Local Government Bill [HL]

My Lords, I declare an interest as former leader of Norwich City Council, and also a former Norfolk county councillor. Perhaps I may add that nothing I will say in any way casts aspersions on the integrity of my fellow Norfolk Peers or indeed on the Minister herself, whom I hold in high regard. I fully accept that the judicial review has cut across this Bill, which means that we did not pursue the issue of hybridity and we did not argue the case before the Examiners. Not surprisingly, therefore, the examination was exceedingly short. We also accept that, together with the Minister, we need to clarify the electoral situation of councillors. However, the Bill is before us and that is what we are debating, so I want to say something about local government reorganisation more generally, and then analyse the reasons for what I regard as a spiteful little Bill. In 1974, Norwich and Exeter had been unitary councils for more than 600 years. They had ratepayer democracy half a century before county councils were even invented. By the 1930s, Norwich County Borough not only exercised all of today's district and county council functions, including the police but ran the massive non-voluntary hospitals and public health chunk of the future NHS, all of today's Anglia water authority and the major utilities, as well as a large part of the social security system. Norwich's budget would have been between £1.5 billion and £2 billion, I calculate in today's prices, compared with our current non-housing budget of £50 million. With that record, it is insulting when Eric Pickles of unitary Bradford, a mere village when Norwich was the second city of England, or the Minister, from the unitary London Borough of Kensington and Chelsea, invented only in the 1960s, tell us that unitary status is fine for them but not for us. From 1888, when Norfolk County Council was invented, until 1974, almost every initiative of note in the county was pioneered by the city. That is what cities do. We are the largest non-unitary authority in the country. We are already considerably larger than many existing unitary authorities. Our population will be 160,000 in eight years’ time. We have two cathedrals, two universities, a major FE college, an international airport, a thriving theatre and the greatest collection of medieval churches in western Europe. What are we lacking—apart, obviously, from the fact that Mr Pickles is not our MP? We have recently been shortlisted alongside Birmingham, Sheffield and Derry/Londonderry for the title of City of Culture. Disinterested observers might think that Norwich was up there with the major cities rather than down there with the rural district councils. Into that respectful and complementary partnership between county borough and county council—at the time, I was a city councillor—came 1974. Peter Walker wanted unitary counties. I was a member of the AMA. We fought for, but failed to save, most of the county boroughs. The history of local government reorganisation since then has been that of remedying the folly of Peter Walker's policies by both parties. In the early 1980s, the Conservatives got rid of the met counties and made Mr Pickles' Bradford unitary. Whoopee! In the mid-1990s, as my noble friend said, the Conservatives, under David Curry and John Gummer, to whom I pay tribute, made a whole swathe of cities unitary: Leicester, Derby, Nottingham, York—all former county boroughs, like Norwich and Exeter—Milton Keynes, Peterborough and Basildon, which do not have such a history or track record. Norwich and Exeter were on that list. Norfolk should have come under the wire then, as the noble Lord, Lord Bowness, has agreed and admitted, but the county Tories in Norfolk fought it off. That drive to unitary status as the most effective local government structure for cities continued under the Labour Government. My noble friend made this point very well: do your Lordships know of any counties that would now wish to turn the clock back to district councils for their cities? Does Derbyshire want to do that to Derby, Nottinghamshire to Nottingham, Leicestershire to Leicester, Buckinghamshire to Milton Keynes? No, they value and support their cities, recognising how much they bring to their county’s economy and growth. Why, by contrast, is Norfolk so bellicose and so fearful? I will come back to that. Following the 2006 White Paper, 26 cities and large towns made their bid. The Boundary Committee was requested to consider Norwich’s and Exeter's proposals, and twice, with unerring instinct, produced the only solution that none of the local authorities, including the county council in Norfolk, wanted: a return to a Peter Walker unitary county. However, the Boundary Committee would not listen, so JRs followed. As Paul Rowsell, the senior civil servant responsible, said in his court witness statement of 22 March this year, had the Boundary Committee reported on time, not nine months late, implementation would have already happened and this spiteful little Bill would not have seen the light of day. Had the Boundary Committee reported on time, the Secretary of State could, as the judge suggested, have consulted on the additional criteria, the JR would not have succeeded and, again, this spiteful little Bill would not have seen the light of day. Max Caller and his Boundary Committee team have wasted a lot time and money and have served local government very badly indeed. So what are the professed reasons for this spiteful little Bill? Page 7 of the impact assessment—I had to request extra copies, but the Minister was good enough to put them into the Printed Paper Office—is headed "Rationale for Change" and is personally signed by the Minister as a fair and reasonable view of costs, benefits and impact. It gives four reasons for the rationale for the Bill. First, she says, it is in the coalition programme. So what? That programme was negotiated after the election by two minority parties and has no electoral mandate. In any case, as the noble Lord, Lord Low, pointed out in the Queen’s Speech debate, it is utterly at odds with the rest of the localism programme in the coalition programme. Secondly, the Minister states that these two cities becoming unitary would be expensive and poor value for money, a point hammered home by the noble Lord, Lord MacGregor. For the first six years of transition, the total net non-discounted cost of Norwich and Exeter going unitary comes to around £300,000 per authority, or £50,000 per year per authority. The impact assessment allows, grudgingly, that there should be savings thereafter but, oddly, it does not estimate them. Funny, that. Your Lordships might just think it relevant that over the following six years those savings would equate to at least £20 million or upwards and would grow each year thereafter. These figures are certified by Deloitte and, for what it is worth, they have been crawled over by me. Will the Minister tell me how an expenditure of £300,000 in the first six years to generate savings of £20 million or more the next six years is expensive and poor value for money? For the impact assessment to give costs, but not savings over time, means these statistics are not worth while. Thirdly, the Minister buttresses her case, which was much quoted by the noble Lord, Lord MacGregor, by quoting the Permanent Secretary as saying that a unitary Norwich and a unitary Exeter represent poor value for money, and that "therefore" stopping these unitaries is good value for money, but compared with what? What the Minister does not say, and did not say in her impact analysis or in her speech today, what the impact assessment should have said and what the House is entitled to know is that the Permanent Secretary, when arguing that city unitaries were poor value for money, was comparing them not with the status quo of the Bill, as you might expect, given that it is supposed to be an impact analysis, but with unitary counties, which are not introduced by the Bill, which were indeed the cheapest option, but which nobody but the Boundary Committee and the Permanent Secretary appear to want. The Permanent Secretary’s comparison is completely invalid. Indeed, it is worse than that because what the Minister does not tell us, which again the House should surely know, is that her solution—the status quo—is the most expensive of the three options. It is far more expensive than unitary Norwich and Exeter, as I have shown. On costs versus benefits, it is far more expensive than the Permanent Secretary’s unitary Norfolk. Her version of value for money is to save £300,000 for each authority over six years and forego savings of £20 million over the next six years. That is not mentioned—funny, that. As Ministers, many of us have signed impact analyses. We know what we are talking about, so I say with the utmost seriousness that this impact analysis is greatly misleading, makes false comparisons and suppresses relevant information. I am sad that the Minister, whom I respect most profoundly, could put her name to it. It really will not do. The fourth of the Minister’s arguments is in the rationale on page 7 of the impact statement. She argues that the 2006 non-statutory criteria were not followed. As we argued at that time, additional criteria were added: that is, a sensible response to the recession. The High Court judge, Mr Justice Ouseley, has nullified the orders because the DCLG failed to indicate in December 2009 that "compelling reasons" such as the recession might lead to a proposal being accepted that did not meet all the 2006 proposals. The Boundary Committee’s tardiness has meant there was no time for further consultation. We, the city of Norwich, have been urged to appeal on constitutional grounds that such action—striking down not just the actions of the Secretary of the State, which can happen, although infrequently, but the will of Parliament itself—has not been taken. I may be wrong, but I have been told that such action has not been taken by any judge hitherto below the level of the Law Lords and now the Supreme Court. At £200,000 or so, Norwich cannot afford the risks of challenge. Of course, the JR reviews the decisions of a Minister, but one High Court judge striking down the express will of Parliament over seven hours of debate is somewhat unsettling. In consequence, we did not pursue the issue of hybridity: that Norwich and Exeter were being singled out for unfavourable treatment compared with the other authorities that had gone through. That argument has also gone by default. Why, then, are the Government so determined that Norwich and Exeter in particular should not be unitary? Clearly, the four arguments in the impact analysis are a work of constructive fiction. Some years ago, when I fought a Norfolk seat with a large rural hinterland, a farm worker rang me from a public phone box. I said that I would drive over, but he said, "No, no. I will come on my bike". I said, "But it’s eight miles". He said, "It’s more than my job or my cottage is worth to be seen speaking to you". That was the Norfolk I experienced as a county councillor. People were decent and public spirited but with an unshakeable belief in a right to rule over pheasants, farm workers and Norwich. The city was gifted to them in 1974 and what they have they hold. Over and beyond property rights, money is the second reason why Norfolk county councillors—two-thirds of whom are also rural district councillors—have fought us. Urban Norwich subsidises the rural county at a severe cost to its own services. Even the Boundary Committee acknowledges that Norwich has been poorly served. In 1974, we handed over six comprehensives, from four of which you could go to good universities, as did my two sons who went through the state system. On Norfolk’s watch, one comprehensive has been closed and four of the remaining five have been taken into special measures. Why? Rather than raise the rates to keep open small rural schools, which I support, Norwich schools have been run down instead. Poorer Norwich council tenants see their services run down to ensure that the rates on affluent Broadland homes are kept low. The third reason for the Tory county opposition is because cities, especially unitaries as my noble friend argued, generate jobs and growth. Half of Norfolk’s jobs are in Norwich, but, as I was told on the county council by one Norfolk county councillor who was also a farmer, no local employer wanted the competition from more new jobs because that would push up wages. The final reason is of course politics. Norwich is a left-of-centre city. It celebrated the French Revolution with a maypole in the market square. It has been the home of dissenters, Chartists, Liberals—at least until now—and now Greens. A unitary Norwich would be stronger not only economically but politically, and I am not sure which is the greater offence. My dismay is particularly with the Lib Dems. Norman Lamb is the MP for North Norfolk. With no formal connection to Norwich, he and the national party of the Lib Dems have overruled the local Lib Dems on the city council, who initiated the move to unitary status and who have fought heroically for unitary status. They view the actions of their London party with utter fury. Norman Lamb’s position is also at odds with the position of the new Lib Dem MP for Norwich South, Simon Wright, who is also committed to a unitary Norwich. On 9 March, Norman Lamb told the other place that he wants progressive city councillors to remain on the county council—that is why he does not want Norwich to be a unitary—so that, in his words, one party, a Tory party, does not, ""rule for the rest of Norfolk for ever and a day"." That, he said, would be, ""an outrage".—[Official Report, Commons, 9/3/10; col. 252.]" For Norman Lamb, a Tory county would be an outrage—before he joined the Tory coalition, of course—so he supports the Tories nationally to block Norwich’s unitary status in order to better fight the Tories locally. How twisted, and how cynical, is that? This remains unfinished business. Be in absolutely no doubt that Norwich will become a unitary authority, although it may take us several years longer than we had hoped. In the mean time, the people who will pay the real bill are the people of Norwich and the county of Norfolk. They will be denied a strong, focused, unitary city that could bring them the jobs and growth they so desperately need.