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Baroness Hamwee: Before the noble Lord speaks, will the Minister assist the Committee as to whether, as seems to be implicit in her answer, scrutiny committees will have those detailed powers without legislation providing for them? That was the objective of some of the amendments in the group. I am interested to know whether it is necessary to specify the powers in the primary legislation.

Baroness Farrington of Ribbleton: I understand that part of the process of submitting an application will be to ensure that there has been wide consultation and that there is support for the proposed system. It appears to me-- I shall write to the noble Baroness if I am wrong--that a scrutiny process would inevitably form part of the application if it is to meet the criteria laid down in the legislation to be taken into account by the Secretary of State.

Baroness Hamwee: I fear that I am not making myself clear. I accept of course that a scrutiny arrangement is to be required. My concern is to know whether the detailed powers to call for reports, for instance, should be specified in the primary legislation, or whether the power of scrutiny encompasses such a power. I accept that the point may be too detailed for the Minister to respond to now. It is not a frivolous point, but I am sure that the Minister is not suggesting that it is.

Baroness Farrington of Ribbleton: I, of course, recognise that it is not a frivolous point. My understanding is that the noble Baroness's fears are groundless, but should that prove not to be the case I shall ensure that she is informed.

Lord Hunt of Tanworth: The Committee will remember that on Second Reading some Members argued that a Bill which was designed to free up things and allow local authorities to experiment was already itself too prescriptive. We must be careful about loading more and more into the Bill to tell local authorities how they should go about these experiments. Neither they, we, nor the Government know the answers, though we should expect to learn a good deal as a result of the experiments which may be of more general application later.

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For those reasons, and those the Minister gave, I am reluctant to accept the amendments. I hope that the noble Baroness will not pursue them. I should like to offer one suggestion entirely without commitment; that is, the Government might consider whether this is the sort of issue where, in a sense, we are all saying that we want the same thing, but it is a question of whether it is spelled out in legislation or whether it is something that could be dealt with in the guidance for local authorities, which has been placed in the Library. I hope that at this stage the noble Baroness will not pursue the amendments.

Baroness Hamwee: It may be that the point can be covered in secondary legislation applying to the particular authority and to the particular arrangements. I believe that the Minister wishes to intervene.

Baroness Farrington of Ribbleton: It may help the Committee were I to say that the scrutiny committees could have powers to call for reports, and so forth. How a scrutiny committee will work will be established in the approved arrangements. Paragraph 3 on page 4 of the draft guidance refers to that. I hope that that makes the position clearer.

Baroness Hamwee: We are all interested to make this matter work. In connection with Amendment No. 16, the Minister has confirmed that the scrutiny committee will be required to make assessments. I was a little surprised by her description of the amendment as too prescriptive.

With regard to Amendment No. 17, it is a shame not to allow that direct relationship with neighbourhood committees. Again, I shall not seek to take the matter further now. I do not intend to restrict the exercise of executive powers, merely to see, if they are to be given to a cabinet model or an individual, how they would fit in with the effective neighbourhood committees which are now in operation.

Baroness Farrington of Ribbleton: I hope that the Committee will forgive me. The noble Baroness referred to "not allowing". My understanding is that the existing arrangements could be continued and allowed. There is obviously wide acceptance that such committees have worked well in many authorities. We wish to avoid prescription, not to cease to allow.

Baroness Hamwee: I did not mean to indicate that I thought that the provision sought to stop neighbourhood committees. I should like them to be allowed to fulfil the scrutiny role rather than that the scrutiny be undertaken by a central committee. If an authority has devolved powers to neighbourhood committees in a way which does not follow the old conventional models, the "shame" to which I was referring is the shame that those committees with the devolved powers do not have a direct opportunity to scrutinise what the executive is doing. That may be another point to which we can return at a later stage. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 16 and 17 not moved.]

Clause 1, as amended, agreed to.

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Lord Hunt of King's Heath moved Amendment No. 18:

After Clause 1, insert the following new clause--

Review of decision-making processes

(" .--(1) Every local authority shall not less than once every four years after the commencement of this Act consider and review the efficiency and effectiveness of its decision-making processes.
(2) Every local authority shall as part of a review under subsection (1) consult the community interests in its area.
(3) The conclusions of a review under subsection (1) shall be reported to a full meeting of the council of the local authority.").

The noble Lord said: The intention of the amendment is to require a local authority, at least once in a four-year period, to undertake a review of its decision-making structure, and to report to full council. One of the most important aspects of the Bill is that it is permissive; it does not seek to be prescriptive. That must surely be right in our endeavour to develop the role and confidence of local government.

I wish to see an approach to local government which tries to widen its discretion rather than to require it just to react to the diktats and circulars of central government. It is clear that many local authorities will wish to take advantage of the Bill, if enacted, as soon as possible. Yet more will wish to reflect on the success, or otherwise, of those local authorities which will be in the first wave of experimentation.

I suspect that a third group of local authorities will say no to begin with and will bury their heads in the sand, not wishing to return to reviewing their decision-making structure. The amendment refers to that group of authorities. If local government is to be the dynamic, innovative source of government at local level which the 21st century requires, it is important that local authorities examine their decision-making structure and ensure that it is as up to date as possible

Many of us have been influenced by the Audit Commission's report of 1997. It stated that too much of a burden is placed on councillors, often unproductively, by committee meetings which focus on detailed issues. The Audit Commission stated:

    "Such committees can assume large amounts of management time, slow down decisions and duplicate each other's work".

We must take that comment seriously. We must encourage those local authorities which may be reluctant in the first instance to undertake a review to consider whether their traditional approach to decision making is up to the needs of local government today and tomorrow. This is a modest amendment which seeks to encourage that without being prescriptive. I beg to move.

8.30 p.m.

Baroness Hamwee: I support the amendment. Many authorities will review the efficiency and effectiveness of their processes more frequently than every four years, but it is good to require them to do so in a formal

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manner. I recognise instantly the example of a committee which focuses on spending £500 but fails properly to debate spending £5 million.

Baroness Farrington of Ribbleton: I am grateful to my noble friend Lord Hunt of King's Heath and to the noble Lord, Lord Bassam, for tabling the amendment. The Government fully support the permissive structure of this Bill, but we want to encourage local authorities to take advantage of the opportunity it affords them. We do not want to ask for volunteers in the manner of some army sergeant major. We want authorities themselves to come to the view that they need to address their decision-making processes and the way in which they engage more widely with those they serve.

The Government therefore welcome the thrust of this amendment, which would require authorities to review periodically their own decision-making arrangements and, in the course of that review, to consult those they serve. This is clearly good practice. We often hear of cases where an organisation seeks views from its customers on what it does and how it might be done better and comes away from the experience wiser, humbler and with a determination to improve. Even the best of us can always benefit from a little constructive feedback. A number of authorities are already doing something like this; for example, producing and maintaining democracy plans.

However, this amendment places no compulsion upon any authority to experiment under this Bill should it become law. It merely ensures that every so often an authority should think about these issues and take a view on whether it is operating as it would wish. The Government believe that this would be a very useful discipline. We are therefore content for this amendment to be made. But I would mention to the Committee that on studying the detail of the text the noble Lord, Lord Hunt, may see a need for certain further amendments to take this new clause fully into the Bill.

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