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Noble Lords: More!

Earl Ferrers: My Lords, I do not wish to prolong the debate. I was delighted to give that rendition, but it will not happen very often. It crossed my mind as being very appropriate on entering an enormous department. I shall discover, no doubt, that I wake up and find everything is sweetness and light.

I am grateful for the fact that so many noble Lords approve of the orders. Many have spoken of areas with which they are familiar. It is an upheaval in many respects and it is not uniform. It cannot be uniform because life is not uniform throughout the country. The whole purpose is to try to get better local government and better value for money in government. Local government should be closer to the people. I was grateful to the noble Lord, Lord Jacques, for saying that at last there is cross-party agreement about the two systems of local government in the single tier and two-tier systems.

I am sorry that the noble Lord, Lord Bancroft, did not approve. My noble friend Lord Selborne said that he was a two-tier man. Those are perfectly understandable reactions. This is a controversial matter. As the noble

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Baroness, Lady Hollis, said, I arrive in the department when a great deal of the acrimony and consultation is over. It is difficult when one makes changes to local authorities in which people have had great faith, pleasure and comfort. But time moves on. We have to recognise that in order to make local authorities more accountable and closely allied to people it is necessary to have these changes.

The noble Lord, Lord Bancroft, said that illogicality by my right honourable friend was exceeded only by inconsistency. That was a fairly spiky observation. If the noble Lord wants consistency one gets inflexibility: if one wants flexibility one is accused of inconsistency. There has been a great deal of discussion about these matters. I gather that the noble Baroness, Lady Gould, approves of Brighton and Hove now being considered economically as one. She said that it made good sense, and I think it is.

I apologise to the noble Earl, Lord Carnarvon, for the fact that I spoke too quickly. I do not think that that is a peculiarity normally ascribed to me. It may have been the result of one of those encouraging bon mots which the Chief Whip expressed to me just before I rose to speak. He said that he hoped that I had a short speech. That may have put my loquacity into overdrive. But the fact that the noble Earl could not understand all that I said is a cause of great distress to me. I shall try to answer some of his concerns.

The noble Baroness, Lady Thomas of Walliswood, said that she saw me here with a certain amount of trepidation. I assure her that she need feel no trepidation at all. I am always sweetness and light. For the expedition of our discussions it would be very helpful if she were always in fear and trepidation of me because then she would not ask me nasty questions and expect me to answer them.

Both the noble Baroness and my noble friend Lord Selborne were concerned about the cost of continuing the county council. Any transitional costs, such as the set-up costs which are incurred by the county council, can be met by borrowing. For many of these costs we have worked out special arrangements so that repayment need not start for three years by which time the county may have been able to make some savings as a result of reorganisation or will have been able to plan well ahead to meet those costs. The cost of servicing such costs will be very small in relation to a county's budget.

The noble Baroness, Lady Thomas, was also concerned about Regulation 6 excluding the county councillors from budgeting. That is in the general regulations, not in the individual orders. We consulted in June on the draft general regulations. According to Regulation 6, where county councils are to become unitary areas, councillors should not take part in setting budgets for the year after reorganisation. I do not believe it right that councillors should be able to determine a budget for what is in effect a different council. This matter was discussed in another place only last week. I believe that there was general acceptance in principle on that point. We expect to lay the regulations tomorrow.

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The noble Baroness, Lady Thomas, and the noble Earl, Lord Carnarvon, were concerned about membership of the police authorities in Bedfordshire and Hampshire. Local authority members of police authorities are selected by a joint committee of the authorities concerned. I remember with very considerable feeling when that measure went through your Lordships' House some 12 months ago. The selection of members must reflect the political balance across the area as a whole, otherwise the local authorities will have a free hand. For instance, Luton may have no entitlement to a fixed number of seats. It is up to the good sense of the committee to work out how that is to come about. The joint committee is formed by the authorities by mutual agreement. If they fail to agree, the Home Secretary has reserve powers to appoint the joint committee members, but he has never exercised those powers and he does not expect to do so.

The noble Earl, Lord Carnarvon, expressed concern about lord lieutenants and high sheriffs. I believe that that was the moment when my speech may have been delivered too quickly for the noble Earl to keep pace. We shall be making separate provision for them in general regulations. Under them each unitary authority which is created under the orders will be deemed to be part of the relevant historic county for ceremonial and related purposes. I believe that is said slowly enough for the noble Earl to absorb. Therefore, jurisdiction will remain with the lord lieutenant and the high sheriff of the county. The regulations will be made at the earliest possible opportunity after April next year.

The noble Lord, Lord Bancroft, was concerned that we were being one-sided against the county council. We do not have any intention of being one-sided and I do not believe that we have been. One of our main principles is that we should be prescriptive only when that is unavoidable. We do not believe that a successful reorganisation will be helped by an increasing level of regulation. In fact, our intention is that, rather than binding the hands of local government, councillors and officers should be allowed to use their detailed professional practical knowledge to take forward the preparation for reorganisation in the way they believe to be most suitable to local circumstances.

In many ways, the most important two provisions are those imposing a duty to co-operate and giving all authorities involved the power to start preparations. The provisions apply equally to the county and district councils. Where there is a further provision, it is because there are specific points which need to be addressed. We do not believe that it would be appropriate to extend the scope of the provisions beyond what is necessary. The unitary authorities are given a right to information, for instance, because they will need information which might otherwise be covered by the data protection requirements, whereas transferors will not be in that position.

My noble friends Lord Murton and Lord Harmsworth and the noble Baroness, Lady Hamwee, referred to the standard spending assessment. For a unitary authority, the standard spending assessment will take account of its new functions. The amount of SSA that it will get for its new functions will be determined after

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consultation with the unitary authority and the continuing county. We shall consult authorities on the disaggregation of the SSA in a reorganised county. That exercise will be concerned only with disaggregating the SSA for the county. Any other proposals, such as those relating to rural areas, for change to the SSA will be considered in each year's finance settlement and the authorities can, as usual, make such proposals at any time.

My noble friends Lord Selborne and Lord Bridgeman were concerned about the start-up costs of the amputated county councils. I think I can reassure my noble friends that the remaining county council can also apply for supplementary credit approvals to meet set-up costs. Special arrangements are made so that in many cases borrowings need not be repaid for some years. That will enable authorities to realise any savings or receipts from reorganisation or to plan well ahead to meet them. In any case, the costs of meeting the borrowings cannot be significant in terms of the counties' overall budgets. I can assure my noble friends that authorities will have an opportunity to comment on the arrangements for 1996 and later years. We shall be consulting on them later in the summer.

The noble Baroness, Lady Hamwee, was concerned about the costs for continuing counties and about supplementary credit approvals. We have made £50 million available for supplementary credit approvals for 1994-95. We shall decide resources for 1996-97 as part of next year's finance settlement. I can reassure the noble Baroness that county councils can apply for supplementary credit approvals. We have said that we are considering extending the eligibility period for continuing counties. With regard to on-going costs, that must be a matter for the on-going authority. In any event, I doubt whether the costs will be found to be significant even in the context of a reduced county's budget.

I am grateful to the noble Baroness, Lady Hollis, for supporting the orders so generously. Of course, they are a change from what has happened before, but the fact that the noble Baroness, speaking on behalf of the Opposition, with myself speaking on behalf of the Government and others tend to feel that the result, change though it will be, will bring better accountability and better local authority representation and performance, is a good thing and is encouraging. I am grateful for your Lordships' support and commend the draft orders to the House—

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