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Reforming Governance in the UK

Policies for Constitutional Reform

Policy Paper 40

1 2 Contents

Summary 4

Introduction 7

Reconnecting Government and Citizens 8 The Politics of Exclusion 8 Towards the Politics of Inclusion 9 Encouraging People to Take Part in Politics 11 Putting the Politics of Inclusion into Practice 12

Accountable and Representative Government 15 Political Accountability 15 Constitutional Principles 15 Parliament 15 The House of Commons 16 The Senate 16 Separation of Powers 17 The Quality of Law Making 18 Select Committees 19 Accountability of Quangos and Agencies 19 Freedom of Information 19 Political Parties 20 Financial Accountability 20 The Existing System 21 Expenditure 21 Reforming Parliamentary Control of Taxation 22 Reforming Parliamentary Control of Spending 22 Financial Information for Parliament 23 Financial Expertise for Parliament 24 Financial Procedures 24 Monitoring Parliamentary Control of the Budget 25

Decentralised Government 26 Introduction 26 The Existing Regional Tier 26 The Desire for Change 27 What will Regional Assemblies do? 27 Implementation and Boundaries 28 Funding 29 Relationship with Local Authorities 32 Co-ordination between Regions 32 Continuing Federal Responsibilities 32 Question 33 Input into EU 33 The Council of the Isles 33

Efficient and Effective Government 35 Poor Government 35 Conservative Reforms 35 Criticism of Next Steps 36 ‘Joined-Up’ Government 36 Tensions between Rhetoric and Reality 37 Setting the Right Targets 38 Initiatives and Experimentation 39 Government and the Governed 40 The Civil Service 40

3 Summary

Liberal Democrats have long been at the forefront of the constitutional reform agenda in the . While recent constitutional reforms have been significant, they have been piecemeal and lacked coherence. Much remains to be done, in fields as varied as English regional , Freedom of Information, reform of the upper house, and proper financial accountability of the Government to the House of Commons. Above all, there is an urgent need to re-connect citizens and government.

This paper builds on previous policy statements on constitutional reform, developing policy in these and other areas.

Re-Connecting Government and Citizens

Liberal Democrats would re-connect citizens with government by:

• Strengthening the perception that the bodies to which candidates are seeking election have real power and that the composition of the body can make a difference to its policies and performance through effective powers to local government.

• Supporting a referendum on the recommendations of the Jenkins Commission on electoral reform as a first step towards our ultimate goal of the Single Transferable Vote system.

• Encouraging new methods of voting, including more postal votes and Internet voting.

• Promoting greater public involvement in decision-making, including through Citizens’ Juries, Citizens’ Initiatives and electronic consultation.

Political Accountability

Liberal Democrats would make government more politically accountable by:

• Replacing the with an elected Senate.

• Enacting meaningful Freedom of Information legislation for and , with exclusions limited to material that could cause substantial harm if released, and the final decision on exclusions lying with an Information Commissioner, not Ministers.

• Strengthening the pre-legislative scrutiny of Government Bills, and the Select Committee system.

• Cutting the number of MPs in the Commons to around 450.

4 • Cutting the number of Ministers, and allowing junior ministers to be appointed from outside Parliament, thereby reducing the Government’s patronage over the Commons.

• Moving towards a written constitution for the UK.

Financial Accountability

Liberal Democrats would make government more financially accountable by:

• Separating the annual Finance Bill from a new Tax Technicalities Bill to allow for greater consultation on the detail of tax matters.

• Amending Commons Standing Orders to allow MPs to propose spending amendments to the budget and Government Bills and spending proposals in Private Members’ Bills, balanced by an executive financial veto.

• Establishing a new Resource Estimates Commission to support MPs and Select Committees in analysing expenditure proposals.

Decentralised Government

Liberal Democrats would empower the nations and regions of the United Kingdom by:

• Further strengthening the devolution settlement in and Wales.

• Over time, allowing the devolved tier to raise an increasing share of its own revenue directly.

• Establishing a Finance Commission for the Nations and Regions, charged with devising a new revenue distribution formula based on need to allocate remaining funds.

• Creating the option for devolution to the English Regions by legislating for referenda on regional assemblies, on the basis of a minimum set of core powers.

• Basing regional boundaries on existing RDA regions, but with scope for smaller areas.

• Allowing further devolution of powers to the regions by subsequent referendum.

• Making future boundary changes possible only after referenda called by the Secretary of State for the Nations and Regions.

5 Efficient and Effective Government

Liberal Democrats would make government more efficient and effective by:

• Enacting a Public Services Act requiring an annual Social Strategy Statement setting outcome targets for Government.

• Establishing a Public Services Select Committee to scrutinise all Government targets.

• Enacting an Environmental Responsibility Act, and requiring Social Justice Audits of all new bills.

• Encouragement of staff mobility between central and local government and the private sector, and promoting a Masters Degree in Public Policy and Administration to develop management expertise in the public sector.

6 Introduction

1.0.1 The vitality of democracy as a to good cases that call for government system of government is drawn from its action. openness to change. When the system is working well, changes in government 1.0.4 We are conscious that, although policy would be seen by the citizens as in this Parliament important flowing from changed circumstances or constitutional changes have been put in from altered perceptions which require train that owe much to Liberal adjustments of direction to be made. Democrat striving, many required Ideally, these adjustments are made reforms remain unachieved. without dislocating lurches and, through the continuing dialogue of 1.0.5 This paper, however, is not a government and governed, with a high mere reassertion of our commitment to degree of acceptance that the measures the goal of a written constitution, proposed are apt to tackle emerging which enshrines a proper distribution of new requirements. accountable public power and citizens’ rights. It is a new attempt to respond to 1.0.2 In practice that ideal is not some of the pressing immediate needs always realised. Complacency on the for reform that we believe should be part of both government and governed readily attainable and which are is the besetting characteristic of the important constitutional building democratic system. This is, perhaps, blocks. In particular, we have been the downside consequence of the struck by the need to look behind some general awareness that if things go of the long established forms of our badly wrong parliamentary democracy democratic system to recognise that does at least allow for challenge and they do not match the substance of our even for the ultimate sanction of contemporary requirements. The upper removing the perpetrators of error house of Parliament, for example, through the ballot box. But that is a should be made capable of playing a crude and not well targeted response to more significant legislative and scrutiny the multiplicity of day to day decisions, role. The House of Commons, which which make up the business of modern has long claimed exclusive rights to government. That sanction, often long control taxation and expenditure, delayed, can leave injustices untouched should be empowered to discharge for years and can exacerbate problems these roles, where they are properly by postponing their consideration. theirs, with real effectiveness.

1.0.3 Liberal Democrats consider that 1.0.6 It is the Liberal Democrats’ our British system of democratic judgement that if these further reforms government is in need of further reform of our democratic system are to achieve a greater continuing implemented it will not only improve responsiveness to the particular the quality of government but will do concerns of the citizens. We want to so by engaging the good sense and the sharpen up the receptivity of the system commitment of our citizens in the process.

7 Re-connecting Government and Citizens

2.0.1 Liberal Democrats are politics is the archaic notion that we concerned that citizens all too often see are subjects, not citizens. The government as remote and irrelevant. education system has failed to We would work to create a new and provide an understanding of how more inclusive politics. Every citizen politics works and what citizenship should have the maximum opportunity means. and encouragement to participate in the democratic process. We would build a • Second, the conduct of successive genuine partnership between the people British Governments has fuelled of the UK and their Government. political disillusionment. Too often, the trust that the British people place 2.1 The Politics of in their leaders has been betrayed. Exclusion The result has been bad policies and defective laws. The products of 2.1.1 Too many people feel excluded Conservative arrogance included the from or are voluntarily opting out of poll tax, the coal fiasco, the arms-to- politics. For example, they are less and Iraq scandal and the BSE crisis. less likely to vote. At the 1997 General Labour has shown similar Election, voter turnout fell to 71 per tendencies, as shown by its approach cent, the lowest figure in more than to genetically modified products and sixty years. the Sierra Leone affair and its handling of devolution, particularly 2.1.2 For a decade, surveys have in and Wales. It is little shown that trust in politicians and wonder that people are disillusioned. institutions has continued to fall away. People think that between elections, • Third, the current style of political ordinary voters have less say over reporting may also be a factor. government policies than they should. There is too much focus on trivia People are less and less likely to see and personalities, too little on elections as relevant. And public substance and issues. understanding of the political system is sketchy. Indeed, awareness of such • Finally, there are deeper social elements as citizens’ rights, the causes of political alienation. Those constitution and how Parliament works who suffer from social exclusion are actually fell during the 1990s. more likely to feel shut out of politics. Over nearly two decades, 2.1.3 The reasons for the growing the British Social Attitudes report sense of exclusion from politics and has measured peoples’ expectations decision-making are highly complex: of their ability to shape, either alone or with others, the course of events. • First, they are partly systemic in It has found that people in lower nature. For example, underlying our socio-economic groups have a much

8 lower sense of political efficacy than 2.2 Towards the Politics of those in better-off groups. Closely Inclusion linked is the role of education in determining how much political 2.2.1 Inclusive government is based power people think they have. This on the notion that power flows upward data, and that on the treatment at the from the people. But authority in the hands of institutions that people British State flows downwards from have come to expect, presents a the ruler. This is the context for powerful and disturbing picture of several aspects of our exclusive alienation. political culture, including excessive centralisation and secrecy. It also 2.1.4 Therefore, the causes of the means that people have not been public’s disconnection from politics do imbued in a strong civic culture that not lend themselves to easy or encourages political involvement. simplistic solutions. We will not have a Therefore, the United Kingdom needs a more inclusive politics without making new constitutional settlement between basic changes to the way the UK is the citizen and the state, to ensure that governed. We need to guarantee public power genuinely belongs to the people’s rights as citizens, bring people. government closer to the people, introduce a fairer system of voting and 2.2.2 Liberal Democrats would give make government more open. the UK a written constitution to protect people’s rights and ensure that recent 2.1.5 But such reforms will not, on and new reforms cannot be reversed by their own, create a new politics. They a future UK Parliament. The will not, for example, stop politicians constitution would set out the powers breaking their promises or quickly and responsibilities of Parliament, the address the causes of social exclusion. executive, the judges, the Head of We also need to encourage people to State, set out the right to self- take part in politics. And we need to determination of the peoples of make important and practical changes England, Scotland, to put a new style of politics into and Wales and Wales, entrench the practice. This chapter sets out how Human Rights Act and establish the Liberal Democrats would: independence of local government.

• Put in place the basic structure that 2.2.3 Inclusive government is needed if we are to re-connect the empowers people to get involved in government and the citizens of decisions that affect their regions, Britain. localities and communities. There is a developing layer of regional • Encourage citizens’ participation in bureaucracy in England, but it is politics. accountable to central government, not to the people of the region. And • Give people more say in the successive Labour and Conservative decisions that affect their lives, in administrations have encroached on the particular, by using the new powers of local government in England communications technologies to – limiting its ability to raise revenue, renew democracy. fragmenting its functions and restricting

9 its role. The result has been a loss of of the electorate - have little incentive interest in the governance of local to vote. Furthermore, nearly half the communities. We must move power votes that people cast in 1997 did not from Westminster and Whitehall and count towards the election of an MP. towards the smallest units of Another 20 per cent were surplus, cast democratic government. This includes for candidates over and above what a redistribution of tax-raising power, they needed to win. And more than which may encourage interest and three voters in five did not vote for participation in the work of sub- their MP! national government. 2.2.6 Liberal Democrats would bring 2.2.4 Liberal Democrats would: in a fairer system of voting. Our first choice is the Single Transferable Vote • Promote the development of (STV) system. This would ensure that democratically elected regional everyone’s vote had the same value, government in England, to take facilitate the election of governments powers and responsibilities away with the support of a majority of the from Westminster, where there is electorate, ensure that the House of demand within the region (see Commons was more genuinely chapter 4). representative, and allow voters to choose between different candidates of • Strengthen local government in the same party. At the same time, we England. We would enhance recognise that AV ‘Top-up’ (AV+), as innovation by giving local proposed by the Jenkins Commission government a constitutional power on voting reform for Westminster of general competence and elections, would be a big improvement strengthen the link between what on the current system. AV+ could be a people pay and what their council ‘stepping stone’ to a further reform to spends. We would promote local STV at a future date. participation by establishing a comprehensive network of 2.2.7 Inclusive government would parish/ councils. (See give people access to official Policy Paper 30, Re-inventing Local information, so that they could play a Government (1999)). full part in decisions. But government proceedings and advice to ministers are 2.2.5 Inclusive government would kept secret unless Ministers decide to have an agenda that broadly reflects the disclose them. Liberal Democrats views of most voters. But British would greatly expand citizens’ rights to Governments assume massive powers, public information (see section 3.9). despite having the support of as few as 43 per cent of those who vote. Inclusive politics would ensure that the House of Commons looked like the country it is meant to represent. But women, young people and members of ethnic minorities are not well 2.3 Encouraging People to represented. It would also encourage Take Part in Politics participation. But those who do not live in marginal seats – over 90 per cent

10 2.3.1 People are less likely to take whom they live and of political part in elections. In the 1999 elections parties. for the European Parliament, barely one elector in four turned out to vote. 2.3.4 We are not persuaded that This is the lowest figure since direct compulsory voting is the solution to elections started. And, on average, only declining voter turnout. Making people 40 per cent of British people, less than vote in a free society appears to be a any other EU country, vote in local contradiction in terms. elections. 2.3.5 We recognise that asking 2.3.2 Turnout is higher where voters people to go to the ballot box too often believe that the result is not a foregone can result in voter fatigue. However, conclusion. We believe that electoral our policy for four yearly all-up reform and in particular a move to STV elections in local government combined as outlined in section 2.2.6 would with our commitment to a fixed four provide the greatest boost to voter year term for the Westminster turnout, particularly by ending the Parliament will give greater scope for problems of wasted votes in safe seats. holding elections for different tiers on The wish to exercise the right to vote the same day. strengthens when it is perceived that the bodies to which candidates are 2.3.6 Liberal Democrats would take seeking election have real power and action to increase the political interest that the composition of the body can of young people, who are less likely make a difference to its policies and than other groups to vote. In 1997, 40 performance. Restoring effective per cent of 18-24 year olds did not turn powers to local government (see out to vote. This compared to nearly section 2.2.4) will therefore promote 30 per cent of the population as a higher turnout in local elections. whole. Further, around 20 per cent of 18-24 year olds, nearly three times the 2.3.3 Expanding people’s figure for the total population, are not opportunities to vote can contribute to even registered to vote. Young people a solution. Subject to imposing are less inclined to become politically appropriate safeguards against abuse, involved in other ways. For example, Liberal Democrats would: they are less likely to belong to a mainstream political party. The • Make a wider use of postal votes. established Liberal Democrat policy of • Introduce voting by Internet and giving the right to vote and stand in telephone. elections from the age of 16 will • Introduce an extended period for encourage young people to become voting, including weekends. more politically aware. • Make available a wider choice of polling stations. 2.3.7 One of the most important • Improve facilities at polling stations features of a well balanced education for disabled people and providing to should be to teach young citizens about all who are registered disabled or their constitutional rights and the who are in sheltered and residential system for making important decisions accommodation, help that is in their country and local community, independent of the people among yet this is often neglected. Liberal Democrats would redress this by

11 including citizenship education in our 2.4.1 Inclusive government would proposed Minimum Curriculum enable people to have a say in policy Entitlement. decisions before they were made. Too often, policies are presented as a fait 2.3.8 We would also bring in new accompli, with little public consultation forms of representation for young or involvement. And where formal people. These could help to involve consultation takes place, it can be too young people in a practical and easily dominated by political and interesting way. Examples are a Youth business elites. New means of enabling parliament, Youth and School councils, the public to take part in decision- the use of on-line forums and schemes making are urgently needed. for ‘shadowing’ MPs, Members of the and Assembly 2.4.2 Liberal Democrats would make Members in Wales. Decision-making greater use of Citizens’ Juries, as a bodies should be under an obligation to means of consulting the public on consult youth fora at the appropriate specific policy issues. Citizens’ juries level. are a structured way of obtaining detailed, considered views from people. 2.3.9 Liberal Democrats would They enable participants to engage with promote citizens awareness of their policy questions and move beyond rights. For example, we would ensure initial views to reach more considered distribution of clearly written material opinions. Citizens’ Juries are a laying out the basic rights and relatively new invention in the UK. To responsibilities of citizens in settings date, they have mainly been used in the where citizens are likely to come into local government and health sectors. In contact with the state, for example central government, the Women’s Unit social security and local government has used them to discern women’s offices, courts and Police Stations. views on issues relating to working mothers. 2.3.10 To reinforce pride in citizenship, we would replace the 2.4.3 In particular, we propose to use existing antiquated, over complicated Citizens’ Juries to ‘shadow’ particular and obscure civil honours system in the government department and agencies. United Kingdom with a new Order We envisage that each jury would which gives proper recognition to those consist of around 20 people, who who have made outstanding would serve for up to two years. Such contributions as citizens. The Head of juries would be encouraged to think State on the advice of an independent ‘outside the box’, developing their own panel would make these awards, with agendas, rather than merely responding provision for the public to put forward to questions set by Government. nominations. 2.4.4 Liberal Democrats would use the new Information and Communication technologies (ICTs) to empower citizens, provide them with more information and make the 2.4 Putting the Politics of political process much more open than Inclusion into Practice at present. The new technologies present exciting new opportunities to

12 increase participation in the democratic until some ill-defined time in the future, process. People can obtain high quality ICTs’ potential to help us renew our more information more quickly. They democracy. The new technologies can can communicate with policy-makers and should be used to empower on a more interactive and responsive citizens, providing them with more basis. They can participate in political information and making the political debates across the country and the process much more open that at world – this is the ‘death of distance’. present. Liberal Democrats would: They can create new discussion forums and new networks, within or without • Greatly increase the use of on-line the formal political process, political pre-legislative consultations and parties and pressure groups. enable people to provide feedback on bills right up to report stage. 2.4.5 The potential of ICTs to enhance democracy has already been • Require all departments and shown by the forums developed by UK agencies to publish and consult on Citizens On Line Democracy. all policy proposals on-line and Examples are the 1997 election on-line provide people with access to discussions, the public consultation relevant background material and with the citizens of Brent and supplementary information. supporting the Newham Youth Parliament. This culminated in the • Make all Select Committee hearings Have Your Say website, that invited web-cast, and ensuring access to people to make submissions on the Select Committees for broadcasters Government’s Freedom of Information at reasonable cost. White Paper and provided background information. Successful overseas • Enable the public to make direct innovations include the Minnesota e- submissions to Select Committees democracy project, which has enabled on-line. citizens to have more deliberative participation than ever before. • Hold on-line conferences on policies, current issues and proposed 2.4.6 Pursuing these opportunities legislation. does not mean that representative government should be replaced by • Use on-line Citizens' Juries and direct democracy. Nor does it mean deliberative polls to provide formal government by cyber-referendum. And inputs into policy-making. the use of ICTs should not be seen as a “quick-fix” for UK democracy. The 2.4.8 Liberal Democrats would also evidence is that they will not, in the make greater use of referendums to short term at least, bring a range of inform decision-making and to settle excluded new groups into the political major constitutional issues. We would: process. (For example, Internet users • Give people the right to put a are still more likely to be male, well particular subject on the agenda of educated, in higher income groups and the next meeting of their local aged under 30). At the same time, the authority if 1.5% of the electorate advent of digital television will signed a petition calling for it. significantly increase access to the Internet. We cannot afford to ignore,

13 • Give people the right to call referendums on significant proposed Citizens’ Initiatives. A referendum constitutional changes. This would would have to be called if 5 per cent stop Government and Parliament of the electorate at regional and exercising undue power without a local levels signed a petition calling specific mandate. In the longer term, for it. The results would be advisory, once a written constitution was in with elected representatives free to place it would lay down procedures act on their judgement and for further constitutional conscience. amendments.

• Commit a future Liberal Democrat government to hold binding

14 Accountable and Representative Government

Political Accountability the people, to apply strict scrutiny to legislation and public expenditure, and to 3.1 Constitutional hold Ministers to account for their actions. Britain needs a two chamber Principles legislature so that the second chamber can help to fulfil the classic constitutional 3.1.1 The different parts of the role of providing checks and balances in constitution are inter-related. They must the political system and democratic be considered as a whole. Our proposals protection for people’s liberties. are therefore based on constitutional principles that we have identified and 3.2.2 We think it should be the function published in the Constitutional of a reformed second chamber, which we Declaration (1996) and in Moving Ahead would call ‘the Senate’, to provide a (1998). direct regional influence in Parliament, to scrutinise legislation and executive action, 3.1.2 We believe that the new and to take a backstop role in preventing constitutional settlement, when it is abusive amendment of the constitution complete, should be entrenched in a without popular consent. Both Houses written constitution, which derives its should be responsible for legislation, with validity from the consent of the people the Senate imposing so much delay (and and which defines and limits the powers no more) in the passing of a bill as to which politicians can exercise. In enable the opinion of the nation to be particular, the exercise of power under adequately expressed upon it. Both the prerogative of the Crown would Houses should control the executive cease, (including, for example, the treaty including agencies and quangos that have making power and the power to make executive functions affecting the United political appointments) and derive solely Kingdom as a whole. from the powers set out in the constitution. 3.2.3 A joint committee of both Houses should be established to 3.1.3 We recognise that there is an apportion an appropriate amount of important background of constitutional Parliamentary time to each of the developments at the European level. This functions of Parliament, including paper, however, concentrates on the adequate time for the revision, position within the UK and stands simplification and codification of the law, independently of any European and for the consideration of private developments. members bills.

3.2 Parliament

3.2.1 The main functions of Parliament 3.3 The House of are to provide strong representation of Commons

15

3.3.1 In Here We Stand (1993) we • Cut the number of Westminster MPs wrote: to around 450.

“The Commons exhibits five main 3.3.5 Some of the constituency weaknesses. It is too large. The spirit in casework traditionally undertaken by which it conducts itself is too partisan to Westminster MPs will be taken up by be constructive. Its membership is too representatives at lower levels. There will mediocre. Its workload is too heavy. And also be scope for reducing the number of it is dominated to an unhealthy degree by Whitehall Departments as more functions the government.” and powers are decentralised to the regions and nations - for example, a 3.3.2 Our proposed reform of the single Department of the Nations and electoral system will change Parliament Regions could eventually replace the for the better. The advent of MPs existing Scottish, Welsh and Northern representing broader electorates, less Ireland Offices, and functional beholden to the party whips and local Departments could be merged. This will selectorates, would go some way to also reduce the number of Parliamentary liberating the Commons from executive Select Committees. dominance. Our proposal (see below) for greater separation of powers will also 3.4 The Senate help. Governments likely to result from the introduction of proportional 3.4.1 The future of the House of Lords representation would be more reliant on is currently being considered by the persuasion and debate, rather than sheer Government in the light of the weight of numbers, to guide through disappointing report from the Royal legislation. Commission chaired by Lord Wakeham. The Liberal Democrat submission to the 3.3.3 Liberal Democrats also believe Royal Commission called for: that the time has come to make politics more stable by introducing four year • 261 senators to be elected by thirds fixed term Parliaments. This will remove every two years, for a six year term, the power of the prime minister to using the single transferable vote in dissolve parliament at a time of his or her constituencies based on the existing choosing. Any motion of no confidence European Parliamentary would have to contain a proposal for an Constituencies. This would ensure alternative government. Any new proper representation for the nations government would only sit for the and regions. remainder of the four year term. • The phasing out of appointed 3.3.4 With the establishment of a members of the second chamber over Parliament in Scotland, a strengthened the first six year cycle, with a final Assembly in Wales and elected regional decision to be made on retaining a government in England, it is our intention maximum of 50 appointed members at substantially to reduce the size of the the end of the transitional period. House of Commons (but without consequential loss of seats in the Scottish Parliament and Welsh Assembly). We would:

16 • A rejection of reserved places for law 3.5.2 The reduction of the payroll vote lords, bishops or other religious in the Commons and the removal of representatives. Ministers from the second chamber would be balanced by the ability of both • A further separation of powers, which Houses to summon Ministers (whether or we discuss below. not they are Members of Parliament) to give written and oral evidence. • Granting the Senate additional powers to those of the existing House of 3.5.3 We envisage that there would be Lords, including the ability to force a Prime Minister’s question time in the Governments to hold referendums on Senate and all Cabinet and other constitutional legislation, greater Ministers could have regular question scrutiny of secondary legislation and sessions there. This will significantly treaties and oversight of quangos and increase the influence of the second public appointments. chamber as it acquires the ability to access senior ministers. A second • A simplification of the way in which advantage of the removal of Ministers is the delaying power of the second the strengthened independence the Senate chamber is determined. will acquire. At present, with Ministers as members of the House of Lords, there is The Senate should be established on scope for advancement for members of these principles. the governing party, and for non- governing parties in potential future 3.5 Separation of Powers governments. As in the House of Commons, this inevitably reduces the 3.5.1 The powers of Prime Ministerial number of members who are willing to patronage reduce the capacity of the speak out against their own party. A House of Commons to hold the second chamber where members have no government to account. As many MPs possibility of becoming Ministers by strive to achieve Ministerial office, their virtue of their membership of the enthusiasm for the detailed scrutiny of chamber is bound to be more executive action and legislation is often independent of the executive. A Senate limited. Liberal Democrats propose to without Ministers will develop an address this problem, in part, by reducing institutional identity clearly separate from the number of ministers (the payroll vote) the executive. to 10% of the membership of the House of Commons. We also propose that 3.5.4 In accordance with the principle Ministers should no longer be drawn of separation of powers, we would from, or sit in the Senate. We would, establish a Supreme Court of the UK, however, allow and encourage the which would discharge the judicial appointment of Junior Ministers from functions currently taken by the House outside the Commons. Secretaries of Of Lords. Supreme Court judges will State would remain MPs and would be swear to preserve, protect and defend the directly accountable to the Commons for constitution of the UK. all the actions of their Departments; they would have the power to appoint their 3.5.5 We believe that the existing own Junior Ministers. arrangements for the appointment of judges lack transparency and accountability. We therefore propose that

17 a Judicial Services Commission • Taking some pre-legislative scrutiny in established by Parliament should the Senate. nominate judges of the High Court and of our new Supreme Court. They would be • Consultation with the Scottish approved by a resolution of the Parliament and Welsh and Northern appropriate Committee of the House of Ireland assemblies where appropriate. Commons, and could only be removed by a resolution of both Houses of 3.6.2 These measures would improve Parliament. the quality of legislation going to the third reading stage, and would free up urgently 3.5.6 The current position of the Lord needed time for other business in the Chancellor as a part of the executive, the main Chamber - there are many legislature and the judiciary is in complete outstanding Law Commission reports contradiction to the principle of the which remain on the shelf for lack of separation of powers. We propose to legislative space. abolish this office, and re-allocate its existing multiple roles. The Ministerial 3.6.3 The Statute Book needs a functions would go to a Minister of regulator to ensure that the laws under Justice, who would be a member of the which we live are as clear and concise as House of Commons like other Cabinet possible. The Senate should be charged Ministers. The Senate would elect its with particular responsibility for this task. own Speaker, in the same way as the The existing House of Lords has Commons. Appointment of judges would established a Select Committee to be made as described in 3.5.5 above. The scrutinise order making powers contained Supreme Court judges would choose one in primary legislation. This should be of their number as President. extended to secondary legislation. As well as verifying that satisfactory 3.6 The Quality of Law standards have been attained in the Making format and drafting of new legislation, the Senate should oversee the regular 3.6.1 There is great scope for review of the Statute Book with a view improvement in legislative procedures. to ensuring the removal of archaic law We support: and the revision of law, which has been found to be unnecessarily obscure. If as • Pre-legislative scrutiny and draft bills, we recommend a Select Committee is which should become the norm. established for this purpose, we would suggest that the Law Commission report • Rolling over Bills to the next Session to that committee. if necessary, rather than rushing them through at the end of a Session as at present.

• Greater use of the Westminster Hall 3.7 Select Committees chamber for Select Committee Report debates or even some non- 3.7.1 We welcome the report of the controversial legislation. Liaison Committee on Select Committees of 2 March 2000. We support many of its recommendations, including: reconstitution of the Liaison Committee

18 as the Select Committee Panel appointed Executives who flagrantly fail to manage by the House at the very beginning of a their Agencies to an acceptable standard. Parliament to enhance its independence; recognition of the additional work of 3.8.2 Quangos with more local or Chairs, whether by payment or an regional remits should be accountable to increase in the office cost allowance; the relevant elected body, whether the increased staff and policy advice for Scottish Parliament, Welsh or Northern Committees. Ireland assemblies or English Regional Assemblies. 3.7.2 Strengthened select Committees have a vital role to play in providing 3.8.3 In addition to Parliamentary adequate scrutiny of the increasing scrutiny, there should be clear and volume of secondary legislation. In effective avenues of redress for particular, there needs to be greater individuals who feel they have been scrutiny of secondary legislation mistreated by quangos. Our proposals for implementing European legislation. Freedom of Information legislation will assist people in bringing complaints, and 3.8 Accountability of make Judicial Review of quango Quangos and Agencies decisions a more realistic option in many cases. We would also ensure that there 3.8.1 Clear rules need to be laid down were Ombudsmen or equivalents in place for the accountability of Next Steps to cover all quangos. agencies and quangos which have a UK wide operation. Ministers should be 3.8.4 Quangos should also be accountable to Parliament for the policy required to have regard to the of agencies and of quangos that they Community Plans of Local Authorities appoint. Clearly the Chief Executive of an in whose areas they operate. agency and the members of a quango are responsible for the service that they provide or the task they undertake. They 3.9 Freedom of Information should be accountable in the case of agencies to the relevant departmental 3.9.1 Liberal Democrats have long committee and in the case of quangos to argued and campaigned against the a joint select committee set up to obsessive secrecy of British undertake this task. Select Committees Governments. Information is essential for should have power to scrutinise accountability. Liberal Democrat appointments to such senior public sector participation in the Scottish Executive posts. In any particular case where a has been vital in securing meaningful question arises as to whether an issue is a Freedom of Information legislation for matter of policy for which the Minister is Scotland. We welcome the introduction accountable or a matter of service of a Freedom of Information Bill in the provision for which the Chief Executive Westminster Parliament, but the or the members of the quango are Government’s present proposals are responsible this should be determined by inadequate. In particular, we believe that: the Select Committee. The Public Services Commission which we advocate • The Information Commissioner and (see chapter on Efficient Government) not Ministers should have the final say should ultimately be able to dismiss Chief on release of documents.

19 • When documents are to be withheld, Financial Accountability the test must be substantial harm to the public interest and not simple 3.11 Introduction prejudice. 3.11.1 The British Executive is at its • The blanket exemption on policy most powerful and centralised when it advice is too sweeping - the factual comes to the budget. Liberal basis for decisions and any alternative Democrats believe that, in failing to options proposed should be released. scrutinise budgets of successive Governments, Parliament has failed the 3.10 Political Parties taxpayer for over eighty years.

3.10.1 Political parties are integral to the 3.11.2 Whether one considers revenue democratic process and their activities are or expenditure, the role of Parliament closely regulated by statute; it is right that has rarely been more than a rubber the state should therefore control election stamp, both in practice and theory. This expenditure and make funding available is in direct contrast to local to ensure fair competition between government, where councillors play an parties and to reduce their financial active part in scrutinising the details of dependence on sectional interests. the annual budget, tabling and often passing amendments to the draft 3.10.2 It is more than a decade now budget. since the Houghton Committee recommended a “modest injection of 3.11.3 Liberal Democrats believe that state aid” into the UK’s parties. Liberal a radical overhaul of Parliament’s role Democrats endorse this view. We believe in the budget could lead to major that state funding should be broadly improvements in decision-making and related to votes gained in the previous thereby to huge savings and improved general election and seats to be fought, as services. By reforming Parliamentary is the practice in many other European control of the budget, Liberal states. For regional parties, it would be Democrats would: based on performance in the relevant geographical area. • Radically change the role of an MP, 3.10.3 We believe that state funding empowering MPs to take an active should go hand-in-hand with curbs on role in analysing Government total national spending by parties on spending proposals. election campaigns. Under the current Political Parties’ Bill, a new Electoral • Force Ministers to defend their Commission will police a national budgets (and therefore understand election expenditure limit of £20 million. them, perhaps for the first time We believe the limit should be half this - ever). £10 million. Of course, payment of state funds to political parties must be made • Powerfully enhance the search for conditional upon the publication of full value for money for the taxpayer. accounts, in particular, the source of all large donations over £1,000. 3.12 The Existing System

20 Revenue proposes its tax measures and Parliament scrutinises those measures 3.12.1 Taxation matters are effectively the sole preserve of the Treasury. Expenditure While some decisions on taxation are taken at local government level 3.12.5 Formally there is a specific (council tax) or European level procedure the Government must go (primarily agreements on indirect tax), through to get parliamentary sanction most key tax changes are announced by for the money it needs. This is called the Chancellor on the annual ‘Budget the ‘Supply Procedure’. It consists of Day’, and are then enacted through the ‘main Supply estimates’ in which the annual Finance Bill between May and Government gives a provisional July each year. This does at least estimate of the money it needs for the ensure that, unlike the system for coming year to Parliament, which then analysing expenditure (see below), duly grants the money, almost Parliament is partly involved in invariably without a vote. scrutinising proposed changes to the tax system. 3.12.6 The ‘myth’ of Parliamentary control over spending is actually clear 3.12.2 The problem with Parliamentary in the procedural rules. These even scrutiny of the revenue side of the prevent MPs amending a spending budget is therefore not the lack of proposal upwards, and prevent MPs direct Parliamentary involvement. The switching spending from one area to problem relates far more to the method another. Indeed, the last time of parliamentary scrutiny and the Parliament voted down a spending resources available to MPs to analyse proposal of the Executive was in 1919, the details of the Finance Bill and when Parliament deleted an Estimate related tax changing legislation. from the Royal Palace’s Vote which was to provide the funds for an 3.12.3 The annual Finance Bill method additional bathroom for the Lord of tax scrutiny has, if anything, become Chancellor. No such action was taken the problem in itself. The number of in 1997 over spending proposals for pages, clauses and schedules in this Bill new wallpaper for the current Lord has ballooned since the 1950s. This has Chancellor! led to: 3.12.7 The only time when Parliament • Extra complexity does trouble itself with the details of Government spending is when the • Lack of constancy money has already been spent. The Public Accounts Committee is arguably • Inconsistency the most powerful committee of the House, and its job is to question the 3.12.4 These features of the current accounts prepared by government system of parliamentary scrutiny departments. Unlike any other impose great compliance costs on the committee, it has at its disposal private, public and voluntary sectors. significant resources in the shape of the Major savings could be realised by National Audit Office, which is a reforming both the way the Executive prestigious and independent body which works explicitly for Parliament

21 and not the Executive, trawling 3.13.3 A first bill could be published through the accounts and financial soon after the budget, with the details records of government. of the few tax measures yielding large sums – the Finance Bill – and proceed 3.12.8 This system of ‘ex post’ through Parliament quickly to ensure financial scrutiny has often uncovered taxes for the coming year had statutory financial scandals and probably sanction. represents Parliament at its most powerful. However, even it is severely 3.13.4 Later on, a draft bill containing limited. The National Audit Office no details of technical proposals could be longer has the power to scrutinise all published, for consultation – the Tax public monies spent by central Technicalities Bill. Measures in such a government, and is thereby weaker Bill could be deliberately restricted to than its local government equivalent, tax changes for future tax years, so that the Audit Commission. The accounting consultation and Parliamentary standards of central government are set progress was much less time pressured. by itself, not by an external, independent body. The resources 3.13.5 Any such separation would be available to the National Audit Office criticised for being arbitrary: there is no and the Public Accounts Committee are tax yield which can be objectively said recognised as being far too limited. to make a specific proposal ‘significant’ in revenue terms. Indeed, it would be 3.13 Reforming too inflexible to set a figure that always Parliamentary Control determined which bill a tax proposal had to go in. However, the of Taxation presumption would be that the main

Finance Bill would be short, restricting 3.13.1 The key to reform of itself to matters crucial to funding the Parliamentary scrutiny of taxation is to budget. separate the large revenue-raising proposals from the more technical ones. Such a separation would enable: 3.14 Reforming Parliamentary Control • The key revenue proposals to be of Spending compared with key spending proposals. 3.14.1 For Parliament to play a proactive and positive role in financial • Greater consultation with the private scrutiny, three key things have to sector on technical tax proposals. happen:

• A focus on reducing the compliance • information to Parliament must be costs of tax, with greater simplicity improved. and constancy. • resources for Parliament to examine 3.13.2 This separation would work in that information must be increased. practice through having two separate parliamentary bills. • procedures for MPs to utilise the information must be changed.

22 Financial Information for Executives would like to set their own Parliament accounting standards?

3.14.2 The Executive had always 3.14.7 Even the new accounting jealously guarded the way it provides information to be provided on ‘outputs information to Parliament on the and performance’, which will enhance budget, both ex ante and ex post. the financial information, and relate spending to objective, is a very partial 3.14.3 None of the information in the improvement. Government itself is Supply Procedure is given on the basis determining both the form and content of any statutory requirement. The of this new information, and there is no information provided ex ante on provision for this data to be spending is both limited and difficult to independently and externally validated. interpret. 3.14.8 Moreover, the new system of 3.14.4 Despite reforms to the resource accounting has resulted in information provided over the years ex only minor changes to the Supply post, opacity has remained the Estimates: Parliament’s ‘ex ante’ mandarins’ main objective. While the information will therefore remain both National Audit Office, on behalf of partial and uninformative. In direct Parliament, has had access rights to all contrast to experience in New Zealand, relevant financial documents within when a similar system of resource Whitehall, until very recently many accounting was introduced several Civil Service documents were years ago, there has been no attempt to deliberately marked ‘Not for NAO undertake a major overhaul of the Eyes’, and there is still far too much system of Estimates, Classes and public money that falls outside the Votes. NAO’s jurisdiction. 3.14.9 Liberal Democrats would 3.14.5 Nonetheless, the financial radically reform the information that information provided to Parliament is Government provides to both about to take a major leap forward with Parliament and the people on its the introduction of resource accounting spending. In particular, we would: and budgeting. This new system will • provide Parliament with much greater Legislate to require Ministers to set information than ever before, including out their budget estimates in the way balance sheets and information that Parliament chooses relates spending to policy objectives. • Reform the Supply Estimates, so 3.14.6 However, most of the Parliament gets more detailed improvement in information will only spending information, including a come in the accounts for ‘ex post’ closer link between inputs (cash) scrutiny. Even then, there is a real and outputs (services) concern that the Treasury has kept for itself the power to determine the • Take the power to set public sector accounting standards that Departments accounting standards from the must report to. How many Chief Treasury, and give it to Accounting Standards

23 Board, which currently sets Commission with the necessary IT standards for the private sector facilities and information access rights. • Empower the Accounting Standards Board to propose the format for • Strengthen Departmental Select Output and Performance data in the Committees’ financial know-how accounts, and the National Audit with additional staff, with specific Office to validate such data expertise in accountancy and financial modelling. • Strengthen the powers of the National Audit Office, by giving it a • Train MPs and staff with new general power of competence to training programmes in audit all bodies in receipt of public understanding the Estimates and money, and so to report to Accounts. Parliament Financial Procedures Financial Expertise for Parliament 3.14.12 Whatever improvements are made to the information and expertise 3.14.10 A key practical problem for the available to MPs, reform will only exercise of real financial scrutiny is that enable real financial scrutiny if there are Parliament lacks the skills and reforms to Parliament’s procedures for resources to assess adequately what the amending the budget and advancing budget Estimates actually mean. alternative proposals. Current Moreover, should MPs wish to alter procedures (Standing Order No. 48) the Estimates, they totally lack the prevent all proposals to increase or facilities to analyse the implications for even switch spending (e.g. take £10 the budget and particular departmental million from the Sports Council budget programmes, and to model alternative and give it to the Department for budget proposals. International Development, or vice versa). 3.14.11 Liberal Democrats would equip the House of Commons, for the 3.14.13 However, radical reform will first time in its modern history, with the also only succeed if it admits the skilled staff and resources to be able to practical limitations for reform in this scrutinise the budget. In particular area. Procedures enhancing the Liberal Democrats would: involvement of MPs in budget decision- making will only be acceptable to any • Establish a Resource Estimates Executive, so long as they do not Commission, whose key challenge the right of Ministers to responsibility would be to report on propose the main initial budget and to the budget Estimates to the House, operate an overall control of fiscal its Departmental Select Committees policy. That is both a political reality and individual MPs. and a genuine argument for balance in the reforms. Procedural reforms to • Enable rigorous modelling of MPs’ enhance scrutiny should in no way alternative budget ideas by undermine the key features of providing the Resource Estimates Executive financial initiative and stable macroeconomic control.

24 intervals, and make 3.14.14 Liberal Democrats believe a recommendations for enhancing reasonable balance can be struck to financial accountability, with an retain Executive’s power, with genuine initial study on the advantages and accountability, by the following disadvantages of placing the whole measures: Supply process on a statutory basis.

• Enable proposals to increase and 3.15 Monitoring switch spending through reform of Parliamentary Control the Commons’ Standing Orders, of the Budget whether spending proposals are

contained in amendments to the 3.15.1 The reforms proposed in this Estimates or Government Bills or section would amount to a significant within Private Member’s Bills. shift of power away from the Executive

• to Parliament. The role of an MP Introduce an Executive Financial would alter drastically, as would Veto, to enable the Chancellor to Parliament’s, with the importance of strike down, without debate, any scrutinising spending once again taking spending proposal made by the centre stage. Commons which would significantly threaten the financial stability of the 3.15.2 However, while the proposed Government. Such a veto could not reforms are thereby radical, they are be used where the Commons had also finely balanced. By proposing new, backed a revenue-neutral highly prestigious bodies such as the amendment. Resource Estimates Commission to parallel the National Audit Office, and • Require Departmental Select by retaining a Executive Financial Committees to make financial Veto, the danger of shifting the balance reports to the House of Commons, towards legislative anarchy has been after consultation with the Resource avoided. Estimates Commission, as to whether they are satisfied with the 3.15.3 However, we would in addition budget Estimates in their area or propose that this package of reforms is whether they have any budget reviewed after its first five years of amendments to propose. operation by an international body such as the OECD, so that Parliament’s new • Require the Resource Estimates powers are themselves subject to audit. Commission to review Parliament’s financial procedures at regular

Decentralised

Government

25 4.1 Introduction 4.2.1 There is already a significant amount of administration of public 4.1.1 The Liberal Democrats have services that is done at the regional long advocated devolution for Scotland level. There is a range of quangos and and Wales (and when possible other public bodies operating at a Northern Ireland) and a system of regional level which have a significant directly elected regional government impact on the lives of the people in for the English Regions. These their areas. The problem is that because commitments have been a core element none of them are directly accountable in our vision of accountable, responsive to the local electorate there is very little and efficient government, delivering awareness of the existence of this layer, services at the lowest effective level. let alone much public involvement with decision-making. The relevant secretary 4.1.2 In recent years important of state appoints most of these advances have been made. A fully quangos. They have little statutory fledged Scottish Parliament with responsibility to take account of local legislative and tax-varying powers has views in what they do. Their been achieved as the fruit of long-term boundaries frequently overlap. Recent cross-party co-operation within the research done by the Centre for Urban Scottish Constitutional Convention. Regional Development Studies has identified 19 separate bodies working 4.1.3 By contrast, devolution for within the North East Region, a pattern Wales and London has also made some that is likely to be mapped closely in progress, but Labour’s one party most regions in England. approach has led to timid and incomplete reform. We would like to 4.2.2 Liberal Democrats support see the powers of the Welsh Assembly directly elected regional assemblies. We enhanced to include tax varying powers wish to pull all these quangos together and primary legislative powers in a under the umbrella of regional range of key areas including: economic assemblies. We would simplify the development, industry and training, current mess of regional administration, Welsh language and culture, health, to make it far more transparent, transport, education and law and order. approachable and accountable to We would also wish to see the Greater ordinary people. London Authority have greater powers, for example to raise revenue and to 4.3 The Desire for Change hold the Mayor to account. 4.3.1 The political imperative for 4.1.4 The great failure of the current devolution has been ignored in the Government, however, has been to London-based discussions of regional provide democratic decentralisation issues. While demand for regional within England. The majority of this Assemblies varies across England there chapter concentrates on this issue. are regions – most particularly in the North East, but also in the North West 4.2 The Existing Regional and Yorkshire and Humberside – where Tier the public are demanding devolution and the status quo is not an option.

26 4.3.2 The potential for regional government to alter the current 4.4 What will Regional stagnant nature of government has Assemblies Do? hitherto been ignored. Regional government has the ability to deliver 4.4.1 Currently there are a number of ‘joined-up’ government - to use a services that are provided or current buzzword – in other words a administered at a regional level, but holistic, strategic approach to they are provided by a complex web of problems. With its attachment to quangos and other organisations. These departmental baronies, Whitehall cover a number of strategic functions delivers fragmented government. The including economic development, debate is too much centred on ‘adding transport, planning, the environment, another layer of bureaucracy and further education & training as well as politicians’. The bureaucracy is already cultural issues including the arts, sport there. The point is to democratise it. A and tourism. Many of these bodies key objective of regional government cover geographical areas with different would be to democratise those boundaries. Liberal Democrats would organisations and bring them under the bring the majority of these scrutiny of elected government, local organisations under the democratic and regional media and the general control of elected regional assemblies. public. So we would redraw their boundaries,

as far as possible. We recognise that 4.3.3 Addressing the direct this would take time, but this would democratic deficit is only part of allow ‘joined up thinking’ between all solving the general lack of involvement these various bodies, as well as giving by the public in decision-making. greater clarity for the local population. Creating a genuinely new body that Most importantly, it would allow them works with the people of the region to be democratically controlled by the and brings them into the decision- elected assemblies. making process will give people a degree of ownership over what 4.4.2 A range of functions currently happens on their own doorstep. This the responsibility of Whitehall will help create a sense of responsibility departments could also be carried out and self-reliance as well as generate by the regions. Regions would: pride in one’s area.

• Follow the model of the North East 4.3.4 The establishment of Regional Constitutional Convention in Government will also help to disperse democratising and asserting an economic power through the regions, influence over regionally based as more public sector workers are quangos. Regional authorities would located at the regional level and be given control over regionally Regions enhance their capacity to run administered functions such as effective economic development planning housing growth figures for strategies. Stronger regional political the region. Those quangos that have centres will help regions retain talented coterminous boundaries with the individuals in fields such as the Civil Region would be brought under the Service and journalism, who currently control of the regional authority. tend to be drawn to London in order to Other quangos without coterminous progress their careers.

27 boundaries would be given a duty to There is certainly no requirement for consult all relevant regional uniformity of size. authorities on their activities, to at least bring them under the influence 4.5.2 The nine English regions that of democratically elected bodies. were defined for the regional Over time, boundaries would be government offices, the RDAs and the brought into line and most quangos regional chambers have proved a good democratised. The precise nature of starting point for building a consensus each process would vary from in favour of an elected regional region to region, according to local assemblies and the Liberal Democrats circumstances and the wishes of are broadly in favour of this approach. local people. In most regions the politicians and interest sectors involved in the new • Take over a range of current central regional organisations are learning how government responsibilities, such as to work together and find common strategic management of education interests. Constitutional Conventions at a regional level, for example to such as already exist in the North East co-ordinate and link secondary and other areas help in this process, education, further and higher and we would encourage their education and work-based training establishment in all regions. schemes. 4.5.3 The process of moving towards • Have powers to enact secondary democratic regional government would legislation. Rather than the relevant start with the passage of an Enabling Secretary of State setting the Act, setting out a menu of powers regulations for the implementation which might be adopted by a region. of certain laws, the Regional There would be a set ‘core’ of powers Assembly would determine them. which any region wishing to devolve would need to take up. This menu 4.4.3 Ultimately, some Regions might would be drawn up by central take on primary legislative powers. government in consultation with However, an important set of powers existing regional bodies. A referendum would be retained at Federal level (see on adopting devolved powers could section 4.9) then be triggered by a request from a majority of local authorities or a 4.5 Implementation and petition of 5% of the population of a Boundaries region. Boundaries in this phase would be based on existing regions or sub- divisions thereof comprising groups of 4.5.1 There has been much debate existing local authorities (to allow about where the ‘natural boundaries’ of smaller areas within existing regions regions fall, particularly in relation to some flexibility where it may be the South East and some of the regions desired, for example in ). in the Midlands which are particularly Initial referenda would be on the basis difficult to identify. Regions must of the minimum core powers for each reflect cohesive natural communities, regional assembly. yet be large enough to be able to compete in the European environment. 4.5.4 Individual regions could subsequently choose to adopt, by

28 referendum, powers from the menu • A regional element of a local beyond the ‘core’. income tax.

4.5.5 Future changes to regional • A local business rate with regional boundaries could be made subject to element. local referenda called by the Secretary of State for the Nations and Regions. • A locally determined level of Site The Secretary of State would be Value Rating with regional element. responsible for receiving all representations on requests for 4.6.4 All central government boundary changes, and would be expenditure should be expressed in required to seek the greatest possible regional terms, so that it is clear which consensus between all affected local regions receive most direct investment authorities and regions before moving from central government in all policy to a referendum. areas.

4.6 Funding 4.6.5 One of the most contentious issues relating to government finance is 4.6.1 In time financial devolution the allocation of revenue to different must follow political devolution. This parts of the UK. Some is allocated to means that devolved bodies should be the Welsh Assembly, Northern Ireland able to levy and vary specific taxes. Assembly and the Scottish Parliament, Consideration should also be given to on the basis of the , allocating a share in the UK taxes which was originally intended to be raised within their boundaries directly temporary. This does not relate to all to the devolved authorities. the money received by those bodies, but does affect any changes in 4.6.2 The transfer of additional funds government expenditure. In the first from the Treasury to devolved instance, changes in expenditure are authorities – the fiscal transfers – determined in Parliament on an English should be on the basis of needs. It basis. Under the terms of the Barnett should be on a sufficient time scale and Formula, a proportion of any increase on the clear understanding that no area allocated to England is then allocated should be penalised. The objective must to the rest of the UK on the following be to raise standards everywhere as the basis: Scotland 10.34% (9.77% for law economy grows. and order); Northern Ireland 3.41% (3.22% for law and order); and Wales 4.6.3 It is anticipated that Regional 5.93%. If there is a reduction in Government would be funded via a expenditure, then a reduction is made direct bloc grant that would be along similar lines. augmented by local tax raising powers. Over time, our intention would be to 4.6.6 There are five problems with transfer the tax-raising function this approach. The Barnett Formula: progressively towards the regions, from • the centre. Options for the tax raising Takes no account of the needs of powers could include one or more of the relevant areas of the UK, the following: because it is solely based on population figures - giving rise to inappropriate comparisons made

29 between the funding received by • Be chaired by the Secretary of State different parts of the UK, e.g. for the Nations and Regions. Scotland and London. • Be composed of representatives of • Takes no account of changes in the national parliaments and needs over time. assemblies of the UK, along with representatives of regional • Takes no account of differences assemblies in England (or regional within Wales, Scotland and chambers where assemblies do not Northern Ireland. exist). The conclusions of the FCNR would require consensus of its • Only relates to changes in members, and would be ratified by expenditure, and is not able to tackle the executives of the bodies inequalities inherent in the current represented on it. No revenue would bases of expenditure. be released without such consensus.

• Is not able to take account of 4.6.8 The FCNR should carry out the regional disparities within England. following six tasks in the first year of its operation: 4.6.7 Liberal Democrats have consistently argued that all devolved • Establish a new Revenue administrations within the UK need to Distribution Formula (RDF) to have greater powers over taxation, so replace the Barnett Formula. This that they can meet their own needs would be a needs-based formula through raising resources in their own (reviewed periodically in territories. There is also a case for conjunction with the Comprehensive regions keeping some of the UK - wide Spending Review), taking account taxation raised in their areas rather than of key health, poverty and education it all going direct to the Treasury; this indicators, and the available tax would allow regions as well as the bases. It would recognise the Treasury to enjoy some of the benefits problems of providing services in of revenue buoyancy. However, to areas with widely dispersed meet disparities throughout the UK, populations. The formula would also and to recognise that not all areas may take account of all spending in the be able to raise adequate funds, Liberal nations and regions by the UK Democrats believe that a Finance government and the European Commission for the Nations and Union, regardless of whether this Regions (FCNR) should be established. constituted revenue made available Liberal Democrats believe that the to sub-UK levels of government. FCNR should: The RDF would be used to allocate finance to devolved administrations. • Have a constitutional status, The FCNR would also recommend enshrining the principle of equity of to Parliament where it would be finance across the UK’s nations and appropriate to use the RDF to regions. The FCNR would be under distribute expenditure which a constitutional duty to agree rules involves neither devolved governing revenue-support and administrations nor local borrowing. government.

30 • Use the Revenue Distribution Formula to re-base the current 4.6.9 In future years, in conjunction distribution of expenditure to reflect with the Comprehensive Spending needs. Review, the FCNR would use the RDF to allocate new expenditure to the • Establish the terms for distributing nations and regions of the UK. revenue within England to reflect not only differences between 4.6.10 This new system would be regions, but also differences within fairer than the current system to all regions (e.g. poor districts within concerned. Northern Ireland, Wales generally rich regions). Where and Scotland would receive revenue regional governments existed, these according to their current needs, and would match regional government disparities within the English regions boundaries. Otherwise, Regional would be recognised. Development Agency boundaries would be used. 4.6.11 The current method of determining need for funding local • Establish whether differences within government is opaque and difficult for Scotland, Northern Ireland and the lay person to understand. Despite Wales should be considered when the complexity of the formula, there are allocating revenue for distribution in hundreds of examples of anomalies those countries, recognising that the with authorities being given widely distribution of revenue is a matter varying amounts for providing the same for devolved administrations. service. This system commands very little confidence amongst government, • Establish a timescale for local government finance experts or the implementing any changes in the general public alike and it is vulnerable balance of spending, so that there to criticisms of tampering with the would not be any reduction in the formulae to suit political interests. quality of services provided in any areas that have previously benefited 4.6.12 Once regional devolution in from the formula or from successful England was established, regions would local policies. The aim of the be given the task of distributing grants timescale would be for the whole to local authorities within their area, country to achieve the high from the monies allocated by the standards reached elsewhere, funded FCNR. In the longer term, we would by the growth of the economy, reform local government finance so rather than an increase in the tax that local councils were able to raise a burden or cuts in services. The much higher proportion of their changes in the balance of spending funding through local taxation (see would be completed by the end of Policy Paper 30, Re-Inventing Local the process of establishing the Government). framework of elected regional government. 4.7 Relationship with Local Authorities • Investigate the possibility of regions receiving directly a proportion of the 4.7.1 Local government should United Kingdom taxes raised within welcome the advent of elected regional their area.

31 assemblies. Regional assemblies will be would be rationalised. However, in drawing power down from national accordance with the principle of government and nationally-appointed devolution, we believe that decisions quangos, not drawing it up from the about local government structures local level. Regional assemblies will do should be determined at local rather much to reduce the local government than national level. time consumed dealing with the multiplicity of regional governmental 4.8 Co-ordination between bodies. Some regional chambers have Regions already enabled a much greater level of regional dialogue, and so co-operation, 4.8.1 The Local Government between their constituent local Association has already taken a lead in authorities. furthering co-ordination between the

regions and we see this useful role 4.7.2 Local government would find a continuing. In the longer term it may democratically elected regional be necessary to construct a separate assembly easier to work with than the body to represent the interests of current mish-mash of agencies and regional government, but that would be offices. Devolution and the creation of a matter for the regional authorities regional assemblies is about drawing themselves to decide upon. power out from the centre, and providing a strategic approach to powers currently at a regional level. So 4.9 Continuing Federal there should be no adverse effect on Responsibilities either the powers or influence of local government. 4.9.1 The Westminster Parliament and the UK Government will continue 4.7.3 Liberal Democrats would draw to be responsible for defence, foreign up devolution legislation tightly, to affairs, , immigration, ensure that regions could not encroach social security, macro-economic on the existing powers of local management, freedom of commerce, authorities. If they wish to, however, some transport infrastructure and local councils should be able to work setting minimum standards and targets together to provide efficiency savings, for public service provision. In England within the framework of the regional and Wales they would also be government. A good example of how responsible for the courts, legal joint working could develop in the services, the law and criminal justice regions is the Integra waste system. In some fields, legislative management project in Hampshire. The powers would need to be exercised project involves the county and district concurrently at European, national and councils. Because of co-operation, they sub-national levels, for example with are projected to achieve recycling respect to the environment. levels far higher than would be realistic working alone. 4.10 West Lothian Question

4.7.4 Once elected regional 4.10.1 The West Lothian question (the government is in place, we would issue of whether Scottish MPs can vote anticipate that the principal local on English matters at Westminster authority tiers of local government

32 while English MPs cannot vote on 4.12 The Council of the Scottish matters) has been much Isles debated. If regional assemblies are established throughout England, the 4.12.1 The British-Irish Council or Westminster Parliament will ‘Council of the Isles’, established under increasingly focus on federal UK issues the , provides and the West Lothian problem will be for regular meetings between vastly reduced. Liberal Democrats are representatives of all the national clear that regional government is the governments of the British Isles. That only sensible way to resolve concerns includes: the United Kingdom (the about powers that are devolved only to Westminster Parliament and the some regions. Although we are keen to representative bodies in Cardiff, Belfast encourage the maximum possible levels and Edinburgh); the Republic of of devolution in all parts of the country, Ireland; the ; and the of course no region would be forced to Channel Islands. Liberal Democrats take on powers that it did not want believe that the Council provides new beyond the core. However, it seems opportunities for recognising the likely that once the process of regional flexible nature of relationships within devolution is firmly underway there will the British Isles, and welcomes the be something of a “domino effect”. establishment of the Council. Liberal Slower regions will see the benefits of Democrats believe that in its first years, devolution for their more advanced the Council should focus on the neighbours, and demand the same for following areas of work: themselves – just as the North East is following Scotland’s lead today. • Education, e.g. mutual recognition of qualifications and entry standards. 4.10.2 Once regional government is in place in most parts of England, we will • Environment, e.g. pollution in the correspondingly reduce the overall size Irish Sea. of the Westminster Parliament. For further details on reform of the House • Tourism. of Commons, see the chapter 3 on

“Accountable and Representative • Agriculture and fishing. Government”.

• Transport. 4.11 Input into EU 4.12.2 In particular, we believe that 4.11.1 A regional government should there is room for regular meetings of a be able to negotiate directly with EU ‘Council of the Irish Sea’ within the on policy matters as well as grant framework of the Council of the Isles. applications, be fully represented on the In many areas, such as transport and Committee of the Regions and, if pollution, there will be strong shared appropriate, have representative offices interests between representatives of in Brussels. Decisions on new towns Cardiff, Dublin, Belfast, the Isle of Man and cross council area developments, and a North West England regional including for example housing policy, assembly. Liberal Democrats believe should be settled at regional level that it makes more sense to discuss rather than via the DETR. them at this level in the first instance,

33 than it does for matters to be resolved believe that a permanent secretariat on a simple Dublin-London basis. should be established, based in a central location such as Cardiff. 4.12.3 To support the work of the Council of the Isles, Liberal Democrats

34 Efficient and Effective Government

5.1 Poor Government 5.2 Conservative Reforms

5.1.1 Both at the policy making and 5.2.1 During the 1980s and early 90s implementation levels, there has been the Conservative government launched long-standing dissatisfaction with the a series of Civil Service reforms, performance of central and local culminating in the Next Steps Agencies government in the UK. There has been introduced from 1988 and the Citizens’ too much ‘departmentalism’ and Charter launched in 1991. Other insufficient focus on common goals. Western Countries such as New Successive governments have been too Zealand and Canada underwent ‘short termist’ in their approach. analogous programmes of reform from Ministers’ annual spending rounds the late 1980s. added little value to public services. Too many decisions are made behind 5.2.2 The underlying Conservative closed doors. The responsibilities for analysis was twofold. In a bureaucracy actions of departments, Ministers and in which market forces are not Civil Servants have not been clear paramount the self-interest of public enough. Observers have pointed to a servants will lead to goods and services tendency to ‘draft around’ problems, being supplied at high unit cost; and the rather than solve them. There have imbalance in information between Civil been few clear benchmarks for public Servants and Ministers allows the servants to be judged against and bureaucracy to run the public sector therefore inadequate incentives to their way rather than the Government’s improve performance. This in way. combination with a media agenda which thrives on ‘scandals’ and bad 5.2.3 The answer to these perceived news has led to a concentration on problems was the Next Steps reforms. avoiding mistakes by sticking to tried These tried to make public service and tested routines rather than deliverers work more like private innovation and risk taking in the public sector firms in the market place. This sector. was to be achieved by splitting off from main Civil Service departments certain 5.1.2 Under the Conservatives, there agencies concerned with the delivery of were major policy debacles - the poll policy, which then had a contract based tax, rail privatisation and the BSE relationship with their Whitehall crisis. The Blair Government has had department. So-called Framework its share of policy and delivery failures, Documents set quantifiable targets with welfare reform and last summer’s which the Agencies were expected to crisis in the Passports Agency topping reach, and Agency Chief Executives the list. had performance related bonuses assessed against these targets.

35 5.3 Criticisms of Next essentially determined top down. They Steps actually reinforce ‘departmentalitis’, as staff are judged specifically on 5.3.1 Some aspects of the Next Steps delivering their own agency targets. A programme were clearly desirable. rigid management by contract system Giving clear performance indicators to inevitably encourages delivery of the public servants and linking them to pay agreed contract, and changing track and promotion was essential to during the period of a contract may be improving management, and in line difficult even if it becomes clear that with public sector reforms carried out objectives are inappropriate. This focus in other countries during the same on processes and outputs rather than period - notably New Zealand. Yet outcomes is also a weakness of there were also serious flaws. overseas reform efforts - in 1999 the New Zealand State Services 5.3.2 One of the most obvious was Commission reported that it was unable confusion over Parliamentary to form an authoritative judgement as accountability. In theory, Ministers to whether the capability of remained accountable for policy departments was growing or eroding matters relating to the work of over time, and their ability to respond Agencies, while the Chief Executives to government priorities and their were accountable for operational external environment over the next two matters. This distinction is however to three years. extremely difficult to make, and open to abuse by Ministers wishing to evade 5.4 ‘Joined-Up’ their responsibilities. Government

5.3.4 Perhaps the most serious 5.4.1 Concerns about the partial criticism of the Next Steps approach is improvements secured by the contract that it has been inward looking in its driven approach to public service focus and has militated against reforms in Britain and elsewhere have imaginative new approaches. Targets given rise to calls for ‘Holistic’ or for Agencies are frequently set in terms ‘Joined Up’ Government in the late of ‘outputs’ (e.g. numbers of drivers 90s. This approach recognises that breathalysed) rather than ‘outcomes’ many of the social and economic (number deaths on the road). An problems Governments seek to remedy example of the kind of objective set for require combined interventions from a the Benefits Agency is ‘Ensure that the variety of functionally organised correct amounts of benefit are paid on Government Departments and time with proper safeguards against Agencies. It also focuses on fraud and abuse.’ While this is perfectly Preventative Government, advocating adequate as far as it goes, it is typical early action to head off problems rather of the Next Steps approach in that it than traditional responsive policies. addresses delivering existing This would argue that the existing NHS programmes to a certain standard, is actually a National Illness Service, rather than trying to find new ways of trying to treat people after they have achieving the outcomes which policy is become sick, and devoting very limited supposed to bring about. Although resources to health promotion and the subject to negotiations with Agency kind of environmental and social Chief Executives, objectives are

36 changes which would prevent much the Treasury, and by setting objectives illness at lower cost. in terms of outcomes for the public is aimed at creating incentives for holistic 5.4.2 The Government has adopted approaches. Beneath the headline two main strategies for implementing targets set in the PSAs, there is a ‘Joined-Up’ Government. At the plethora of more detailed targets. policy-making level it has set up or expanded a number of cross- 5.5 Tensions between departmental bodies alongside the Rhetoric and Reality functional departments. Most important of these is the No.10 Policy Unit, 5.5.1 As with much on the New which already existed but has been Labour agenda, there is a tragic greatly expanded. Other examples contradiction between the stated aims include the Social Exclusion Unit and and principles of policy, and the the Performance and Innovation Unit. Government’s ability to understand The PIU is a stronger break with their logic and follow them through. Whitehall tradition in that its project One of the key factors which has led to teams are staffed by outside experts a responsive ‘fire-fighting’ approach to and often exclude the relevant policy-making over the years has been Whitehall Department altogether. successive Governments’ sensitivity to Ministers in charge are also usually short term criticism and need to present drawn from other departments. The every initiative as a glorious success. effect of this has been to give the Prime This has actually discouraged initiative, Minister greater control of and risk taking, long-term thinking, and independence from departments and willingness to learn from mistakes. To their Cabinet Ministers. It has also led make a success of joined-up to the setting up of a range of special government, an administration would initiatives outside mainstream have to be prepared to accept some programmes - for example Education failed experiments, some ultimately Action Zones. successful projects taking time to develop and show results, and a large 5.4.3 The second major plank of measure of local initiative and ‘Joined-Up’ Government comes from discretion. New Labour’s obsession the Treasury, in the form of the with presentation makes them almost Comprehensive Spending Review and uniquely ill-suited to introduce the kind its associated Public Service of reforms which they propose. Their Agreements. In place of the traditional approach has been characterised by annual spending round where top-down dictation, the setting of departments haggled with the Treasury targets which are easily achievable, over their expenditure totals, meaningless or determined by a tabloid government spending is now to be set agenda rather than the public interest. in terms of a succession of three-year CSRs. Departments have to bid for 5.5.2 As at February 2000, Liberal funds for these periods though the Democrat research has identified no Public Service Agreements, which less than 8, 636 different targets set by contain specific outcomes which are Government under the aegis of the supposed to be achieved with the funds Public Service Agreements or allocated. This system places more otherwise. Many of these are highly power to shift trends in spending with detailed and process oriented - the kind

37 of target which ties public servants 5.6 Setting the Right down to existing agendas rather than Targets encouraging innovation. For example, the Royal Observatory has a target of 5.6.1 Much of the intention behind increasing the number of enquiries the Next Steps programme and the answered from 10,000 to 11,000 per current Government’s ‘Joined-Up’ year. Many targets are already achieved Government is good, and the best - for example, the Next Steps Annual aspects should be retained. However, Report for 1998-99 said that only 27% the way targets are set needs to be of Agencies’ targets were set at a level improved. There should be a limited which required an improvement in number of ‘outcome’ targets on which performance. Of the 32 performance Ministers would be judged and which targets set for the Treasury itself, two would provide the main focus of are already achieved, six target a trend political accountability. At the lower that is in place already, for five the level, there would need to be more Treasury determines success or failure detailed targets, including the ‘output’ itself, three targets require the type targets which remain useful as government simply to have a policy, six internal management tools. There are uncontroversial and the data on should be an overall legislative which five are to be assessed won’t be framework which would provide for available until after the next phase of consistency, and prevent Ministers the CSR is decided. This leaves only six moving the goalposts to suit targets as meaningful. themselves. A new Public Services Act

would require the Government to: 5.5.3 It is obvious from this sad story that priority is given to presentation • Publish annually a “Social Strategy over substance in the PSA process, and Statement”, identifying its social the Government does not have the priorities and translating these into a willingness to relax rigid central control set of measurable medium and long which is essential if ‘holistic’ term targets. This should be government is to be achieved. undertaken without regard to

traditional departmental boundaries. 5.5.4 Another criticism of the The Social Strategy Statement Government’s progress is the large should contain quality of life number of special initiatives - measures and environmental ‘initiativitis’. Pilots and other schemes indicators. can be helpful in producing new and better ways of working, but their • ultimate objective must be to Set out annually, in a “Social incorporate new best practice into Targets Statement”, to be delivered mainstream programmes. The present and debated before the Budget, initiativitis can lead to confusion, progress in meeting targets. These duplication, and the diversion of the targets will be divided into long term best staff away from mainstream “outcome” targets - or Strategic delivery into special initiatives serving Results Areas (SRAs), and shorter small groups. term “output” targets, or Key Results Areas (KRAs).

38 • Establish a Public Services Select Social Exclusion Unit do not escape Committee to scrutinise all the Parliamentary scrutiny. All such targets adopted in these Statements agencies must be subject to the scrutiny to ensure they are relevant and of an appropriate Select Committee, or meaningful, and require the National to the Public Services Select Audit Office to report annually on Committee. performance against targets and on the costs of achieving different 5.7 Initiatives and standards. This would help to Experimentation encourage genuine pre-Budget debate. 5.7.1 Special initiatives and pilot schemes have an important role to play • Specify the output targets in a in achieving a more creative and “Service Delivery Agreement” enterprising public sector. However, between the responsible Minister they cannot be a substitute for and the Chief Executive of his improving mainstream programmes, Department. Chief Executives and should not be used as a way of would be held responsible for evading normal lines of accountability. performance against outputs, and There must also be scope for ‘bottom their pay would include a up’ initiatives as well as new performance related component. programmes imposed from the centre. We propose: 5.6.2 In order to measure and assess Government performance against • Giving guidance to the NAO to targets, it is necessary to have adequate assess success of pilots and series of authoritative statistics. It is experimental schemes in terms of therefore worrying the Government’s what lessons they give for the future current proposals for establishing a design of policy, not just their direct Statistical Commission will allow the effectiveness Government of the day to decide what statistics the Commission should collect • Setting clear time limits for special and publish, and what should be left to initiatives and pilot schemes at the Departments. We therefore propose outset, so that they cannot outlive that the Commission should be placed their usefulness or proliferate on a properly independent basis. unnecessarily

5.6.3 To ensure government as a • Setting up a series of task forces to whole is addressing key political interview Civil Servants, including priorities, we would also legislate for those on junior grades, about their an Environmental Responsibility Act views on the running of their and for Social Justice Audits of all bills departments or agencies and ideas coming before Parliament. This would for improving them. complement existing certification under the Human Rights Act. We would also create a high-level Environmental Sustainability Unit along the same lines as the Social Exclusion Unit. 5.6.4 It is important that cross- departmental agencies such as the

39 5.8 Government and the organisations to help them fulfil their Governed advice and advocacy roles

5.8.1 Despite the efforts of Plain 5.9 The Civil Service English campaigners and some new forms of service delivery such as NHS 5.9.1 The move towards Next Steps Direct, contact between government Agencies and devolution in Scotland agencies and the citizens who they are and Wales has inevitably had some supposed to serve is often difficult, impact on the structure of the Civil time consuming, and even baffling for Service. Reforms have tended to the individual. The public sector lags undermine the unified Civil Service, behind the private in standards of both by dividing Civil Servants between customer service. ‘policy’ civil servants based in the Whitehall HQs and the Agency staff 5.8.2 It is also a role of good who are increasingly recruited government to ensure that individuals independently on Agency-set terms and and groups are empowered to stand up conditions, and by strengthening the to government agencies when the separate identity of the Scottish and occasion demands. Voluntary Civil Servants Recent organisations have important functions years have also seen a growth in the in informing government on policy number of Ministerial Special Advisers, matters, assisting individuals who are raising questions about the continued sometimes wary of approaching official political impartiality of the Civil agencies for support and advice, and Service. We wish to retain an impartial acting as advocates for individuals who Civil Service with a long-term career may come into conflict with officialdom structure, but welcome greater mobility between the central Civil Service, the 5.8.3 We therefore support: rest of the public sector, and the world of business. There is also greater scope • An obligation on all government for direct accountability of civil bodies to make advice services servants to Parliament. We propose: available on all form filling and entitlement programmes • Creation of a Public Service Commission to replace the Civil • The use of personal caseworkers Service Commission, with a remit to who meet the whole needs of ensure political neutrality and individuals in fields such as social appointment on merit in central, security and employment advice local and devolved government. The Commission would report to a • Increased use of telephone helplines Select Committee of the House of and more interactive government Commons, and could in extreme websites cases dismiss Senior Civil Servants

• • Partnership between government Every Civil Servant’s first duty and voluntary organisations, should be to the Written including where appropriate Constitution, rather than their targeted funding for voluntary Minister or Agency

40 • The Ostmotherly rules governing or devolved Government or the Civil Servant appearances before private sector. select Committees should be changed to allow discussion of • Encouragement for private sector policy dimensions of Service and local government staff to take Delivery Agreements, and to enable appointments or secondments within Chief Executives to give evidence the Civil Service. on their own behalf about management issues • Opening all Chief Executive Posts in both Departments and Agencies to • Establishing a Master of Public public advertisement. Policy and Administration degree course at leading UK Business • Rigorous codes of practice to ensure schools, to which Civil Servants probity in Civil Servants moving from central or devolved into the private sector, and vice government or local government versa. officers could be nominated by their departments or authorities. • Maintaining a clear distinction between politically appointed • An expectation that every Civil Special Advisers and mainstream Service career will involve at least Civil Servants one appointment in an Agency, local

41 This paper has been approved for debate by the Federal Conference by the Federal Policy Committee under the terms of Article 5.4 of the Federal Constitution. Within the policy-making procedure of the Liberal Democrats, the Federal Party determines the policy of the Party in those areas which might reasonably be expected to fall within the remit of the federal institutions in the context of a federal United Kingdom. The Party in England, the Scottish Liberal Democrats and the Welsh Liberal Democrats determine the policy of the Party on all other issues, except that any or all of them may confer this power upon the Federal Party in any specified area or areas. If approved by Conference, this paper will form the policy of the Federal Party, except in appropriate areas where any national party policy would take precedence.

Many of the policy papers published by the Liberal Democrats imply modifications to existing government public expenditure priorities. We recognise that it may not be possible to achieve all these proposals in the lifetime of one Parliament. We intend to publish a costings programme, setting out our priorities across all policy areas, closer to the next general election.

Working Group on Reforming Governance in the UK

Rt. Hon. Robert Maclennan MP (Chair) Cllr Jonathan Wallace Cllr Chris Clarke Ed Davey MP Staff: David Ive Christian Moon John Macdonald QC Judith Baines Lord Newby Dr Richard Grayson

Note: Membership of the Working Group should not be taken to indicate that every member necessarily agrees with every statement or every proposal in this Paper.

Comments on the paper are welcome and should be addressed to : Policy Unit, Liberal Democrats, 4 Cowley Street, London SW1P 3NB

ISBN: 1 85187 649 9 © June 2000

Further copies of this paper may be obtained, price £4.00 from: Liberal Democrat Image, 11 High Street, Aldershot, Hampshire, GU 11 1BH Tel: 01252 408 282 Printed by Contract Printing, Units 9-10 Joseph House, Eismann Way, Phoenix Park Industrial Estate, Corby, NN17 5ZB.

Cover design by Helen Belcher

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