Local Government Bill [HL]

My Lords, the Minister has kindly written to those of us who participated in Committee and challenged her assessment of the costs and savings of Norwich and Exeter going unitary, and we are grateful. This amendment seeks to build on her information and take it forward to build the partnership that she in previous discussions and, today, the noble Lord, Lord Tope, have called for. In the impact assessment, at Second Reading and in Committee, the Minister regularly referred to the £40 million of transition costs and how these were unaffordable. That has been repeated again today. When intervened on because the £40 million took no account of savings, the Minister said: "““I refer to gross costs because that is what we are talking about””.—[Official Report, 14/7/10; col. 709.]" It was of course what the Minister was talking about. It was not what we are talking about and in public policy terms makes no sense whatever. What matters is not gross costs, but net costs. Let me give a simple example. Someone’s water rates are, say, £100 a year. A meter costs £100 but would reduce the bill by half to £50 a year. After two years there would be a continuous saving if you went from being on the rates to having a meter. Would the Minister really say that the only figure that mattered was the gross cost—the £100 cost of the meter—say that it was unaffordable and refuse to fit the meter to reduce costs even though she could recover the cost in savings, the payback time, in just over two years? Of course she would not; nor would anyone in this House. If necessary, she would spread the cost of the savings over the two years. She certainly would not tell us to share the house with another family so that in partnership we split the full water rates bill between us. The decision surely to fit the water meter we would all think is a no-brainer. I ask noble Lords to forgive the analogy, but essentially that is what the Minister is doing here. She is not going for the straightforward option of calculating net savings with the purchase of a water meter, but suggesting that house sharing might possibly achieve the same effect. That is the position of the two authorities. The Minister said in her letter of 22 July that the cost of creating a unitary Norwich during the transition period to 2014 would be £20.1 million and that savings for the same transitional period would be £22 million. From year two onwards, the Minister has identified savings, by full rollout, of almost £4 million a year. So there would be net savings over the first four to five years of nearly £2 million, and thereafter annual savings of nearly £4 million a year to be achieved by a unitary Norwich. In other words, the savings made by fitting a water meter would kick in at year two and it would have more than paid for itself by year three or four. Frankly, in all my time as a Minister, that is as good a return on capital in terms of investment to savings that I can recall. On the Minister’s own figures set out in her letter, savings would outpace costs after year two and thereafter would produce annual savings of £4 million a year. Going for the water meter does more that. It would encourage people to save water by putting a brick in the loo cistern, by taking showers, by keeping a water tub, and by avoiding watering the lawn. In the same way, having a unitary authority with clear accountability and transparency so that everyone in Exeter and Norwich knows who is doing what to which price and a known standard under the pressure of full democratic accountability, increases effectiveness and value for money. That is something we all want. But what is the Minister proposing instead? It is not the water meter, the sure way of ensuring value-for-money services—that is, structural reorganisation—but what is effectively house sharing in order to halve the water rates. Or, as she says in her letter, the £40 million upfront costs can be avoided and the savings, which so far outpace the costs, can be made not by going unitary but by house sharing; that is, by ““having good, co-operative partnerships””. I shall quote from her letter again: "““Our clear case is that savings of this magnitude and more are achievable by effective collaborative working between the city council and the county in each case. Hence, by stopping the unitary councils, the net result is simply to save £40 million””." For the Minister, the gross costs and the net costs are the same because the likely savings can be achieved another way, so the water meter is not necessary. The Minister’s entire value-for-money case, repeated today by the noble Lord, Lord Tope, rests not on savings that would come from a unitary Norwich, but from a collaboration between two polar opposite authorities: one a tightly drawn city council and the other a very large rural county council. One is left of centre and the other is right of centre. The city has problems of density and the rural county has problems of sparsity. One has urban service needs such as street lighting, litter, refuse collection, policing and late night rowdiness, homelessness and the deprivation of large council estates. It is also the city’s duty to maintain its heritage buildings and amenities, as well as supporting its business heart which provides half the jobs in Norfolk. Let us compare those pressures with the pressures faced by Norfolk, and I speak as a former Norfolk county councillor. The county has a huge road network which is expensive to maintain. There are small rural schools which are uneconomic because in order to offer teaching of a good enough quality they need considerable subsidies, but without which villages might die. Norfolk needs to support rural transport, shops, pubs and post offices, and must provide peripatetic services for the elderly, the disabled, the housebound, the car-less, women, children and the fragile. Norfolk’s rural needs are as real and as proper as those of the city of Norwich, but they are totally different. How does the Minister think we can share services sensibly and reduce costs by intelligent collaboration when, rightly and properly, the focus of the county is on rural needs and the focus of the city is on urban needs? That is what local government is about: the distinctiveness of place. It would be hard enough for such a partnership, with legitimate differences in perspective, if it was forthcoming and willing, even though the priorities might well be different. But what happens to the alleged £40 million in savings that the noble Baroness and the noble Lord, Lord Tope, have insisted are available when that partnership is not forthcoming; when the house sharing of a water meter is not on the table? The Minister knows—we have told her—that during the process of following the earlier orders to construct unitary authorities, the counties refused to co-operate and withheld the information we needed. They refused then to do what the Minister says they should do now. We asked for information but answer came there none. The entire case of the Minister and the noble Lord, Lord Tope, is based on the assertion that sufficient savings can be made by voluntary partnership as would occur under unitary reorganisation. When I pressed the Minister in Committee on how we could deliver that partnership if we were denied the information—as we have been so far—on which intelligent co-operation was built, the Minister said, metaphorically, that that was our problem, not hers; that it was not for her to interfere. I think she would agree that she said that. Yet it is the Minister—not us—and no one else who is saying that we could get similar savings to reorganisation by collaboration. The Minister’s letter makes it clear what the savings would have been if Norwich and Exeter were to be unitary and she insists that those savings could be found by voluntary partnership. Our experience so far is that voluntary partnership is not available to us because the information is withheld and the Minister has said, ““Not my problem””—and yet this is the Minister’s strategy to us which she is failing or refusing to back up with an ability to deliver. I take it that the Minister wants to make those savings, as we all do, but how are we going to achieve them if the information is withheld and the Minister will do nothing to ensure that that information flows? If that information is not forthcoming through partnership, the Minister will have denied the public purse and the local taxpayers the proper savings which, as I said on an earlier amendment, would have come to every household in Norwich of around £100 a year. When local authorities are facing cuts in services and a possible rise in council taxes, if the Minister is going to deny the residents of Norwich those savings, she must be in a position to help us to achieve the alternative route she has offered of collaboration and partnership. If the two cities, Norwich and Exeter, do not get, as the amendment calls for, disaggregated financial statistics on which to build partnerships, the Minister will have cost Norwich and Exeter citizens each some £3 million to £4 million a year. She will have refused the certain savings coming from unitary status and have replaced them with hypothetical savings coming from partnership, and then walked away when even those hypothetical savings were not delivered because the information base on which the partnership rests was not shared. Hence the amendment. I understand that the Minister cannot impose willing partnership on reluctant conscripts. She does not have that authority and cannot therefore do so in legislation. However, she can require the counties to divulge the financial information. These are public statistics, held in a neutral way by the county council, which the citizens of that county and city are entitled to know; we are talking about public information. She could require the counties to divulge the financial information on which joint arrangements can be built. Essentially, the amendment seeks to put words in the Bill to reflect the sentiments that the Minister and the noble Lord, Lord Tope, have uttered today. It requires the county council to break down financial statistics by district and to share that information so that the activities the county undertakes within and with that district council are known and transparent. That is the way in which we get decent services between housing and social services for the elderly and frail people who wish to remain in their own homes; that is the way in which we avoid duplication on economic development and seek to continue to attract jobs to Norfolk. The amendment requires publication of information that the county must already hold. With it, we may be able to attempt constructive partnership; without it, we do not have a chance. What objections should there be to making such information available? Why should those figures—public information about money—not be in the light, rather than be kept in the shadows? Why are the council tax payers of the city not entitled to know how their money is being spent? I hope that the Minister will accept the amendment. If she means what she says, and I have no doubt about her integrity on this point, and the savings of £40 million and more—£4 million a year—can be achieved by voluntary partnership rather than reorganisation, which was the point made by the noble Lord, Lord Tope, she must ensure that both authorities have the relevant financial information on which to construct those partnerships. If that information is withheld, all that we have heard today from the Minister and the noble Lord, Lord Tope, will be pious platitudes. If they mean what they say, and the citizens of Norwich and Exeter can be spared an extra £100 or so a year in council tax, they will support the amendment. I beg to move.