As noted last Thursday, Lord Shipley gave his valedictory speech in the House of Lords Local Government debate. Here is his speech in full:

My Lords, I thank colleagues from across the House for the privilege of working with them over the last 16 years in this Chamber on Bills, on Select Committees and on the general work of this House. Having reached the age of 80, I have decided that the time has come to have a retirement. I thank all the staff of the House for their advice, efficiency and constant good humour. I thank my own Whips’ Office for its loyalty, help and command of its role. I thank my immediate colleagues—my friends—in the Liberal Democrat group, who have been such a support over the years, for their friendship, which I know will continue in the years ahead. I thank my wife and all my family for their support in my time here; it is so appreciated. I thank all the speakers who are going to speak in this debate. I look forward to the maiden speech of my noble friend Lord McCobb, who brings a wealth of experience from his many years in local government.

In this debate I want to praise the Government for their commitment to devolving power out of Westminster and Whitehall into England, a country of 56 million people, and for their commitment to electoral reform, at least at a parliamentary level. There are, however, huge questions as to what all this means in practice for citizen participation and democratic accountability. The new Government have announced that they will strengthen accountability to balance the greater funding freedom for mayors. I thank the Library for its briefing on what the new Government have announced. Chief executives of mayoral strategic authorities will become local accounting officers; there will be a stronger role for the local audit office; there will be streamlining of the outcomes framework for mayoral strategic authorities; and there will be reforms to support the financial Toggle showing location ofColumn 362sustainability of local authorities, including retention of business rates and reforms to the highest cost services—social care, homelessness and special educational needs and disabilities. I welcome all those things.

I see this debate as an opportunity for all noble Lords to contribute at this important time to government thinking and to thinking at all levels of local government about how we should proceed now that the mayoral structure and strategic authorities are being put in place. I want to talk about three issues. First, too often, devolution is seen as being about just the location of power. But that is only part of it. Actually, it is about the effective use of power and responsibilities, and whether the resources and capacity are there to deliver those responsibilities.

Secondly, we, together with government, have to define far better than we previously have what we expect mayors to do in each of their areas. My view is that mayors have responsibilities which are much too broad. They need to devolve as much as they can to local authorities, and those local authorities, in turn, need to devolve as much as they can to neighbourhoods and to town and parish councils. Too often, people think of devolution as being about power to themselves from somebody else. But true devolution comes from giving up power and transferring that power to others. Indeed, at the Local Government Association annual conference in July, the then Secretary of State said:

“Residents can feel just as shut out by the town hall as by Whitehall”.

I agree. It is very important that, if the Government are going to reach every postcode, citizens should have more involvement in matters affecting their everyday life.

My third point is that we live in a representative democracy, and that means that votes cast should ideally have equal weight. That system worked pretty well when we had a two-party system. But in local government in England now there are effectively six major groupings, and the time has come for a more proportional voting system to reflect citizens’ views adequately. However, it is also my view that we must ensure that there is a connection between councillors and the people they represent, particularly in rural areas.

The new Government want to rewire the state, with all parts of England having a strategic authority. I commend their commitment to transfer powers over such matters as schools, employment support, transport, housing and innovation. I strongly welcome the likely announcement in the Budget—much trailed—that a share of income tax, perhaps £21.5 billion, will be devolved as part of a new road map towards greater fiscal devolution. We should note that this will not be new money, but it will focus minds on what it is spent on, and funding will be more predictable for local government. However, as the Local Government Association emphasised recently, a timetable is now necessary to clarify how devolution will be delivered, as currently there are no plans for the whole of England to be covered by strategic authority proposals. We need to see the “whole of England” part of the devolution process, and anything further the Minister can say about that would be helpful.Toggle showing location ofColumn 363

We should note that most parts of England receive more in public spending than they raise in taxation; only London and the south-east generate more from taxation than they spend. There is a huge fiscal reliance in England on London and the south-east. This is why growth in areas outside London matters so much, and why mayors and strategic authorities must help achieve that as their primary aim. However, resources are a problem. We have just been talking about the triple lock and social care. It is the case now that there is a local authority in which social care can take 92% of its core funding. It used to be two-thirds, but since 2015 there have been cuts in public services as social care has been loaded more and more on to council tax. There is a very serious financial problem in local government, which is the result of the failure over so many years to find solutions to growing demands for social care. This needs urgent resolution, otherwise we will continue to see heavy cuts in other services.

This is all about partnership working between mayors, strategic authorities, Whitehall and every level of local government. It is about effective joint working between councils at all levels, including parish and town councils, and there has to be a willingness to deliver that partnership. Place-based policy-making matters. The British Chamber of Commerce has said that business should be at the heart of devolution, and it needs to be. You cannot solve the problem of youth unemployment and too many young people not in education, employment or training unless business is at the heart of that. If that does not happen, the Government will not reach every postcode as they have promised to do.

I mentioned earlier the capacity of mayors. Mayors have a huge range of responsibilities, from police and fire to strategic planning, inward investment, culture, skills and transport, and now I see proposals that mayors may have a role in holding water companies to account. The basic question is this: how on earth does one person do all these things? I used to serve on the north-east regional development agency, One North East. I was there for seven years. It had a lot of staff and there was a government office, to bring Whitehall together in one place. Unfortunately, it is the case that, in many parts of England, there are just not enough people to do some of the jobs that the Government rightly think need to be done.

One of the Government’s solutions—we saw it in the passing of the English devolution Bill at Easter—is to appoint commissioners. The commissioners are not elected; they are appointed by the mayors, though there will be scrutiny of the appointments. But I have come to the conclusion that we need more shared staffing between existing local authorities and these strategic authorities and that strategic authorities need to have the resources to do the job the Government expect of them. I add to this my conclusion that we need direct elections to mayoral strategic authorities. If the mayor is directly elected then the members of the strategic authority need to be directly elected, through a form of proportional representation.

That takes me briefly to electoral reform. The national commission is welcome. It is wise to press ahead. It does not yet include local government, and it should. I do not want to get involved with all the different Toggle showing location ofColumn 364systems you could have, but it is wrong that one party, under first past the post, can win control of a council with a substantial minority of votes. It is vital that voting systems keep up with changes in levels of voter support for different parties. I hope the Government will be willing to look at that.

I am drawing towards a conclusion. I want to comment on the overnight visitor levy. I have many times in your Lordships’ House talked about the importance of a tourist tax. It is called an overnight visitor levy, and I am strongly in favour of it. However, some of the mood music that I am hearing is not terribly helpful. There is a real worry that the tourist areas that are short of social housing because there are so many second homes are not being guaranteed the resources to build the social housing that is required in their areas. They are frightened that the mayors are going to have big projects which will not be in their areas. There needs to be clarity on this. It is a good example of the problem we have with devolution but also of the opportunity. Who decides what would be raised by the levy and where it would be spent? There are many examples: in Manchester, a voluntary tourist tax has been hugely successful.

Mayors have to be set targets and assessed against them. For example, mayors should be made responsible for reductions in the number of young people who are not in education, employment or training. It is not only the Government or the private sector that do these things—let us make the mayors accountable for some of these things. Further, mayors should be measured on their ability to promote local procurement in every postcode. That is the objective. I hope the Government will see the importance of doing these things. Mayors must be assessed on their success in growth. I hope that they will be assessed against their ability to run an authority in which budgets are properly constructed and costs properly controlled, so that the mayoral strategic authority does not then end up blaming the Government of the day for everything that goes wrong.

This is about sharing a great deal more. I would like to think that all MPs in the mayoral strategic authority area would have the right to be part of a select committee structure to talk to the mayor on the basis of an annual report produced by that mayor. We have to think much more about doing things like that.

I am really keen on what the Government are doing. I congratulate the Minister and all her colleagues on the ambition that they have set. There is a danger that mayors and strategic authorities will end up being strong on strategy but short on delivery. We have to do far better than that, for that is what the general public expect us to do. I beg to move.