PARLIAMENTARY DEBATES HOUSE OF COMMONS OFFICIAL REPORT

Third Delegated Legislation Committee

DRAFT DURHAM, GATESHEAD, , NORTH TYNESIDE, , SOUTH TYNESIDE AND SUNDERLAND COMBINED AUTHORITY ORDER 2014

Monday 7 April 2014

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The Committee consisted of the following Members:

Chair: MR CHARLES WALKER

† Beith, Sir Alan (Berwick-upon-Tweed) (LD) † Mearns, Ian (Gateshead) (Lab) † Brown, Mr Nicholas (Newcastle upon Tyne East) † Morris, Grahame M. (Easington) (Lab) (Lab) † Opperman, Guy (Hexham) (Con) † Campbell, Mr Ronnie (Blyth Valley) (Lab) † Perry, Claire (Devizes) (Con) † Colvile, Oliver (Plymouth, Sutton and Devonport) Ruffley, Mr David (Bury St Edmunds) (Con) (Con) † Sawford, Andy (Corby) (Lab/Co-op) † Cox, Mr Geoffrey (Torridge and West Devon) (Con) Simpson, David (Upper Bann) (DUP) † Djanogly, Mr Jonathan (Huntingdon) (Con) † Ward, Mr David (Bradford East) (LD) † Glen, John (Salisbury) (Con) † Glindon, Mrs Mary (North Tyneside) (Lab) John-Paul Flaherty, Committee Clerk † Jones, Susan Elan (Clwyd South) (Lab) † Lewis, Brandon (Parliamentary Under-Secretary of State for Communities and Local Government) † attended the Committee

The following also attended, pursuant to Standing Order No. 118(2):

Onwurah, Chi (Newcastle upon Tyne Central) (Lab) 1 Third DelegatedHOUSE OF COMMONS Legislation Committee 2

Guy Opperman (Hexham) (Con): Does the Minister Third Delegated Legislation agree that the example of Greater Manchester, which Committee led the way in authorities coming together, gaining the critical mass to push forward, particularly in areas such as transport and infrastructure projects, and the resulting Monday 7 April 2014 growth, is exactly what the seven local authorities in our case should be trying to follow? [MR CHARLES WALKER in the Chair] Brandon Lewis: My hon. Friend makes a good point. Draft Durham, Gateshead, There is a good example out there of how this can be Newcastle Upon Tyne, North Tyneside, done and how it can move things forward. I would hope Northumberland, South Tyneside and that all the combined authorities that we have established over the past few weeks, as well as the one today, will Sunderland Combined Authority follow that example by working together for the benefit Order 2014 of their residents and deliver more efficiency and better services. 4.30 pm The Parliamentary Under-Secretary of State for Mr Nicholas Brown (Newcastle upon Tyne East) (Lab): Communities and Local Government (Brandon Lewis): For completeness, it would be fair to point out that I beg to move, the briefing note, which I think we have all received That the Committee has considered the draft Durham, Gateshead, from advocates of the proposition, says that, in the Newcastle Upon Tyne, North Tyneside, Northumberland, South initial period of operation, the transport arrangements Tyneside and Sunderland Combined Authority Order 2014. will be that Durham county council will discharge the The draft order was laid before the House on 13 March. delegated transport functions within its own boundary; If approved, it would bring about the establishment of Northumberland county council—this relates to the a combined authority in another of the major areas of point raised by the hon. Member for Hexham—will this country, this time across Durham, Northumberland discharge the delegated transport functions within its and Tyne and Wear. Hon. Members might recall our own boundary; and Nexus will discharge the functions debate on 18 March regarding combined authorities in that were previously discharged within the Tyne and Merseyside and Liverpool, in and South Yorkshire, Wear area. Due to the complexity of moving from a and in West Yorkshire. I am delighted to confirm that five-authority ITA to a seven-authority combined authority, those combined authorities were established on 1 April. a transitional approach to integration is required. That The combined authority we are considering today is what has been explained to us. In other words, for the will be responsible for economic development and immediate future, nothing is going to change at all. regeneration and for transport. Seven councils in the area have agreed that the combined authority will exercise The Chair: As a general—not specific—request, may their functions on economic development and regeneration. we have interventions, not speeches? The combined authority will have the transport functions currently exercised by the Tyne and Wear integrated transport authority, which will be abolished on the Brandon Lewis: As I said, one of the beauties of establishment of the combined authority. The combined combined authorities is that it is for the local areas that authority will also undertake similar transport functions have come together to request it to design and work out currently exercised by Durham and Northumberland how they go forward to suit their local area. It is not for county councils. us centrally to interfere in that. Central to what we are considering today are two of We are looking to ensure economic growth, which is the key priorities of the coalition Government: growth essential to the recovery of our economy and to rebuilding and localism. our future after the economic failures and spiralling debt that we inherited when we took office in 2010. It is Sir Alan Beith (Berwick-upon-Tweed) (LD): Before through achieving economic growth that jobs are created, the Minister leaves the point about transport, will he the incomes of hard-working families can grow and we clarify how the arrangements will ensure that predominantly can build sustainable prosperity for communities throughout rural transport needs in Northumberland and Durham our country. The policies of the coalition Government will be protected against the significant urban issues, are delivering on, in effect, an SOS for growth, with which might the command the attention of the transport unemployment now a little more than 5%, with more part of the body? people and in particular more women in work than ever before, and with growth, as my right hon. Friend the Brandon Lewis: The combined authority has Chancellor of the Exchequer told the House in his representatives from all the local authorities involved Budget speech, to reach an Office for Budget Responsibility and was requested by those authorities. The authorities forecast of 2.7% for 2014. For the first time in 35 years, themselves will make their views known to ensure that we have a higher employment rate than the United rural areas are well covered. They should do so; it is States of America has. quite right for them to make that case locally. I suspect that, by coming together, the authorities (Gateshead) (Lab): The Minister quotes themselves are arguing that it will give them a bigger national statistics, but they do not refer to the position buying power—by buying effectively in bulk as a bigger in the north-east of England. With virtually all such critical mass—hopefully to provide an even better service. statistics, if they are good nationally, they are worse in 3 Third Delegated7 APRIL 2014 Legislation Committee 4 the north-east, and if they are better in the north-east, Guy Opperman: To answer the point made by the they are much better nationally. They are not applicable hon. Member for Easington, surely where the economic to the north-east—the statistics that he quotes should drivers in the communities that we all serve come be about north-east. together—namely the chambers of commerce and the gentleman and the ladies who produced the Adonis Brandon Lewis: I am surprised that the hon. Gentleman, report—their ability to access greater funding and greater as a member of the Labour party, is not talking about infrastructure spend will be massively improved by the one nation and therefore wanting to understand fully creation of the LA7. That is surely the way forward and the national impact of some of those beneficial figures. the answer to the point fairly made. Denying the beneficial work done by the coalition Government is missing the point. Brandon Lewis: My hon. Friend makes a good point. One of the reasons to create combined authorities is Authorities working together have two big advantages— to let areas come together in an economic format to there are many advantages, but two stand out. First, by deliver beneficially for their area and what they need coming together they are able to develop a real locally. An important element of the policies, as we transformation in how they work, with real efficiencies made clear in our White Paper response to Lord Heseltine’s by bringing things together to avoid duplication and to report on growth, is that local authorities have a vital deliver a better and more cost-effective service. Secondly role. Councils should put economic development at the and equally significant, as many of us know from our heart of all they do, collaborating, including with private own experience of bringing areas together to lobby for a sector partners, across a functional economic area. A growth deal or any other kind of work, coming together combined authority is nothing less than a means for a gives people a louder and more powerful voice. I am council to undertake that collaboration, which will be sure that the north-east’s councils had that in mind the foundation of all they do to promote economic when they made their proposal. It means that when growth. councils propose a combined authority, taking a localist It is not surprising, therefore, that the proposed combined approach, which commands extensive local support, authority has been recognised as key in two of the city our policy is clear: if we consider that the statutory deals that we have agreed with the area. If Parliament conditions are met, we will invite Parliament to approve approves the draft order, we expect the combined authority a draft order to provide for the establishment of the to be equally key in any future growth deal with funding proposed combined authority. That combined authority from the local growth fund. will enable the councils concerned to give full effect to their ambitions for joint working. Oliver Colvile (Plymouth, Sutton and Devonport) (Con): It is a pleasure to serve under you this afternoon, Localism will also guide our response to any proposals Mr Walker. One of the things that the draft order could for changes to a combined authority after it has been achieve is to bring together the local authorities and the established. Such proposals may include a request for communities within the travel-to-work area. In my another council to join the combined authority as a constituency, that would be incredibly helpful. constituent council, or an existing council member of a combined authority may wish to leave that authority. Brandon Lewis: My hon. Friend makes a good case. I In any such case, our policy will be to seek parliamentary hope that the authorities in his area have listened. One approval of a draft order to enable such changes, provided of the key things about the combined authorities is that that we are clear that the change meets the statutory they are not the result of a centrist or top-down approach; conditions. What is important here is the area’s best they are about local areas coming to Government with interests. a proposal. With his persuasion, I hope that we will have areas of the south-west coming forward very soon. We have considered the particular circumstances of the combined authority proposal made by the seven Grahame M. Morris (Easington) (Lab): I appreciate councils, as the law requires, and we have concluded that the Minister is making a case, and the hon. Member that it would be right for us to pursue our localist policy for Plymouth, Sutton and Devonport has indicated the in this case. We considered the proposal in the light of benefits of an integrated transport system. Does the the statutory conditions, which are set out in the Local Minister recognise, however, that the north-south divide Democracy, Economic Development and Construction means that investment in the north-east region is £5 a Act 2009—the Act under which any combined authority head, compared with investment in public transport is established. Those conditions are that my right hon. infrastructure in the south-east of, I believe, £2,900 a Friend the Secretary of State must consider that establishing head—500 times more. Will the proposal do anything a combined authority is likely to improve the exercise of to address the north-south imbalance? statutory functions relating to transport in the area, the effectiveness and efficiency of transport in the area, the Brandon Lewis: Again, the proposal is not a Government exercise of statutory functions relating to economic one. We are facilitating a proposal that has come from development and regeneration in the area and the economic the authorities in the north-east, but which matches our conditions in the area. I can tell the Committee that we localism policy. Whether councils choose to collaborate consider that those tests are unambiguously met in this through a combined authority or some other arrangement case. In short, the combined authority will bring together is entirely a matter for them. The authorities we are decision making on the closely interrelated issues of discussing have asked to work together as a combined transport and economic development, and provide for authority. Our whole approach to combined authorities, more efficient, effective and transparent decision making reflected in the draft order before the Committee today, by councils, with their partners, across the whole of the as well as those a few weeks ago, is one of localism. functional economic area. 5 Third DelegatedHOUSE OF COMMONS Legislation Committee 6

[Brandon Lewis] their collaborative joint working with each other and public and private sector partners. By doing that, they We also consider that it would be right to establish will open the way to boosting economic growth, increasing the combined authority, having regard, as the 2009 Act investment and promoting more strongly and effectively requires, to the need to reflect the identities and interests the economic prosperity of the area. of local communities, and to secure effective and convenient local government. In addition, we are clear that in all of those respects, the combined authority would command 4.46 pm wide support from local businesses, and in particular Andy Sawford (Corby) (Lab/Co-op): It is a pleasure the North East local enterprise partnership, from other to serve under your chairmanship, Mr Walker. I welcome public bodies and support from local people and their the opportunity to debate this important statutory democratically elected representatives. instrument, which I hope will help seven local authorities Accordingly, on the basis of that localist approach, in north-east England to work together more effectively we are seeking the Committee’s approval for the draft in their communities’ interests. There will be challenges order, to which each of the constituent councils has ahead for them both as they work together and as they consented. We are seeking that approval on the basis of seek to get the Government’s ear to realise their ambitions the information that we have about the proposed combined for their area. I will not detain the Committee long. authority, which includes the governance review undertaken We had the opportunity to debate combined authorities by the seven councils in the area, as required by the recently on the Floor of the House, when some of the 2009 Act if they wish to propose a combined authority. wider issues were explored at some length. I hope we It also includes the results of the consultation that we will hear today that progress has been made on some of have undertaken on the combined authority, again as the issues I raised. The Opposition believe that combined required by the 2009 Act, and detailed proposals from authorities, which were introduced by last Labour the seven councils about how they would wish their Government, can bring many benefits. It is disappointing combined authority to operate, to take decisions and that there has been a five-year interregnum before their most important, to be open, transparent and accountable. establishment, particularly given that when the country The draft order provides for the establishment of a was facing the effects of a global financial crash, this combined authority across the area of Durham, Government came in and, in an act of economic vandalism, Northumberland and Tyne and Wear. As before, the took away the regional development agencies that were draft order specifies the formal, legal name of the a means by which local authorities were working together combined authority to which all the councils concerned across their regions and with central Government and have consented. How that authority will brand itself, business. including the use of any brand name, will be a matter entirely for that authority. The draft order also makes provision for the abolition of the Tyne and Wear integrated Mrs (North Tyneside) (Lab): Does my transport authority, for the transport and economic hon. Friend agree that, by moving forward in this way, functions of the combined authority and for its membership our seven local authorities are taking a bold step to and constitutional arrangements. The latter arrangements improve economic regeneration and growth in our area? include a requirement for there to be at least one overview and scrutiny committee, with a membership Andy Sawford: I do believe that it is the right thing for drawn from the members of the councils concerned, to these local authorities to come together to work across hold the combined authority to account. Good governance the area, which is economically important but faces practice will mean that such committees will be politically particular challenges, as my hon. Friend is only too balanced, to enable appropriate representation of councils’ aware and has raised in the House. These authorities minority parties in the governance of the combined face not least massive funding challenges, but also authority. structural and economic challenges, which they can work on together. Sir Alan Beith: What course of action is open if the Greater local collaboration and co-operation can produce governance is not conducted in that way, and there is much better results in areas such as transport, housing, not political balance on the oversight committee? employment, skills and training than national programmes run from Whitehall. Indeed, some of the local authorities Brandon Lewis: My right hon. Friend makes a fair in the north-east involved in this combined authority point, which was raised in our conversation on the have already begun to demonstrate that. Combined Floor of the House about combined authorities just a authorities have a key role to play in ensuring that we couple of weeks ago, as the hon. Member for Corby will can have economic success throughout the country, no doubt recall. In the present case, the authorities making the most of the strengths of different sectors confirmed in their governance note to the Government across the country and developing new skills in industries that they are looking to ensure that political balance that reflect the strengths of different parts of England. and good governance are in place. That is enough The new combined authorities will offer strong and assurance for us. If however at any point in the future visible collective leadership in time and, crucially, bring any of the combined authorities is not practising best democratic accountability not seen in local enterprise practice and proper governance, I will be willing to partnerships. While those partnerships are a welcome return to look at that. way of involving business in a strong relationship with If the draft order is approved today, it will open the local authorities and other partners for economic way for the seven councils in the functional economic development, the combined authorities, by bringing areas surrounding these great cities to deepen and intensify democratic accountability, offer something new. 7 Third Delegated7 APRIL 2014 Legislation Committee 8

Oliver Colvile: Has the hon. Gentleman assessed how in their area. Many councils across the north-east are much extra this measure might end up costing the already working together to deliver programmes of council tax payers? support for unemployed young people, delivering much better results than central Government agencies, not Andy Sawford: If the hon. Gentleman will be patient least the failing Work programme. for a moment, he will hear me talk about the efficiencies The extension of the transport authority into that I believe can be delivered through the combined Northumberland and Durham represents an opportunity authority. The point I was making, which prompted to deliver transport services across a wider geography. I him to intervene, was that because the authorities are am sure that Members will correct me if I am wrong, democratically accountable, their local communities can but that seems to make sense for commuters and businesses. hold them to account, whereas local enterprise partnerships That has certainly been the view expressed to me by the are not subject to any form of public audit and have no authorities that are coming together to form the combined direct link to the local electorate—[Interruption.] Indeed, authority. as my hon. Friend the Member for Blyth Valley points out from a sedentary position, the European Union Sir Alan Beith: I am not sure that that is quite the does not recognise LEPs for the purpose of transferring view the authorities have expressed: Durham has retained European funds. That is why combined authorities are some delegated powers. The hon. Gentleman should particularly important in connection with funds that bear in mind the fact that the kind of major scheme that help areas of the country that face structural challenges might work in Tyneside with one contractor is not in their economy. necessarily a good way of providing rural bus services Local enterprise partnerships bring businesses together, in communities such as Berwick-upon-Tweed. but combined authorities can be an even more powerful voice in aligning decision making and economic growth Andy Sawford: Far be it from me to argue with the at a strategic level, so that there is a single framework right hon. Gentleman about what is in the interest of across an area, underpinned by a coherent strategy. his area, but the crucial point about the combined Crucially, there would therefore also be an investment authority is that there is strong democratic accountability programme, which is particularly important in an area at local level. It will be important to ensure that the such as the north-east where, as my hon. Friend the combined authority is held to account for decisions it Member for Easington pointed out, there has been a makes, principally through the local authorities themselves. lack of infrastructure investment compared with some As the right hon. Gentleman pointed out, some delegated other parts of the country. That is a fair point and powers will be maintained by the local authorities. should be acknowledged. Guy Opperman: I endorse the point made by my right Combining the authorities creates the opportunity hon. Friend the Member for Berwick-upon-Tweed, but for closer working across the public sector. Efficiencies the shadow Minister is surely making a point about the can therefore be made by integrating functions and effect of a combined authority on transport infrastructure services and providing solutions to the challenges of provision. The gold standard is somewhere like London, reduced budgets. These authorities, as much as any where the Oyster card is interchangeable across all across the country, face the challenge of reduced budgets authorities. Is that not the sort of thing we are trying to because they have been so affected by an above average achieve through combined authorities? cut resulting from a deeply unfair approach to local authority funding. Andy Sawford: The hon. Gentleman is right to look According to the Association of North East Councils, to examples from around the country. The Greater the £350 million of additional funding cuts in the Manchester combined authority, which he himself says north-east, just this year and next, will hamper economic is a good example—indeed, it is a trailblazer as a growth as well as hurt the vulnerable. That is a massive combined authority—has made good progress on transport. cut to core funding. Over this Parliament as a whole, I note that authorities in the north-east are looking to the north-east faces a cut of £91.93 per dwelling, compared develop a quality contract for bus services, which I with an average in England of £71.58 per dwelling. think would be the first in the country. That would be However, that England average includes areas such as very welcome. Having spent three enjoyable years of my inner-city London and Liverpool, as well as other core life in the north-east, I know that it is a fantastic area, cities that have faced massive cuts. but people there would acknowledge that it is different That cut stands in contrast to some authorities, in character from London or Greater Manchester. There particularly those we see as we go south down the are significant rural areas as well as the important country. The important heat maps produced by the centres of urban population. The transport needs across House of Commons Library, as well as by councils such the area must therefore be considered at a regional level, as Newcastle, show us that some authorities are actually and they certainly should not be determined by the hon. getting an increase in their spending power. I say to the Member for Corby, however well intentioned he is. Minister that part of the challenge on which combined The councils that have come together to form the new authorities will work together is the fact that the four north-east combined authority tell me that they share areas of the new combined authorities, along with an ambition to create the best possible conditions Greater Manchester, face above average cuts. for growth in jobs, investment and living standards, to The seven local councils in the north-east have shown make the area an excellent location for businesses, to a strong commitment to pooling their powers and putting prioritise and deliver high-quality infrastructure and resources on the table. I know that there are already to raise skill levels. Opposition Members, of course, good practical examples, such as the two Tyneside councils wish them well and we will do our best to support collaborating on a joint programme for jobs and investment them—not least by working for the return of a Labour 9 Third DelegatedHOUSE OF COMMONS Legislation Committee 10

[Andy Sawford] The draft order is about securing for the north-east one of the things that we envy about London—not only Government, who will restore fairness to local government the amount of money that it gets, as various hon. finance and work to realise fully the potential of Total Members have pointed out, but the Greater London Place approaches to improve public services and make authority’s ability to decide what to do with its resources, better use of resources by bringing the public sector moving them between different activities. It has a degree together locally. That would include an English deal to of devolved power comparable in some ways to what devolve significant new powers and budgets, such as for Wales has, for example, but the north-east does not have the Work programme, skills, housing and transport. that. The previous Government’s attempt to provide the In their briefing to all hon. Members, the north-east’s north-east with the means of achieving something similar councils say they want the Government to match Labour’s was notably unsuccessful, not least because the proposal plans for devolution after 2015: did not involve enough power to commend itself to voters. The coalition Government, however, have put “The responsibility is now on government to respond constructively, and set out that fundamental transfer of powers and resources—long together a much more locally based approach, but one promised, and which they have so far failed to deliver”. that still enables power to be devolved. The test will be I also ask the Minister to comment on three specific in how much power is devolved to the combined authorities issues. First, Labour Members are keen to see progress as they develop, although there is some from the start. on the issue of authorities with non-contiguous boundaries There has been a consultation, and I took part in it being able to join combined authorities. I will not with a letter of 13 December, which expressed the sort rehearse all the arguments again—indeed, we have a of concerns that I have mentioned so far. It is not clear measure of agreement with Government Members and to me how far the constitutional and governance a degree of good will—but will the Minister update us arrangements, which are not specified in the draft order— on when the consultation is expected? Perhaps he can some are, but not all—will be maintained and will meet give us a clear indication now, as weeks have passed. my concerns. Some are about political balance, which is Secondly, local authorities have urged the removal of difficult to achieve in the north-east, where all authorities the legal restrictions to do with the combined authorities’ are currently controlled by the Labour party, and there ability to borrow for non-transport purposes, which they are different minorities on different authorities. The argue will remove a significant barrier to the unlocking political balance offered in the order is only at the level of local resources to support infrastructure and growth. of the oversight committee, and through two members The Opposition are prepared to look at the arguments for each constituent authority. It is not clear, therefore, and to engage with the combined authorities, but will how overall balance will be achieved or what will happen the Minister explain the Government’s position? As I if no serious attempt is made to achieve it. understand it, he has ruled out any change. My hon. Friend the Minister showed unusual faith in the north-east Labour leadership; he seemed to assume Thirdly, on a more positive note, I welcome the news that everything would be fine because he had had a that combined authorities will be able to recover VAT as word with those involved. We have not generally found local authorities do. As the Minister knows, I pressed that to be the case in appointments to public bodies in for that in the debate in the Chamber a few weeks ago. the north-east. We have been through 13 years of Labour He has also received representations directly from local Governments with predominantly, but not always, Labour- authorities and local government bodies throughout controlled councils and many public bodies having Labour the country. Will he confirm when that welcome change appointees running them. There has been quite a lot of will take effect? experience and track record, and they have quite a bit Those of us on the Labour Benches are proud of how of form. Labour councils in the north-east, South Yorkshire, Greater Manchester and throughout the country are taking a lead in working together for economic success Mr Nicholas Brown: The right hon. Gentleman is and in innovating in their areas, in particular given the being uncharacteristically unfair. The model under the unfair way in which they have been treated by the last Labour Government relied on the development Government. agency, and a principal member was Lord Shipley—leader of Newcastle city council at the time, and a Liberal Democrat peer. He was appointed by the Labour 4.57 pm Government. The last Government had a mixture of Sir Alan Beith: It is a pleasure to serve under your representatives on these bodies. The current proposal is chairmanship, Mr Walker. We all enjoyed hearing you for a single-party structure. read out the snappy title of the new authority: the Durham, Gateshead, Newcastle upon Tyne, North Sir Alan Beith: I am glad to say that the Labour party Tyneside, Northumberland, South Tyneside and Sunderland could not always keep a good man down, and it could combined authority. I hope that does not have to appear not in the case of my noble Friend Lord Shipley, who is on every sheet of notepaper and document produced. much used by the present Government in the context of The snappier “north-east combined authority”title might Lord Heseltine’s work on the regional growth fund. pass into regular use. Hon. Members on both sides have rightly recognised Despite my interventions about some matters that his invaluable experience as leader of Newcastle city remain of concern to me, I support the creation of the council. combined body, because it is about jobs for my constituents I pay tribute to the right hon. Member for Newcastle and others in the north-east and about the pursuit of upon Tyne East, who has taken a close interest in trying policies at regional level that can assist in creating jobs to find ways of giving the north-east some of the in our area. Transport is very much part of that process. devolved power it needs, even if he has been unsuccessful 11 Third Delegated7 APRIL 2014 Legislation Committee 12 in some ways in that attempt. I noted today his criticism The body can be important and valuable for us. We of the new authority in The Journal in Newcastle, which need local authorities in the area to work together. We did not entirely correspond with his party’s Front-Bench also need their co-operation to be recognised by central line. Government’s giving them more power to make decisions My concern is not only about political balance, but in the region and resources that they can use to promote about geographical balance and particularly the needs jobs. The body will be under significant scrutiny—certainly of rural areas. Transport needs in rural areas are quite from me, and, I hope, from other Members—to ensure different. The sort of collective contract suggested for that it delivers on its potential. urban areas might not work for rural areas and might lead to small businesses running bus services in those Several hon. Members rose— areas being excluded because of a big contract going to a big company. The Chair: Order. Wind-ups will start at a quarter to For example, there is an award-winning small business six. bus contractor in Berwick-upon-Tweed, which has grown from providing a very small service to providing services over a wider area. There are quite a number of others 5.5 pm dotted around Northumberland that need to be involved Mr Nicholas Brown: It is a pleasure to serve under in future provision of services. Providing public transport your chairmanship, Mr Walker, and to follow the right in rural areas is often a matter of finding a cost-effective hon. Member for Berwick-upon-Tweed. Like him, I way of ensuring that a bus service can run at all. We are accept that the principal focus of the arrangements is, not talking about a half-hourly service or 15-minute and should be, on jobs. The largest single ask from our service; we are talking about whether it is a one-day-a-week region is to strengthen, deepen and broaden the economic service or not at all, or whether there can be a bus and employment base in the private sector. The question service every day to a particular village. The demands is how we should go about it. I also agree with the right are very different from those in urban areas. hon. Gentleman’s analysis of the region’s structure. Essentially, we are two conurbations with a great and beautiful rural hinterland. The question is how best to Ian Mearns: I think the right hon. Gentleman reflect that in the governance arrangements. would accept that one major operator throughout I disagree with the Minister and the Labour Front Northumberland is taking excessive profits from its Benchers. I think the structures being put in place for contract. The system is largely unregulated and operators our region are fundamentally wrong. The structure are taking profits out of the contracts of between 15% under the previous Government was better, with regional and 20% in those areas. Ministers working with the Association of North East Councils on the one hand; and on the other, with a private sector-led economic development agency to focus Sir Alan Beith: I do not know whether the hon. specifically on economic development in the region, Gentleman has carefully studied the balance sheets of with a professional, front-facing approach, so that a bus and train operators, but in rural Northumberland private sector-dominated committee can have its officers the big operators tend to provide only a very limited talk directly to private sector companies from whom we number of through routes. Most local services are provided seek inward investment, with or without public support. by more local operators. For certain purposes, unanimity will be required in Guy Opperman: The right hon. Gentleman’s opposition transport matters, and I imagine that it will be only a to the plan is well known and well articulated in many temporary safeguard. I want to ensure that rural interests places. He refers to the private sector. He will be aware are protected. They will not be protected by the presence that the Adonis report was written fundamentally by a of every authority. For example, the leader of large number of people from the private sector. They Northumberland county council is from the urban part made the case that, from a private sector standpoint of Northumberland; council leaders will often be because and from that of the economic review team of the half the population is in a relatively small urban area. It Adonis report, they wanted a combined authority—not, might be that no one with rural experience or representing with respect, his proposal. a rural area would be serving on even the oversight body or the transport body, and we are greatly concerned about that. We need to know how scrutiny will be Mr Brown: I do not accept that at all. I am quite exercised effectively so that the body does the job it happy to argue it chapter and verse, but probably somewhere needs to do, and for the whole area. else. It is probably best that we focus on the order before us. I fundamentally disagree with the hon. Gentleman. A point was made earlier that one of the benefits of having such an authority is that it can serve a travel-to-work area. Much of my constituency is within the wider Mrs Glindon: Does my right hon. Friend agree that travel-to-work area of Tyneside; lots of people travel over the years our local authorities, as individual authorities, from Belsay, Ellington or even Alnwick to work there. and the regional development agency have done some However, other parts of my constituency are not: Berwick- wonderful work in attracting businesses to our area? We upon-Tweed is more in the travel-to-work area of cannot divorce them from being a major part of our Edinburgh. However, more than 80% of the working economic future. The fact that they are supported by population work within the old borough area and do the LEP, the chamber of commerce and other businesses not travel out of the area for work at all. Needs are surely shows the confidence that the business sector has different in different parts of the area. in such authorities. 13 Third DelegatedHOUSE OF COMMONS Legislation Committee 14

Mr Brown: I agree with some of that. I certainly pay has asked the local authority leader, Councillor Watson, tribute to Newcastle city council and the economic what representation there will be for opposition councillors. development work that it has done with the private Councillor Watson agrees with the Minister—“none”; sector on the east end riverside projects, and the way in so none it is. which new private sector employment has been attracted. For the Liberal Democrats, there is Councillor Greg GE, Wellstream, Duco, Bridon Fibres and Shepherd Stone. I expect the whole Committee is familiar with Offshore are all providing an important part of the him, as he is reasonably well known and appears on the employment base for the east end of Newcastle. front page of national as well as local newspapers, However, we could not really say the same if we usually as a result of investigative journalism, but I crossed over the border into what was, until recently, understand that, according to him, he is a close confidant Conservative-controlled North Tyneside. The development of the leader of the Liberal Democrat party. He says agency gave it the best economic development site, “We do feel there has been frankly little effort to engage or certainly on the north banks of the River Tyne—let me involve other groups in this. not exaggerate—but development has been painfully We know we’re not likely to change the overall decision”— slow in coming. That is no reflection either on the he is right about that— Member of Parliament or on the Labour members of “but we have to make our concern registered at the way this has the local authority. been carried forward.” I am going to break the habits of a lifetime and agree Mrs Glindon: I have to disagree, as that is my constituency. with Councillor Stone. He is right. The opposition The last Labour council was forward looking, and should be represented somehow in the arrangements. under that council we bought the Swan Hunter yard, We will do better in pursuing a common objective—and which will be developed for the renewables supply industry. creating jobs or running a decent transport system are common objectives among elected representatives of all Mr Brown: My point is that it has not been developed parties—if all parties, and everyone who agrees with yet, and we look forward to events unfurling. that objective, can have a say in the arrangements. Because of what the Government are laying down, they cannot. That is completely wrong. Mrs Glindon: It is being. I know that it is odd that I, a Back-Bench Labour rebel member of the Committee, should advocate Mr Brown: My hon. Friend says it is being developed. representation for the governing party, and that that Rather a lot of what is before us is about what will party should be acting to thwart it, but nevertheless, happen in the future, and not enough is about what has odd as it may be, that is how I feel, and, as my hon. happened, or about things of which there is visible Friend the Member for Blyth Valley points out—always evidence. did, Ronnie, always did. My first major criticism of the arrangements is their We are not only invited formally to abolish the Tyne single-party structure. They replace local government and Wear transport joint board—Mrs Thatcher’s joint structures, in the case of the joint board for the transport board, which actually works in our region. We have authority. That, in turn, was put in place when already gone over the replacement arrangements, which Mrs Thatcher’s Government abolished the Tyne and are exactly the same, so why we are doing this could be Wear county council; so it is a Conservative party called into question. I thought the right hon. Member structure, but in fact the county—the remnants of the for Berwick-upon-Tweed made a perfectly valid point county, if you will—has made it work well for us. There about the nature of the broader conurbation on the one is a community; it is a joint board and has pro rata hand and rurality on the other. representation of the majority and opposition parties. It has faced its troubles over the years but has stood Guy Opperman: The right hon. Gentleman fairly up to them and found a way through, and I think it has outlined the transitional measures—Rome was not built drawn the best from the local representatives, who are in a day—but they will lead to an integrated transport not the leaders of the authorities, but members of the system run by the LA7 as a whole, rather than by local authorities who have taken a specific interest in individual authorities. Surely that is worth attaining public transport. They have become quite knowledgeable and striving for. on the subject, and have found that they have far more in common than divides them. That is what we are Mr Brown: I do not see it. Although the hon. Gentleman abolishing. said I fairly describe the arrangements, I was reading What we are putting in place is a single-party out the briefing note of the advocate of them; it did not arrangement. On the governing bodies there is no provision require a lot of interpretation on my part. I am not sure at the moment for representatives of the Conservative I agree with the hon. Gentleman’s point. There are party or the Liberal Democrat party at all. In other particular concerns in operating public transport in words the Opposition in the Russian Duma have more rural areas that do not relate very directly to operating a of a say than the opposition in Tyne and Wear. Do they transport system across a conurbation. The two things like those arrangements? No, they do not, and you can have to sit alongside each other. That is one thing, but hardly blame them for that, Mr Walker. having the structure arranged mainly for the conurbation I find it difficult to understand why a Conservative-led also running the rural arrangements is flawed, as the Government would want to do that to their own people. right hon. Member for Berwick-upon-Tweed astutely The deputy Tory leader in Sunderland, Councillor Peter pointed out. I could take up all the Committee’s time Wood, according to that excellent source of information talking about that, Mr Walker, as we both know, but the Sunderland Echo, has said it is not acceptable and that would not be fair on other Members. 15 Third Delegated7 APRIL 2014 Legislation Committee 16

I will move on to the economic arguments. We need a Will Hutton, Bridget Rosewell and Jonathan Ruffer and clear focus on private sector economic development the multitude of organisations that they took assistance projects that would work for our region and some from—stated, on page 7 of the report: public sector structure to drive them forward or to say “The seven local authorities” no if they will not work. The best arrangement was the professionally led development agency arrangement that coming together and establishing pertained under the previous Labour Government. I “the LA7 Leadership…which is responsible for shaping the strategic seriously doubt that the order represents the right direction of” arrangement. so much The Minister of State, Cabinet Office, the right hon. “and agreeing local major transport schemes” Member for Tunbridge Wells (Greg Clark), who has must be the way forward. The authorities some oversight on these matters, also entertains doubts about the order. The Financial Times quoted a speech of “have expressed a commitment to working together and collectively with wider stakeholders for the benefit of the North East, alongside his, which warned against incomprehensible bids. He a desire to explore opportunities to access greater powers and said: “Your ambition is impressive”—that can always funding delegated from central government.” be said of people asking for public money— That is exactly the point brought to bear on and to deal “but we need to be able to understand exactly what you are with many criticisms of the lack of funding from central aiming for.” Government. Similarly, that point applies to many criticisms He is correct. General aspirations and general expressions of the powers devolved to the north-east. Again, the of good intentions—expressions so broadly drawn that mechanism seeks to advance that aim. Lord Heseltine, they read like the prospectus for the South Sea bubble, who produced the Heseltine review, envisaged exactly another Conservative economic development arrangement what we are doing today as part of something that will that went badly wrong—do not amount to leading transform the north-east. forward specific projects. These over-elaborate structures are not what the region needs, which is a slimmed-down, The reality is that the north-east has looked at itself. I sharply focused measure that we can all get behind to applaud the seven local authorities, none of which are explore whether specific projects will work for our Conservative and none of which I would particularly region. support personally, for having the courage to press forward on this point. They may be at odds with certain I was entertained to hear my hon. Friend on the hon. Members on their views of the way forward, but Front Bench say that there could be savings with these on this issue they are unquestionably right. It is to their new structures. I would love that to be so. It is a credit that they have put aside past differences—and perfectly decent and reasonable aspiration, but my fear Lord knows there have been past differences—and decided is that it will turn out otherwise and cost more and to work together, collectively, for the common good. deliver less. The electorate, when given a referendum on whether we should have an assembly for the north-east, We should welcome this effort to put an end to the voted firmly no. The key activists urging a no vote were turf war that has existed for so long in the north-east. from the Conservative party. They believed that no was The best example, which many have cited, but it is the correct answer for the region, and they worked hard worth retelling, is that when bids were invited for the to obtain that result. All credit to them for that, because green investment bank, the north-east put forward not they convinced their fellow citizens. The most powerful one, two or three bids, but four separate bids. Central argument against that assembly was that it would be a Government, who award such contracts, would have talking shop and would not do anything. With this looked open-mouthed at an area of fewer than 2.5 million order we are presented with a talking shop, but without people submitting four different cities as the location, the public representatives. How a Conservative-led rather than collectively coming together, working out Government can inflict that on their own party activists the best location and, collectively, getting behind it. The who voted for the exact opposite will take some explaining, right hon. Member for Newcastle upon Tyne East is although as you can probably tell by now, Mr Walker, well quoted in The Journal today, saying: I am not the person to explain it. “nothing that has been presented to us suggests how they will achieve anything, in particular over economic development.” 5.20 pm Our ability to secure the green investment bank, for example, will be massively improved by coming together Guy Opperman: The good news is that the right hon. and working collectively, not acting like a bunch of Member for Newcastle upon Tyne East does not dictate ferrets in a sack, fighting each other. policy for the Government parties or, I am pleased to If an example is needed, members of the Committee say, Opposition parties. This policy is strongly endorsed should consider Manchester, which, again, is a Labour- by Lord Adonis; he supports it, as do other Members of controlled city—let us be blunt about it—with pockets the House of Lords and several key supporters. Not of other parties. The Greater Manchester area, not just least, support comes from the Adonis report itself. I sat the city, has been transformed in terms of its collective unashamedly with several Opposition Members—hon. bargaining power, access to cash from central Government, Gentlemen and hon. Ladies—and contributed to that its ability to get devolved powers and, more specifically, report and attended functions in support of it. its amazing ability to try to change transport infrastructure. The private sector organisations that contributed to I have no doubt the northern hub would not have happened the Adonis report, and the public sector organisations without Greater Manchester coming together and making that did so, were part of the economic review team. The the case to Government as a collective region that that significant players who were part of the north-east was something that would benefit the area tremendously, economic review team—Heidi Mottram, Lord Curry, and they were successful in that. 17 Third DelegatedHOUSE OF COMMONS Legislation Committee 18

[Guy Opperman] example of a local authority that was capable of delivering transformational change for its own area over several I endorse the comments made by my right hon. decades. I could go through a list of the achievements of Friend the Member for Berwick-upon-Tweed about the Gateshead council and its partner organisations: the importance of a rural element. It does not apply only to cultural development of the riverside on the Gateshead Northumberland, but to Durham. Weardale and parts quays; the Metro centre, which was done in combination of County Durham, such as Barnard Castle, are with the Church of England Commissioners and Cameron fundamentally very rural. They, too, will need to be Hall Developments; the international stadium that has represented. Points were made about buses, and they brought international events to our borough and into are the classic example of where the rural provision of the north-east of England; and of course our cultural services by public authorities can fall by the wayside. strategy that saw the angel of the north on the front We are flagging up the exact examples of where the page of on the first day of January in the local authority leaders, all of whom represent their year 2000, with the headline “Launch of a new millennium”. seven local authorities, can come together and say, “It is From a local authority perspective, that sort of advertising important that we drive forward together for the region’s could not be bought—in fact, I have often said that the greater growth, but that we do not forget the smaller angel of the north was the best £800,000 we never spent. elements of particular parts of the region”, whether it is In the aftermath of the last election, we lost our the bus services that I have concerns about in Gilsland, RDA. Until then and until now, English devolution has Otterburn and Allendale, or my right hon. Friend’s been confined to one region of England, and that is services towards the north of the county. Such things London. It is the only area of England that has had a need to be included, but they are also included by right to do all sorts of things, including regulation of reason of the original local authority—that does not go the public transport infrastructure. There has been a away. The provision of local authority services does not massive difference in the way in which that has affected go away with the creation of the LA7. London, compared with a region such as the north-east. Like the right hon. Member for Newcastle upon Tyne I have to admit that there have been significant East, I could go on at great length, but I will not. My differences—not only in the past, but in the present— focus is the ability to drive forward transport and between local authorities in the north-east of England, infrastructure changes. That will definitely be good for but a large part of that is because we are arguing about jobs and growth. Rather than individual cities and local sharing out between ourselves the crumbs off the table. authorities applying for the green investment bank and However, the LA7—the seven local authorities in the spending a huge amount of money on that application order—have worked successfully together on a major and process—which, frankly, in these straitened times project for decades: the delivery of Newcastle International could have been directed elsewhere—the seven local airport as a means of getting in and out of our region. authorities can come together on larger infrastructure That has seen an unprecedented growth in passenger and other projects, and allow themselves to provide the usage, compared with what we saw until about a decade local services that they are democratically elected to ago. I would also say that this is not about the LA7 provide in their local areas. I would rather they focus on proposal and covering one travel-to-work area; many that than try to punch above their weight, when they different travel-to-work areas are covered in the area have got a collective seven-person body that can do the from the Tweed down to the Durham-Tees border. job for them. What are we trying to achieve? Among the things we want are economic growth, and the redevelopment of 5.27 pm our transport infrastructure. We are bringing together Ian Mearns: It is a pleasure to serve under your seven local authorities, all of whom have suffered massive chairmanship on this important occasion, Mr Walker, cuts in their revenue support grant. As the Minister as we talk about the north-east of England. The order is knows too well—we have rehearsed the arguments—the welcome, but it is a means to an end, not an end in itself. average cuts in the north-east of England have been of It is far from perfect, but it is the only game in town, the order of 35% from base budget. Members from and it therefore has my support. Given the tribulations constituencies in the south might argue that there has that we have had to get to this stage, it needs to be been a decades-old difference in the amount of spending, supported. If we take a massive step back, it might be but I guess that many Members from southern some time before we get to this stage of the game again. constituencies who trot out those arguments would not I will nail my colours to the mast. The failed attempt readily swap the levels of need and deprivation that we to have a north-east regional assembly was scuppered in have in our constituencies and accept the financial November 2004 by a referendum of the population. I position that we are in. can tell the Committee that the campaign that led up to If those huge amounts of money are cut out from that referendum was not the reason for the idea’s defeat. local authority revenue support grants and from those I am afraid that, from my perspective, the idea was budgets, jobs are sucked out, as is spending power from defeated with the launch of the White Paper in May local high streets and from the regional economy. Vital 2002. It was called “Your Region, Your Choice”, and it services for the most vulnerable people in our society was the embryo of an awful offer for the people of the are removed and, crucially, resources are removed from north-east in relation to the devolution of government the voluntary sector that are there to back up local to an area like ours. authorities in the delivery of many of those services. Until the general election, I was a councillor for In the north-east of England, we have a very different 27 years in one of the named authorities, in Gateshead. private sector from the one in the south. The private I would say to my right hon. Friend the Member for sector is diverse, but, I have to say to the hon. Member Newcastle upon Tyne East that Gateshead was a good for Hexham, it is not really represented by the chamber 19 Third Delegated7 APRIL 2014 Legislation Committee 20 of commerce, because the one thing that marks out the There are of course a lot of flaws in this proposal, but north-east economy is that there are so few businesses we can iron them out as time goes by. We must grab the that have more than 50 employees. A representative of idea with both hands, try to work on it and bring the Federation of Small Businesses told me that, out of it back. It is right to make it more open to other parties. 136,000 registered companies, fewer than 1,000 companies We are all in it together in the north-east. We have had a in the whole of the north-east of England had more rough time. On every measure, the north-east is the than 50 employees. Among them are great success stories, lowest of all the country. Cornwall used to beat us on such as Nissan, with more than 6,500 employees and one or two things, but now we are the lowest. We do not probably 25,000 further jobs in its supply chain. They have a Barnett formula like the one the Scottish got are vital to an economy such as the north-east’s, but when they were down and out. We had the mines, the they are not entirely representative of the way in which shipyards and of course the steelworks. was the north-east economy works. There are about 100,000 having the rough time, so Lord Barnett came along and businesses that are one or two-person operations; those gave it extra money, which it still gets today. We did not very small companies are much more representative of get it. We are down and out. The mines, the shipyards the north-east economy than those represented by the and the steelworks have gone, but we do not get any chamber of commerce. I often meet representatives of extra money. business in my area who say to me that the chamber of The Committee can see where we are coming from. commerce does not speak for them. I think the combined authority is a stepping stone. We have seen over many decades a reduction of As far as my constituents are concerned, in south-east Government investment in economic development activity Northumberland we need transport infrastructure. If in the north of England. That has been going down and I can get my people into the conurbations of South has got worse under this Government. As a proportion Tyneside and North Tyneside where all the work is, I of the national share, investment in economic development will be happy. If I had a good transport system, they activity in the north has been going down on a regular could get in and back home again. That is what we are straight-line curve over more than decade. Transport looking for in my constituency, Blyth Valley. All I can infrastructure investment has been paltry in comparison say is that I wish the combined authority—whatever it with London and the south-east. As my hon. Friend the will be called—good luck in the future. I hope we can Member for Easington said, investment is about 500 to put it right as it develops. one: London, per head of population, gets 500 times more transport infrastructure investment than the north- 5.39 pm east. How will we ensure that our transport infrastructure Grahame M. Morris (Easington) (Lab): It is a pleasure is revitalised by bringing together seven local authorities, to serve under your chairmanship, Mr Walker. As the unless there is significant Government support for the only County Durham MP on the Committee, it is activity of the seven local authorities in the venture? beholden on me to say a few words in support of the Unemployment in the region is just under 10%. We order. I recognise and agree with many points made on are an area with a balance of payments surplus. Nationally, both sides of the Committee. I fully understand the we are running a record deficit in our balance of trade, important role that One North East, our regional but the north-east of England as a region has a balance development agency, successfully played. If the hon. of trade surplus, largely due to companies such as Members and right hon. Members on the Government Nissan and its supply chain. It is vital to the UK, and Benches searched their hearts and looked at the facts, therefore deserves investment if we are to see the UK they would agree that every pound of public investment economy as a whole grow. Unlike the whole nation, the that went into One North East generated at least £4.50 in north-east is becoming a net beneficiary to our balance economic activity. I may have cited a conservative figure. of trade. It was incredibly successful as a model, and for the life We welcome the order, but it is not perfect. I have one of me I do not understand why that model was dismantled. question for the Minister: will he ask his Secretary of It did command support from the business community. State to use his influence at the Cabinet table to demonstrate If what we are about in this place is bringing in some a commitment to localism by ensuring that the resources measures and creating some mechanism to stimulate currently controlled by central Government for training, economic growth, particularly in the private sector, skills, transport, inward investment and economic which we all acknowledge needs to be done, that was a development are devolved to the new combined authority? very good vehicle to do it, and it worked very well, in That would be a real testament to the Government’s co-operation with the local authorities, which helped to commitment to localism. draw up the regional economic plan. That said, the LA7—it sounds like a Cuban pop 5.36 pm group—does have a proven track record, in the guise of Mr Ronnie Campbell (Blyth Valley) (Lab): I will be the North East Leadership Board. They have worked brief because everybody has said everything already. I very effectively together on a number of projects. My sympathise with what my right hon. Friend the Member hon. Friend the Member for Gateshead mentioned for Newcastle upon Tyne East says. He made some working together to sustain and promote the airport, valid points, but there is a history, which we heard. We and I think that there is scope there. should have had a regional assembly. I remember the I wish to ask the Minister this question and I would arguments. Leading our campaign was a developer called be grateful if he could give us a reply. It seems to me John Hall, an opera singer and, I think, a poet—I was that what we need is the political will to address some of not sure—and we were told to keep out of it. The Tories the deficiencies, and that comes down to resources. The were hellbent on getting rid of the idea all together, and local authorities have been denuded of resources. Various they won hands down. If that vote were taken today, we figures are bandied about. County Durham has had an would win the yes vote hands down. enormous cut in revenue support grant, which is inhibiting 21 Third DelegatedHOUSE OF COMMONS Legislation Committee 22

[Grahame M. Morris] Members have raised particular issues, which I will try to deal with in order. The hon. Member for Corby its ability to carry out economic regeneration, working raised several, and as he often does in such debates he in partnership with the private sector. If the Minister referred to the spending powers. I remind him, as I did wants to see some tremendous examples of success at the Dispatch Box a couple of hours ago, that, at more from public-private partnerships, he should come to than £3,000 a year per dwelling, the most deprived 10% east Durham and see the tremendous work that was of authorities have considerably greater spending power carried out there in the wake of the pit closures, particularly than the most affluent 10% of authorities, which get in the north of my constituency. That is a testament to about £1,900 a year. Some of the authorities in the the efforts not only of the RDA and of the local north-east have some of the highest spending powers in authority, but of the former Minister for the north, who the country worked to pull ends together across various Departments. The hon. Gentleman was right to note that some Again, I think that that model has enormous merits. authorities have seen an increase in spending power this year. I see that as a really positive step forward. Such Chi Onwurah (Newcastle upon Tyne Central) (Lab): I authorities are benefiting from incentives established by endorse the comments that my hon. Friend is making. the Government such as the new homes bonus. As we Is it not the case that, given the challenging circumstances move forward, even more local authorities may see in which so many local authorities are operating now in increases through growth in business rates thanks to the the north-east, it needs extra focus and resource to support business rates retention scheme. the creation of long-term, sustainable jobs, with decent wages and decent hours, and not the short-term approach? Mr Brown: I have heard the Minister make that point on many occasions. What is important, however, is not Grahame M. Morris: Absolutely; I completely agree. just the authorities’ spending power but what they must Is it the Minister’s intention to put the case that the spend their money on. The number of people in care, LA7 should be eligible to receive EU funding—the whether children or vulnerable adults, in authorities match funding to which other hon. and right hon. such as Sunderland and Newcastle upon Tyne far exceeds Members have referred? That would be a significant that in the authorities that he tries to compare those advantage that we do not enjoy at the moment, but it great urban communities to. He should acknowledge boils down to political will. We need an organisation, a that when he presents the figures. We need to know vehicle that is backed up by the appropriate level of what discretionary expenditure they have. Of course, resource. I accept that there is a body of shared intelligence, they do not have any at all. of capacity that is being built up jointly by the local Brandon Lewis: The right hon. Gentleman confirms authorities, and there may be benefits. Northumberland my point: that is why they have a higher spending power may be able to share some of the particular expertise in the first place—considerably higher than areas that that it has. Durham, Gateshead, Newcastle and North do not have as many of those issues. and South Tyneside have particular areas of expertise that may bring about some synergies across the region. The hon. Member for Corby again raised the Total Therefore, despite my reservations about the lack of Place project, and did a huge disservice to the local funding, I think that the embryonic idea is a good and authorities that are going far further than Total Place. solid one and I propose that we support it. Sir Richard Leese has outlined how much further devolution has gone under the few years of this Government, 5.44 pm compared with the 13 years of the previous Government. Brandon Lewis: It has been a pleasure not only to Areas that have taken forward community budget pilots serve under your chairmanship, Mr Walker, but to be —Greater Manchester being a good example—and part of a very interesting debate on what will be, if those in the transformation network, many of whose Parliament approves the order, an important development representatives I met at a round-table meeting this for the economic success of the area we are discussing. morning, are doing great work. They are just the pinnacle It is a development that epitomises localism, being of what authorities throughout the country are doing: founded on and driven by the initiative of the councils breaking down barriers across agencies in the public involved and their partners. Establishing the combined sector and delivering better services. authority opens the way to the councils, the local enterprise The hon. Gentleman asked specific questions about partnership and their other partners collaborating more consultation for combined authorities on a non-contiguous effectively to promote economic growth, to secure basis. We hope, and I intend, to consult on that before investment for the area and to pursue more efficiently this year’s local elections. economic development and regeneration. The combined The consultation on VAT, about which the hon. authority will have a central role in continuing the Gentleman asked and which we touched on in our positive progress we are seeing as a result of the Newcastle Chamber debate a few weeks ago, closes on 18 April. upon Tyne city deal, showing what can be done with the Subject to that consultation and Parliament’s agreement, recently agreed city deal for Sunderland, South Tyneside we expect that, although the VAT exemption was not in and the North East local enterprise partnership. The place for the beginning of the 2014-15 financial year, it combined authority will be able to provide the stable, will be in place soon thereafter. efficient and accountable governance needed to drive My right hon. Friend the Member for Berwick-upon- forward the projects and investment needed to deliver Tweed asked about governance. We are conscious of the outcomes envisaged in those city deals. Likewise, the that issue and will look at it with great interest. The combined authority will be able to provide the governance authorities involved should take care to ensure that needed for any future growth deal, with resources being they deliver best practice by having good governance provided from the local growth fund. and proper representation. I would not rule out our 23 Third Delegated7 APRIL 2014 Legislation Committee 24 returning to deal with that issue if we need to, but I have commitment to delivering growth and prosperity to high hopes that we can rely on the good conscience of their area, a priority that should be at heart of everything people in local government to deliver the right thing. done by councils across the country. Businesses and In my right hon. Friend’s intervention and his speech other partners in the north-east have made it clear he touched on rural bus services, and as I said, he makes that they share that commitment, as do the coalition a fair point. We know, as is noted in the transitional Government, as demonstrated by the city deals that we arrangements, that the combined authority plans to have agreed with the area and others. The first wave of delegate some transport matters back to Northumberland deals alone is expected to create 175,000 jobs over the and Durham so they can continue to be responsible for next 20 years, and 37,000 new apprenticeships. That has their rural services. That does mean, however, that the been greeted positively in the House because it meets combined authority should be able to deliver and cater the desire for more jobs. I am confident that the Committee for the cost of rural services in the transport levy that it shares that commitment, and I commend the order to raises. the Committee. My right hon. Friend also commented—with a wry smile and a twinkle in his eye—on the name. I fully 5.53 pm appreciate his comment and I do not disagree with him. Andy Sawford: There are some issues and concerns That is why I stress that the name and branding used on for the Opposition to take away from the debate as we paper and anything else that the authority wishes to use develop policy towards 2015, but it has been positive is entirely for it to choose. We have included a legal name, overall. but central Government exercise no restriction on the I fully agree with my right hon. Friend the Member choice of name by the councils, or indeed the choice of for Newcastle upon Tyne East on his regret at the chairmen, as we have seen recently in other authorities. abolition of the RDAs, and with the point very well Hon. Members asked about borrowing. The borrowing made by my hon. Friend the Member for Easington on powers of combined authorities are limited to their the gross value added of the RDAs. They were abolished transport function. In this case, the combined authority at a critical time and the damage, particularly to young inherits the levy-raising power of the Tyne and Wear people looking for work, was an appalling act of economic ITA, and hence that power exists only in relation to vandalism by the incoming coalition Government. My transport. Such power is essential to provide the income hon. Friend the Member for Gateshead said that the stream on which potential borrowing is secured. draft order was the only game in town. In that spirit, I The right hon. Member for Newcastle upon Tyne am sure all hon. Members today want to see it take East referred to ANEC; I have met the leaders of effect, notwithstanding some of the genuine concerns ANEC both in the region and in London. He made it that have been expressed. clear in his speech that he is against the proposal. The Finally, on the accountability of the combined authorities, Government believe in localism; the combined authority a long-established means of accountability for local is something for which the local authorities have asked government bodies on which authorities are working and want, and we are happy to deliver it. My hon. together is for the councils to be represented by their Friend the Member for Hexham made a strong speech leaders. The lack of political diversity in the north-east in support of the proposal, as did other hon. Members, is a matter for local people. They have had the opportunity in particular the hon. Member for Gateshead, who to see at first hand the work of Liberal Democrat spoke about devolution. Again, I gently refer the hon. leaders in Durham, Northumberland and Newcastle, Gentleman to the comments of Richard Lees, who has and of a Conservative mayor in North Tyneside, and commented on how the Government have devolved they have rejected leadership by other political parties. I more than the previous Government, and in a much am pleased that they have affirmed their belief that the shorter period of time. The hon. Gentleman may also Labour party is the right party to take forward their recall from the Localism Act 2013 that when we devolve communities, which have been so badly let down by power, we do not just devolve it to local authorities, Conservative Governments in the past. Those local because that Act devolves power direct to communities authorities with a different political balance must themselves throughout the country. hold their leader to account for the actions taken when In terms of giving more powers to local government sitting as part of the combined authority. That should, I or to combined authorities, as I said to authority hope, form the appropriate level of democratic representatives just today, if they can make a case, come accountability, with the appropriate checks and balances. and talk to us because we are keen to devolve as much I am also well aware, not least from the front cover as we can, as I and the Minister of State at the Cabinet of this evening’s edition of a regional newspaper, that Office, my right hon. Friend the Member for Tunbridge hon. Members in this place and the local newspapers Wells (Greg Clark), made clear to the Select Committee will provide a form of accountability for the combined on Communities and Local Government just last week. authority in future. The hon. Member for Easington referred to EU Question put and agreed to. funding. We will expect the combined authority to work Resolved, seamlessly with the local enterprise partnership, which That the Committee has considered the draft Durham, Gateshead, has a key role in strategic economic planning and future Newcastle Upon Tyne, North Tyneside, Northumberland, South EU funding. Tyneside and Sunderland Combined Authority Order 2014. The establishment of the combined authority is what those in the area want to see; they have come to Government 5.55 pm with that proposal. They want to see it because of their Committee rose.