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Baroness Hamwee: My Lords, we support the amendment; indeed, it is one that we moved at an earlier stage. I continue to ask why it is necessary to give the Secretary of State this power to restrict expenditure when the Secretary of State already has wide powers through existing local government legislation. At the last stage I called this clause a "sledgehammer" of a clause, and I still regard it as that.

The Government's reply was that it provides a safeguard against an irresponsible mayor diverting such a large proportion of the authority's resources to discretionary resources that essential services are starved of funds. That begs the questions of what essential services are and who judges whether services are essential. I could not help but think of the term "bogus asylum seekers", which is used a great deal. Asylum seekers are only bogus if you choose so to designate them. This is a similar situation.

The provision in the Bill reveals the degree of control that is to be applied. Much of the spending of the new authority will be capital expenditure. Noble Lords are aware of the complex system of credit approval for capital expenditure, which is also a very constraining system, and of the controls on revenue expenditure.

How will the provision operate? Will a message come to the authority from Whitehall or perhaps Eland Place in the middle of the year, after the budget has been set and the authority has embarked on its spending pattern for that year? There may be practical considerations to take into account.

We are particularly concerned about the principle. The Government stated that the power will control expenditure on discretionary activities, but the provision on which it bites does not provide discretionary powers in the way that a member of the public would understand them. Clause 30(1) states that the authority shall have the power to do anything which it considers will further any one or more of its

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principal purposes. That is not discretionary; it is a facilitating provision allowing expenditure from the statutory powers.

The Conservative Benches were suspicious about Clause 30(1), thinking that it might be very wide. Noble Lords were reassured by the Government about how narrow that provision is. We have always supported the provision because we recognise that the Government cannot predict and spell out every activity which may be necessary to support the promotion of the principal purposes. Although the deluge of government amendments indicates that they are trying to spell out everything, it is not possible to do so. Clause 30(1) is a very sensible provision. It is made much less useful by the subsection to which we and the Conservative Front Bench object. We support the amendment.

4.15 p.m.

Lord Whitty: My Lords, I am very pleased that the noble Lord, Lord Dixon-Smith, is not seeking to comment on the internal procedures of the Labour Party, nor do I comment on the internal procedures of the Conservative Party. From whatever party the successful candidate comes, the Secretary of State will require some reserve powers on behalf of Londoners and taxpayers generally.

The amendment is narrowly defined. I am slightly surprised that the point of principle focuses on this point. The clause is not a power to limit the totality of the authority's expenditure; nor is it a power to limit expenditure on specific statutory duties. It is a power that is directed only at the amount of spending on activities other than those which fall within the authority's specific powers or duties.

The Government have made their position clear on this issue. The power to set a financial limit is included in the Bill for two important reasons. First, we have made a commitment to Londoners in our manifesto, in our White Paper and in everything that we have done in regard to the Bill, that staff and costs in the GLA will be streamlined. Secondly, Londoners want the GLA to spend its money on services and they do not want it to squeeze services in order to facilitate extravagant expenditure on itself or on activities that are outside its specific statutory powers and duties.

This power for the Secretary of State is a reserve power to control the ability of any mayor to spend outside those areas. It is not about constraining, in advance or in retrospect, the mayor's freedom to spend money on general power activities, and it is not about how much the authority should spend on each of its specific functions. It is, however, an essential and specific safeguard against expenditure outside those specific functions, and it is therefore a reserve power which I contend is very, very much in the interests of Londoners, to whom the noble Lord, Lord Dixon-Smith, referred. I cannot accept the amendment and I hope that the noble Lord will not press it.

Lord Dixon-Smith: My Lords, the Minister has revealed that he has never had to produce a local

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authority budget. That may be thought by noble Lords to be an insignificant matter, but anybody who has to perform that task, which can be a desperate task, knows that a local authority's budget is made up of so many boxes of matches and that 99.9 per cent of those boxes of matches are committed before the process begins.

I entirely accept that this limited power of direction is very specific and that it is not aimed at the generality of expenditure but at very narrow paths. In the context of the Bill, if the idea is acceptable at all, that is the only way it could be done, but I do not see the point of giving those powers and then putting a limitation on them when there is already a power to have overall control of the authority's absolute budget.

The Minister might imply that the mayor would wish to squeeze the generality of the authority's expenditure at the expense of these specific new general power functions. I wonder how long a mayor could expect to last if he were to squeeze the police budget, the fire and emergency planning budget and the budget of Transport for London. In my view, there was an air of unreality to the Minister's reply. I believe that we should test the opinion of the House on the matter.

4.20 p.m.

On Question, Whether the said amendment (No. 10) shall be agreed to?

Their Lordships divided: Contents, 101; Not-Contents, 131.

Division No. 3

CONTENTS

Abercorn, D.
Addington, L.
Alexander of Tunis, E.
Archer of Weston-Super-Mare, L.
Astor of Hever, L.
Attlee, E.
Avebury, L.
Barker, B.
Belhaven and Stenton, L.
Boardman, L.
Brabazon of Tara, L.
Brentford, V.
Bridgeman, V.
Buccleuch and Queensberry, D.
Buscombe, B.
Cadman, L.
Caithness, E.
Carlisle, E.
Carnegy of Lour, B.
Clement-Jones, L.
Cochrane of Cults, L.
Courtown, E.
Craig of Radley, L.
Cuckney, L.
Davidson, V.
Dean of Harptree, L.
Denbigh, E.
Dholakia, L.
Dixon-Smith, L.
Eccles, V.
Eden of Winton, L.
Elibank, L.
Elliott of Morpeth, L.
Ezra, L.
Falkland, V.
Fookes, B.
Gardner of Parkes, B.
Glentoran, L.
Goodhart, L.
Gray of Contin, L.
Greenway, L.
Grey, E.
Hamwee, B.
Harris of Greenwich, L.
Harris of Richmond, B.
Higgins, L.
Hogg, B.
Hooper, B.
Howe, E.
Jenkin of Roding, L.
Jopling, L.
Lawson of Blaby, L.
Leigh, L.
Lester of Herne Hill, L.
Liverpool, E.
Lucas of Chilworth, L.
McNair, L.
Mar and Kellie, E.
Mayhew of Twysden, L.
Mersey, V.
Miller of Hendon, B.
Mills, V.
Monro of Langholm, L.
Morris, L.
Mountevans, L.
Murton of Lindisfarne, L.
Nunburnholme, L.
O'Cathain, B.
Pender, L.
Porter of Luddenham, L.
Rawlings, B.
Razzall, L.
Reay, L.
Redesdale, L.
Rennard, L
Roberts of Conwy, L.
Rodgers of Quarry Bank, L.
Rotherwick, L.
Russell, E.
St. Davids, V.
Sandberg, L.
Sandford, L.
Seccombe, B. [Teller]
Shannon, E.
Sharp of Guildford, B.
Sharples, B.
Smith of Clifton, L.
Strathcarron, L.
Taverne, L.
Thomas of Walliswood, B.
Thomson of Monifieth, L.
Thurso, V.
Tope, L. [Teller]
Tordoff, L.
Vivian, L.
Waddington, L.
Wallace of Saltaire, L.
Wilcox, B.
Williams of Crosby, B.
Wise, L.
Young, B.

NOT-CONTENTS

Acton, L.
Ahmed, L.
Ailesbury, M.
Allenby of Megiddo, V.
Alli, L.
Amos, B.
Archer of Sandwell, L.
Ashley of Stoke, L.
Ashton of Upholland, B.
Bach, L.
Barnett, L.
Bassam of Brighton, L.
Berkeley, L.
Blackstone, B.
Blease, L.
Bledisloe, V.
Borrie, L.
Bragg, L.
Brooke of Alverthorpe, L.
Brookman, L.
Burlison, L.
Carter, L. [Teller]
Chorley, L.
Christopher, L.
Clarke of Hampstead, L.
Cledwyn of Penrhos, L.
Clinton-Davis, L.
Cocks of Hartcliffe, L.
Crawley, B.
David, B.
Davies of Coity, L.
Dean of Thornton-le-Fylde, B.
Desai, L.
Dixon, L.
Donoughue, L.
Dormand of Easington, L.
Effingham, E.
Elder, L.
Evans of Parkside, L.
Evans of Watford, L.
Falconer of Thoroton, L.
Farrington of Ribbleton, B.
Faulkner of Worcester, L.
Filkin, L.
Gladwin of Clee, L.
Goldsmith, L.
Goudie, B.
Gould of Potternewton, B.
Grabiner, L.
Graham of Edmonton, L.
Gregson, L.
Grenfell, L.
Hacking, L.
Hardy of Wath, L.
Harris of Haringey, L.
Harrison, L.
Hayman, B.
Hilton of Eggardon, B.
Hogg of Cumbernauld, L.
Hollis of Heigham, B.
Howells of St. Davids, B.
Howie of Troon, L.
Hoyle, L.
Hughes of Woodside, L.
Hunt of Kings Heath, L.
Inchyra, L.
Irvine of Lairg, L.
Janner of Braunstone, L.
Jay of Paddington, B. (Lord Privy Seal)
Jeger, B.
Jenkins of Putney, L.
Judd, L.
Kennet, L.
Kilbracken, L.
Kintore, E.
Laming, L.
Lea of Crondall, L.
Lipsey, L.
Lockwood, B.
Lofthouse of Pontefract, L.
Longford, E.
Lovell-Davis, L.
McCarthy, L.
Macdonald of Tradeston, L.
McIntosh of Haringey, L. [Teller]
Mackenzie of Framwellgate, L.
Mallalieu, B.
Massey of Darwen, B.
Merlyn-Rees, L.
Milner of Leeds, L.
Molloy, L.
Molyneaux of Killead, L.
Monkswell, L.
Murray of Epping Forest, L.
Nicol, B.
Northbourne, L.
Northfield, L.
Orme, L.
Patel, L.
Paul, L.
Peston, L.
Pitkeathley, B.
Plant of Highfield, L.
Ponsonby of Shulbrede, L.
Puttnam, L.
Ramsay of Cartvale, B.
Rendell of Babergh, B.
Richard, L.
Rogers of Riverside, L.
Sawyer, L.
Scotland of Asthal, B.
Sefton of Garston, L.
Serota, B.
Shepherd, L.
Shore of Stepney, L.
Simon, V.
Smith of Gilmorehill, B.
Smith of Leigh, L.
Strabolgi, L.
Symons of Vernham Dean, B.
Taylor of Blackburn, L.
Tenby, V.
Thornton, B.
Turner of Camden, B.
Uddin, B.
Varley, L.
Warwick of Undercliffe, B.
Whitty, L.
Wilkins, B.
Williams of Mostyn, L.
Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.

1 Nov 1999 : Column 583

4.29 p.m.

Clause 32 [Consultation]:


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