Local Democracy, Economic Development and Construction Bill [HL]

My Lords, this amendment by the noble Lord, Lord Hanningfield, seeks to remove Clause 67, on regional strategy preparation. I take the point that the noble Baroness, Lady Hamwee, has just made: without Clause 67, the effect is that Part 5 of the Bill cannot be implemented, so the amendment is clearly significant. When we debated this issue in Committee, I resisted it strongly. I completely respect the experience and commitment of the noble Lord—certainly his commitment to making sub-regional arrangements work, and to being highly innovative in his own area—but I must disagree with him about the need for a spatial strategy that occupies the regional space. In Committee I spoke at some length about the role and scope of regional strategies and why I believe that a regional perspective and policy capacity will be needed even more in future, in the post-recession world. That world may well be faced—the noble Lord has already indicated that he understands this—with radical differences in location, in terms of jobs, regeneration, skills and housing, and with the extraordinary challenge of building a low-carbon economy. I do not want to reiterate those arguments, but I must briefly say why we need this part of the Bill and why the noble Lord is quite right that we cannot accept his amendment. This country has had regional strategy-making provision in various guises for decades, because successive Governments have recognised that there are strategic issues that can only be addressed at the right spatial level, whether that is national, regional, sub-regional or local. We are a country of regions, just like other European countries. Our regions have different strengths, demographics, histories and geographies, and they face different challenges on resources, land use, housing and regeneration, and on employment and natural environments. Each of our regions could put forward a different profile; each presents a different contribution to the future of the UK, the European and the world economies; and each faces different challenges in how to build aspirations, skills, jobs and enterprises, and how to deliver sustainable growth. Finding a solution to those challenges—although the solution will differ and sometimes be more difficult in different regions—can be effectively sought only at the right spatial level. Working at a regional level to link across higher education, for example, to plan for social cohesion, to create knowledge-based jobs, to reduce travel-to-work times and to target the right investment and regeneration, are all challenges common to all regions. To compete with global challenges means a level of analysis and planning that works with local authorities but opens up regional possibilities as well. More than ever, we need a regional perspective and regional opportunities. The creation of a single regional strategy is a crucial tool to help strengthen our local and regional economies in a sustainable way. If every local authority had to prepare its own strategy in isolation, it would be a recipe for confusion and uncertainty. It is the opposite of what business and communities want. They want certainty, transparency and leadership. That is why our response to the consultation showed near universal support for the principles of a single regional strategy. The new strategies we are legislating for in the Bill will help support and grow our regional and local economies in a particularly potent way. The current system of separate strategies has led to fragmentation of both the number and range of strategies and organisations at the regional level. I took the liberty of taking some advice from the north-west as it moves towards its own analysis and configuration of its regional strategy. I am very grateful to be able to quote from its most recent document, Principles and Issues Paper, as I think that it is a very compelling argument. It states: ""We … know that there will be increasing and sometimes competing, land-use pressures on the countryside, urban fringe, open spaces and brownfield land. All will be needed to deliver economic growth, infrastructure, housing, energy, adaption to increased flood risk and climate change, recreation, less intensive farming, food, and a valued landscape … All these issues mean that we must ask ourselves fundamental questions about how our economy and society work. We will need to be radical in considering how we can integrate environmental, economic and social issues to achieve economic prosperity without unsustainable use of resources. We will need to address what sustainable models of business look like post recession, where the jobs of the future will come from and any fundamental long term changes in the world economy"." The north-west has set out how it sees that vision unfolding for its region. That means an integrated vision for 20 years or so—a strategic framework—bringing together the spatial elements of policy on land use, planning, demographic and housing needs, which have been expressed so far in the regional spatial strategies. That has to be brought together with the evidence and planning for jobs, investment and enterprise, which has been held by the regional economic strategy. It is not so much an alignment of strategy, whether it is alignment in evidence or policy, as a way of expressing those elements together to get the right results in the use of natural resources, planning for urban and rural areas and housing, locating suitable transport, jobs and business. It is the only way we can hope to meet our greenhouse gas targets and our budgets and to identify the right regional parties and local interests which ensure that we have a strong delivery focus. Therefore, in all those new strategies, we are looking for more than an alignment of evidence or policy; we are looking for a framework which will provide a more streamlined and timely process, with a better balance of priorities and local interests and a clear alignment between economic and spatial planning with a strong delivery focus. We also believe that, contrary to the fears raised by noble Lords opposite, this will increase the amount of local involvement in the preparation of regional strategies because of the considerable flexibility for local authorities to identify the priorities they feel able to tackle at local or sub-regional level, and to identify, through active participation in the leaders’ boards, what they consider to be regional priorities. The local authorities are in the driving seat of those proposals. We have talked about the importance of consultation and stakeholder engagement. The proposals do not centralise power because—after extensive consultation, not least with the local authorities themselves—we are confident that the balance is right for a genuinely equal partnership, a collaborative approach between the RDAs and the local authorities. We have also made it clear that there are improved requirements to consult and engage communities and stakeholders with the process of independent testing of the regional strategy though an improved examination in public. Where the legislation provides for the Secretary of State to intervene, this intervention is limited. Where there are Secretary of State’s powers, they are either not new or they are limited in scope. I understand that the noble Lord has a deep-seated opposition to what we are doing. However, our proposals are widely supported by those whose job it is both to anticipate and to manage the future in practical ways. That came out in the consultation with a strong degree of consensus across the private and public sectors. The joint statement from the chief executives from the RDAs and the LGA, which was published last year, welcomed the strengthened role for local government in economic development and the introduction of a single regional strategy. As we have debated on a previous amendment, we do not want regional strategies that promote economic growth at all costs without full and proper regard and testing of whether they follow sustainable development principles. I understand that we will probably not agree on the need for a regional dimension for policy. However, we genuinely believe that a single integrated strategy is more crucial given our economic circumstances and how we will have to plan for the future. It will provide a better mechanism to address the challenges and opportunities facing all our regions and will put in place important preconditions for recovery in a sustainable way.