correctly that Whitehall finds devolution difficult, which I know about from the Welsh perspective. It has got better in relation to Wales—much better—but there is still work to be done. I recognise what the noble Lord said.

I neglected to mention earlier the Select Committee, which I think is a good idea. Whether it is in the shape of a Joint Committee or not is above my pay grade and expertise, but it is an idea worth pushing.

The noble Lord, Lord Hunt, and others referred to the tourist tax. From going to Europe, we are all familiar with the bill at breakfast time for the tourist tax. We all pay it very willingly, and so it seems like a good idea. I had better be careful in going any further than that, except to say that we will forward the idea and the comments made to the Treasury.

Recently, I was in Birmingham for Windrush events, and was taken to an event in support of the Commonwealth Games. There is a growing enthusiasm, as there was in London, but I agree that it needs financial underpinning. Presumably the Treasury will be aware of that and will want to make sure that it is at least as great a success as the Olympic Games in London in 2012.

The noble Baroness, Lady Janke, spoke from her experience in Bristol and talked about the great European cities. The politicians on the continent who have come forward from being mayor are notable, including Jacques Chirac and Sarkozy, Matteo Renzi in Florence and, a generation previously, Willy Brandt in Berlin. There is a much closer link there, whereas here we have previously been able to offer only Joe Chamberlain. I suspect that that is about to change next week when it comes to mayors who have gone on to other things.

The noble Lord, Lord Adonis, asked about the borrowing cap. I will give him more details in a letter, if I may, but work is progressing on that, with examples in Brighton and Hove and in Stoke. It is beginning to happen, but it is early days; I will enlarge on that in a letter. He referred also to the general position on constitutional reform, for which a case could certainly be made. He also asked about the issue of mayors and police and crime commissioners, which I think I have covered.

My noble friend Lord Inglewood also talked about the great European cities and the global nature of London. Many people referred to the growing imbalance in Britain and the centralisation. It is true of France, to some extent, but it is possibly greater in Britain. Part of that is just because of the global nature of London, which it would be very difficult to do anything about even if we wanted to. We do need to encourage the provincial dynamism that he spoke about; it was a point very well made.

My noble friend Lord Haselhurst, with his great experience of Yorkshire, Lancashire, Birmingham and, more recently, Saffron Walden and north Essex, recognised how valuable it is to seek to ensure that we get a rebalancing within the country and have local power going to our great cities and, indeed, beyond, throughout England.

The noble Baroness, Lady Quin, spoke powerfully about what is going on in Gateshead, as did my noble friend Lord Horam. In terms of Tyne and Wear Archives and Museums, where she does so much, she recognised that the current structure does not make sense. Anything that we are able to do in a pragmatic way to make it work more effectively would be really welcomed.

The noble Lord, Lord Storey, who has roots in Liverpool, referred powerfully to the situation in Toxteth and how that was turned round, so that now one goes to Liverpool and there is a great sense of pride about the Albert Dock, the cathedrals and Toxteth. It has changed massively and, although there are still challenges, it is very different from how it was previously.

The noble Lord, Lord Butler, gave a great welcome to the report. He talked about putting someone in charge, which is a theme that came across and with which many agree. He had doubts about a department for the regions and talked about the dangers of silo thinking, which I think we all recognise. He also talked about the focus on Brexit, which has meant that we have not paid attention to other things, and indicated that there is a “fertile field for enthusiasm”. That is a message to carry forward and I thank him very much.

My noble friend Lady Eaton talked about councils being best placed to deliver for local people. Again, that theme came through.

The noble Lord, Lord Desai, perhaps gave this more of a Brexit spin. I am not sure that I agree with him totally that Brexit is an English crisis. For example, Wales voted almost the same way as England. That is not something I am happy with, but it is a fact of life, so it is a little bit wider than that.

The noble Lord, Lord Stunell, talked about the energy of my noble friend Lord Heseltine and how he brought this issue to bear, which has been a mission for him through the years—and thank goodness for that. He had some very valid points about traffic situations. Again, I recognise that from Wales, where if you wanted to get a speed limit changed in a village you had to wait for an accident and pray that there was not going to be too serious an accident before you could do it. That has all changed and is very much better.

My noble friend Lord Horam talked about his experience from Preston, Gateshead and, more recently, Orpington, and the importance of putting someone in charge and having drive at the centre.

The noble Lord, Lord Hunt, welcomed what we are seeking to do and, though not necessarily agreeing with all that was in the report, talked about the importance of a new financial settlement. I agree with that. Clearly, it is going to be a matter for a spending review and the new Government, but these things will come with a price tag. It is not just about the money, but money will be needed for much of this. I have dealt with the point on the Commonwealth Games and the tourist tax.

The noble Lord, Lord Wallace of Saltaire, made valid points, some of which we have been dealing with in the public lavatories legislation, such as the position in Saltaire and Bradford. He talked about how we need to break the logjam in Yorkshire, not least because the area he represents and is from is unrepresented by a metro mayor—my personal view is that that is not a desirable situation—and an impasse exists in South Yorkshire. He asked about the shared prosperity fund. I fear this is the usual line, but there is no change on it; it will be a matter for the spending review. It will obviously take into account the interests of different parts of the country and seek to ensure that those which most need the shared prosperity fund—perhaps those which previously benefited from cohesion funding—will continue to receive benefits.

Lastly, I thank the noble Lord, Lord Kennedy, for the points he raised. I agree with much, but not all, of what he said. As usual, he made some very good points. He spoke about the transformative changes brought about in Docklands in London, which is absolutely true. I should perhaps say in parenthesis that, in Wales, something similar happened with the Cardiff Bay development, which Nicholas Edwards, the late Lord Crickhowell, took forward. The docklands in Cardiff is a larger area than the docklands in London, but the project has been similarly transformative.

With that, I thank noble Lords very much. I will write to answer points of detail that I have missed, but I once again thank my noble friend Lord Heseltine for ensuring that we have had such a great debate. This must be a rare occasion on which there are probably more people in the Moses Room than in the Chamber of the House. That is another tribute to him.

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My Lords, I am overwhelmed by the generosity of the tributes paid to the report. I am overwhelmed to speechlessness by the generosity of the words of the Minister—I am even tempted to wonder whether I have been forgiven. I am doubly grateful that he is preparing to send a full record of this debate to the civil servants in every relevant department. They will be grateful for a clear steer coming from any Minister on any subject. I have taken the liberty of sending the report to the two people who will have a chance to do something about it, so it is getting wide coverage across the globe.

It is the convention that I do not respond in detail to the remarkable contributions. I may perhaps clarify that the report was commissioned by the six conurbation authorities and published on their behalf. The issues which have flowed have perhaps widened the debate in a way that I did not intend.

Classically—the noble Lords, Lord Wallace and Lord Beecham, made this point—the contrast between what has happened to the west and the east of the Pennines is a microcosm of my experience over 40 years of why it is easy for local people to say, “Give us the money, give us the power”, until you say, “Produce a structure that gives us the confidence that you know how to deal with it”. I find it tragic that the proposed new arrangements in Newcastle and the debate in Yorkshire are still proceeding, when in other great English cities they have managed to find an accord. I hope that this debate can make some contribution.

What comes out of this debate, and the most generous compliment that is made to your Lordships’ House on occasion, is the quality of the contributions, based upon that one immense human asset: experience. Everybody who has spoken knew and cared a lot about what they were talking about. They were able to contribute a dimension from their background and experience. I found that enormously impressive, and it meets my personal experience of engaging on the ground with politicians of all parties who are dealing with these complex issues. The moment they become part of the manifesto sloganising of party politics, it becomes divisive, too much and all somebody else’s fault—we all know the language used, and I am a past master at exploiting it. But when you have a piece of derelict land, there is not much Marxism or wild capitalism about what you do; you have a problem to solve, and the sort of people involved in this usually can come together, have a discussion and find a solution.

That is what the vast majority of local decision-making is about. You want people with the power and the free sense that they are responsible and accountable to be in a position to do something about it. However many messages you send, if you are sitting in London, you are not there. It is just words coming out of the ether, but the derelict ground still needs to be dealt with.

The Minister self-evidently has a problem, with which we all sympathise. Like everyone in this debate, he has no idea what next week will bring. What is certain is that there will be no clarity next week, or next month. Whichever way the debate goes, traumas of one sort or another will continue to dominate Britain’s public life and to paralyse a great deal of it.

Always the optimist, looking on the bright side I have one new proposal coming out of today’s debate, which the Minister might care to circulate, not just to the civil servants but to his parliamentary colleagues. This House knows, understands and cares profoundly about this issue, so while the Government are sorting out Britain’s future and its relationship with the European Union, why not give us the chance to initiate legislation? Why not relax the Whips and let us get on with trying to produce the framework for legislation that could take forward the broadly consensual thrust of everything that has happened today? When ultimately the Government come back to us and tell us that they have sorted out the big strategy and know where Britain’s future will be, we will have for them a document that they can then introduce in another place—and carve up in a way that politicians always do.

Motion agreed.

Committee adjourned at 7.38 pm.