Greater London Authority Bill

This has been a lively debate. I will not follow the noble Baroness, Lady Hamwee, through the detailed way in which she presented her arguments. It is probably better that I do what I was invited to do by the noble Lord, Lord Hanningfield, and address some simple political realities. I am grateful for the contributions of my noble friends Lady Turner and Lord Campbell-Savours. They raised issues which are contextually germane to what we are proposing. I believe that noble Lords have erected fears which are unfounded. The strategy they propose runs greater risks than does accepting what we are trying to do, not only by inventing a budget for the Assembly. The underlying fear is that the Mayor might, in the face of argument or criticism, reduce and diminish the power of the Assembly by cutting the budget. I am not convinced that there need be any additional statutory safeguards; the normal democratic processes are there to do just that. Creating an Assembly budget which then can be promoted and defended gives the Assembly a new and unique ability to do that. Let me deal first with the Assembly component budget and the simple majority question. Amendments Nos. 30 and 32 specifically allow the Assembly to amend by simple majority only its own final draft budget. To pick up a point made by the noble Baroness, Lady Hamwee, there is no basis in legislation, as I said earlier, for the Assembly to vote against the Mayor’s budget as a whole. It must approve the final draft, with or without amendment. I have three arguments. The first is to do with inconsistency, and I do not think it is frivolous; the second is to do with the reputation and function of the Assembly; and the third is to do with the realpolitik of what it means to operate in a democratic environment. It does not make sense for the Assembly to be allowed to amend one part of the final budget through a simple-majority vote while the rest of the consolidated budget requires a two-thirds majority for amendment, even if that part is about the Assembly’s own budget. That takes us to the question of reputation. It would send a curious and unconfident signal if the first thing the Assembly did on getting its own independent budget was to try to secure preferential treatment to ensure that it is more protected and easier to increase than budgets for GLA front-line services. The noble Baroness said that that would not be so, but I believe the perception of Londoners would be that neighbourhood police forces are less important and have less political salience than the administration of the Assembly or that the fire service counts for less than securing more staffing for Assembly Members. I would not feel comfortable sending that message. The second risk, which is related to the first, relates to reputation and realpolitik. For the first time, Assembly Members will have a strong common interest in ensuring that the Assembly has the resources necessary to fulfil its functions. This is the point raised by the question of scrutiny. On the first day in Committee, we discussed how the scrutiny powers of the Assembly are enhanced by requiring the Mayor to explain to it in new ways why he had taken certain decisions. For the first time, the Assembly will have the resources necessary to fulfil its functions effectively and, together with the additional powers on confirmation hearings and staffing, it will be able to hold the Mayor to account on behalf of Londoners. This is a different state of affairs. It will be far easier for the Assembly to achieve a consensus on its own budget against a Mayor who proposes an excessively low budget than it is at the moment, when it has to try to reach consensus on policy issues. If it did not do that, I would think that there was something seriously wrong with the political organisation of the parties involved. Amendments Nos. 21, 31 and 33 set the minimum amount. The same arguments apply in part. The amendments provide the Assembly with additional and preferential safeguards in its budget rather than ensuring that the existing arrangements, whereby it can amend its final draft budget by a two-thirds majority, work well. I find this a rather alarmist scenario. I do not say that it is typical of the noble Baroness, Lady Hamwee, but the expectation that something cannot be achieved within the present arrangements is strange because the two-thirds rule provides a sufficient safeguard to enable the Assembly to amend an excessively low budget proposed by the Mayor. As the noble Lord, Lord Campbell-Savours, implied, rather than establishing a complex and arbitrary mechanism to guarantee a minimum budget, the Assembly should have confidence in itself and use its existing powers and the powers of persuasion between parties to command a majority that ensures a fair and equitable budget. We are having architectural arguments about ceilings and floors. I do not think it is inconsistent to have a ceiling and no floor. A ceiling is important because it would look very odd to give the Assembly carte blanche to increase its own budget unacceptably, but a floor anticipates a profound lack of trust between the Assembly and the Mayor and a lack of self-confidence in the Assembly. It sends a seriously uncomfortable and probably inappropriate message that the Assembly budget is more worthy of extra protection than the budgets of front-line services. It is a very cumbersome and complicated way to protect the Assembly. It adds more layers of complexity to an already complex process. I shall not repeat my response to the argument that, without a budgetary floor, the Assembly would suffer a death by 1,000 cuts. The noble Baroness’s amendment would not have its intended effect. The calculation it proposes would allow the Mayor to freeze the budget—a cut in real terms—and increase his own budget. That would not protect the Assembly from cumulative cuts. Amendment No. 35 makes explicit that the Assembly can allocate money as it sees fit from within its own agreed budget. The amendment is not necessary, given the spirit and the letter of the law. It is clearly within the spirit of the Bill that the Assembly should decide how best to allocate its budget within the agreed total of that budget, regardless of whether or not it had amended the Mayor’s final draft proposal. Section 34 of the GLA Act 1999, which enables the Assembly to do anything that is incidental to the exercise of its functions, provides the legal basis for the Assembly to take such decisions. The point raised by the noble Baroness in her amendment is covered. I hope that noble Lords will not press their amendments.