Skip to main content

Levelling-up and Regeneration Bill

Volume 828: debated on Monday 27 February 2023

Committee (3rd Day)

Relevant documents: 24th Report from the Delegated Powers Committee, 12th Report from the Constitution Committee, Scottish, Welsh and Northern Ireland Legislative Consent sought

Amendment 51

Moved by

51: After Clause 5, insert the following new Clause—

“Levelling-up consultantsWithin 120 days of this Act being passed, a Minister of the Crown must publish an estimate of how much local authorities have spent on consultants in relation to this Part.”Member's explanatory statement

This means that a Minister must publish an estimate of how much local authorities have spent on consultants in relation to Clauses 1 to 6 of the Bill.

My Lords, I will be moving these amendments in the name of my noble friend Lady Taylor of Stevenage. The first amendment is Amendment 51, which is after Clause 5. It asks for the Minister to publish an estimate of how much local authorities have spent on consultants in relation to the first six clauses of the Bill. The reason for laying this amendment is that there has been quite a lot of discussion over the last few years about the amount of money being spent both by local and national government on consultants. We wanted to probe the Government on this and have a small discussion around this area.

Back in 2020, the Public Accounts Committee released a report which said that the Government were

“too quick to spend money on consultants to undertake work that could actually be better done by existing civil servants”

and that this was being done rather than developing and retaining in-house skills. Since then, any restriction on spending controls on consultants have been ditched by the Government, allowing Whitehall departments to potentially spend millions more on these external consultants. The limits were introduced under a previous Prime Minister, David Cameron, in 2011, requiring central authorisation if contracts lasted more than nine months or exceeded £20,000. Our concern is that the value of contracts has been rising. The limit set earlier this year was £600,000, which is a huge jump. We are very concerned about this, because government spending is being tightened in other areas of public expenditure, particularly during the cost of living crisis. If the Government are increasing this extra cost of outside consultants, how can that be justified in the current crisis? However, obviously, one thing we appreciate is that during the pandemic there was additional spending in this area that could not be avoided.

In 2022, the UK public sector awarded £2.8 billion-worth of consulting contracts, according to data from the contract analyst Tussell Ltd which was published in the Financial Times. That figure was up by 75% from 2019, so even taking into consideration rising costs during the pandemic, that is still a huge jump in spending. Does the Minister agree with the Public Accounts Committee that the Government’s way forward on this should be to retain civil servants and develop their skills, and that that is a better use of government money?

I turn to the nub of the amendment, which is the published estimate of how much local authorities have spent on consultants in relation to Clauses 1 to 6. Last week in Committee, we discussed the thorny issue of competitive funding. Our concern is that this is not the best way to fund different local authorities in their bids for levelling-up pots of money. We know that local authorities have complained about the Government’s proliferation of these competitive funding pots. Alongside this, local authorities obviously have been using more consultants. It has recently been reported that consultancy firms have raked in around £26 million from councils which are clearly cash strapped. They have lost funding from central government over the last few years, so they really do not have this money to spend. The reason they are spending it is that they are trying to prepare high-quality levelling-up funding bids, and they no longer retain much of the necessary skill set for that in house.

Considering that many of those with successful bids have lost far more in local authority funding cuts than they are going to achieve, does the Minister agree with me that the only people who seem to be turning a profit here are the consultants? We believe that the Government should change the way the funding is assessed and granted. I would be grateful if the Minister, and the wider Government, could think about how we can return skills in house—both in national government and local authorities—to stop this huge amount of cash going on external consultants.

My noble friend’s Amendment 52 relates to the practicalities of implementing a levelling-up agenda. It proposes that a Minister must publish a statement of any levelling-up directors who have been appointed and their role in implementing the levelling-up missions. We have heard for some time from the Government about the levelling-up directors and their intended appointment, but we have had very little detail or further information.

Last year, my noble friend Lord Bassam of Brighton tabled a series of Questions about the government appointment of regional levelling-up directors, asking what their remuneration, role and responsibilities would be. The creation of these posts was announced not long after the White Paper was published last spring. At that stage, it was said that they were to be paid £140,000 a year. Last December, my noble friend was told in response to his Question that at that stage, none had been appointed and that further details on what they might actually do were still being worked out. Put simply, the noble Baroness, Lady Scott, said in response to his Question:

“Further announcements will be made in due course.”

Given that levelling-up directors are, in theory, supposed to be driving the agenda nationally and regionally, and getting both councils and government working together and with all the relevant agencies, charities, businesses and so on that can help deliver this agenda, I would be grateful if the Minister could tell us what progress has been made with these posts. I have heard a rumour that somebody might actually have been appointed; maybe I have missed the confirmation of that. It would be helpful to know about progress on the posts, or whether the Government have had a rethink about this and how it is going to be structured. Have the Government perhaps pulled the plug on this way forward? It would be helpful to have a better understanding. The reason why this is so important is that it strikes me that they are supposed to be the glue between the department, local councils and local communities, and to start to make things happen. So, we consider a proper understanding of their role in implementing the levelling-up missions to be critical. If the Minister can give us any further information on this, it would be gladly received. If he cannot, it would be helpful to know when we are likely to have an update.

My Lords, I rise to speak to Amendments 51 and 52 in the name of the noble Baroness, Lady Taylor of Stevenage. As the noble Baroness, Lady Hayman of Ullock, just pointed out, these amendments relate to consultant spend by councils and regional director spends, and their roles in the Government’s levelling-up agenda.

Amendment 51 is important, as the noble Baroness just pointed out. A freedom of information request showed that in the 245 upper and lower-tier councils, £26.9 million has been spent on levelling-up bids. That is £26.9 million taken away from social care, housing, cleaning, street cleaning and bin collection at a time when councils are finding things particularly difficult. Of that money, the vast majority went to external consultants. Does the Minister think it right that £26.9 million should be used on a lottery process pitting town against town and city against city to bid for levelling-up funds, only for the Government to move the goalposts at the last second by changing the criteria against which councils are bidding, which means not only that this money could have been spent on other services but that it has been wasted?

On Amendment 52, I wish to start with a general point, and here I do not necessarily share the sentiments of the noble Baroness, Lady Hayman of Ullock. The concept of 12 regional directors controlled out of Whitehall somehow being the panacea for devolution is ludicrous. Let us be clear: what this will turn out to be is a system of crude decentralisation. Those of us who have been around for quite a while in local government know that when we had something similar in the past, the regional directors of the department dispersed to work with local area partnership boards came with “We are here to help and support you” as their mantra. However, they were used as government enforcers and the eyes and ears of government, going back to the department and saying which areas were in the good books and who should be put on the naughty step because they were not carrying out the Government’s agenda.

Reports back from such regional directors decided who got money and what sticks or carrots were deployed. I know that the noble Earl will pour out soothing words from the Dispatch Box, saying that is not the role, but history shows that it is. Look at the job advert issued in November 2022—it kind of gives the game away. It says that they will report progress to the newly established committee for levelling-up, which is exactly the same as the previous directors in the department did.

We are now told that these regional directors are on hold, but that they could be answerable and accountable to the mayors. Let us take Yorkshire as a region, as these are regional directors. We could have four mayors in Yorkshire with different agendas and from different political persuasions. To which mayor will the regional director be accountable—one of them or all of them? It is clear that these roles have not been thought through from a regional perspective but from an office in Whitehall, with a very Londoncentric view of how they can be used as government enforcers.

Talking of Yorkshire, we are a little perplexed—not that we are from Yorkshire, but perhaps the Minister can help with this. Civil Service World on 17 February had an interesting headline, stating that the department

“hires former … No. 10 official as levelling-up director.”

Ed Whiting, David Cameron’s former deputy private secretary has been hired, and he very helpfully tweeted that he has been recruited to the role of levelling-up director in the north, based in and working out of Leeds:

“I’ll be based in Leeds, hoping to be travelling round North”,

working with local councils and others on innovation. He also expects to travel to London often too—ah, yes, that newly established Cabinet committee for levelling-up has to be informed. He goes on, quite incredibly—he has been hired on a six-figure salary—to say that “details” of the new role are “tbc”.

We are perplexed, Minister, and some clarification would be helpful. Is Mr Whiting a regional director for levelling up and, if not, what is his role and how does it fit with the regional directors? When was he recruited, where was the job advert and who sat on the recruitment panel? Why have local authorities in the north not been informed officially who he is and how he is there to help them? Why has someone been recruited on a six-figure salary when their role is still to be confirmed?

That is why Amendment 52 is important. We need transparency and clarity on who the department is using in the regions and what roles they have, to ensure the Government do not establish an expensive decentralized bureaucracy, costing the taxpayers millions, trying to enforce their agenda in local areas.

My Lords, as we have heard, this group of amendments is related to consultants and the Government’s appointment of levelling-up directors. Specifically, Amendment 51, in the name of Baroness Taylor of Stevenage, would require the Government to publish an estimate of how much local authorities have spent on consultants in relation to Part 1 of the Bill. I fear that requiring local authorities to report in this way would be disproportionate and unnecessary, but let me explain why.

The new burdens doctrine, established and maintained by successive Governments, requires all Whitehall departments to justify why new duties, powers, targets and other bureaucratic burdens should be placed on local authorities, as well as how much these policies and initiatives will cost and where the money will come from to pay for them. This provision already ensures that the Government must properly consider the impact of their policies, legislation and programmes on local government and fully fund any new burdens arising.

Further, local authorities are already bound by the Local Government Transparency Code, which mandates local authorities to publish data on all expenditure over £500 in open and accessible formats. I will come back to that point in a second, but I have a great deal of sympathy with the points made by the noble Baroness about expenditure by central government on consultants.

Will the Minister clarify something? When he says that the Government fully fund any new burdens, does that mean that the Government are reimbursing local authorities for the cost of creating their bids?

It would depend on the circumstances. It would depend on whether the expenditure on consultants was classified as a truly new burden or not, and that is an arcane science on which I do not pretend to be expert. Perhaps I may provide the noble Baroness with clarification in writing on that point, because I recognise that it is of relevance.

As I was saying, I have a great deal of sympathy with the noble Baroness’s points on expenditure by central government on consultants. As a matter of principle, I think all Secretaries of State across government would agree that they should impose a self-denying ordinance on their departments where skills can be developed in-house. Where that can happen, it should. The problem is, I suggest, twofold. First, the skills needed are very often highly specialised; secondly, if one looks across government as a whole, it is very difficult to make general statements about the needs of individual departments. However, I think the noble Baroness and I are aligned in our antipathy to expenditure that may turn out to be unnecessary—certainly expenditure that turns out to be wasteful. No department wants to go down that road.

On expenditure, transparency, as so often, is key. I note the comments of the noble Lord, Lord Scriven, about consultancy expenditure by local authorities in preparing their bids. I would just say to him that the decision by some local authorities to appoint consultants in their bidding process was a decision for them, and such decisions will doubtless have reflected in part the point that I just made: that the necessary skills are not always on tap locally. I think that is all I can say about that, but I will write on his questions about Mr Whiting, as I do not have the necessary briefing on that in front of me.

I want to ask a specific question, which I think the noble Baroness, Lady Hayman of Ullock, also asked. Has any regional director been appointed? That is the key question, particularly about Mr Whiting.

I am coming to Amendment 52 in a second. It might be helpful if I added a few comments about local government funding more generally, because we recognise that the sheer number of different funds has become onerous for some councils to navigate and deliver. We have taken initial steps to address this complexity in the funding landscape. For example, the levelling-up fund provides cross-departmental capital investment in local infrastructure, and the UK shared prosperity fund provides resource-focused investment to support people, boost pride in place and strengthen communities. However, the levelling-up White Paper made it clear that we can do more, and we will set out a plan on funding simplification shortly.

Amendment 52, also in the name of the noble Baroness, Lady Taylor, sets out that we must publish a statement of any levelling-up directors who have been appointed and their role in relation to the implementation of the levelling-up missions. It might be helpful if I gave a little bit of background on our approach to levelling up. It is clearly a long-term programme. Levelling-up directors are but one part of a wide suite of activity across government to deliver the 12 missions and the objectives of the levelling-up White Paper. I am afraid that I can give the noble Baroness only a brief update on where we are. I can tell her and the noble Lord, Lord Scriven, that no appointments have yet been made. We are reviewing the recruitment process for levelling-up directors internally, as well as our wider approach to working with places across the country. It is obviously key that we get this right and that we join up effectively across government. I or my ministerial colleague, my noble friend Lady Scott, will be happy to update noble Lords further on this in due course.

To bring us back to the specific amendments, Civil Service appointments are already subject to the requirements of the Constitutional Reform and Governance Act 2010, so it is unnecessary to seek to create further statutory processes around this. Legislating in this way with regard to Civil Service roles would be disproportionate and unnecessary. Therefore, I ask the noble Baroness to withdraw Amendment 51. I hope that what I have said has been reasonably helpful and that she will not feel that she must move Amendment 52.

My Lords, I have listened to this debate very carefully. The noble Lord, Lord Scriven, talked about Yorkshire, which he clearly knows well. Apparently, this new director will be based in Leeds. Several times “the north” was referred to—but does “the north” include west of the Pennines or is that a different area? What is the geographical boundary of these things, or is it still fluctuating?

It is open for decision. We want to see local areas taking the initiative themselves. Where there is a functioning economic hub, for example, or a whole county, they may wish to apply for CCA status, but it is up to them to make those decisions. One can talk in general terms of “the north”, but until we know that the appetite is in those northern areas for taking advantage of the opportunities that we are trying to create, I cannot be more specific.

For clarity, the issue with Mr Whiting, to whom I referred, is that, as the Minister helpfully said, no regional director has been appointed so far. However, Mr Whiting describes himself as a regional director for the north and not for a particular region. Therefore, it is important that, when the Minister writes to me, he clarifies exactly what Mr Whiting’s role is and how it fits with the regional directors.

My Lords, I agree that it would be very helpful, because it is a bit confusing at the moment to know exactly what is what. I would appreciate that.

I thank the noble Lord, Lord Scriven, for his support of Amendment 51. On Amendment 52, I am not entirely sure that I agree with the appointment of directors. The point of the amendment is to get a better understanding of exactly what is happening, what the timescales are and what is expected of them, then to be able to make a proper assessment of exactly what we think about this policy of directors. It is quite difficult to have a proper position on it if you do not know what is going on and what sort of people are likely to be getting the jobs. It would be extremely helpful if the Minister could write to us around any appointments that might be in the pipeline to give us a better understanding of how it is all working and what the timescales are.

While we are on Amendment 52, the Minister said that the recruitment process was being reviewed. When he writes, it would be good to understand what that means. Has there been any process so far? Are they liaising with the sector on how recruitment might best be done and on the timescales? I know that the Minister cannot give us any further information on that today, and he may not have a lot to put in his letter, but if he could give us as much as he possibly can, so we know where we are as we move forward through the scrutiny of the Bill, it would be extremely helpful.

On Amendment 51, again I thank the Minister for agreeing to write to me with more clarification around these matters. It is extremely helpful to have that. I am pleased that he agrees with us that developing skills in-house is important and that we must not have wasteful expenditure in departments. Again, the way forward is to stop it happening and to invest more in people. I thank him for his response, and thank the noble Lord, Lord Scriven, and my noble friend Lord Berkeley, for their contributions. I beg leave to withdraw my amendment.

Amendment 51 withdrawn.

Amendments 52 to 57 not moved.

Clause 6: Interpretation of Part 1

Amendments 58 and 59 not moved.

Clause 6 agreed.

Clause 7: Combined county authorities and their areas

Amendment 60

Moved by

60: Clause 7, page 6, line 33, after “whole” insert “or part”

Member's explanatory statement

This probing amendment means that a CCA can include part of a two-tier council area, rather than the whole area.

My Lords, as we start to examine those parts of the Bill which address local government and devolution powers, we might welcome the fact that the Bill addresses the long-standing asks of councils and their representative bodies for greater devolution, and that there is more flexibility in the proposed structure of combined county authorities than we might previously have envisaged. Nevertheless, we had hoped for a Bill that was far more ambitious and open to ideas when looking to address the imbalance of power in the UK.

As we have often heard in your Lordships’ House, the UK today is the most centralised state in Europe and there is too much in the Bill that seeks further powers for the Secretary of State to intervene. I welcome very much that the Secretary of State accepts that the national challenges require place-based solutions—at least, it appeared so from the White Paper. However, I feel strongly that Part 2 would better deliver this if accompanied by greater powers and fairer funding so that leaders can support the local economic recovery according to the needs of their own areas.

We have pointed out before in your Lordships’ House that, without a comprehensive and fair funding system across local government which would properly empower local authorities to deliver what is needed to support, sustain and develop their communities and economies, any steps taken towards devolution will have a hollow ring. Even worse, if funding mechanisms are driven by the current competitive bidding pots, which favour areas that are able to spend the most on shiny bids, they will run counter to the whole levelling-up agenda. I was grateful to the noble Earl, Lord Howe, for saying that the sheer number of funds have become onerous and that we certainly need to look at that. There is a further danger in this “bidding bingo” way of funding local areas: it is yet another way of imposing the Government’s policy on growth and infrastructure in local areas and does not make for true devolution in any sense of the word.

We may have wished that provisions for reorganising local government had been the subject of a separate devolution Bill, an issue I have raised before in your Lordships’ House. Given that this does not appear to be on the horizon, we will be seeking amendments to transfer greater powers to local areas. I welcome the implicit recognition that devolution can drive economic, social and environmental development in local areas, but questions remain over whether the specific model of combined county authorities is right for every area, and whether all the current constituent parts of local government will have their importance recognised and their voice heard as the new structures develop. Local residents and leaders will always know best their own areas and the powers they need to deliver on their ambitions. Amendments for this part of the Bill will aim to allow greater flexibility for towns, cities, counties and the people who live in them to determine their own future.

Amendment 60 is a probing amendment to discover what a CCA can include as part of a two-tier council area—will all or only part of it be allowed? The amendment is designed to help us understand whether the Government will prescribe the nature of a CCA area to include all constituent councils. This has been tabled because there has been significant confusion about the geography of CCAs and what is and is not in scope. For example, does the CCA have to include the whole of an upper-tier authority area? In the case of my home county, Hertfordshire, must it include the whole of the county? The Minister will know that this is complicated: in some areas, counties already include unitary areas, and some county areas have enormous populations and significantly diverse demographics.

In previous devolution rounds, we have seen a confusing spectrum of scope—from being instructed on what will be in and out geographically, to documentation saying that it is for local government to decide. The second option is clearly preferable to all of us, but even when that is the stated initial intent, the goalposts are often moved during the bidding rounds to be more prescriptive than was initially thought.

Amendment 99 probably belongs better with the group of amendments relating to consultation on CCAs. If consultation is needed for the formation of a CCA and/or its dissolution, as we contend in other amendments, should there not also be consultation when a CCA is to be amended? Later regulations could determine the qualifying parameters for this, so that extensive consultation is not necessary for minor changes. This and similar amendments seek to determine the principle of public engagement on local government structures. I beg to move.

My Lords, the noble Baroness, Lady Taylor of Stevenage, is quite right to table this amendment to explore the area that can be included in a combined county authority. As I understand it, a combined county authority is a bit of a misnomer. Last Wednesday, the noble Baroness, Lady Scott, said in response to an amendment that a CCA could include, for instance, the unitary authority of Wiltshire and the city unitary authority of Swindon. Equally, when I asked her what would happen in Devon, she said quite clearly that the county and district authorities of Devon and the unitary authority of Plymouth would be included. These are not necessarily combined county authorities: they are unitary and county and district combined authorities—if that is determined, we hope, by the people who live there and the councillors elected to represent them.

It is really important for us to get some clarity about how this will operate. In some parts of the Midlands, you can imagine there being concern about which parts of a county are to be included. For example, in Nottinghamshire and Derbyshire there is an overlap of travel-to-work areas, and they would try to form a combined authority that would not necessarily include the whole of Nottinghamshire or Derbyshire. For example, there was certainly some movement to try to get parts of North Derbyshire included in the West Yorkshire Combined Authority. There is a lot to consider, and I hope we will get clarity from the Minister on the Government’s thinking.

I support the amendment in the name of the noble Baroness, Lady Taylor of Stevenage, on the ability of just part of a two-tier authority to join if that is what is wanted. You cannot expect all the district councils necessarily to want to go with their upper-tier county authorities into a new combined county authority if that does not work for them. For instance, a historic county boundary may no longer represent the travel-to-work areas of that geographic area.

I am also pleased that the noble Baroness, Lady Taylor, has tabled Amendment 99, on public consultations. The public should have a say on this issue, which will come up again in later groups. There has been too much of a top-down requirement for combined authorities, which depends on those currently in power in local areas making the decisions without proper decision-making—more than consultation—by local people. In the end, the public will have to be asked to pay the additional taxes to support the working of the combined authority. Clause 7 simply states:

“The Secretary of State may by regulations establish … a combined county authority”.

That is not good enough. Local people, who are going to pay the additional taxes required, should have a say in what happens.

After all, the combined authorities may or may not be of benefit to local communities. They will benefit the Government, because they will be doing their will: in my view, we currently have delegation from the Government, rather than devolution to local people. For instance, in the West Yorkshire Combined Authority where I live, we have delegation of transport funding and regeneration funding, but with all the strings attached that the Government apply to funding where the decision has been made in departments or in combined authorities’ mayoral offices.

Therefore, if combined authorities do not have prior public debate and prior consultation and approval, what we get is the creation of another remote institution making decisions for local areas without direct accountability for them. Can the Minister explain what policies and proposals of combined county authorities can be questioned and challenged before final decisions are made? Currently, scrutiny arrangements in combined authorities are of the implementation and outcomes of decisions. I am keen to hear from the Minister whether the Government support the idea of pre-decision scrutiny to help to improve outcomes and involve more elected representations. In that way, more local people—or, certainly, their elected representatives—will have a say in any policies and priorities that are set out by the combined authorities. I support these two amendments and look forward to the reply.

My Lords, this group of amendments relates to the area of a combined county authority, the new type of local government institution being provided for in Part 2 of this Bill. Provisions in this part support the delivery of the local leadership mission of the levelling-up White Paper, to enable by

“2030, every part of England that wants one”


“ have a devolution deal with powers at or approaching the highest level of devolution and a simplified, long-term funding settlement.

I am sorry to interrupt so early in the Minister’s response, but could he define more clearly what the “highest level of devolution” actually means?

If the noble Baroness will bear with me, I shall do my best on that.

Noble Lords will be aware that 10 combined authorities have been established since 2011 in our city regions. However, we recognise that such authorities might not be so appropriate for non-metropolitan areas. The new model of combined county authorities is more appropriate for non-metropolitan areas, many of which have two-tier local government. It enables the establishment of a single institution covering a functional economic area, or whole county geography, which would be a suitable institution to provide effective leadership over an appropriate geography to qualify for a devolution deal.

I take on board the comments of the noble Baroness, Lady Taylor, about local government funding, but it might be helpful if I added a little to the information I gave the Committee in the last group of amendments. Our intention is to set out a plan for streamlining the funding landscape, as I mentioned, to provide greater flexibility for local authorities and make it easier to navigate opportunities for growth. This will include streamlining local growth funds, reducing inefficiency and bureaucracy and giving local government the flexibility it needs to deliver for local economies. As part of this work, we expect that there will be fewer small competitions. Where competitive funds do exist, we will look to streamline bidding and support greater alignment between revenue and capital sources. We will also consider the monitoring and evaluation requirements to ensure that places have robust, proportionate, ongoing monitoring and evaluation plans for the impact and delivery of investments and spending.

Amendment 60, tabled by the noble Baroness, Lady Taylor, seeks to allow part of a two-tier county council area to be included in a combined county authority, rather than the whole county council area. This would not be consistent with the policy we set out in the White Paper, whereby we will devolve to an institution covering a whole county geography or functional economic area. I will come on in a moment to the rationale for that model. In a combined county authority, such as the intended East Midlands CCA, the upper-tier councils within the area covered by a combined county authority are the constituent members of the CCA. There is no upper-tier council that covers part of a two-tier county council’s area; the only upper tier council is that two-tier county council, whose area covers a wider geography. As such, as the two-tier county council will be the constituent member of the combined county authority, the whole area that the council covers must be part of CCA’s area.

Moreover, allowing part of a two-tier county council’s area to be part of a combined county authority would not be consistent with the levelling-up White Paper’s principle of devolution being to institutions covering functional economic areas or whole county geographies, over which a number of functions should be exercised for maximum effect. Splitting the responsibility for such functions could also lead to discrepancies—

Can the Minister explain, then, where the geographies of a county area do not coincide with the geographies of an economic or travel-to-work area? Often, they do not. What I have heard is that you can either have a functioning geography of a county and its two tiers, or the alternative, but not a mixture of the two.

I am pleased that the Minister has raised the East Midlands. On the northern tip of the East Midlands there is Chesterfield and north Derbyshire. Most businesses in that area would look into the South Yorkshire Combined Authority in terms of their business, and not into the county combined authority. It seems to be an administrative boundary designed down here in Whitehall rather than a true travel-to-work area. How would the north Nottinghamshires and Chesterfields be affected by this when, in reality, the economic performance and activity is actually into the South Yorkshire Combined Authority?

May I add to what my noble colleagues have said? This goes to the heart of this amendment. We struggle to say how you can have a county with more than one functioning economic area included in that county. To take my county as an example, the south of the county largely relates to London, because some of the boroughs almost are London boroughs, whereas the north of the county relates much more to Cambridge and Bedfordshire. There are definitely two distinct, functioning economic areas within one shire county. The shire counties go back centuries: their economic geographies have changed very considerably since then. If you take the economic geography of my noble friend Lady Hayman’s area, people in Cumbria may even relate to an economic area that includes parts of Scotland. This is not a simple picture around the country.

Some extremely sensible and logical points have just been made. Perhaps I could address them by pointing out the contrast to what we have seen up to now. Devolution deals, up to now, have typically been put in place in city regions, where they cover the functional geographies in which people travel, commute, work and live.

The Government absolutely recognise that functional economic geographies are far less clear-cut in rural and semi-urban areas, and that the strategic scale and cultural and political resonance of county identities can act as a useful proxy. One can work only on the basis of best endeavours when trying to decide what a sensible area looks like. On a best endeavours basis, deals should be agreed over a sensible geography of a functional economic area, with a single institution in place across that geographic footprint to access more powers. That is the aim.

We absolutely recognise that in some areas it will not be a straightforward case of drawing a line around a particular geographic area but, where there is a will to make progress, it ought to be possible to find a way through. The department will do its best to assist areas in their thinking if that is of help. We will prioritise establishing deals where they cover a strategic geography, either a functional economic area or a whole-county geography.

The noble Baroness, Lady Pinnock, asked me to provide some clarification on the various tiers of a devolution package. The most comprehensive devolution package, level 3, is on offer to areas that have or are able to put in place a single institution over a sensible geography, with the strongest and most accountable leadership, such as a mayoral combined authority, a mayoral combined county authority or a single unitary authority, or a county council covering the whole county area, with a directly elected mayor or leader. If the structures are in place for that kind of powerful leadership, it is likely that the area will qualify for the highest tier of package.

I have a lot to say in response to the noble Baroness’s points about local consultation but, if she will allow, we can cover that issue more fully in the debate on the next group of amendments, which are all about local accountability.

To get back to the amendment, I suggest that splitting the responsibility for functions currently vested in local authorities could lead to discrepancies in the delivery of important services, such as transport or adult education, within areas of a county council. I think it would introduce unnecessary complexity.

I am sorry to interrupt the Minister, but he keeps talking about complexity. This is complexity of boundary, not of reality. I will give him a situation where complexity may hold back the levelling-up agenda. Let us again take the top end of the east Midlands and South Yorkshire. If both the South Yorkshire combined authority and the Derbyshire and Nottinghamshire combined authority have control of the skills money, the fact that probably about half the people from the north end of the east Midlands come up into South Yorkshire means that the skills required should be funded for jobs available in the South Yorkshire combined authority. If the Derbyshire and Nottinghamshire combined authority decides not to invest in that type of skill, the issue is that the flow of labour will not be there for South Yorkshire businesses. How does that kind of problem get solved? It is not an administrative issue but the reality of having the skills where real people and businesses travel and work together.

I take the noble Lord’s point. The experience we have had with combined authorities is that local authorities’ natural tendency is to co-operate with each other. We have seen this all over the place: they do not want to operate in silos and they look outside their boundaries. Yes, there may well be cases where at the beginning there would seem not to be a particularly good fit, but that does not preclude two authorities, such as those he mentioned, getting together and finding a way through, if they possibly can, to address the mismatches of the kind he mentioned.

Amendment 99 seeks to amend Clause 23 to require a public consultation before any proposal to change the area of an existing combined county authority. We agree that those with an interest in the area should be consulted before a combined county authority is changed. As I said, we will have more to say about this in the debate on the next group of amendments.

Clauses 45 and 46 set out a requirement for a public consultation on any proposals from the local area on changes to the area of a CCA. Where a combined county authority has been established and subsequently seeks to change its boundary, Clause 23 enables the Secretary of State to make regulations for areas to achieve that. The Secretary of State may make regulations changing the area of a CCA if that is something the area consents to, the Secretary of State agrees and Parliament approves the necessary secondary legislation.

We fully recognise the crucial importance of residents in the local area having a say; that is common ground between us. That is why any CCA or local authority seeking to submit a proposal to the Secretary of State to change the area of a CCA must carry out a public consultation, as set out in Clause 45(3). This consultation must take place in the area covered by the CCA. This enables local residents, businesses and other interested parties to have a strong input into any such proposals. A summary of consultation responses is then to be submitted to the Secretary of State alongside the proposal.

Clause 46 provides an additional safeguard to ensure that there is sufficient public consultation. This enables the Secretary of State to undertake a consultation prior to making any regulations to enact these changes if they feel that there has been insufficient public involvement in their development.

We completely agree with the sentiment of Amendment 99, but I suggest that we already have provisions later in the Bill to address this; we will debate some of these in a few moments. I therefore hope that the noble Baroness feels able to withdraw Amendment 60 and not to move Amendment 99 when it is reached.

My Lords, I am pleased we tabled these probing amendments, because they have brought out some of the discussion we needed to have in these areas. I am grateful to the noble Baroness, Lady Pinnock, for her comments. She said that “combined county authority” is a misnomer, and I think she is absolutely correct.

Previous responses indicate that we could include unitaries and counties all within a two-tier area. It is not clear in the Bill what that might mean. In the example of Nottinghamshire and Derbyshire, with the overlap of economic areas and travel-to-work areas, et cetera, the geography is far more complicated than back in whatever century it was when the county shire boundaries were devised. The purpose of my amendment was to determine whether parts of a two-tier area would be required to join a CCA if it did not work for them. It is really important that we do some more probing around this and think about it more.

We did not get on to the subject of population, which I will come to in a minute. My concern with this is that we have the phrase that the Secretary of State can determine “by regulation” what a combined county authority will look like. That does not seem to me to be in the spirit of devolution in any way whatever. If it is for the Secretary of State to determine that by regulation, I would be interested to know the noble Earl’s view on how that would be conducted in relation to the partners in the local area.

I am grateful for the noble Earl’s extensive response on this, which is an indication that we are moving the debate forward somewhat. I will come back to the issue of the functional economic area. These are not neatly contained now within county council areas. We have heard a few examples of that. We need to focus on that and think about how we might amend the Bill to recognise that.

The noble Earl spoke about streamlining funding. I was grateful for those comments and I am sure they will be welcomed across local government, but when will we see the detail of how that streamlining of funding will work? If he has any more information on that, it would be helpful.

I have a lot of sympathy with what the noble Earl said about city regions. They make a lot more sense—I spent quite a lot of time with colleagues in the city region in Manchester looking at how that works. However, that does not mean that that model can be lifted and put down in areas that are very different in this country. The difficulties that we have set out underline exactly why there must be flexibility for local areas to consider for themselves what the appropriate geography might be for them.

I return to the issue of population size. In previous iterations of these bids for devolution, we were told that any bid under 600,000 population would not be considered. My county of Hertfordshire has a population of 1.2 billion—sorry, 1.2 million; I am exaggerating—which is a very different issue from a rural county that might have a population of only 300,000. That is why this is much more complicated in shire areas. Will the noble Earl comment on whether population issues will be taken into consideration in relation to the size and constitution of combined county authority areas?

It may be helpful to the noble Baroness if I comment on that specific question. We expect upper tier local authorities with a population of less than 500,000 to collaborate with their neighbouring authorities to agree a sensible geography for a devolution deal. Where neighbouring local authorities wish to join a deal which has been negotiated and have the same level of ambition, we will expect other authorities to take this seriously in order to secure devolution and to avoid areas being stranded. Once again, I come back to the point I made earlier that our experience with combined authorities has shown that this kind of co-operation takes place quite readily. That is the position we have taken currently.

I am grateful to the noble Earl for his clarification. It covers one side of the picture with the smaller county areas. However, larger county areas, where the population may not lean towards a single county authority, should still be a subject for discussion.

I agree that we have several amendments relating to consultation processes and that the other amendment in this group probably sits better with those, so I am happy to postpone discussion of that until the future group. However, the principle of consultation, and recognising the importance of local areas having a say, seems to be enshrined for all the other issues around the setting up and dissolution of a CCA. If it is right for those, it must be right for a change of boundaries too. That is the point we were trying to make with Amendment 99. That said, we have had a useful discussion and I am happy to withdraw Amendment 60 at this stage.

Amendment 60 withdrawn.

Amendment 61

Moved by

61: Clause 7, page 7, line 5, at end insert—

“(3A) The Secretary of State may not lay regulations under this section until he or she has deemed that establishment is supported by no less than 60% of residents in the area.”Member's explanatory statement

This means that a CCA is established only if the Secretary of State deems there is no less than 60% of support from the local residents.

My Lords, as we have already discussed this afternoon, the principle of consultation when fundamental changes are being made to governance structures is an important one. Amendment 61 is aimed at establishing the principle of public consultation in relation to the formation of a combined county authority and to setting a realistic threshold for the constitutional reform to proceed.

A fundamental principle of localism is that changes must be made with people and not to them. Without a provision in the Bill like this, it is too easy for a leader or a group of leaders, or even a Secretary of State, to take fundamental governance changes, such as the formation of a CCA, a long way without consulting those who will be affected by them. The complex structure of local government in the UK, which means some areas have multiple layers of local authorities overseeing services, makes this even more necessary. The amendment in the name of my noble friend Lady Hayman outlines the process for ensuring that the outcome of the consultation process is publicly available, essentially before any submission to form a combined county authority is made.

Amendment 62 is designed to probe government thinking on the constitution of combined county authorities. With the rolling five-year housing targets potentially being removed, for example, is it the intention that governance structures should be able to consider the impact across a defined economic area, or do the Government envisage that the combined county authority will determine such matters for itself? If the latter is the case, is there to be an arbitration process which will help to determine where one economic area crosses boundaries with another? On the issue of non-constituent members of CCAs, for example, will it be the case that some members of authorities will be required to sit in more than one authority if it affects their economic geography?

Amendment 63 reflects on the nature of levelling-up missions and the significant part of the Bill that refers to planning matters. The Government may have assumed that co-operation between combined county authorities would take place in order, for example, to resolve boundary issues where a service is necessarily delivered across boundaries or where a planning matter either crosses boundaries or requires a facility delivered in one area to have the use of services provided in another. As I make these points, I am reminded of the example of Harlow and Gilston village, which sits in both Essex and Hertfordshire.

Planning history suggests that writing the duty of co-operation on the face of the Bill would be helpful. Whether we are talking about the delivery of missions across rural areas, or in urban areas such as London and Manchester, where the boundaries of CCAs may be complex, guidance and a framework for duties to co-operate would probably be helpful.

Amendment 64 is crucial, particularly as it is difficult to see how missions will be delivered at all with a patchwork quilt of non-coterminous boundaries between public bodies as they are currently constituted. This has been a long-standing issue in local government. The amendment will, for example, enable discussions about the impact of the rollout of ICSs on the potential for future health devolution—a really important issue. If we do not devolve the responsibility for health issues to these new authorities, we will not be able to tackle as effectively the inequalities in health that we discussed in earlier debates on the Bill.

It is welcome to note from the Greater Manchester population health plan that significant benefits have already been recorded for local residents following the devolution of health and social care to the Greater Manchester Combined Authority. This includes a substantial increase in school readiness and a smoking prevalence rate falling twice as fast as the national average. We definitely see the benefits of this, and we want to see it extended across other devolved areas. We would welcome further information from the Government on how they envisage the further devolution of health, police and crime commissioner powers, and other public functions which would enable the progress of the missions.

Amendment 65 is probably shaped by my long experience as a district councillor. We in district councils were very pleased to see the original amendment to Clause 18, which enshrines the role of district councils in determining the future governance of their areas; but I always believe in a belt and braces approach, particularly where the track record for inclusion has not always been consistent. The same applies to my colleagues in the National Association of Local Councils in respect of parish and town councils. We want everybody to be included in these discussions.

Lastly, Amendments 101 and 102 refer to the dissolution of CCAs. The first would require that public consultation take place before dissolution. If there is to be consultation on the setting up of a CCA, it follows that it should also take place if one is to be dissolved. Amendment 102 asks the Secretary of State to clarify, upon dissolution of a CCA, how local powers will be retained, and implicitly suggests that they will not return to central government. I would be interested to hear the Minister’s comments on how that might work for the future. I beg to move.

My Lords, I rise to speak to Amendment 127, which appears in my name in this group, and to make a couple of brief comments on the amendments so clearly and comprehensively presented by the noble Baroness, Lady Taylor of Stevenage.

I refer back to the terminology the noble Baroness used in the previous group when talking about what the spirit of devolution should be: it should surely be a democratic spirit. The decision about the shape of devolution should rest with the local people, the people who are actually affected. Historically, the perception and the reality of some instances of devolution has been deals done un-transparently, in the dark, in what would once have been smoke-filled rooms. The smoke may have gone, but that lack of transparency remains.

What we are seeking here is a different idea of devolution—devolution that is truly transparent and open, with local people in control of the process rather than having it inflicted on them. With that in mind, my Amendment 127 calls for a referendum to be conducted on whether a combined county authority should be established in a given area. It occurs to me, having listened to the debate on previous groups of amendments, that the amendment should say “established or disestablished”, but we are in Committee so we can explore these things as we go along.

I see that the noble Lord, Lord Scriven, is in his place, so we might have already had extensive discussion about what happened in Sheffield, South Yorkshire and north Derbyshire. I will not, therefore, go into great detail on that, but it is worth noting that Sheffield voted against having a mayor and then, not long afterwards, found itself with a mayor.

I will also give a more positive, more recent example from Sheffield. Sheffield is the largest local authority to convert, through a referendum, from a cabinet-based system to a modern committee-based system of government. I know many of the people who were involved in that campaign, which was led not by political parties but by a local community group. Many people said, “You’ll never get this referendum through. It’s all too technical, difficult and complicated, and people won’t understand.” But the referendum was voted through. It was a real vehicle for a huge amount of debate and discussion in the city about how it was run and administered, and how that could be done better. Putting a referendum in for CCAs would be a chance to have a discussion and a debate, and to really engage local people, which is what we need in our local areas to improve the quality of local governance.

Of course, the other recent example of such change, driven at the local level with decisions made by local people, is the city of Bristol deciding to get rid of its mayor. That was the decision that the people of the city made. Again, some said, “You’ll never get this referendum through; everyone is just going to shrug and it will all be too difficult.” But people were engaged and involved and they made the decision for themselves. Surely, that is what democracy means, and that is why I have tabled this amendment.

My Lords, I will make just one or two comments on this group. I have listened very carefully to this and the previous group and I think we have an opportunity for the Government to clarify a number of issues around consultation and, indeed, referendums. I listened carefully to what the noble Baroness, Lady Bennett of Manor Castle, said about referendums. What is needed is a statement from the Government, hopefully before Report, on what the nature of consultation should be. What would be deemed to meet a minimum requirement or threshold for there to be an official consultation?

Secondly, the Government need to be absolutely clear what their own powers should be in relation to a consultation: what they can require of a local authority or set of authorities. I welcome the fact that this discussion is taking place; it is really important. We have discussed before in recent years during the passage of previous Bills what local people have a right to expect of their consultation. I, too, in Newcastle, have been through a mayoral referendum, and the same thing happened. The decision was not to have a mayor, but, of course, we now have a mayor of the North East Combined Authority—for which, in fact, there was no referendum. Our referendum was within scope; I ask the Minister: are referendums out of scope?

Turning to Amendment 62, I was struck by one or two other very important issues raised by the noble Baroness, Lady Taylor, which the Government need to be a bit clearer about. The first was also raised by the noble Baroness, Lady Hayman of Ullock: travel-to-work areas. It all depends how big your CCA or other combined authority is geographically. A very important issue is raised in Amendment 62: whether the Government are thinking in terms of each CCA having a single economic hub. In a number of areas that would not be suitable. In my own part of the country, several travel-to-work areas apply. Hopefully, that point will not be forgotten by the Government.

Lastly, on Amendment 63, the noble Baroness, Lady Taylor of Stevenage, made another very important point about the duty to co-operate. When during previous Bills we have debated the duty to co-operate, the Government have always been very positive about having that duty placed clearly on the face of the Bill. But a CCA is not just being required to co-operate with a neighbouring CCA, but with all the other bodies that may relate to it. Given the ability of the public sector to operate across boundaries, both geographical and in terms of responsibilities and powers, it matters that the duty to co-operate is made absolutely clear at the outset.

My Lords, I will just make one or two additional comments to those of my honourable friend Lord Shipley, the main one concerning Amendment 126 in the name of the noble Baroness, Lady Hayman of Ullock, about public consultation. I have been involved in a number of statutory instruments on the establishment of metropolitan combined authorities where the public consultation involving “the public” has been minimal, but it was agreed to be satisfactory because it enabled other local institutions—be it businesses, local council representatives or the LEPs—to respond. That has been labelled “public consultation”.

It seems that once they have been established, combined authorities of whatever nature will rely on public support. Public support will not be forthcoming if they have not been fully engaged with on the establishment of the mayoral authority. The examples given by the noble Baroness, Lady Bennett, were appropriate in this instance. Bristol City Council decided to get rid of its mayor. Surely that has to be available. Equally, it has to be writ large in the Bill that the public in an area have a right to have their voice heard prior to a combined county authority being established. In the end, they are the recipients of both the tax bill and the decisions made by that authority.

I emphasise the importance of coterminosity. It is not just economic geography or travel-to-work areas—call it what you will—it is about coterminosity with, for instance, police areas and national health areas. These make a big difference to a combined authority’s ability to make a substantial difference to the lives of people in that area. The new integrated care boards seem to have thrown out the idea of coterminosity, certainly where I live, and that will be a negative on their ability to do their best for local people.

The only other point I want to make is about the right for the Government in Clause 24 to dissolve a CCA, and again the importance there of local people being consulted and being able to influence the outcome of a decision. Given that, this is an important set of amendments and I look forward to the noble Earl’s response.

My Lords, I will make a few comments on my Amendment 126 before we hear the Minister’s response. I tabled this amendment because public consultation is something I feel very strongly about. I worked in consultation before I entered Parliament. The noble Lord, Lord Shipley, made some comments about standards of consultation, and it is incredibly important when we are talking about consultation that we know what we mean by that and that we are not just talking about stakeholder engagement, because they are very different things. I know that the Government do have minimum standards of consultation that they follow, so I wanted to make sure that that was properly on the record.

I want the results of the public consultation to be publicly available because consultation is not just about going out and talking to people. It is about listening to people and, having listened to them, it is about demonstrating the changes made in response to what the public have said during that consultation process. That is why, to me, this is critical. If you are to bring people on board with what you are trying to achieve, they need to genuinely believe that they have been part of the process in a constructive way. Even if you do not agree with them, it is important to explain why not and whether any further action has been taken.

Finally, I may have got this wrong, but I think the Minister said in his response to the previous debate that there were no further requirements around consultation because it is covered in Clause 46. I had a look at Clause 46 and it says:

“The Secretary of State must carry out a public consultation unless”

and there are few examples. The final one is if

“the Secretary of State considers that no further consultation is necessary.”

Again, that would concern me unless it was clearly demonstrated and transparent why that was no longer required, because we have seen publicly what has been said and what further action has been taken or not taken and the reasons surrounding that. I would be grateful if the Minister could clarify that that is the approach the Government will be taking to consultation in this area.

My Lords, as we have heard, this group of amendments covers preconditions for establishing, and indeed disestablishing, a combined county authority. This process is locally led and it aligns with the process for a combined authority that we have seen successfully used in many areas to date.

Amendment 61, tabled by the noble Baroness, Lady Taylor of Stevenage, seeks to insert a requirement into Clause 7 that the Secretary of State can establish a combined county authority via regulations only if they deem there to be at least 60% support from local residents in the area to be covered by the CCA. In a similar vein, Amendment 127, tabled by the noble Baroness, Lady Bennett of Manor Castle, seeks to insert a requirement into Clause 44 for there to be a referendum before the Secretary of State may make regulations to establish a combined county authority, and for this question to be approved by a majority of local government electors.

We do want to ensure that the local public, in the broadest sense, are consulted on a proposal to establish a combined county authority in their area. This desire on the Government’s part is already captured by the requirement for a consultation provided for in Clause 43. Clause 43(4) states that, prior to submitting a proposal for a combined county authority to the Secretary of State, the local authorities proposing the establishment of a CCA must undertake a public consultation on the proposal in the area that the CCA will cover.

The noble Lord, Lord Shipley, asked, perfectly reasonably, what a proper consultation would look like. One important element is that it would have to cover the waterfront, as it were, in terms of stakeholders, to get a real sense of the strength of feeling and the climate of opinion in an area, and the extent to which an authority has taken the trouble to represent the scope of that opinion and feeling in the submission it makes. Once the consultation has happened, the authorities must submit a summary of consultation responses to the Secretary of State alongside their proposal.

When deciding whether to make the regulations to establish a combined county authority for an area, one of the tests the Secretary of State must consider is whether the area’s public consultation is sufficient. That is a judgment the Secretary of State must make in the light of the information presented, but if they conclude that it has not been sufficient, Clause 44 provides that the Secretary of State must undertake a public consultation before any regulations can be made.

I noted the point made by the noble Baroness, Lady Hayman, and will take advice on why that clause is worded as it is. I suggest to her that there is nothing sinister in it—it is the way that these legal provisions have to be drafted—but the net effect is as I have described, because what we wanted to introduce was a safety net, as it were, of a further Secretary of State-initiated consultation if that was deemed necessary. I hope the fact that we have done that demonstrates the importance which the Government attach to the consultation process.

We believe that the existing clauses provide for sufficient local consultation. I hope the way I have outlined the provisions and what we intend them to do in practice has persuaded the noble Baroness, Lady Bennett, that a referendum would be unreasonably burdensome. What we want, above all, is transparency of local opinion and that I hope we will get.

Many examples are flashing through my head, but I am thinking about one particular local government consultation that I saw, which happened to be around the city of Chester. The consultation asked, “Do you want to build on the green belt in areas A, B, C, D or E?”. Many local people pointed out to me that they wanted to say, “None of the above”, but there was no space in the box or provision to do that. So can the Minister reassure me that part of the Secretary of State’s examination of the summary of consultation responses will look at whether the consultation truly gave the space for local opinion to be expressed?

That is certainly the aim. I do not know whether the noble Baroness would agree with me that one of the downsides of referendums that we have seen in the past is that people are asked to take a binary decision. That very often does not allow for the nuances and subtleties of an issue to be presented in the question, to put it at its mildest. So we think the consultation model is more appropriate for this type of situation, particularly as the different constituent elements of a community will have different interests and viewpoints on the issue in question.

It is clear that, even barring a referendum, under Clause 44(3)(c) the Secretary of State will ask for further consultation if they consider that it is required. I assume that the Secretary of State will not have a subjective opinion on that and that there will be some objective criteria. It therefore comes back to what my noble friend Lord Shipley said: would it not be wise for the objective criteria about what good consultation is to be shared and, potentially, to be in the Bill? That would stop the position where local authorities had to rerun a consultation because it had not met the criteria which the Secretary of State was looking for in the first place.

Yes, I take the noble Lord’s point. It comes back to one that I think the noble Lord, Lord Shipley, made about minimum standards in this area. It might be helpful if I took advice on this and wrote to noble Lords who have taken part in this debate, to see whether I can add some clarification.

Turning to Amendment 62, tabled by the noble Baroness, Lady Taylor of Stevenage, the levelling-up White Paper clearly states the Government’s ambition for devolution, including the devolution framework, which is underpinned by four principles. One of these principles is sensible geography. The White Paper clearly states that future devolution deals should be agreed over a sensible, functional economic area and/or a whole-county geography, with a single institution in place across that geographic footprint. We have already debated that issue on the previous group. The combined county authority model is being established in the Bill to provide a single institution that can cover such functional economic areas, or whole-county geographies, where there is existing two-tier local government and multiple upper-tier councils. As such, I reassure the noble Baroness that combined county authorities will be focused on single economic hubs.

While I am on this point, I think it was the noble Baroness, Lady Pinnock, who asked whether mayors were mandatory for a devolution deal. The answer is no, a mayor will not be a prerequisite for a new devolution deal, but we do believe that a high-profile, directly elected leader will be most effective for levelling up. They will provide a single point of accountability for local citizens. The Bill will also allow mayors to use different titles, if they wish to, not simply “mayor”—but that is a detail.

Amendment 63, tabled by the noble Baroness, Lady Taylor, seeks to prevent the Secretary of State laying regulations to establish a combined county authority until they have laid a statement in both Houses, including plans for a duty of co-operation between the CCA and neighbouring areas. A fundamental principle of devolution, as I emphasised earlier, is that it should be locally led. It should be for the area itself to decide how it wishes to co-operate with its neighbours, not for central government to impose this.

The Bill contains methods to support inter-area co-operation, such as the non-constituent member provisions, which would allow a neighbouring council to have a voice in a combined county authority, should the CCA wish for this. We have also seen good co-operation between existing combined authorities and their neighbours, as I mentioned earlier: for example, joint working between the West Yorkshire combined authority and the City of York on transport shows that this does work in practice. I hope the noble Baroness agrees that devolution should be locally led.

Turning to Amendment 64, combined county authorities are based on the building blocks of local authority areas. As such, while there is sometimes coterminosity with police forces and NHS trusts, sometimes there is not. Where possible, we encourage coterminosity and, where the boundaries of a combined county authority and its policing are coterminous, the Government’s preference is for the mayor of a combined county authority to take on the police and crime commissioner functions. Examples of where this has already happened for combined authorities include Greater Manchester and West Yorkshire. Where there is no coterminosity with policing and health boundaries, there are other methods for ensuring collaboration, such as the Bill’s non-constituent and associate membership provisions, which would allow a member of an integrated care partnership or a police and crime commissioner to attend combined county authority meetings.

Amendment 65 proposes that all district councils in a combined county authority’s area would have to consent to its establishment. Only upper-tier local authorities—that is, two-tier county councils and unitary councils—can be constituent members of a combined county authority and only constituent members can consent to the establishment of a CCA. As district councils cannot be constituent members of a combined county authority, they cannot consent to its establishment. The amendment would prevent a CCA being established unless all district councils within the CCA’s area agreed to it. I suggest that this would give district councils a privileged position above all other bodies that are not constituent members, and would in practice be likely to prevent devolution to many areas where the majority of councils are in favour. However, we agree that it is important for district councils to be able to have a say in the establishment of a combined county authority, and the Bill already provides for this.

As I mentioned a moment ago, Clause 43(4) states that, prior to submitting a proposal for a combined county authority to the Secretary of State, the local authorities proposing the establishment of a CCA must undertake a public consultation on the proposal in the area that the CCA will cover. As important local stakeholders, we would expect district councils to be involved and use this opportunity to have their say on the proposal. As stated in the levelling-up White Paper, we expect CCAs and their upper-tier local authorities to work closely with their district councils and have been pleased to see this happening in deal areas such as the east Midlands.

Amendment 101 seeks to ensure the public are consulted prior to the dissolution of a combined county authority. I support the noble Baroness’s desire for this, which is why there is already a requirement in the Bill for a public consultation on any proposals from the local area on changes to the area of a CCA or on the area being dissolved as part of a CCA being abolished. Where a combined county authority has been established and subsequently seeks to dissolve its area and abolish the CCA, Clause 24 enables the Secretary of state to make regulations for areas to achieve that.

The Secretary of State may make regulations dissolving the area of a CCA if the area consents, the Secretary of State agrees, and if Parliament approves the necessary secondary legislation. So there is, as it were, a “triple lock” on this process. In both scenarios, we fully recognise the crucial importance of residents in the local area having a say. That is why any CCA or local authority seeking to submit a proposal to the Secretary of State to dissolve it as part of the CCA being abolished has to carry out a public consultation as set out in Clause 45(3). This consultation must take place in the area covered by the CCA, which enables local residents, businesses and other interested parties, as I have mentioned, to have a strong input into any such proposals. A summary of consultation responses must then be submitted, in the same way as I described earlier, to the Secretary of State alongside the proposal.

Clause 46 provides the additional safeguard that I mentioned to ensure there is sufficient public consultation. This enables the Secretary of State to undertake a consultation prior to making any regulations to enact these changes, if they feel that there has been insufficient public involvement in the development of them.

I suggest that Amendment 102 is unnecessary because of the provisions in Clause 24. Clause 24 sets out the statutory requirements for the dissolution of a CCA’s area and subsequent abolition of the CCA. Any changes to the delivery of functions because of a combined county authority’s boundary being abolished must be given active consideration. Such changes to the delivery of functions will be set out in the regulations the Secretary of State will make to abolish a combined county authority, which require the consent of the local area and parliamentary approval, as I have described.

Parliamentary committees and this House will have a statement in an explanatory memorandum explaining any changes to the combined county authority’s area or conferral of powers, the views of the consultees and how these changes meet the statutory test of improving economic, social and environmental well-being. If there is a local wish to abolish a CCA to which functions have been devolved, it is possible that those functions will be discontinued in that area.

The clauses already include provisions that, when changing an area or abolishing a CCA, the regulations can transfer functions to another public authority if that is decided to be appropriate. For some areas, a public authority will continue to undertake some of the functions in the area. For some, it may be decided that the function is no longer to be exercised in the area. As such, Parliament will already have this information through the means that I have described. I hope the noble Baroness is reassured.

I turn to Amendment 126, tabled by noble Baroness, Lady Hayman of Ullock. I agree with the intention of this amendment, which is to ensure the findings on any public consultation to establish a combined county authority are made public by the area submitting the proposal. The Bill already makes provision for this. I remind the Committee again of Clause 43(4), which states that, prior to submitting a proposal for a combined county authority to the Secretary of State, the local authorities proposing the establishment of a CCA have to conduct a public consultation on the proposal. That will provide an opportunity for local residents and other stakeholders to have their say. A summary of consultation responses must be submitted alongside the proposal to the Secretary of State. The decision to submit this summary will be taken at council meetings, which are held publicly. As such, the summary of consultation results will be publicly available.

I hope that these rather lengthy explanatory comments are helpful and that the noble Baroness, Lady Taylor, will feel able to withdraw Amendment 61.

I am very grateful to the noble Earl for his detailed comments on the amendments. I would like to start with a few comments on the amendment tabled by the noble Baroness, Lady Bennett. She mentioned that devolution deals were often done in smoke-filled rooms. I do not think that would have been the case in Manchester because they seem to have cracked the smoking cessation issue in Manchester, which is good to hear. But it is true that there has been an impression that these deals were cooked up behind closed doors. There has not always been a degree of consultation, which is why we have had such a significant discussion this afternoon around what consultation should take place on the setting up of a CCA, the dissolution of one or any boundary changes. The examples that the noble Baroness, Lady Bennett, gave on the effectiveness of public consultation and referendums in both Sheffield and Bristol illustrate that these things can be done very effectively, if adequate information is provided for the public to have a debate and discussion before they vote.

The noble Lord, Lord Shipley, raised the opportunity for the Government to issue a statement on consultation, being clear about what the parameters need to be, what the Government’s powers are and what local people can expect to have a say on. That is a vital point.

We also had a lot of discussion under this group of amendments and the previous group on travel-to-work areas. The noble Lord, Lord Shipley, asked whether each CCA is going to have a single economic hub. I do not think that question has been answered yet. We may have multiple hubs in county areas. I will use a local example, as it is the one I know best. In Hertfordshire there are multiple hubs. There are even two very distinct economic clusters: one in the pharmaceutical industry, which is thriving and doing extremely well in things like cell and gene therapy, and one in the creative industries. They are very distinct and different economic hubs within one area. We need to think about how that works in counties where there is not just a simple, single economic hub.

On Amendment 63, the noble Lord, Lord Shipley, talked about how previously on this Bill the Government have been clear more than one public authority may be included in the CCA. Non-constituent members have been talked about a lot. If there is more than one public authority in an area—for example, a local enterprise partnership, the National Health Service or a PCC—it can be very confusing when they do not have coterminous boundaries about who is responsible for delivering within that CCA. It is important that we get further clarification on that as the Bill develops and goes forward.

My noble friend Lady Hayman spoke about standards of consultation and the fact that the consultation should be publicly available. Added to our other discussions on consultation, these are important points. I am grateful to the noble Earl for saying that he would come back to us on that strange subsection in Clause 46 that talks about the Secretary of State having the power to say that they do not think that any further consultation is necessary. That will require further clarification.

The standard of consultation is important. One example I had was a consultation on the withdrawal of some bus services, to which there were 13,000 responses that said, “We don’t want to lose these bus services”, but the services were withdrawn anyway because there was no funding to take them forward. That is not consultation: if you have no intention of taking something forward or of changing your opinion on what you will do, having 13,000 responses that say the opposite is very frustrating for the people consulted. We have to be careful about consultation in that respect.

I turn to the noble Earl’s direct responses to the amendments. The 60% support issue was putting a figure out there to ask whether there would be a specific requirement of a percentage—a barrier we would need to cross—before we could accept that that was a clear public response. But the figure is not the important point here: the point is about what proper consultation is.

I am reassured by the noble Earl’s comments, but we must ensure that public consultation is sufficient. If it will fall to the Secretary of State to undertake this consultation, if it is not sufficient, it would be far better if the criteria and parameters for the consultation were set out clearly beforehand, so that we did not end up with public consultations in numerous areas going to the Secretary of State, who would say, “That’s not sufficient”, and we would end up redoing the consultation. I would be much happier if we were very clear about what the criteria of the consultation would be before we set out.

I covered the issue of the single economic hub in previous comments. The fundamental principle that the noble Earl referred to about the duty of co-operation being locally led is right, but I still find the provisions around non-constituent members of CCAs confusing for two-tier areas and for county areas where single economic hubs may be operated across a number of different areas. As we work through the Bill, further clarification on how that duty of co-operation might look would be helpful.

There has been a long-standing issue around the coterminosity of boundaries. I know that they are decided by different government departments for their own reasons, but it is very difficult to make this work. I am fortunate that, in Hertfordshire, our PCC boundary is coterminous with the county, but the health boundaries are not, which has made it consistently difficult to work across those boundaries.

On district councils’ engagement, I fundamentally disagree with the fact that district councils are one of a number of stakeholders in an area. The difference between district councils and even other public bodies is that district councils are made up of groups of people who are democratically elected. So they are not important local stakeholders but democratically elected bodies—the same as a county council. So we are saying that the democratic elections held by unitaries and counties give them more of a say—if that were the case, it is sheerly a case of numbers, because the democratic principle is the same. So we have to be very careful about putting district councils in as stakeholders, whereas counties and unitaries are the decision-makers here; that is the fundamental principle of this.

The noble Earl spoke about a triple lock on consultation—I listened to that and understand that the provisions are there. So, provided we have clarification on the wording in Clause 46, we can consider that there is enough in the Bill to refer to consultation on setting up or dissolving a CCA. But we need to clarify the issues around whether, if a boundary is changed or something is fundamentally changed about the CCA area, we need to have another look at what the consultation on that is.

On the intention of Amendment 126, an awful lot hangs on Clause 43. That is fine, but we need to make sure that the level of public transparency on the consultation that is set out in Clause 43 is adequate and will meet any test of public accountability. That said, I am very grateful for a good debate and to all noble Lords who participated. I withdraw Amendment 61.

Amendment 61 withdrawn.

Amendments 62 to 65 not moved.

Clause 7 agreed.

House resumed. Committee to begin again not before 8.21 pm.