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House of Lords

Wednesday, 15 July 2015.

3 pm

Prayers—read by the Lord Bishop of Portsmouth.

Women: Dishonour-based Violence

Question

3.07 pm

Asked by Baroness Cox

To ask Her Majesty’s Government what is their response to the Day of Remembrance on 14 July for victims of dishonour-based violence, and what steps they are taking to prevent such violence against girls and women.

The Minister of State, Home Office (Lord Bates) (Con): My Lords, the Government are clear that so-called honour-based violence is utterly unacceptable. We commend the efforts of all those working to raise awareness of these horrific crimes, including through yesterday’s first national day of memory for victims of this form of abuse. Tackling forced marriage and so-called honour-based violence is a key priority. This is why we have criminalised forced marriage and are committed to supporting survivors and those at risk.

Baroness Cox (CB): My Lords, I thank the Minister for his commendation of yesterday’s day of memory for victims of so-called honour killings. It was symbolically chosen as the day that would have been the 29th birthday of Shafilea Ahmed, if she had not been suffocated by her parents in front of her siblings for daring to adopt a western lifestyle deemed to bring shame on her family. Is the Minister aware that many victims of “honour-based” violence still do not receive the support and protection they desperately need from the police and social services because of a reluctance to interfere in cultural practices? What steps are the Government taking to ensure that cultural sensitivities do not inhibit the protection of vulnerable citizens or, indeed, override the law of the land?

Lord Bates: The noble Baroness is absolutely right to raise this and I pay tribute to her tireless work in this area, championing people who are suffering in such a terrible way. It is very much a hidden crime and that is a major problem we face, but we are clear that we must not allow cultural sensitivities to get in the way of prosecuting the guilty. A crime is a crime and a victim is a victim wherever they are. We need to get that message out there. I was pleased that my colleague from the Home Office, the Minister for Preventing Abuse and Exploitation, was at the same event as the noble Baroness and spoke movingly of the accounts that she heard, which have given us a new sense of commitment to doing all we can to tackle this heinous crime.

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Baroness Hussein-Ece (LD): My Lords, does the Minister accept that very many of the victims—these young girls and women subjected to this disgraceful, dishonourable crime of violence—find it incredibly difficult to approach the police and, in effect, shop their families? They rely heavily on organisations in the community that do a lot to support women and signpost them. Can the Minister say how much investment is being made to fund these organisations and to recognise the work they are doing to ensure that women have a place to go when they need help?

Lord Bates: My Lords, there are various things. Starting with the Home Office, we have the forced marriage unit, which has done tremendous work in going around the country and making sure that police, local authorities and schools understand the nature of the problem. We have just established the female genital mutilation unit, which will work in a similar way to promote awareness. Of course, it is vital that we work with these other organisations to which she has referred to ensure that we get the message across. The Chancellor announced a further £3 million for refuges for those suffering from domestic violence, and that area of access would be available to those who have suffered as a result of so-called honour-based crimes.

Baroness Uddin (Non-Afl): My Lords, as one of the architects, alongside the noble Lord, Lord Ahmed, of the first report on the task force on forced marriage, I welcome all the work that has been done—in particular by the Minister himself, and previously by the noble Lord who is now the Chief Whip. Will the Minister acknowledge the work of the Newham Asian Women’s Project and Southall Black Sisters, which have been stalwarts, but for which the funding has sadly been decreasing over the years? Can he assure the House that that funding support will continue, without which our commitment will not be met to the victims of forced marriage and so-called honour killing? By the way, I find absolutely distasteful the whole idea that it is an “honour” killing.

Lord Bates: The noble Baroness’s terminology is absolutely right—it is anything but honourable. It is a way in which to categorise the term, and I have challenged it myself in talking about these matters.

On funding, I am very happy to look into the specific case that she raises about that refuge to see what she can do there, but I am sure that the Government are committed to tackling this whole wide area of violence against women and girls. The Prime Minister has put himself behind this—that is why we had the Girl Summit here a year ago. Then there is the work of my former right honourable friend William Hague in advocating this on an international basis, because that is also where the solution lies.

Lord Swinfen (Con): My Lords, how many cases have been referred to the police or other investigative organisations to be looked into?

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Lord Bates: My noble friend puts his finger on a key point. When you look at the level of prosecutions, after the legislation has been put through and the initiatives have been announced, we have not got a strong story to tell. The previous Labour Government introduced forced marriage protection orders; as a result there have been some 800 of those orders, which are a civil function. But we very much want to see further criminal prosecutions so that the message goes out that we do not tolerate this type of behaviour at all.

Lord Rosser (Lab): In the light of the answers that the Minister has already given, what resources are the Government providing this year and next to promote measures and action seeking to prevent dishonour-based violence? The support of which organisations or bodies has been secured by the Government in the drive to prevent dishonour-based violence against girls and women in this country?

Lord Bates: We have worked on a cross-party basis; the Serious Crime Act introduced new measures on female genital mutilation and the anti-social behaviour and crime Act introduced measures on forced marriage. We have now produced various statutory guidance, which is now available and being promoted to police forces. Her Majesty’s Inspectorate of Constabulary is going to undertake a review this summer into so-called honour-based crimes to see what more can be done in police forces across the country. A great deal is being done, but we are not complacent—more needs to be done.

Baroness Afshar (CB): My Lords, I declare an interest as the president of the Muslim Women’s Network UK. This group has been active in working within the community and with Muslim women, men and their families, but unfortunately it is starved of funds. As the Minister is very kindly offering some funds, please may I ask for some for us?

Lord Bates: I recognise that a great deal of work is going on. I hope that I have demonstrated that the Government are taking this very seriously. If there are particular organisations about whose work Members of your Lordships’ House wish to make representations, then of course I am always available on this very important issue.

Lord Flight (Con): My Lords, some element of mistreatment of women surely arises from the practice of Sharia law, in contradiction to the law of the land. Is it not time that something were actually done to control this and potentially to ban the practice of Sharia law in this country?

Lord Bates: I think that is a wider point. There will be an opportunity for the House to consider that in the forthcoming counterextremism legislation, where we will look at the effort that has been taken to challenge certain views in our society and to reaffirm British values.

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Local Authorities: Public Health Budget

Question

3.16 pm

Tabled by Lord Beecham

To ask Her Majesty’s Government what is their assessment of the impact of the £200 million reduction in the public health budget on local authorities in the current financial year.

Baroness Pitkeathley (Lab): My Lords, with the leave of the House and at the request of my noble friend Lord Beecham, I beg to ask this Question.

The Parliamentary Under-Secretary of State, Department of Health (Lord Prior of Brampton) (Con): My Lords, the Department of Health recognises the importance of implementing this saving in ways that minimise any possible disruption to services. It is about to consult publicly on how best to do that, and on how best to monitor the impact on services.

Baroness Pitkeathley: I thank the Minister for that reply. In view of the very strong statements that we have had in recent weeks from the Prime Minister and the Secretary of State for Health—and indeed from the Minister himself from this Dispatch Box—about the importance of prevention to help the NHS cope with future demand, is it not extraordinarily short-sighted to impose reductions which inevitably will result in cuts to preventive services, such as contraceptive services, drug and alcohol services and weight reduction? Does this not absolutely undermine the Government’s objective of improving public health?

Lord Prior of Brampton: I shall give you a short quote from the Prime Minister:

“when you look at the costs of obesity, smoking, alcohol and diabetes, we know we need a completely new approach to public health and preventable diseases. A real focus on healthy living. That’s why it’s at the heart of the plan”;

that is, the Five Year Forward View. We accept that prevention is extremely important. This reduction in spending is £200 million out of a grant for local authorities of £3.2 billion—a reduction of about 6%. Local authorities have demonstrated in many other areas an ability to extract savings. I am sure they will do the same in this case.

Lord Walton of Detchant (CB): My Lords, I am not the only doctor to have expressed some reservations when the Health and Social Care Act decided to transfer funding for public health from the National Health Service to the local authorities. Do the Government now regret that decision in the light of the problems highlighted in the Question—particularly at a time when public health is facing enormous challenges, not least due to the obesity epidemic and the alarming increase in the incidence of type 2 diabetes?

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Lord Prior of Brampton: My Lords, I am hesitant to disagree with the noble Lord, in view of the fact that he told me earlier that he qualified as a doctor in 1945, which was nine years before I was born. However, the devolution of responsibility to local authorities has been fairly universally welcomed. They are better able to take into account local priorities. I should also add that just over £2 billion of the public health budget is held centrally as well.

Baroness Walmsley (LD): My Lords, is the noble Lord aware that many of the local authorities commission these important prevention services from NHS providers? Has any impact assessment been made on the effect on the NHS of this loss of income?

Lord Prior of Brampton: I think that the noble Baroness will know that we are due to go out to consultation on this matter, and that is an important issue that will be taken into consideration.

Lord Winston (Lab): My Lords, does the noble Lord not recognise that this Question goes much broader than just the confines of the issue that we are discussing? Local authorities have an effect on the environment, transport, housing, poverty and a whole range of social issues that absolutely affect public health. Until that is sorted out, this is going to be a major problem in this country.

Lord Prior of Brampton: The noble Lord makes a good point that goes considerably broader than the Question. I accept that many of these things are inextricably linked.

Lord Turnberg (Lab): My Lords, does the noble Lord accept the report from NICE, which showed that investment in public health improves not only the health of individuals but the economy? Can I tempt him to agree that cutting funding by as much as—I think—7.5% is counterproductive in trying to improve the nation’s health?

Lord Prior of Brampton: The noble Lord may be interested to know that the McKinsey institute assessed that the cost of obesity to the British economy was some £46 billion. I am under no illusion about the importance of proper prevention.

Baroness Manzoor (LD): My Lords, health inequalities continue the gap in access to services and equity in our health services. The gap remains the same and has not become narrower between various socioeconomic groups, 20 years on. That means the rich, poor, black and indigenous white population. Exactly what is going to be done with part of the health prevention budget to try to reduce the gap?

Lord Prior of Brampton: A condition of the grant to local authorities is that they take on the responsibilities that the Secretary of State has under the Health and Social Care Act to reduce inequalities. As statutory

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bodies, local authorities have a duty under the Equality Act 2010 to provide equal opportunities for people with protected characteristics.

Lord McKenzie of Luton (Lab): My Lords, just last month, the Secretary of State for Health told the Commons that:

“The big change we need to see in the NHS over this Parliament is a move from a focus on cure to a focus on prevention”.—[Official Report, Commons, 2/6/15; col. 459.]

Two days later, on 4 June, the Chancellor announced a £200 million cut in the Budget. How joined up is that, and how is it justified?

Lord Prior of Brampton: Most people in this House will recognise that a strong and successful National Health Service depends on a strong and successful economy. Sometimes Governments have to take difficult decisions to improve the long-term strength of the economy, which is what we did in that case.

Caste Discrimination

Question

3.22 pm

Asked by Lord Harries of Pentregarth

To ask Her Majesty’s Government when they intend to implement the amendments to Section 9 of the Equality Act 2010 that requires the introduction of secondary legislation to incorporate caste as a protected characteristic.

The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Williams of Trafford) (Con): My Lords, this Government completely oppose caste discrimination. Since coming into office, we have been considering the caste duty, particularly in the light of the Tirkey v Chandok employment appeal judgment. That suggests an existing legal remedy for claims of caste-associated discrimination under the ethnic origins element of Section 9 of the Equality Act 2010. We note this potential protection.

Lord Harries of Pentregarth (CB): I thank the Minister for her reply and I am glad that she mentioned that case because the Employment Appeal Tribunal, as she rightly said, stated that caste-based discrimination may already be unlawful under existing legislation, but not necessarily so. Is it not therefore essential for the sake of legal clarity that the clear will of Parliament be enacted—namely, that caste-based discrimination be included in the Equality Act?

Baroness Williams of Trafford: My Lords, the Employment Appeal Tribunal judge referred to caste in its many forms potentially coming within Section 9 of the Equality Act. This judgment is binding upon employment tribunals.

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Lord Cashman (Lab): My Lords, in 2012, the United Nations Committee on the Elimination of Racial Discrimination in all its forms recommended to the United Kingdom,

“that the Minister responsible in the State party invoke section 9(5)(a) … in order to provide remedies to victims of this form of discrimination. The Committee further requests the State party to inform the Committee of developments on this matter in its next periodic report”.

I have two simple questions. When is the next periodic review and will the Minister comply with these recommendations?

Baroness Williams of Trafford: I can confirm that this Government, elected only a few weeks ago, are actively considering the matter.

Lord Popat (Con): My Lords, the vast majority of the British Hindu and Sikh community are outraged at this amendment to the Equality Act. Does the Minister agree with the Hindu organisations that implementing this amendment would be a blow to community cohesion in this great country and that the Government should legislate to remove it from the statute book?

Baroness Williams of Trafford: I agree with my noble friend that the issue is divisive. There is a strong lobby both for and against, and the Government are very concerned not to exacerbate the problem. Therefore, the present position, whereby protection from caste discrimination is developing naturally through case law, is very helpful.

Lord Avebury (LD): Will the Minister tell us how many representations have been made and by which organisations for the repeal of Section 9(5)(a), as demanded by the noble Lord, and why the Government have not agreed to meet persons or organisations that support Section 9(5)(a), which includes the whole of the Dalit community in this country?

Baroness Williams of Trafford: My Lords, I do not have exact figures and names to hand but I am very happy to write to the noble Lord with them.

Lord Desai (Lab): My Lords, is not the problem that the majority Hindu and Sikh organisations are responsible for discrimination of the minority in their own ethnic origin community? I do not think that one should quietly concede the majority’s view in this respect.

Baroness Williams of Trafford: I agree with the noble Lord that this can be a problem within communities of that nature, and is not generally something that is within the British culture.

Baroness Flather (CB): My Lords, the Hindu community says that there is no caste discrimination in this country and therefore we do not need this subsection. Fine—but if that is the case, why are they fighting so hard against it? If there is no discrimination, then there is no discrimination. If this becomes law—as

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it should, and the sooner the better—there will be no prosecutions, nothing will happen and it will die out. But because they are fighting so hard, it leads me to believe that there is discrimination.

Baroness Williams of Trafford: My Lords, cases of this nature are very few and far between. As I said, the Government are actively considering the matter.

Lord Stevenson of Balmacara (Lab): My Lords, the last Government passed a Bill that required the present Government to act, and they have failed to do so. We understand that there is evolving case law, but it does not fully satisfy those who feel that the law must be respected. The Government may be new, but are they really changing the rules so that we will be governed by what they think might be a helpful way forward?

Baroness Williams of Trafford: My Lords, it would not be appropriate for me to speculate on discussions within government. I do not want to comment on or rule out any course of action. As I have said a couple of times now, the Government are considering the present position.

Lord Lester of Herne Hill (LD): My Lords—

Lord Singh of Wimbledon (CB): My Lords—

The Lord Privy Seal (Baroness Stowell of Beeston) (Con): My Lords, it is the turn of the Lib Dem Benches and then we have time to go to the Cross Benches.

Lord Lester of Herne Hill: Will the Minister explain how her replies are compatible with parliamentary supremacy, given that Parliament decided to insert the duty into the statute? Will she also explain how it is compatible with legal certainty, given that the only way one could do it through case law would be by going to the Supreme Court, at a cost of many hundreds of thousands of pounds, when Parliament has decided that it should be done by us by statute?

Baroness Williams of Trafford: My Lords, I repeat once again that the Government will be actively considering this, and will take their view in due course.

Lord Singh of Wimbledon (CB): My Lords, it has been said, I think misleadingly, that Hindu and Sikh organisations are against this legislation outlawing caste discrimination. Can the Minister note that the whole Sikh community and the whole thrust of Sikh teachings are totally against the notion of caste?

Baroness Williams of Trafford: I duly note that.

Baroness Symons of Vernham Dean (Lab): My Lords, will the Minister please write to my noble friend who raised the question of the periodic review and let him, and indeed others who are interested, know when it will take place?

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Baroness Williams of Trafford: I am very happy to do that.

Baroness Royall of Blaisdon (Lab): My Lords, the last Government agreed to conduct a feasibility study into if and how it might be possible to estimate the extent of caste-based discrimination in Britain. The research was concluded in November 2014, I understand, but the report has not yet been published. When is the report likely to be published, and why has there been such a delay?

Baroness Williams of Trafford: My Lords, the case law provides potential protection for someone wishing to claim caste discrimination, which is what all sides of this House wanted during earlier debates. We need to consider carefully whether putting the word “caste” into the Act would actually change or clarify the legal position.


Hunting Act 2004

Question

3.30 pm

Asked by Lord Dubs

To ask Her Majesty’s Government what assessment they have made of the impact of their proposed amendments to the Hunting Act 2004 on efforts to protect animal welfare.

The Minister of State, Home Office (Lord Bates) (Con): My Lords, the proposed amendments do not overturn the hunting ban. Pursuit and killing of wild animals by dogs remains illegal. Hare coursing also remains illegal. The UK continues to have some of the strongest animal welfare protection in the world.

Lord Dubs (Lab): I wonder if the Minister has ever read the Conservative Party manifesto. In the spirit of helpfulness, perhaps I may point to one sentence:

“A Conservative Government will give Parliament the opportunity to repeal the Hunting Act on a free vote, with a government Bill in government time”.

Whatever made the Government think that they could slip a measure through without having a full Bill, as they were contemplating doing a few days ago? Do not the Government realise that getting this measure through Parliament would be deeply unpopular—as it is in the country? Would not the best thing be to drop the whole daft idea?

Lord Bates: I can confirm that I did read the Conservative manifesto, and I think that quite a lot of the electorate probably read it as well. On the noble Lord’s point, of course there is a manifesto commitment about a free vote, and that will come. What we were dealing with here was secondary legislation to bring in technical changes which would bring the legislation into line with that which exists in Scotland. That is what was at issue in this debate. No secondary legislation would change the primary purpose of the Bill, so that is a separate matter.

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Baroness Parminter (LD): Does the noble Lord accept that an amendment to the Hunting Act which makes the number of dogs allowed to chase a wild animal limitless will make the Bill unenforceable? It has done that in Scotland, where there have been zero prosecutions for mounted hunts.

Lord Bates: I do not think that it will make it unworkable. There has been concern, which has been expressed in representations from farmers, particularly in upland areas, that the current provisions and exemptions for pest control are unworkable, causing them problems and resulting in the loss of livestock as a result of attacks by foxes. So the question was: can they bring it into line with that which is already the case in Scotland? The view was that that was a reasonable request and something which should be done.

Lord Mancroft (Con): Will my noble friend agree with me that the Government’s proposals did not constitute repeal but were welcome nevertheless, and that we look forward to repeal, as it is in the manifesto, at a convenient moment in the future? In asking this question I declare my interest as chairman of the Masters of Foxhounds Association, chairman of the Council of Hunting Associations and chairman of the Countryside Alliance.

Lord Bates: My noble friend makes me grateful for that provision in the manifesto which the noble Lord, Lord Dubs, referred to, that it is a free vote on these matters.

Baroness Smith of Basildon (Lab): My Lords, is not a pattern emerging regarding the Government’s attitude to legislation and the role of Parliament? Both the Delegated Legislation Committee and the Constitution Committee have expressed concerns about a worrying trend to limit scrutiny in this House. We have the absurdity of the Government’s trying to rush through English votes for English laws with a multi-page amendment to the Standing Orders of the House of Commons with no reference to or debate in the House of Lords. Then, with the fox hunting legislation, we have a pantomime of trying to change—whatever the noble Lord says, it would change—the intent and the purpose of primary legislation through an amendment in secondary legislation. Are these examples the amateurish, foolish mistakes of inexperienced Ministers, or are the Government now frightened of sensible scrutiny?

Lord Bates: They might be, but the question is: which Ministers? The power to vary the exemptions was in the Act introduced by the Labour Government in 2004. Section 2(2) provides for the ability to amend Schedule 1 to the Act. We are simply taking the opportunity and advantage of the provision that they wisely put into the legislation.

Lord De Mauley (Con): My Lords, to what does my noble friend attribute the behaviour of the Scottish National Party, which appears to oppose amending the law in England so that it is aligned with that in Scotland and which a few months ago undertook not to do what it says it would now do?

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Lord Bates: My noble friend raises an important point. In February, Nicola Sturgeon said:

“The SNP have a longstanding position of not voting on matters that purely affect England—such as foxhunting south of the border, for example—and we stand by that”.

That was the SNP’s position then; we know what its position is now, and I think people can draw their own conclusions. It also plays into a wider issue of why SNP Members of Parliament should seek to use their influence to stop England and Wales having the same exemptions as they have in Scotland.

Lord Trees (CB): My Lords, our society accepts the killing of animals for specific purposes. Does the Minister agree with me that such killing should be strongly justified, should be carried out in as humane a manner as possible and should be done by competent individuals acting in a cool and dispassionate but compassionate way? Furthermore, will he go so far as to agree with me—I doubt that he will—that in a civilised society like ours, we should do all we can to dissuade individuals from pursuing leisure activities for pleasure which result in the killing of animals?

Lord Bates: The Animal Welfare Act 2006 is very clear that the causing of unnecessary suffering to an animal is an offence and the maximum penalty is an unlimited fine or six months’ imprisonment. That is not what we are talking about here; we recognise in certain circumstances that it is necessary to control pests, particularly in rural areas. The argument made is that the current provisions do not allow that to be done effectively. There is no question of contravening the Hunting Act, as my noble friend has mentioned, because that bans hunting with dogs to kill mammals. That would not be done in this case. It is a case of flushing out using dogs, with the killing done as humanely as possible but at the point of a gun.

European Union (Approvals) Bill [HL]

Committed to Committee

3.37 pm

Moved by Lord Freud

That the bill be committed to a Committee of the Whole House.

Motion agreed.


Iran: Nuclear Deal

Statement

3.38 pm

The Minister of State, Foreign and Commonwealth Office (Baroness Anelay of St Johns) (Con): My Lords, with the leave of the House, I shall now repeat a Statement made earlier in another place by my right honourable friend the Foreign Secretary. The Statement is as follows:

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“With permission, Mr Speaker, I would like to make a Statement on the outcome of the nuclear negotiations with Iran.

In recent days, the world has held its breath as talks between world powers and Iran edged towards a conclusion. The negotiations were hard. All sides faced tough decisions. In the early hours of yesterday morning, a process that began over a decade ago came to a conclusion.

The result is a historic deal, a landmark moment in efforts to prevent nuclear proliferation and a victory for diplomacy. The UK with its partners in the E3+3—China, France, Germany, Russia and the United States, with the EU High Representative as our co-ordinator—have at last reached a comprehensive agreement with Iran on its nuclear programme. With the conclusion of these negotiations, the world can be reassured that all Iranian routes to a nuclear bomb have been closed off and can have confidence in the exclusively peaceful nature of the Iranian nuclear programme going forward.

The origin of these negotiations lies in the revelation some 12 years ago that Iran was concealing nuclear activities, in violation of its international obligations. At that time, Iran, under a different Government, was not willing to meet the requirements of the International Atomic Energy Agency. The international community responded with multiple UN Security Council resolutions. The agreement that we have reached does not absolve Iran of blame for its previous activities, nor does it wipe the slate clean. Instead, it offers Iran the opportunity to draw a line under its past behaviour and, gradually, to build the world’s trust in its declarations that it is not pursuing the development of a nuclear weapon. This will not be a quick process but, with the implementation of this deal, it should be possible.

The Government’s purpose in seeking an agreement has always been clear: to secure assurance that Iran will not be able to develop a nuclear weapon. To that end, this agreement imposes strict limits on Iran’s nuclear programme that are comprehensive and long-lasting. For 10 years, Iran’s enrichment capacity will be reduced by over two-thirds from current levels. It will enrich uranium only to a level of 3.67%—well below the 90% level of enrichment considered necessary for a nuclear weapon. Its stockpile of low-enriched uranium will be limited to 300 kilograms, down from more than seven tonnes, with the balance exported to Russia. Its research and development activities will be constrained so that it will not be able to enrich with advanced centrifuges for at least 10 years. Additionally, no uranium enrichment, enrichment R&D or nuclear material will be permitted at Iran’s underground Fordo nuclear site. The agreement also cuts off the plutonium route to developing a nuclear bomb. Iran’s heavy water research reactor at Arak will be redesigned and rebuilt so that it will no longer have the capability to produce weapons-grade plutonium.

Given the historic levels of mistrust that have built up between Iran and the international community, a strong inspection regime and a framework for addressing concerns about past military dimensions to Iran’s nuclear programme are vital for building trust and providing us with the confidence that Iran is meeting its commitments. Some of the crucial monitoring and

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transparency measures of this deal will last indefinitely, such as the implementation of the additional protocol to the comprehensive safeguards agreement. The additional protocol for every country allows access to sites about which the IAEA has concerns that cannot be addressed in any other way. Iran is no exception. Iran’s NPT obligations—including the obligation never to acquire or develop nuclear weapons—will apply during and after the period of the deal. We will not hesitate to take action, including through the reimposition of sanctions, if Iran violates its NPT obligations at any time. Our concerns about the possible military dimensions of Iran’s nuclear programme will be addressed. The IAEA and Iran have agreed a road map of actions to clarify the issues.

Taken together, these measures mean that, if Iran were to renege on its promises and try to “break out” for a bomb, it would take at least 12 months even to acquire the necessary fissile material for a single device. The robust transparency measures that we have agreed mean that we, the international community, would know almost immediately and we would have time to respond. In return for implementing these commitments, and as our confidence in Iran’s programme develops over time, Iran will receive phased and proportionate sanctions relief. Initially, there will be relief of EU, US and UN nuclear-related economic and financial sanctions but, to be clear, this sanctions relief will be triggered only once the IAEA verifies that Iran has taken the agreed steps to limit its nuclear programme.

Other core provisions in the existing UN Security Council resolutions will be re-established by a new resolution. Important restrictions on import and export of conventional arms and development of ballistic missiles will be reimposed through an annexe to the resolution and lifted only later in the agreement.

These relaxations are backed by a robust enforcement mechanism: if there is a significant violation of the nuclear provisions of the agreement, all previous UN sanctions can be reimposed through a snap-back mechanism, which any party to this agreement can invoke. The EU and the US could also reimpose their own sanctions in such a scenario. Clearly, having made this agreement, it will be strongly in Iran’s interest to comply with the provisions of it to avoid a return to the sanctions regime that has crippled its economy for so long.

We now need to look ahead to the implementation of the agreement. After such a tough negotiation there will inevitably be bumps along the road. We entered into this agreement in good faith, and all sides must try to resolve together any problems in implementing this deal. But the deal includes robust enforcement provisions, and we will not hesitate to use them if Iran goes back on its word.

Although this agreement is focused solely on Iran’s nuclear programme, its conclusion could have wider, positive consequences. By providing the means—through sanctions relief—for Iran’s economic re-engagement with the world, it will allow the Iranian people to feel the tangible benefits of international co-operation. As that economic re-engagement materialises, we will, of course, seek to assist UK businesses to take advantage of opportunities that arise. That assistance would, of

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course, be enhanced through having a functioning British embassy in Tehran. We remain committed to reopening our embassies in each others’ countries and will do so once we have resolved some outstanding issues.

The deal also has the potential to build a different kind of relationship between Iran and the West, and change in a positive way the dynamics in the region and beyond. In an atmosphere of developing confidence and trust, there will be an opportunity for Iran to realign its approach in support of the international community’s efforts, in particular in confronting the challenge of ISIL and the resolution of regional crises, such as those in Yemen and Syria.

But this will be a process. It will take time. In the mean time, we remain realistic about the nature of the Iranian regime and its wider ambitions. We will continue to speak out against Iran’s poor human rights record. And we will continue to work closely with our friends, allies and partners in the region who live with Iranian interference in their neighbourhood. Iran will not get a free pass to meddle beyond its borders.

An Iranian bomb would be a major threat to global stability. That threat is now removed. We and Iran now have a common responsibility to ensure that the wider potential benefits, for the region, and for the international community as a whole, are delivered. The UK is fully committed to playing its part and I commend this Statement to the House”.

3.48 pm

Baroness Morgan of Ely (Lab): My Lords, I thank the Minister for repeating the Statement. The Opposition welcome the successful end to the marathon Iran negotiations. It allows us to see a glimmer of light in a world that seems increasingly precarious. We have had challenge after challenge in the field of foreign affairs over the past few years and it is comforting to have a successful outcome which has proved the value of the diplomatic route.

I start by paying tribute to the Foreign Secretary, John Kerry, our European and international partners and everyone involved for their efforts in securing this major diplomatic breakthrough. Neither should we forget President Rouhani, who has had to face down some pretty tough hardliners at home. I ask the Minister to join me in paying particular tribute to the noble Baroness, Lady Ashton, for her sterling work on this matter during her tenure as High Representative of the EU of Foreign Affairs and Security Policy. Nobody has worked on this matter more tirelessly than she has. It is a fitting tribute to her, and a part of her legacy, that this agreement has been delivered.

Will the Minister also join me in encouraging the US Congress to endorse this agreement, which would send a positive message about the role of diplomacy in the world? There are some worrying signals coming from the Republicans that they will seek to block this agreement, which I fear would be a mistake. There has long been consensus across these Front Benches that seeking an agreement with Iran was the right thing for the international community to do. We have always supported the twinned approach of sanctions and negotiations backed up by UN Security Council

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resolutions. None of us wants Iran to have a nuclear weapon and no one believes that the world would be a safer place were it ever to acquire one.

It is worth reflecting on how much graver the world might have looked today had the Foreign Secretary returned to the House of Commons to report that the talks had collapsed without an agreement. We would be facing the almost certain restart of Iran’s nuclear programme with no means of monitoring or inspection, the possibility of a nuclear arms race in the Middle East and greater instability in an already volatile region. That is why it was right to use the negotiating opportunity that the pressure of sanctions against the Iranian regime has created. That process was not rushed in order to get this right. The important point now is to ensure that this agreement lives up to the words of yesterday’s joint statement by the EU High Representative and the Iranian Foreign Minister: that this,

“is not only a deal but a good deal. And a good deal for all sides”.

The Minister outlined many aspects of the agreement in detail. Let me touch on a number of these. First, Iran has reaffirmed as part of the agreement that,

“under no circumstances will Iran ever seek, develop or acquire any nuclear weapons”.

This is, of course significant, but the world—especially those countries in the region that have particular concerns—will want to see that Iran’s words are matched by its deeds, so I welcome the assurances that thorough and independent inspections are at the heart of this agreement. It is vital that its implementation is based not on faith but on facts, evidence and verification.

Does the Minister agree that, while we should be positive about the implementation of this agreement, we must also go into it with our eyes wide open? If there is a lesson to be drawn from the collapse of the agreed framework negotiated with North Korea by the Clinton Administration in the 1990s, it is that the success of these agreements should be judged not over months but over years. It is therefore right that some sanctions should be removed gradually and only when Iran honours the commitments it has made. Are the Government satisfied that, were Iran to violate the terms of the agreement, the provisions for sanctions to snap back are tough enough to block its path to a nuclear weapon? Does the Minister agree with the words of Javad Zarif, the Iranian Foreign Minister, who said yesterday that this deal represents,

“not a ceiling but a solid foundation … to build on”?

It is no secret that Iran has been involved for many years in exploiting sectarian tensions in the region, whether through proxy armies or support for terrorist groups. Those issues, and the difficulties in our own relationship with Iran, will not go away overnight. However, this agreement does present Iran with the opportunity to play a much more constructive global role. The Statement asserts that,

“we remain realistic about the nature of the Iranian regime and its wider ambitions”.

Could the Minister elucidate what the Government understand by the “wider ambitions” of Iran in the area? The Statement goes on to say:

“Iran will not get a free pass to meddle beyond its borders”.

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What exactly is meant by this? Will we stop Iran from any involvement in defeating ISIL or Daesh in Iraq? What exactly are the Government suggesting in terms of the relationship between Assad and Iran, and its provision of arms to Hezbollah? What do the Government intend to do, and how, if they genuinely want to stand by this Statement? Does the Minister agree that opening up better links with Iran will help the process of reform within that country? It needs to include improving its human rights record and the ending of house arrest for opposition leaders.

The Iranians are a gifted people with a large, educated and determined middle class representing one of the world’s great civilisations. There is a real opportunity to reach out and engage with this part of the world and the people living there, and to bring Iran in from the cold. For Britain especially, the Minister mentioned ongoing efforts to reopen our embassy in Tehran. Will she tell us specifically when she expects that to take place?

Working together as an international community is a well-worn phrase, but this moment shows what can be achieved through patience and diplomacy. If history teaches anything, however, it is that peace is a process and not an event. Yesterday, the Iranian President called this a “new chapter”. We all live in hope that it is a new chapter which will help lead to a safer and more peaceful world, free of nuclear weapons. We on this side will continue to support all efforts to make that hope a reality.

3.56 pm

Lord Wallace of Saltaire (LD): My Lords, we on the Liberal Democrat Benches welcome this Statement and welcome enormously the successful conclusion of the negotiations, although we have some reservations about aspects of the Statement and its tone. Within the coalition Government, the Liberal Democrats pressed from the outset for an active exploration of a changed relationship with Iran. It has a very complex political system in which there are some very nasty and hardline elements, but also some elements of civil society and a desperate desire, particularly among the urban population, for a reopening of its relationship with the rest of the world.

We should pay tribute in particular to the Americans who led this negotiation and to the enormous efforts which Wendy Sherman, the American negotiator, put in. We should also recognise the enormous efforts which Cathy Ashton made as the EU negotiator. I would welcome the Minister marking the fact that this has been a triumph for European co-operation in foreign policy rather than simply a British effort. I noted in the last Statement made on the European Council that the Prime Minister said that we wanted to return the European Union to its original fundamentals as a customs union. The EU, in its original fundamentals, was never just a customs union; it was always about foreign policy, co-operation and security. The Government need to make that clear as they negotiate for EU reform.

We have some reservations about the suggestion that the origins of these negotiations lie in the revelation in 2003 that Iran was considering nuclear activities.

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In 2003, the year of the invasion of Iraq, the Iranians offered to reopen negotiations with the United States and the European countries on a closer relationship, which the Americans blocked off. The then Labour Government, to their shame, simply followed the American lead, as so often they did in that period of an American Republican Administration, and we missed what seemed to many of us to be an opportunity for an earlier transformation of the relationship.

It being a principle in good international relations, we have to recognise that you need to understand how your opponent sees the world. At that point, the Iranians had seen, first, American and European support for Iraq in the Iraq-Iran war, which was a very bloody war, and, secondly, the western invasion and occupation of Iraq just next door to them. Not surprisingly, the Iranian regime—nasty though it was in many ways—felt threatened. Therefore, after 10 years of very difficult negotiations, we come to a position where we have not entirely secured the abolition of a nuclear weapons programme in Iran.

We recognise that this is a compromise on which there are things still to be done. However, there is now the opportunity for a gradual change in the climate. We should like to hear from the Minister how far the Government recognise that this offers the opportunity for a transformation of our relationship with the complexities of the various Middle East conflicts and the Iranian role in them.

I thought that it was extremely unwise of the Israeli Prime Minister to suggest that this was a disaster and that Iran represented an existential threat. The other week I heard an Israeli Minister refer to Saudi Arabia as a moderate state and the Iranians as evil. That seems enormously mistaken. Clearly, Iran does meddle well beyond its borders, but there are many other states in the Middle East which also meddle beyond their borders, supporting other terrorist, Sunni organisations. We need to be concerned about that as well.

As Liberal Democrats within the coalition, one of our concerns was that the Government risked being caught on the hardline Sunni side of a developing Sunni/Shia conflict. I hope the Minister will reassure us that the Government are determined not to be caught there and that our interests are in promoting an easier relationship between Iran and the Sunni autocracies to which we are so close. We still sell too many weapons to those heavily armed states. I hope she will say that we will now be pushing for a transformation as we deal with the multiple threats from ISIS and from other terrorist groups across the Middle East.

Baroness Anelay of St Johns: My Lords, I thank both Her Majesty’s Opposition and the Liberal Democrats, with whom I was very privileged to work in coalition—particularly the noble Lord, Lord Wallace. I thank them for their support throughout this process. It has been an extremely long process and it has been difficult for political parties to remain united over that period. The seriousness with which all parties and their leaders have continued their commitment to it shows the major role that the UK plays, not only in the world but in trying to ensure that the world remains at peace without nuclear intervention.

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It is with great pleasure that I recognise the remarkable role and patience of the noble Baroness, Lady Ashton, as high representative of the External Action Service of the European Union. One watched her attend meetings month after month, year after year and through the night. She always looked commendably and diplomatically in charge of events. We have much to thank her for.

I turn to specific questions from noble Lords. The noble Baroness, Lady Morgan, asked whether I was concerned about the role of the United States Congress. Clearly, there is now a period in which Congress has to consider the matter, at the end of which it can express its view. It is a matter for the United States Congress. I would not interfere in its events, just as I would not wish it to interfere here. We await the outcome with interest. All these matters can proceed only once a United Nations resolution has been achieved.

I was also asked whether I agreed that what had been achieved were thorough, independent inspections and verifications, and that those were at the core of everything. I absolutely agree with the noble Baroness. She also had a degree of realism—it may be painful, but we have to keep our eyes wide open for at least 10 years. This agreement has been won after such a hard struggle; we must not let any of it slip.

With regard to snap-back, am I assured that it is tough enough to block the way to the obtaining of nuclear weapons? Yes, I am. The process of snap-back is robust because it is structured in such a way that it reserves the powers of all the P5 of the UNSC to snap back to the original sanctions in the event of any violation by Iran. Of course, in any event, if either the EU or the US thought that there had been a violation, they could impose their own sanctions as well.

Iran’s wider ambitions were referred to by both the noble Baroness, Lady Morgan, and the noble Lord, Lord Wallace of Saltaire. It is crucial that we consider the wider interests of the region. Throughout this process, I have always said that it is important that we are able to welcome Iran back into the international community, but that welcome has to be tempered by a realism that Iran has ambitions. I agree with the implication behind the question of the noble Lord, Lord Wallace, that it is important that all parts of the international community work with Iran so that we can work towards an easier relationship between Sunni and Shia, as I believe he put it. That is what we should all aim to achieve.

I am already reassured to some extent by the measured tone that we have heard from Saudi Arabia in its reactions to the signing of this agreement. That is, indeed, promising. My right honourable friend the Prime Minister has made it clear that we hope this may lead to our undertaking further work with Iran in encouraging it to act responsibly as part of the work that the coalition does, not necessarily as part of the coalition but working towards the same end, in dealing with the threat of ISIL—or, as some prefer to call it, Daesh.

Both the noble Baroness and the noble Lord asked me whether this agreement makes it easier for us to have relationships with Iran. I very much hope that it does, but again with our eyes wide open. As I mentioned

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in the Statement, this will not stop us speaking out against human rights abuses in Iran, but our current work and the fact that we will have a base eventually, when the embassy reopens, gives us a much better opportunity to interact with the people in Iran and to make sure that information is more readily available. With regard to the opening of the embassy, there are still technical problems with regard not to re-equipping but actually to equipping the embassy after it was emptied. However, we are hoping that will be achieved by the end of this year.

The noble Lord, Lord Wallace, asked me whether the UK had an interest in not only promoting the easier relationship between Sunni and Shia, but also ensuring that we are able to work with countries in the wider community in the region in order to allay their concerns. I hear the concerns that President Netanyahu of Israel has already expressed and my right honourable friend the Foreign Secretary will travel there tomorrow to discuss the implications with him.

The noble Lord, Lord Wallace, teased me a little about the position of the Conservative Party vis-à-vis the European Union. I have always made it very clear that I find it very helpful to work through the European Union both with regard to negotiations such as these and certainly with regard to work in the United Nations. The E3—the UK, France and Germany—have been at the heart of these negotiations since the Foreign Ministers visited Tehran in October 2003, launching the process that culminated in yesterday’s agreement. That says it all.

4.07 pm

Lord Lamont of Lerwick (Con): My Lords—

Lord Jopling (Con): My Lords—

The Earl of Courtown (Con): Shall we hear from the noble Lord, Lord Lamont?

Lord Lamont of Lerwick: My Lords, I refer to my entry in the Register of Lords’ Interests as chairman of the British Iranian Chamber of Commerce. First, in judging this deal, does the noble Baroness think it important to point out that 10 years of sanctions did not succeed in reducing the total number of centrifuges, which during that period increased from 3,000 to 22,000, and that the only alternative to a negotiated settlement was military intervention and the use of force, which would have been disastrous? Secondly, she referred to possible past dimensions of the Iranian military programme, and said that they would be settled later. How far have the Iranian Government gone in committing themselves to allow these matters to be investigated, and does she have complete confidence that this will happen? Thirdly, does she agree that it is extremely encouraging that President Rouhani, who took the unprecedented step of opening public negotiations with the United States for the first time since 1979, has said that he sees the agreement as just the first step towards better relations between the Islamic republic and the wider world?

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Baroness Anelay of St Johns: My Lords, I will deal with the latter point first. The noble Baroness, Lady Morgan, quoted the Foreign Minister with regard to the fact that the attitude in Iran is that this is the starting point, not the ceiling. This is not where we finish but where we start—and there is a great deal to do, to put it mildly. In response to my noble friend, it would be improper for me to give details about where the negotiations are and identifying past activities, but those discussions continue. What I can certainly say is that with regard to implementation of the terms of the agreement, Iran will provide access to the IAEA in accordance with the provisions of the Additional Protocol to the Comprehensive Safeguards Agreement and the transparency provisions of the deal. So access has to happen. If anybody feels that there is any collusion or obstruction, there are ways in which that can be resolved by the joint commission—and, if necessary, we can go back to sanctions.

With regard to access to the wider investment in Iran, the fact is that all the preparations for developing nuclear capability went on while there were sanctions, but look what it did to the rest of the country. This agreement will allow the rest of the country to begin to thrive again.

Lord Elystan-Morgan (CB): My Lords, I hesitate to dampen the euphoria expressed in London and Washington in relation to this agreement, but are there not certain harsh realities of which we should remind ourselves? The first is that Iran is still solemnly and totally committed to the destruction of the State of Israel—a factor that may not be irrelevant to the condemnatory words of Benjamin Netanyahu. Secondly, despite all the restrictions, Iran—which is a theocratic state—is within a short step of becoming a lethal nuclear power, should it so wish.

Baroness Anelay of St Johns: My Lords, there is no short step to becoming a lethal nuclear power. This is a robust, durable, verifiable agreement and any breakout would certainly take at least a year to achieve. It would be noticed very quickly and sanctions would come back. That is why this deal is so effective. I would say that there is no euphoria but a recognition that this is a tremendous success after so much work. There is also a realisation that Iran has much to do to become accepted as a viable international state.

Baroness Symons of Vernham Dean (Lab): My Lords, in the Statement which the noble Baroness repeated, she said that the IAEA and Iran had agreed what I believe she called a road map of actions to implement the agreement. Can she tell us whether this road map is in the public domain and, if so, whether she will ensure that it goes into the Library of the House? Secondly, I declare an interest as chair of the Saudi-British Joint Business Council. In the repeated Statement, the noble Baroness also referred to “developing confidence and trust” in the region. She said that the Foreign Secretary will be going to Israel to discuss matters already raised on the Floor of the House. Can she tell us about the other state that has expressed a good deal of difficulty over this agreement? Notwithstanding

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what she said a moment or two ago about Saudi Arabia, there are enormous concerns there about this agreement. What steps are the Government taking to assure Saudi Arabia that we are aware of its difficulties with this and that we are prepared to work with it on those points?

Baroness Anelay of St Johns: My Lords, through diplomatic channels we are having discussions with a range of states, and clearly Saudi Arabia is an important player in that area with which we have close and enduring relationships and for which we have respect. We may disagree on many of its policies but we certainly agree that it has concerns and that it needs to maintain its national defence. Certainly, those discussions proceed, and that goes more widely.

The noble Baroness asked whether I would put into the domain details about how the road map might be developed. The steps for Iran to take in the PMD road map are not public but I can say that there will be an increasing opportunity as we have these questions and debates to put on the record further details about the way in which there are robust controls over what happens if Iran were to break its word. My right honourable friend the Foreign Secretary began to do that yesterday in discussions with the press, and that will continue in the way in which Ministers seek to keep both Houses informed.

Lord Jopling (Con): My Lords, will the noble Baroness be kind enough to tell us a little more about the timing of the implementation over the next year or so of this deal? In particular, can she tell us about the effect that would be applied to the deal if the United States Congress were to fail to endorse it? As she said quite rightly, that is a matter for Congress—but would it be the case that if it failed to endorse it, that would bring the whole thing to a grinding halt and we would be back to square one? It would come as no surprise to any of us who observed the hysterical and overexcited way in which Congress greeted Mr Netanyahu when he was there—he is of course strongly opposed to this deal—if Congress decided not to endorse the deal.

Baroness Anelay of St Johns: My Lords, there are indeed many steps in the process by which we can reach the stage when we get to the transition period. There is a whole series of days: finalisation, adoption, implementation and transition days, and UNSCR termination day, which is 10 years after the anniversary of implementation day. This is to ensure that the terms of the agreement are kept to by Iran and that we do not allow the sanctions to be lifted too soon. Some of the sanctions, such as those with regard to arms and ballistic missiles, will take some years to lift.

My noble friend asked me specifically about the United States. My understanding is that Congress has up to 60 days to review the deal. As for Congress not approving the deal, it is not for me to advise the United States how their President might act but I rather suspect that this is such an important deal that the United States will find a way of agreeing with the other signatories, and that the agreement will take effect.

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Lord Ashdown of Norton-sub-Hamdon (LD): My Lords, despite the necessary uncertainties about long-term destinations from what happened yesterday, is not one thing certain? We now have an opportunity to build a more stable Middle East that did not exist two days ago, for which much thanks. Is it not good also to recognise that that has been achieved through long-term, patient diplomacy, which stands in stark contrast to a Middle East policy that is otherwise fixated on the instant gratification of high explosives, and that this departure is also much to be pursued?

Baroness Anelay of St Johns: My Lords, I am always pleased to be able to celebrate the importance and effect of diplomacy. I entirely agree with what the noble Lord said about the opportunity for a more stable Middle East.

I am reminded by those who advise me that when, in response to my noble friend Lord Jopling, I was reading out the number of days—the finalisation, adoption, implementation, transition and UNSCR termination days—I should have said for clarity that UNSCR termination comes 10 years after adoption day, not implementation day.

Baroness Afshar (CB): My Lords, as an Iranian-born Member of this House I welcome this decision, in particular in the name of the people of Iran if the sanctions are removed on medication and food, because the poor in Tehran and the rest of Iran are starving. However, I am very grateful that the Government are remaining vigilant on human rights issues and I urge them to continue, because Iranian human rights measures are absolutely deplorable.

Baroness Anelay of St Johns: I can assure the noble Baroness that we will continue our pressure on the human rights record in Iran, which really bears no scrutiny because it is so poor. With regard to the suffering of the Iranian people, she is right to draw attention to the fact that sanctions have not affected medicines over this period.

Lord Anderson of Swansea (Lab): My Lords, this is historic but risky because of the history of deception by Iran and the linkages between the Revolutionary Guards and arch-proliferators such as North Korea. Do we expect that this agreement will lead to any spillover, for example into Yemen where Iran has had a very malign influence? What reassurances have we given the Gulf states, including more military assistance, to help them over the interim period? The Minister mentioned the embassy. If our businessmen are to take full advantage of the new openings, surely an embassy would help immeasurably?

Baroness Anelay of St Johns: My Lords, as I mentioned earlier, there are still obstacles in the way of reopening the embassy but we are working very hard on them in discussions with Iran and we hope to reopen it by the end of the year. The noble Lord is right that that will help businesses from around the world, particularly the UK, to operate there. However, businesses are right to be circumspect about how soon they go in and

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the circumstances under which they can operate. I am sure there will be lot of caution. I think I have already made it clear that we are talking to countries in the area through our posts and also sometimes through ministerial contacts with regard to the implications of this agreement. Clearly, our diplomatic work since last summer with regard to Yemen has been trying to ensure that there is no spillover into what appears at times to be a proxy war.

Lord Howell of Guildford (Con): My Lords, while we have no illusions about the continuous malign influence of certain Iranian groups in the Middle East, should we not recognise that if things were to go the other way or this deal were to be blocked, that would probably trigger the opening of a major nuclear arms race in the region? As it is, if this deal holds, can we not look in the other direction and begin to think about a Middle East nuclear weapons-free zone, which has long been the ambition of many? I urge my noble friend to encourage her colleagues to make that a priority for the future despite the obvious difficulties.

Baroness Anelay of St Johns: As always, I listen very carefully to my noble friend. He has great wisdom in this area. I agree with him with regard to the importance of ensuring that an arms race is not started and that blocking this deal could have achieved exactly that. With regard to the Middle East weapons-free zone, I had discussions about this when I was at RevCon in New York a couple of months ago—and I am grateful again to the Opposition for ensuring that I was able to go with their support during that period of purdah. I am afraid that progress was rather disrupted because of Egypt seeking to make it impossible for Israel to take part in those discussions—at least it appeared to try to make that impossible—by saying that if Israel did not turn up on specified dates the whole thing would go ahead without it. There is a lot of difficulty internationally in taking forward the idea of a Middle East weapons-free zone but I agree with my noble friend that we should try to do so.

Lord Cunningham of Felling (Lab): My Lords, the noble Baroness and Her Majesty’s Government deserve our congratulations and so do our partners in this project, which we hope will lead to an enduring settlement. The Minister said on more than one occasion that if things did not turn out right it would take Iran at least 12 months to secure a weapon. Does history not show us that the ability to procure such a weapon is based on gross national product and nuclear engineering and the associated science and technology? Is the implication of what she is saying that we recognise Iran already has those assets?

Baroness Anelay of St Johns: My Lords, I certainly appreciate that the noble Lord has experience and is right to be cynical. However, the agreement takes into account several factors relating to how Iran could re-equip and get fissile material, and what we can do to stop that. For example, with regard to Iraq, the international joint venture will assist Iran in redesigning

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and rebuilding a modernised heavy-water research reactor in Iraq which will not produce weapons-grade plutonium, thus removing it from the picture. Fuel will be exported and Iran will not undertake reprocessing. Fordow will be converted into a nuclear physics and technology centre, and the IAEA will have daily access to it—not just every now and then, but daily access. We will be watching.

Baroness Deech (CB): What confidence can the Minister give the House that verification will work, given that 24 days’ notice has to be given to Iran of an inspection, which even then may be refused by a commission? Surely, of course, only a very short-notice inspection would be worth it, given Iran’s history of secret nuclear development. Why does she think that Iran has insisted on retaining and working on many thousands of centrifuges? What on earth can its motive be, if that state wishes to keep those thousands of centrifuges?

Baroness Anelay of St Johns: My Lords, as I think I explained in the Statement, the number of centrifuges is dramatically reduced, as is fissile material. What we have aimed at in this agreement is that Iran should still be able to have a civil need for use of reactors but not a military one. That is what we believe has been achieved. As for whether Iran can break out quickly, and the time between it being noticed and reported that something is going wrong and action being taken—how long it would take between a request from the IAEA to get access and being able to insist on access—it would typically take about 21 days between demand and access. There is, then, a very clear process that has to be followed, which I am happy to discuss with the noble Baroness in detail outside the Chamber, given the time available. Of course, the breakout period cannot be achieved except in a period of over a year. We have time to prevent breakout into a future with Iran having a nuclear weapon. It will not happen.

Baroness Neville-Jones (Con): My Lords, I welcome the agreement, which is obviously the fruit of a great deal of extremely hard work and hard negotiation. I think that most noble Lords will agree with me that the proof of its adequacy will be in implementation. This is one of those agreements where the words are fine but it is the actions that follow that will really matter. I hope that all parties to it, particularly the European parties, will be robust in checking any backsliding. One worry of those who would like to see this agreement succeed is that somehow, Iran will be allowed to get away with things along the line and the robust reaction will not take place because it is all too difficult and unpalatable. I seek some reassurance on robustness.

My other point, alluded to by the noble Baroness who spoke previously, is on verification. Surely, this agreement depends crucially on adequate verification, and I worry that there seems to be an ability on Iran’s part not only to challenge but to block verification proceedings. There seems to be a road through which they will be able to prevent the IAEA providing us with the necessary reassurances. How can we ensure that this joint commission, to which I gather such

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issues will be referred, can cut through something like that? How can we get round Iran blocking something by language and words, and get it to fall into line?

Baroness Anelay of St Johns: We get round language and words by having the ability to have a snap-back on sanctions within the United Nations at any time, and the EU and the United States can do so themselves with their sanctions. My noble friend is right, however, to ask about the process. The joint commission makes its decision by consensus. Obviously, it can do it by majority. What I can say, of course, is that it is important that Iran is on that joint commission so that it can engage with and respond to any suspected issues of non-performance. It can represent its interests in the same way as all other members of the joint commission. But the fact is that if there is a disagreement over whether something is a serious breach, or if Iran were unwise enough to block the IAEA access to which my noble friend refers, it is still possible for the sanctions to be snapped back. That is the prize that Iran has sought: that there should be an end to sanctions. The prize that we have sought has been to make sure that this world does not face a nuclear weapon-holding state in Iran. I think that the prize for Iran and the prize for the rest of the world has been achieved.

Supply and Appropriations(Main Estimates) Bill

First Reading

4.30 pm

The Bill was brought from the Commons, read a first time and ordered to be printed.

Cities and Local Government Devolution Bill [HL]

Report (2nd Day)

4.30 pm

Relevant documents: 1st, 2nd and 3rd Reports from the Delegated Powers Committee

Amendment 34A

Moved by Lord McKenzie of Luton

34A: After Clause 7, insert the following new Clause—

“Audit committees

(1) A combined authority must arrange for the appointment of an audit committee to—

(a) scrutinise the authority’s financial affairs;

(b) review and assess the authority’s risk management, internal control and corporate governance arrangements; and

(c) review and assess the economy, efficiency and effectiveness with which resources have been used in discharging the authority’s functions.

(2) The audit committee must have an independent chair.”

Lord McKenzie of Luton (Lab): My Lords, I shall also speak to our other amendments in this group. A strong and adequately resourced scrutiny process is an

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essential ingredient in the process of devolving substantial powers to combined authorities—and, it might be thought, especially to mayoral combined authorities. The sheer quantity of amendments in this group reflects the importance that all noble Lords, including the Government, have given this issue.

Our Amendments 35 and 37 ensure that the scrutiny committees can enquire into and challenge not only actual decisions—for example, by call-in procedures—but matters under consideration prospectively, rather than just retrospectively.

Amendment 43 requires that guidance by the Secretary of State on the functions of overview and scrutiny committees should be affirmed by the affirmative procedure, in the light of the crucial role that such committees should play.

The Bill lacks an adequate procedure comparable to that of the audit committees found in local government. Amendment 36 seeks to remedy this deficiency, but we felt on reflection that it does not quite meet the case, since it delegates to the overview and scrutiny committee the task of appointing another committee, independently chaired, to carry out that audit function. Our Amendment 34A seeks to remedy the position by explicitly requiring the appointment of a separate audit committee, again independently chaired, with the responsibility for reviewing and scrutinising the authority’s financial management and affairs in the same terms as Amendment 36. Given the potentially large expenditure of the combined authorities if the promise of devolution is to be realised, this is an important role and one that is distinct from the general overview and scrutiny process.

Although they have yet to be moved, we support the Lib Dem amendments concerning political balance and the chairing of the scrutiny committee, but have some concerns about possible delays of call-in powers, which could necessitate another round of consultation.

We will listen with interest to the government amendments, particularly to Amendment 41, which requires the approach to reconsideration powers to need the consent of the combined authority. This would appear unduly restrictive. We are not quite sure why it is proposed to have an alternative to an independent chair of scrutiny, but in any event can live with what is proposed. I understand that we are not able to hear from the noble Lord, Lord Kerslake, today on his very substantial amendment about governance, which we felt was very important. As proposed, however, some of the voting thresholds may be problematic, especially the requirement for unanimity at the first meeting of the overview and scrutiny committee.

Overall, however, these amendments highlight the importance that we should place on getting oversight right in circumstances where considerable power is rightly being placed with a combined authority and possibly a mayor. This should also address in part—although, doubtless, not comprehensively enough—those who have expressed fears about a single-party state. I beg to move.

Lord Shipley (LD): My Lords, we have a number of amendments in this group. During the debates on this Bill, we have tried from these Benches to emphasise

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the importance of legitimacy and accountability in this new tier of government. By legitimacy, I mean, first, a direct connection with the ballot box in the new structure and, secondly, the prevention of one-party states in which the same political party has control of the post of elected mayor, the nominated combined authority and the nominated overview and scrutiny committee. In Committee, we proposed direct election to the combined authorities, so that the mayor was not the only elected post, but this did not find favour. Now we have a group of amendments that concerns overview and scrutiny committees, which are very important—more important than they might have been, had some of the amendments that we debated in Committee been agreed.

I am pleased that, following our debate in Committee, further, more detailed proposals have come forward from the Government. Some are welcome but some do not go far enough. Let me explain what I hope the Government will do. Our amendments would require the chair of an overview and scrutiny committee to be from a different political party from the mayor; that assumes that the mayor is a member of a political party. If that is not the case, the chair could be from any political party. An independent chair could work—we said that previously—but it would be better to have an opposition councillor who has been duly elected to their post as a councillor from within the combined authority area, not least because if one appoints an independent person it immediately raises the question of who appoints that independent person. To put it another way: how is independence guaranteed? The make-up of the overview and scrutiny committee also needs to reflect the number of seats held by each party in those local authorities making up the combined authority. Later, we have proposals on the electoral system that should be used so that the first past the post system does not encourage the development of a one-party state.

Our other amendments would also allow the committee to call in decisions made by the mayor and delay them—not for long—to allow further consideration when it is felt to be necessary. To do its job properly, an overview and scrutiny committee needs the power to call for information and to receive it. It will not be enough if the overview and scrutiny committees exist but are then prevented doing their job by a combined authority that prefers to keep things out of public scrutiny.

Amendments 35 and 37, which we support, would enable the overview and scrutiny committee to examine decisions before they are taken, rather than wait for a decision to be made; that is welcome. Amendment 34A, which I signed up to, would create an audit committee with an independent chair. I welcome that proposal as well. It is essential in this case that the chair is independent and appropriately qualified to do the job. In practice, it should cover the functions of a public accounts committee, an efficiency committee and a risk committee. This matters because the savings that could be achieved by public service reform and reducing duplication at a local level have been well established, but we now need to ensure that it all happens. The audit committee would be of significant help in delivering that objective.

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The noble Lord, Lord McKenzie, made mention of Amendment 41, and I will do likewise, with two questions for the Minister on that amendment. First, proposed new sub-paragraph (4A) states:

“An overview and scrutiny committee must publish details of how it proposes to exercise its powers in relation to the review and scrutiny of decisions made but not yet implemented”.

If the implementation period is very short, what power would an overview and scrutiny committee have under this measure to hold up a decision for further consideration? Secondly, and this is the point that the noble Lord, Lord McKenzie, raised when talking about proposed new sub-paragraph (4B), what is the objective in requiring an overview and scrutiny committee to,

“obtain the consent of the combined authority to the proposals and arrangements”?

I can see that there could be a situation in which the overview and scrutiny committee misses something, which would need to be put right by the combined authority. However, I certainly hope that this measure would not be used by members of a combined authority who do not wish to see the overview and scrutiny function work effectively. I look forward to hearing the Minister’s comments on that.

Finally, all our proposed amendments have a common purpose in wanting to ensure proper accountability for the devolution that is about to occur. I hope the Minister will agree that they should be included in the Bill.

The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Williams of Trafford): My Lords, all these amendments are about overview and scrutiny and the accountability of combined authorities. Making overview and scrutiny as strong and effective as possible is a priority for us. I was pleased in Committee by how clear it was that this is a shared priority across this House. The government amendments reflect the discussions I had with noble Lords from across the House, and I am grateful to them all for the expertise and experience that they brought to the discussions. Effective scrutiny not only ensures better decision-taking by those exercising new devolved powers but can be the safeguard against one-party states developing, and so prevent the loss of public confidence in the process of devolution.

Before discussing the various substantive issues on overview and scrutiny that have been raised, I turn first to government Amendment 81, which provides that any orders made under the powers in the new Schedule 5A to the 2009 Act will be subject to the affirmative parliamentary procedure, rather than negative. The Delegated Powers and Regulatory Reform Committee recommended this, and we accept the recommendation.

Before turning to the detail of scrutiny arrangements, I shall address Amendment 34A, which would require the combined authority to appoint an audit committee and for that audit committee to have an independent chair. In the case of local authorities, and indeed in the case of such existing combined authorities as the Greater Manchester Combined Authority, the audit committee is appointed by the authority. Audit committees usually comprise senior non-executive members of the authority and, where this is the local choice, may also include one or more independent members. We recognise

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the importance of audit committees. The role of that committee in any authority includes supporting the authority’s chief financial officer, the Section 151 officer. It is an integral part of the financial controls and internal checks of the organisation.

Without this amendment, the approach would be to allow combined authorities to appoint, as they see fit, audit committees drawn from the membership of the authority and, where they consider appropriate, include independent members. I am sure that none of us wants unnecessary prescription. However, I can see the case for a combined authority, given its particular structure, which may or may not include a mayor, to be required to have an audit committee appointed by the authority. I can also see the case that it might be appropriate for such a committee to have one or more independent members. I am not persuaded that it would be right to prescribe in every circumstance that the chair of the committee should be an independent member. Accordingly, I am prepared to consider the issue further for Third Reading, have discussions with noble Lords and, if appropriate, return with an amendment on this at Third Reading.

I will return at the end to questions asked by noble Lords. Turning now to the substantive issues, I first address the question of call-in. Government Amendments 38, 41 and 49 and Amendments 39 and 40 relate to this. The government amendments aim to strengthen the power of call-in for overview and scrutiny committees of combined authorities. With these amendments, combined authorities and their overview and scrutiny committees will be able to set up and operate effective and proportionate call-in arrangements. These come into play when there is a real need, but equally they cannot become a mechanism for delaying or for impeding the efficient conduct of business. Crucially, the call-in arrangements in any authority will be a local matter for the authority and its scrutiny committees to decide and agree.

4.45 pm

Amendment 38 gives a strong foundation for call-in by providing that the overview and scrutiny committee has the power to direct the combined authority not to implement a decision called in while it is under review.

Amendment 41 provides that the overview and scrutiny committee must publish the arrangements of all procedures for call-in that it has agreed with the combined authority. This approach in handling the arrangements developed and agreed locally means that there can be a genuine local ownership of the call-in arrangements so that these become part of the local culture of effective scrutiny.

Amendment 49—this might assist the noble Lord, Lord Shipley—allows the Secretary of State to make provision about the length of time for which a decision can be called in. This is to provide a safeguard so that, whatever the local agreed arrangements are, call-in cannot be either for too short a period to be effective or so long that it delays the implementation of decisions for an unnecessarily long time.

Amendments 39 and 40, tabled by the noble Lord, Lord Shipley, and the noble Baroness, Lady Pinnock, would give the overview and scrutiny committee the

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power to call in a decision and require a delay in implementation for further public consultation to be carried out. I do not believe we can go along with this step. I do not think a delay in implementation should be contingent on public consultation. I think the noble Lord, Lord McKenzie, also alluded to his concerns on this aspect.

The next substantive aspect of overview and scrutiny that I would like to address is that of the powers and operation of scrutiny. The Government are committed to ensuring strong and effective scrutiny in combined authorities. Accordingly, we intend to make an order under paragraph 3(2)(g) of new Schedule 5A which would ensure that, like members of overview and scrutiny committees of a council operating executive arrangements, the members of the scrutiny committee for the combined authority will have access to documents containing exempt or confidential information that relates to a decision it is reviewing.

Amendments 44 to 48, 50 and 55 are also focused on enhancing the information requirements for overview and scrutiny committees, but I do not believe they are necessary or appropriate. Amendment 44 would allow the power to be given to an overview and scrutiny committee by order to compel other bodies to provide information. This is unnecessary because the power in paragraph 3(2)(g) already allows the Secretary of State to include in an order details of information that must be disclosed by “other persons”. In addition, giving a blanket power to the overview and scrutiny committee to do this risks creating undue additional burdens on businesses and public authorities.

Amendment 45 would amend paragraph 3(2)(f) of new Schedule 5A so that the Secretary of State must, when making an order about the publication of reports or recommendations of an overview and scrutiny committee, or of the responses by the combined authority, require the overview and scrutiny committee to publish these.

Amendment 55 would remove the provision which allows the Government to provide for exempt or confidential information to be removed from reports, recommendations or responses when they are published.

Amendments 46, 47, 48 and 50 would amend paragraph 3(2)(g), which allows provision to be made in secondary legislation about information which must, or must not, be disclosed to an overview and scrutiny committee by the authority or by other persons. The amendments would require any order under this paragraph to require a local authority in all cases to disclose information to a scrutiny committee.

The Bill provides that the Secretary of State may make provision in secondary legislation for the publication of reports et cetera and for information to be disclosed to an overview and scrutiny committee. It is sensible that the principles of exempt and confidential information continue to apply. These principles require an authority to protect confidential information, such as information prohibited from being disclosed by a court order. The principles also protect exempt information—for example, information about the investigation of a crime—unless it is in the public interest to disclose it. Rather than encouraging the openness which they seem to intend, the amendments could produce the opposite effect

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and inhibit the overview and scrutiny committee in its work. Where authorities and scrutiny committees are forced to publish all reports in full, they may feel unable to write on sensitive matters which should rightly be considered.

Opposition Amendments 35 and 37 would widen the scope of scrutiny so that a committee may review decisions under consideration. In strict terms, while a decision is under consideration, there is nothing to review. However, I understand and indeed support the wish for overview and scrutiny committees not only to be involved after the event but to play a role in earlier stages of shaping policy. The Bill satisfies this by allowing the scrutiny committee to make reports and recommendations proactively about anything that affects the authority’s area or its inhabitants, as provided for in paragraphs 1(2)(c) and 1(3)(c) of new Schedule 5A. Hence, Amendments 35 and 37 are not necessary.

I turn to amendments relating to the membership of overview and scrutiny committees and who should be their chair. On membership, government Amendments 42, 51 and 56 make provision further to guarantee the independence and appropriate balance of the membership of all overview and scrutiny committees of all combined authorities.

Amendment 51 provides that the majority of members of an overview and scrutiny committee must be members of the constituent councils of the combined authority area. In practice, nearly all members will be from constituent councils, but there may of course be independent members—as I will touch on in relation to the chair—or members in different roles as decided locally. Overview and scrutiny committees will have the power to co-opt non-voting members as they see fit.

As to the political balance of an overview and scrutiny committee, the Government are committed to ensuring in every case an appropriate political balance. Accordingly, the Government’s firm intention is to provide by order under paragraph 3(2)(a) of new Schedule 5A that the political balance of any overview and scrutiny committee must align with the political balance of the elected members of the constituent councils, a matter which we discussed the other day. As a consequence, government Amendment 42 removes paragraph 2(4)(b), thereby removing the requirement for the committee to be politically balanced in relation to the combined authority membership. This amendment is vital to ensuring that we avoid everywhere the one-party state that noble Lords have mentioned in debates and achieve a truly politically balanced membership across the combined authority area.

Amendments 53 and 57 seek to provide that the membership of an overview and scrutiny committee is politically balanced, reflecting seats held by constituent councils in the combined authority area. While we understand and broadly share these aims, we believe that the approach which we are adopting of delivering and specifying political balance through an order is the right approach which will enable genuine political balance, in every circumstance, to be delivered.

As to the chair of an overview and scrutiny committee, government Amendments 52 and 56 make provision, again, to ensure the independence of an overview and

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scrutiny committee. Amendment 52 would provide on the face of the Bill that the chair of an overview and scrutiny committee for a combined authority must be one of two categories of person: either an independent person; or, in the case of a mayoral combined authority, a member of a constituent authority who is not of the same political party as the mayor or, in the case of a non-mayoral combined authority, a member of a constituent authority who is not of the same political party as the biggest party of the combined authority. The definition of independent will be provided in secondary legislation and ensure that any such person is recruited by the combined authority through open and fair processes. In the case of any particular combined authority, an order can specify what option for the scrutiny committee chair—independent person or constituent council member—is to be adopted. Alternatively, this can be left as a matter for local choice, to be exercised at any time the authority sees fit. Government Amendment 56 provides the appropriate definitions. I believe that these amendments deliver the intention that the noble Lords, Lord Shipley and Lord Scriven, sought to achieve in Amendment 54.

Lord Scriven (LD): I welcome the Minister’s reply but I would like to go away and reconsider what she is suggesting. In my own personal experience, open competition or advertisement has been made for independent chairs of a number of committees on which I have sat in South Yorkshire, including for the fire authority. It turned out that the independent members—when further scrutinised after appointment by the majority party—all, interestingly, had a link back to that majority party. While I appreciate that what the Minister is saying is reasonable, in practice I have on at least three occasions seen it not to be reasonable. I ask her to really consider the whole process relating to independent members and how, in a one-party state, to stop such members being linked to the majority party—either the mayor’s party or a combined authority party.

Lord Ashton of Hyde (Con): I remind noble Lords about the rules on Report: we should not introduce new matters and nobody should speak after the Minister, except for matters for elucidation.

Baroness Williams of Trafford: I thank the noble Lord, Lord Scriven, for his comments; I certainly will go away and think about them. In making these amendments, we hoped that they would deliver the intention that both he and the noble Lord, Lord Shipley, sought to achieve. No matter how the legislation is done, we could all point to examples where it is not quite perfect, no matter how good the intention and no matter how tight the legislation is—though I take the noble Lord’s point.

I turn, finally, to opposition Amendment 43, which seeks to give greater statutory force to the guidance about overview and scrutiny that may be issued under paragraph 2(9) of new Schedule 5A. As the Bill stands, that guidance is already statutory guidance in the sense that due regard must be given to it. I do not think that further statutory requirements about guidance would be right. As the House will appreciate, if the

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Secretary of State draws up any such guidance, he would of course want to seek the views of those who are expert in the field of overview and scrutiny.

I turn to some specific points and, first, to the point made by the noble Lords, Lord McKenzie of Luton and Lord Shipley, on why a combined authority should agree to the overview and scrutiny arrangements. It is important that scrutiny arrangements are agreed by the combined authority—though it need not be unanimous agreement—so that the authority embeds scrutiny into its arrangements and the culture of the organisation. It is certainly not a clause to be used to weaken arrangements; rather, it is to ensure a culture of scrutiny throughout the authority.

Lord Shipley: My Lords, can the Minister elucidate what happens if there is a stand-off because neither side agrees?

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Baroness Williams of Trafford: My Lords, that is an interesting question. I have witnessed many a stand-off in local authorities. The combined authority is obliged through its voting arrangements, whatever they may be—they will be different in different places—to come up with a resolution. I appreciate that it might start with a stand-off but I hope that it will be resolved in accordance with the democratic arrangements within the combined authority.

The noble Lord, Lord Shipley, asked about implementation, the short period of time and the powers of call-in. I hope I have explained to him that our new amendments give the Secretary of State the power to provide, by order, for a minimum call-in period.

The noble Lord also inquired about the chair of the overview and scrutiny committee. Under the Government’s amendments, the chair of an overview and scrutiny committee can never be a member of a constituent council if he is a member of the same political party as the mayor of a combined authority.

I hope those responses are helpful and that, with them, the noble Lord will feel happy to withdraw his amendment.

Lord McKenzie of Luton: My Lords, I thank the Minister for her detailed response to our amendments and a raft of other amendments. I also thank the noble Lord, Lord Shipley, for his support for most of our amendments. I look forward to the Government bringing forward at Third Reading something on Amendment 34A and the audit committee. In respect of Amendments 35 and 37, I understand that the matter is already covered. I take the point on statutory guidance.

I do not 100% agree with the Government on Amendment 41 on the point that we discussed. However, it is fair to say that, together with the noble Lord, Lord Shipley, we have a substantial identity of view over a broad range of areas. We do not have an identity of view on everything, particularly around access to some of the documentation. However, for my part, I am happy to withdraw the amendment.

Amendment 34A withdrawn.

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Schedule 3: Overview and scrutiny committees

Amendment 35 not moved.

Amendment 36 had been withdrawn from the Marshalled List.

Amendment 37 not moved.

Amendment 38

Moved by Baroness Williams of Trafford

38: Schedule 3, page 22, line 37, after “includes” insert “—

(a) power to direct that a decision is not to be implemented while it is under review or scrutiny by the overview and scrutiny committee, and

(b) ”

Amendment 38 agreed.

Amendments 39 and 40 not moved.

Amendment 41

Moved by Baroness Williams of Trafford

41: Schedule 3, page 22, line 38, at end insert—

“(4A) An overview and scrutiny committee must publish details of how it proposes to exercise its powers in relation to the review and scrutiny of decisions made but not yet implemented and its arrangements in connection with the exercise of those powers.

“(4B) Before complying with sub-paragraph (4A) an overview and scrutiny committee must obtain the consent of the combined authority to the proposals and arrangements.”

Amendment 41 agreed.

Amendment 41A had been withdrawn from the Marshalled List.

Amendment 42

Moved by Baroness Williams of Trafford

42: Schedule 3, page 23, line 18, leave out from “committees)” to end of line 21

Amendment 42 agreed.

Amendments 43 to 48 not moved.

Amendment 49

Moved by Baroness Williams of Trafford

49: Schedule 3, page 24, line 23, at end insert—

“(h) as to the minimum or maximum period for which a direction under paragraph 1(4)(a) may have effect.”

Amendment 49 agreed.

Amendment 50 not moved.

Amendments 51 and 52

Moved by Baroness Williams of Trafford

51: Schedule 3, page 24, leave out lines 24 to 31 and insert—

“(3) Provision must be made under sub-paragraph (2)(a) so as to ensure that the majority of members of an overview and scrutiny committee are members of the combined authority’s constituent councils.”

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52: Schedule 3, page 24, line 31, at end insert—

“(3A) Provision must be made under sub-paragraph (2)(b) so as to ensure that the chair of an overview and scrutiny committee is—

(a) an independent person (as defined by the order), or

(b) an appropriate person who is a member of one of the combined authority’s constituent councils.

(3B) For the purposes of sub-paragraph (3A)(b) “appropriate person”—

(a) in relation to a mayoral combined authority, means a person who is not a member of a registered political party of which the mayor is a member, and

(b) in relation to any other combined authority, means a person who is not a member of the registered political party which has the most representatives among the members of the constituent councils (or, if there is no such party because two or more parties have the same number of representatives, is not a member of any of those parties).”

Amendments 51 and 52 agreed.

Amendments 53 to 55 not moved.

Amendment 56

Moved by Baroness Williams of Trafford

56: Schedule 3, page 24, line 42, at end insert—

“( ) In this paragraph—

“constituent council”, in relation to a combined authority, means—

(a) a county council the whole or any part of whose area is within the area of the combined authority, or

(b) a district council whose area is within the area of the combined authority;

“registered political party” means a party registered under Part 2 of the Political Parties, Elections and Referendums Act 2000.”

Amendment 56 agreed.

Amendment 57 not moved.

Amendments 58 to 61 had been withdrawn from the Marshalled List.

Amendment 62

Moved by Baroness Williams of Trafford

62: After Clause 9, insert the following new Clause—

“Requirements in connection with establishment etc. of combined authority

(1) The Local Democracy, Economic Development and Construction Act 2009 is amended as follows.

(2) In section 110 (requirements in connection with establishment of combined authority), for subsections (1) to (3) substitute—

“(1) The Secretary of State may make an order establishing a combined authority for an area only if—

(a) the Secretary of State considers that to do so is likely to improve the exercise of statutory functions in the area or areas to which the order relates, and

(b) the constituent councils consent.

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(1A) If a scheme for the establishment of the combined authority has been prepared and published under section 109 the Secretary of State must have regard to that scheme in making the order.

(2) In a case where no such scheme has been prepared and published, the Secretary of State must consult such persons (if any) as the Secretary of State considers appropriate before making the order.

(3) In this section “constituent council” means—

(a) a county council the whole or any part of whose area is within the area for which the combined authority is to be established, or

(b) a district council whose area is within the area for which the combined authority is to be established.”

(3) In section 113 (requirements in connection with changes to existing combined arrangements), for subsections (1) and (2) substitute—

“(1) The Secretary of State may make an order under section 104, 105, 106 or 107 in relation to an existing combined authority only if—

(a) the Secretary of State considers that to do so is likely to improve the exercise of statutory functions in the area or areas to which the order relates, and

(b) the constituent councils consent.

(1A) If a scheme has been prepared and published under section 112 the Secretary of State must have regard to that scheme in making the order.

(2) In a case where no such scheme has been prepared and published, the Secretary of State must consult such persons (if any) as the Secretary of State considers appropriate before making the order.

(2A) In this section “constituent council” means—

(a) a county council the whole or any part of whose area is within the area or proposed area of the combined authority, or

(b) a district council whose area is within the area or proposed area of the combined authority.”

Baroness Williams of Trafford: My Lords, I know that we have already debated this but I promised to come back to it today, following the Delegated Powers and Regulatory Reform Committee report. I would also like to speak to Amendments 71, 72 and 77. I read with interest the DPRRC’s report yesterday and would like to respond with a detailed explanation of the reasons behind these amendments. Amendments 62 and 77 are designed to fast-track the establishment of a combined authority where circumstances warrant this, while maintaining all the necessary safeguards.

The current process for creating a combined authority under the 2009 Act is lengthy and consists of four stages. First, local authorities have to undertake a governance review. This involves the authorities concerned considering whether a combined authority would improve the governance of the functions which they are considering it might exercise. In doing this, the authorities usually engage with local partners and their communities, although they are not statutorily required to do so. The next stage is for the authorities to develop a scheme for a proposed combined authority. Together, the governance review and scheme provide the reasons for establishing the combined authority and how it will operate. The third stage involves the Secretary of State undertaking various considerations and a statutory consultation that includes being required to consult the very authorities that have undertaken the review, prepared the scheme and are seeking the establishment of the combined authority.

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The fourth and final stage is that each House of Parliament must approve a draft order providing for the establishment of the combined authority, after which the Secretary of State can make the order in the terms of the approved draft. Past experience shows that it can take well over a year even to reach the point of the order being made. Noble Lords will see that inevitably, the process involves some duplication. In particular, where establishing a combined authority is agreed as part of a devolution deal, the duplication of local discussion, engagement and consultation can be substantial.

Amendments 62 and 77 provide a streamlined process for creating combined authorities where the risks of duplication are minimised. An example might be where a number of councils, as part of a deal, agree to the establishment of a combined authority. They have provided the Secretary of State, as part of these deal discussions, with sufficient information and evidence to undertake the statutory tests: that is, to conclude whether creating the combined authority is likely to improve the exercise of statutory functions in the combined authority’s area; and to have regard to the need to reflect the identities and interests of local communities and to secure effective and convenient local government. All councils in the area of the proposed combined authority then consent to its establishment.

In such a circumstance, the fast-track process would enable the Secretary of State to seek Parliament’s approval to the draft order, once he has fulfilled his statutory duty to consult such persons as he considers appropriate. With this streamlined process, the councils no longer have to undertake the lengthy process of developing a governance review and preparing a scheme. This is because the substance of these processes will have been undertaken in a different way and the Secretary of State will continue to be required to apply the statutory tests and the statutory consultation, which he would need to do in accordance with administrative law—the legal framework which applies in any case where the Secretary of State exercises his powers. He must have regard to all relevant considerations, must not have regard to irrelevant considerations, and his decisions must be rational and within the powers that he is exercising.

These amendments also provide that where the fast-track process is not being followed and councils are developing a governance review and scheme, the process can still be more streamlined than it is currently. The current requirements on consultation, particularly that the Secretary of State consult the authorities that have prepared the scheme, are replaced by a requirement that the councils, which will have engaged with their communities when preparing their scheme, must consent to the establishment of the combined authority in the terms of that order. The Secretary of State still has the option of consulting if he considers it necessary.

These amendments therefore facilitate the timely implementation of devolution deals which will be of critical importance to areas being able to respond quickly to the economic challenges and opportunities they and the country face today—helping to grow our economy, improving productivity and increasing our competitiveness. I hope noble Lords consider that these explanations address the DPRRC’s comments.

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Government Amendments 71 and 72 will enable the Secretary of State to confer functions of a public authority on local authorities as well as combined authorities. Amendment 83 is consequential on these. These amendments are intended to make it clear that there is a level playing field for all areas to agree devolution deals with the Government, including areas where there is no combined authority.

Noble Lords have previously raised concerns that the Bill focuses on devolution to large cities with combined authorities, and asked how the Bill’s provisions apply in non-metropolitan areas where there may perhaps not be combined authorities. We are clear that devolution applies equally across England—to counties and towns as well as cities. As I have said, the Government are ready to discuss with any area the powers and budgets they want devolved to them and the governance arrangements they propose to support those powers. We want towns and counties to play their part in growing the economy, and we are offering them the opportunity to agree devolution deals and provide local people with the levers they need to boost growth.

It will be for local areas to decide over what geography they would wish to have those powers devolved. Where a functional economic area covers a wider area than a single local authority, a combined authority can be an excellent means for enabling local authorities to collaborate effectively and work across their administrative boundaries. But there are areas in which the functional economic area may comprise a single local authority, and where this might be the best geography over which to devolve powers and budgets. We are already discussing such deals with some areas and making excellent progress in areas such as Cornwall. Amendments 71 and 72 are necessary to enable such deals to be agreed. These amendments apply to county councils and district councils the same powers for transferring public functions as under Clause 6, which the House has approved, including the amendments approved on Monday.

The Delegated Powers and Regulatory Reform Committee has concerns about the potentially wide scope of powers that could be conferred under the provisions in Clause 6 and these new clauses without a statutory consultation. We responded to its concerns on Clause 6 by tabling Amendment 33, which was passed by the House on Monday. This requires the Secretary of State to lay a report before the House whenever an order is laid before Parliament under the provisions in Clause 6. This report would need to include details of any consultation.

Before saying more on consultation, I would like to address the point made by the Delegated Powers Committee that a duty to lay a report cannot be regarded as equivalent to a duty to consult. We do not see, and never have seen, the duty to lay a report as replacing a duty to consult. The purpose of the report is to ensure that Parliament has full information about the deal in question, including information about the powers being devolved, why they are being devolved and what outcomes are expected from that devolution. We see the report addressing the issue raised by the committee that there is no information about the kind of powers that may in any case be devolved.

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We have explained why this Bill is an enabling Bill. Equally, we recognise the importance of Parliament being fully aware of the nature of a deal when considering an order implementing it. That is the purpose of a report.

In relation to both Clause 6—before we introduced the additional requirement of the report—and to the equivalent provisions which Amendments 71 and 72 introduce into the Bill for transferring powers to county councils and district councils, including unitaries, the Delegated Powers Committee has concluded that they constitute an inappropriate delegation of powers. In our response to the committee’s first report, with the important points we have included, we made it clear that we do not share this view.

5.15 pm

The committee saw no reason why the legislation giving a wide discretion as to the conferring of functions should not, at the same time, give a clear indication of what those functions might be. As we have set out in this debate, and as we heard persuasively from the noble Lord, Lord Heseltine, on Monday, if the Government set out in some way the scope or template for devolution, it would turn the whole bottom-up devolution process which they are pursuing, following their manifesto commitment, on its head. It is for the areas themselves to decide and come forward with what they want devolved to them. It is for them to reach their decisions without some centralist template, schedule or description constraining their ambition. As the noble Lord, Lord Heseltine, explained, if there were to be some centralist framework, given the nature of Whitehall, the risk is that it would be limiting. This Government, with their manifesto commitments and through this Bill, are seeking to reverse 150 years of centralisation. We are not—as the Delegated Powers Committee is suggesting—confusing flexibility with imprecision.

Turning back to consultation, in the context of deal making, we do not see that making a duty on the Secretary of State to consult would be appropriate. Such a duty would reinforce the top-down, government-driven view of this process—the very antithesis of what we want this process to be. We consider that consultation is more appropriately undertaken locally by the areas developing the proposals than by the Secretary of State. However, it is right for the Secretary of State to consider such consultations. He will need to do so in order to fulfil the statutory test before regulations transferring powers can be made. This is likely to improve the exercise of statutory functions in the local authority’s area.

Moreover, it is right that Parliament should know all about such considerations by the Secretary of State. The reporting requirement now included both in Amendments 71 and 72 and in Clause 6 of the Bill ensures that this is so. Each House of Parliament will need to approve any order conferring powers under the provisions in this Bill, or under Part 6 of the 2009 Act, through the affirmative procedure. For these reasons, I believe that Amendments 71 and 72 will ensure that Parliament will have all that it will need to consider the orders implementing the devolution deals.

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Lord Tyler (LD): My Lords, I am grateful to the Minister—as I am sure are all noble Lords who have been following this very difficult process. It has been a difficult process from the outset because the Government have brought forward very substantial changes with these new clauses. I do not blame anybody for that. That is the way life is. It will be apparent from the noble Baroness’s long explanation that the concerns of the Delegated Powers and Regulatory Reform Committee are substantial—and she has answered them substantially. But she was very generous earlier in saying that, between now and Third Reading, she would think about some of the issues that have been raised.

I wonder whether the House shares my view that we are in some difficulty. I do not know how many Members who have been following these proceedings have been able to read the report in detail. It was available only yesterday afternoon. I wonder, therefore, whether there would be general agreement in the House—and perhaps the noble Baroness would also agree—to giving us a little more time to see how these two quite distinct views might be brought together. The unanimous decision of that well-respected committee was that there were concerns about these two clauses. The fact that the noble Baroness needed 12 or 13 minutes to explain what exactly was involved in the new clauses rather supports my view.

Rather than having a detailed debate, and since there are only a few days between now and Third Reading, I wonder whether she would agree to withdraw government Amendment 62 and the associated short Amendment 77, as well as Amendments 71 and 72, so that everybody can be sure that we are bringing together the important concerns of the Delegated Powers and Regulatory Reform Committee with the substantial answers that the Government would wish to give. It may be that, with a small tweak here and there, the concerns of the committee can be met. Then we should be a great deal more satisfied with the process and reassured that the House’s consideration of the Bill has been properly undertaken.

Baroness Eaton (Con): Will the Minister confirm that if an area currently without a combined authority agrees a devolution deal that involves the creation of a combined authority, without Amendments 62 and 77 it could be at least a year, if not two, before any powers could begin to be devolved?

Baroness Hollis of Heigham (Lab): My Lords, I, too, take this opportunity to raise again an issue covered in Amendments 62, 63, 64 and 65, on which I am still not sure we have got to the right position. Is there any flexibility here? I think we all recognise that the Minister has been extremely helpful to the House, but she is still holding to the view that you can belong to only one combined authority: therefore, I address the issues in Amendment 64. That is fine if you are part of Greater Manchester and a whole big combined metro authority. It is also fine when you want a combined authority of adjacent urban unitary authorities with shared goals and objectives. However, I think the Minister was the first to recognise that there are very real problems where you have an urban unitary area surrounded by rural areas. Plymouth may be an example of that, although I am not speaking for it as I do not

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know whether it shares my views. Equally, where you have shire districts, as with Norwich and Cambridge—I am speaking for them—possibly Exeter, and many other medium-sized cities of England, there is a complexity because they are, if you like, islands of urban economic generation. Therefore, it makes sense not to have that one-size-fits-all version of a combined authority.

For example, my city produces economic growth. We have only about 20% or so of the relevant population but produce more than 50% of the relevant jobs. We want city and district partners for what we have now— that is, a greater Norwich partnership for economic development, travel to work and issues of connectivity. However, it would be desirable to have a wider geography with which to tackle the bigger issues of public sector reform, and integrated NHS and social care, for example, which cannot be done on a sub-county basis, and where it may make sense to go beyond a county basis and link across counties. How do we do this? I have just received an email from the leader of Cambridge City Council—not my own, so it offers a different view. We have been trying to see where the voices lay on this. Mr Herbert states that a growing number of councils want to create city-district partnerships for economic development and travel to work, while being part of a larger geography for public sector reform and tackling care and the NHS jointly. He says that the ideal solution might be,

“to have different combined authorities for those different functions, bringing together the partners who it makes most sense to work with on these different issues. That is particularly true for the largest county towns/cities and the new unitaries who have a strong common cause with immediately adjacent authorities, but not necessarily with all authorities in a county or LEP area”.

Mr Herbert adds, however, that the problem is that,

“the current legislation around Combined Authorities, and the draft Bill the new Government has brought forward, seemingly do not allow for this—insisting on a single Combined Authority”.

He talks of addressing the issue:

“While the Bill is still in draft, and before we get forced into arrangements”,

which I maintain do not work for a large chunk of the country, such as urban authorities surrounded by rural authorities, unitaries surrounded by shire districts and district cities, which provide the energy for their counties, which are surrounded by other districts. The proposed single combined authority that the Minister has laid down will cramp the contribution that such areas can make to economic growth. I absolutely understand that this has to be negotiated in a bespoke way with the Secretary of State and am perfectly happy that that should be the case, following the thrust of what the Minister has argued in the past. Will the Minister or the Secretary of State therefore meet the leaders of such authorities in such situations for whom the single combined authority—the one-size-fits-all approach—does not work? If it is too late for this Bill and if the Government are willing to expand the remit, perhaps amendments to that effect could be tabled in the other place.

Baroness Jenkin of Kennington (Con): My Lords, can my noble friend clarify that Amendments 71 and 72 are necessary to put all local areas on a level playing field, and to enable a devolution deal in local authority areas such as Cornwall?

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Lord Woolmer of Leeds (Lab): My Lords, I want to echo some of the points made by the noble Lord, Lord Tyler. From my own selfish point of view, I welcome speed in this area. There is no doubt that a lot of corners could be cut in terms of the public understanding of what is being proposed, the discussion and so on. These are substantial changes. Some local authorities will go in with others that never dreamt of doing so before. Other public bodies will be incorporated or will jointly share functions with local authorities never considered before. These are very substantial changes.

Normally, one would say that there has been a lot of thought about this, proposals have been discussed and so on. There is a balance here between speed and process, and Governments want to get on. In the days when I led a council, I had to get on. It is jolly annoying when you sometimes have to stop to consult and discuss more widely, but at the end of the day it can be helpful. If it is not done appropriately and adequately at local level, the Minister may find that there is more pressure at government level for those discussions to go on than they expected. So there is an argument for careful discussion. I am not suggesting that we hide behind that, but we should not put the cloak around us that speed is important. We have been waiting for years for this, as the noble Lord, Lord Heseltine, said—150 years, the Minister said. Let us get on with it; we know what we want to do. I would welcome the chance to discuss some of those matters at Third Reading, not to hold things up but just so that there is adequate discussion.

I ask the Minister to clarify one or two points. Amendment 62 states that,

“‘constituent council’ means a county council … or a district council”.

I assume that that probably means both a county council and a district council, and that both would need to be considered. That may be purely language but I assume that it would mean both. Where do unitary authorities fit into that wording? Where do they fall into the constituent council language?

Finally, can the Minister clarify a point that was raised by my noble friend Lady Hollis? If a shire district council wished to join a combined authority—for example, comprising metropolitan district councils—am I right in saying that the county council, or part of it, would have to join? For example, if Harrogate and its associated area wished to join with West Yorkshire, would North Yorkshire County Council as a whole have to join a combined authority, and would it then have enough to join a combined authority? Could a shire district join a combined authority without the county council? If the Minister could clarify that, it would be useful to me. I am not suggesting that there would be a disagreement, but it would just be helpful to me to understand that.

If a very large county council were to be part of a combined authority through the fact that one or more of its district councils wanted to join that authority, would the other part of that county council be able to join another combined authority? In other words, could a very large county council be part of two combined authorities? That is not impossible for very

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large county councils and it is not really clear in the Bill. It would certainly be helpful to me and to others to have those points clarified.

5.30 pm

Lord McKenzie of Luton: I thank the Minister for her detailed exposition of the issues around these two sets of amendments. I support the noble Lord, Lord Tyler, in asking whether we can take this forward to Third Reading, if necessary. These substantial amendments herald very significant changes to what has been the process hitherto. We had the Delegated Powers Committee’s report just yesterday—for some of us who were on other duties, not until this morning—and the noble Baroness’s presentation raises issues. Rather than asking the Government to withdraw the amendments, why do they not proceed while recognising that they are if necessary open to final amendment at Third Reading, which is only a few days away? Given the range of queries now emanating from our considerations—every time we look at this it raises more issues—it seems that we should try to structure a meeting with the Minister, and colleagues if necessary, between now and then to iron out as much of this as possible.

From our point of view, as my noble friend Lord Woolmer said, if we can speed up the process we would be supportive of that in principle. We certainly support extending the arrangements to individual counties and councils. That is not an issue but some of the process stuff is. One point that bothers me still is in relation to what the Delegated Powers Committee report said on Amendment 62. In paragraph 11, the report says clearly:

“We see the scheme process, which involves local engagement and consultation, as being wholly different from the process of discussion and negotiation which takes place only between the local authorities and the Secretary of State”.

I would accept having administrative law brought into play and prayed in aid as a constraint or parameter that the Secretary of State had to comply with. But introducing that sort of concept fairly late in the day is a bit unusual, and its context needs proper consideration.

On Amendments 71 and 72, we know that the innate problem is of having a difference between those of us who believe that there should be some parameters put into the Bill, but not to stifle initiative and innovation, and the Government’s view that they will oppose that. Notwithstanding that, it would be helpful for progress today and to get the best solution possible over these amendments if the Government would recognise that, if necessary and appropriate after further discussion, this would be open for amendment at Third Reading. That would otherwise save us making more difficult choices here and now.

Baroness Williams of Trafford: My Lords, I thank all noble Lords for the comments that they have made. My noble friend Lady Eaton talked about the problems of delay, which are very real. The noble Baroness, Lady Jenkin, talked about Amendments 71 and 72 being necessary for places such as Cornwall. She is absolutely right.

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My noble friend Lady Eaton asked whether an area that is not currently a combined authority can access the powers of devolution. She asked about areas without combined authorities. Again, without Amendments 71 or 72 it is not possible to confer powers on, say, Cornwall. Places such as Cornwall would be very concerned if the Bill did not have that power.

The noble Baroness, Lady Hollis, asked why you cannot be in two combined authorities. Councils can be constituent members of one combined authority and non-constituent members of another. That is quite possible. I will give the noble Baroness an example before she gets to her feet. In Greater Manchester, Cheshire East is a non-constituent member of the Great Manchester Combined Authority for the purposes of, I think, business rates.

Baroness Hollis of Heigham: So it is not an opt-out?

Baroness Williams of Trafford: No, it is not an opt-out but it is a non-constituent member for the purposes of some of the powers the combined authority might get for business rates. I think that is the reason that it is a non-constituent member. I apologise if the noble Baroness is still confused.

The noble Lord, Lord Woolmer, asked several pertinent questions, as always—

Baroness Hollis of Heigham: Will the Minister come back to the substance of the questions I asked? She may well do later in her wind-up to this bundle of amendments but, if that is all she is going to say, forgive me, she has not addressed the issues. We share the same wish for outcome but can she come back to some of the other issues I raised?

Baroness Williams of Trafford: I was trying to say to the noble Baroness that for one purpose a local authority might be a constituent member of a combined authority; for another purpose—I gave the example of Cheshire East—it may be a non-constituent member of a combined authority. In other words, it has involvement with more than one combined authority but on a different basis, which I thought was the point she was making.

Baroness Hollis of Heigham: If the Minister could write to me more fully, that would be helpful and then perhaps we can follow it up. I do not want to waste the time of the House.

Baroness Williams of Trafford: I have just been passed another note about this. Another example is that York is a non-constituent member of West Yorkshire Combined Authority. In fact, I think that is why the noble Lord, Lord Woolmer, was nodding so readily.

Lord Woolmer of Leeds: At what point in a mayoralty would a non-constituent authority become a constituent authority? How many elements of the combined authority’s functions would a non-constituent authority have to share in order for it to become a part of a combined authority? That presumably means that

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the mayor of the combined authority would be taking decisions or influencing decisions of the combined authority that were outwith the electorate of this non-constituent local authority. Am I right on that?

Baroness Williams of Trafford: I hope I can answer this satisfactorily. Let us take the example of York, within Yorkshire. If York was to become a constituent member of some sort of Yorkshire combined authority it could not then become a constituent member of another combined authority, but I think it would be perfectly possible for it to become a non-constituent member of another combined authority for certain purposes. So in other words, if Cheshire East decided that it would, with consent, have a combined authority with Cheshire West and Chester, would that then preclude it from being a non-constituent member of the Greater Manchester Combined Authority? I do not think that it would—but I can confirm that in due course, if it helps the noble Lord.

Lord Warner: May I suggest that the Minister responds to the perfectly sensible proposition of my noble friend Lord McKenzie that we curtail this set of discussions so that we can make some progress?

Baroness Williams of Trafford: I always try to answer noble Lords’ questions from the Dispatch Box. However, in this instance, I take the noble Lord’s point. With the leave of the House, I propose to withdraw Amendment 62 today and return to it at Third Reading.

Amendment 62 withdrawn.

Amendments 63 to 65

Moved by Baroness Williams of Trafford

63: After Clause 9, insert the following new Clause—

“Removal of geographical restrictions in relation to EPBs

(1) The Local Democracy, Economic Development and Construction Act 2009 is amended as follows.

(2) Omit subsections (3) and (4) of section 88 (EPBs and their areas).

(3) In section 95(2)(a) (changes to boundaries of an EPB’s area: conditions), for “conditions A to D” substitute “conditions A and D”.

(4) In section 98(3)(c) (preparation and publication of scheme for new EPB: conditions) for “conditions A to C” substitute “condition A”.

(5) In section 99 (requirements in connection with establishment of EPB), after subsection (3) insert—

“(3A) Subsection (3B) applies where the Secretary of State is considering whether to make an order establishing an EPB for an area and—

(a) part of the area is separated from the rest of it by one or more local government areas that are not within the area, or

(b) a local government area that is not within the area is surrounded by local government areas that are within the area.

(3B) In deciding whether to make the order, the Secretary of State must have regard to the likely effect of the creation of the proposed EPB on economic development or regeneration in each local government area that is next to any part of the proposed EPB area.”

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(6) In section 102 (requirements in connection with changes to existing EPB arrangements), after subsection (2), insert—

“(2A) Subsection (2B) applies where the Secretary of State is considering whether to make an order under section 95 and—

(a) part of the area to be created is separated from the rest of it by one or more local government areas that are not within the area, or

(b) a local government area that is not within the area to be created is surrounded by local government areas that are within the area.

(2B) In deciding whether to make the order under section 95, the Secretary of State must have regard to the likely effect of the proposed change to the EPB’s area on economic development or regeneration in each local government area that is next to any part of the area to be created by the order.””

64: After Clause 9, insert the following new Clause—

“Removal of geographical restrictions in relation to combined authorities

(1) The Local Democracy, Economic Development and Construction Act 2009 is amended as follows.

(2) Omit subsections (3) and (4) of section 103 (combined authorities and their areas).

(3) In section 106(2)(a) (changes to boundaries of a combined authority’s area: conditions), for “conditions A to D” substitute “conditions A and D”.

(4) In section 109(3)(c) (preparation and publication of scheme for new combined authority: conditions), for “conditions A to C” substitute “condition A”.

(5) In section 110 (requirements in connection with establishment of combined authority), before subsection (4) insert—

“(3A) Subsection (3B) applies where the Secretary of State is considering whether to make an order establishing a combined authority for an area and—

(a) part of the area is separated from the rest of it by one or more local government areas that are not within the area, or

(b) a local government area that is not within the area is surrounded by local government areas that are within the area.

(3B) In deciding whether to make the order, the Secretary of State must have regard to the likely effect of the creation of the proposed combined authority on the exercise of functions equivalent to those of the proposed combined authority’s functions in each local government area that is next to any part of the proposed combined authority area.”

(6) In section 113 (requirements in connection with changes to existing combined arrangements), after subsection (2A) (inserted by section (Requirements in connection with establishment etc. of combined authority) above) insert—

“(2B) Subsection (2C) applies where the Secretary of State is considering whether to make an order under section 106 and—

(a) part of the area to be created is separated from the rest of it by one or more local government areas that are not within the area, or

(b) a local government area that is not within the area to be created is surrounded by local government areas that are within the area.

(2C) In deciding whether to make the order under section 106, the Secretary of State must have regard to the likely effect of the change to the combined authority’s area on the exercise of functions equivalent to those of the combined authority’s functions in each local government area that is next to any part of the area to be created by the order.””