Localism Bill

My Lords, I echo the concerns of the noble Lord, Lord True. This is difficult territory. The Bill as it stands contains a provision that, "““enables the authority to incur only such expenditure as is reasonable””." The noble Lord, Lord Greaves, has already indicated that it is not at all clear what ““reasonable”” might be, but I put it another way: if expenditure is unreasonable, then, of course, it can be challenged by the usual audit processes. I think that that is sufficient safeguard in that respect. What is more complicated is the question of equal prominence. Amendment 128AA states that the decision is only to, "““be exercised following a resolution authorising the maximum amount to be spent””." This raises some difficult issues. On the equal-prominence argument, who is to provide the case for the petitioners—for those who are seeking the referendum? It can hardly be suggested that the local authority should provide their case for them. There will be cases in which there is a well resourced, articulate group of people who can produce a substantial case. If, on the other hand, it is a community group, or some organisation which produces a three-line question for a referendum, it may not be able to do that. Is the council then constrained to reply to the three-line referendum with a three-line response? That would not be reasonable. The equal prominence test is very difficult to operate in practice. I am also somewhat doubtful about the notion of a council specifying a maximum amount to be spent at the beginning of a process. One does not know what form the campaign will take. To go back to my example—although it is not on all fours with this issue because it related to a binding referendum rather than to these, which are not binding—Peel Developments was a well resourced company putting substantial amounts of money into a campaign locally. There may well be a situation where a well resourced commercial interest—for instance, a private residents’ group—put a lot of money together to campaign legitimately on an issue. I suggest that the council could not tie its hands in advance by indicating a maximum amount. Flexibility is called for here. The noble Lord, Lord Greaves, is on a probing expedition. I would like to join him on that expedition, although I am not sure that we will end up in the same place. There needs to be some serious consideration here. While the Electoral Commission’s views may be valuable, we again have to bear in mind that these are not binding decisions. It is therefore less important, though not unimportant, to be as precise as on the major constitutional issues on which the commission adjudicates or indeed regarding the electoral process itself, where there are limits to be employed. Given that referendums can be authority-wide or merely confined to a ward or a smaller area—or, given the right percentages, across the whole of London—it is very difficult to be at all precise about how matters should be couched in financial terms or even about how they should be expressed. Within that area, the case for a referendum on a simplistic notion to reduce council expenditure or abandon a particular project might be advanced in a few short paragraphs, while the arguments against might be complicated. On perhaps an environmental issue or any one of a number of issues, the case against the referendum might be complicated, but the case for it could be presented simplistically. It cannot be right that the council is constrained from putting the full picture to its population. I do not know quite where we end up with this, but I am not particularly happy with the thrust of some of the noble Lord’s amendments. I would not like to see much in the way of constraint on how councils can respond to petitions.