Previous Section Back to Table of Contents Lords Hansard Home Page

Lord Whitty moved Amendment No. 232A:

Page 59, line 31, leave out paragraph (a) and insert--
("(a) if the Mayor has decided a minimum amount of grant which the Authority is to pay to the body for the year under section 105(1) above, that minimum amount;").

The noble Lord said: This is a minor amendment. It is intended to remove a possible misunderstanding of the existing draft; namely, that the mayor is required to state for each functional body a minimum amount of capital grant he will pay to that body (and therefore is required to decide four minimum amounts). That was not the intended effect of Clause 107(4)(a). It was intended to leave the mayor free to decide what capital grants to make to the functional bodies and to require him to specify an amount only where he makes a decision to pay a body no less than a certain amount.

The amendment ensures that the requirements for preparation of the capital spending plan are brought completely into line with other arrangements in the Bill. I beg to move.

On Question, amendment agreed to.

28 Jun 1999 : Column 122

The Deputy Chairman of Committees (Lord Dean of Harptree): In view of Amendment No. 232A being carried, I cannot call Amendment No. 233.

[Amendments Nos. 233 to 245 not moved.]

Lord Dixon-Smith moved Amendment No. 236:

Page 60, line 16, at end insert--
("(7) Section E of a capital spending plan made for any financial year ("the relevant financial year") other than the first two financial years following the commencement of the Authority shall consist of--
(a) a statement of--
(i) the amount of the body's total capital spending in the preceding financial year, and
(ii) the total amount of expenditure which the Mayor had expected the body to incur in the capital spending plan for the previous year;
(b) where the amount in paragraph (a)(i) exceeds the amount in paragraph (a)(ii), a statement of the reasons for this and a proposal for reducing the capital spending plan for the relevant financial year by the amount of the excess.").

The noble Lord said: The purpose of the amendment is to guard against systematic overspending on capital items by publishing an outturn at the end of the year so that it can be compared with the planned amounts of capital spending for each functional body in each of the previous two financial years so that the level of financial management, or the competency of that management, can be perceived easily.

The amendment maintains a principle for which we have been pressing throughout the Bill of imposing greater visibility in the authority's spending. It reinforces the disclosure requirements of earlier proposed amendments. Were this disclosure to reveal an overspend in relation to the plan, it would require reasons to be given together with proposals to claw back or deal with the problem of an overspend. This would be a protection for the people of London and would help to prevent poor management of capital resources which might lead to an unacceptable risk for the people of London in the future, which would be permissible as the Bill is currently framed. I beg to move.

Lord Whitty: The amendment is somewhat overprescriptive. It would require the mayor to produce every year an extra part of his plan which reported precisely on the deviations from the plan the previous year and explained the reasons for the excess. It would also require proposals to be made for clawing back that excess.

The mayor will draw up every capital spending plan in consultation with the functional bodies and others, and with the GLA as a whole. It is clearly important that we have serious monitoring. But this is a vigorous straitjacket. Under Clause 109, the mayor may take account of any factors which appear to him to be appropriate. That would include the extent to which functional body spending departed in either direction from expected levels, bearing in mind that the expected level specified is not intended to fix the amount of capital spending for the functional body. There may well be good reasons why more or less spending is incurred by a functional body and its departure from the mayor's

28 Jun 1999 : Column 123

expectation may be for the general benefit not only of the functional body but of the GLA and London as a whole. Therefore, the requirement that not only should he publish it in this form, but that it should be subject to a commitment to claw it back in the following year would be excessive. The mayor needs freedom to exercise discretion responsibly. It would be wrong to prescribe his specific course of action in legislation. Having said that, I accept the mayor's responsibility to report on the monitoring, but not in this form.

Lord Dixon-Smith: I am grateful to the Minister for his explanation, which I shall study with some care. When I was involved in local government, we were used to the idea of producing a precise capital expenditure plan for every year which was entirely expenditure based. It was always the case that if there was an underspend, the reasons were established, explained and published. If there was an overspend, which one must admit could occur, the reasons had to be established, explained and the consequences dealt with in the subsequent year's financial plan. As night follows day, an overspend in one year was followed by a diminution of the planned spend in the subsequent year.

Nevertheless, I hear what the Minister said. I shall study it and, in the mean time, beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 107, as amended, agreed to.

Clause 108 [Preparation of the plan: consultation and completion]:

Lord Dixon-Smith moved Amendment No. 237:

Page 60, line 22, after ("Assembly") insert (", to each of the London borough councils, to the Common Council").

The noble Lord said: In moving this amendment, I shall speak also to Amendments Nos. 238 and 239. We are still in the business of achieving greater approval and openness for the mayor's capital spending plans. The first two amendments propose that the boroughs and the Common Council, together with the assembly and the functional bodies, should be circulated with the draft and final version of the capital spending plan. The plans are almost bound to have a direct impact on the boroughs and at the least they should be aware of them as soon as they are available. The amendment would achieve that.

The third amendment deals with openness with regard to the capital spending plan and brings it more into line with local government standards of openness; for example, the right to make copies is clear in Section 14 of the Audit Commission Act 1998, which provides for the right to make copies of documents in relation to the period in which the authority's finances are under audit. That is a good principle to follow.

The Government's proposals refer to the right of inspection, but they do not refer to the right to make copies. We believe that the right to make copies should exist, particularly in this complex area of capital spending. Careful examination and careful consideration are needed if any lay member is to have some understanding of what has happened. Members of the

28 Jun 1999 : Column 124

public should be able to examine the plans properly and this right could well be essential for that to be possible. I do not believe that the Government should have any difficulty in accepting the amendments, although I am bound to admit that their ability to receive good amendments has not been much revealed in our proceedings up to this point. I beg to move.

Baroness Hamwee: We would not take issue with the first two amendments in this group, but the points made by the noble Lord, Lord Dixon-Smith, illustrate the importance of good consultation, not just on the financial matters but on the strategies underlying them. We have made comments already today about the importance of the authority's financial cycle and the provision of information and so on being sensible as regards the boroughs' own financial cycles. We perhaps stumbled on an issue about whether the Secretary of State can take decisions and give directions in such a way as would be a nonsense in view of the dates by which the boroughs have to agree their budgets.

The timing for the capital spending plan, its availability to the public and discussion of it seem to us necessarily to involve the other players on the London scene, and not just the assembly. But the January date is rather late; it highlights some of the points made earlier today.

On Amendment No. 239, I hope that the Government will tell us that somewhere in their amendments about making material available the point about copies is already covered. The amendment and subsection (5) illustrate the comment that has run as a thread through the points made from these Benches about how detailed the Bill has become, and also the amendments being put forward, because it seems not to be possible to deal with such matters in a general and common-sense fashion. We would not, of course, wish that copies of the capital spending plan should not be available for copying, however.

10.30 p.m.

Baroness Farrington of Ribbleton: Amendment No. 237 would require the mayor to send a copy of his draft capital spending plan to the London borough councils and the Common Council and invite them to submit their written comments within 21 days.

Amendment No. 238 would require the mayor to send the final version of the capital spending plan to those councils.

The capital spending plan is the means by which the mayor will control and influence the capital spending amounts and priorities of the GLA and the four functional bodies. It is clear that the assembly should be consulted on the draft plan, given its relationship with the mayor and the fact that its members are elected representatives of Londoners in relation to GLA functions. Similarly, it is clear that the functional bodies, which will be directly affected by the plan, should also have this right.

It is vital that the mayor should send the assembly and the functional bodies the final capital spending plan because the assembly will want to monitor the capital

28 Jun 1999 : Column 125

spending of the GLA and the functional bodies by reference to the plan, and the functional bodies will need to be guided by it. The plan also serves in part as statutory notification of credit approvals they have been allocated for the year.

The mayor could, of course, send the draft and final capital spending plan to the London borough councils and the Common Council if he thought that this would serve a particular purpose and--which I stress--if time allowed him to take account of any observations that they made to him. But their interest in the plan is not of the same kind as that of either the assembly or the functional bodies, and there is no case for requiring the mayor to do so in primary legislation.

With regard to Amendment No. 239, on making copies, government Amendment No. 238B fulfils our commitment to ensure that members of the public should be able to obtain copies of the capital spending plan for a reasonable fee. This right will, of course, also apply to the London boroughs and the Common Council.

In the light of what I have said, I invite the noble Lord to withdraw the amendments.

Next Section Back to Table of Contents Lords Hansard Home Page