What next as the Cities Bill nears Royal Assent?

The amendments, politics and implications of the Cities Bill as it passes its third reading in the Commons.

Ben Harrison

Director of Communications and Development

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Yesterday the Cities and Local Government Devolution Bill finished its journey through the House of Commons. After several sessions of debate and discussion which have seen amendments tabled from all sides of the House, a revised version of the Cities Bill will now return to the House of Lords, where it was initially introduced, before gaining Royal Assent.

But what has changed within the Bill since it was introduced to the Commons, and what does that mean for what happens next?

What has changed since the Bill was introduced to the Commons?

During the Committee and Report stages in the House of Commons, a range of amendments were tabled to the Bill, and as a result, a number of important changes have been voted through, including:

1. New clauses to allow for the reorganisation of local government structures and boundaries in relation to district council areas if at least one relevant local authority consents.

This late amendment was the focus of much debate in the Commons, as MPs from all sides raised concerns that it could essentially lead to the Secretary of State forcing boundary changes on local areas where relevant authorities had not given their consent.

The Government rejected this charge, insisting it would insist upon consensus before any changes were made, but the amendment will make it easier for changes to take place where, for example, a particular district council wishes to form part of a combined authority, rather than remain within an existing county structure.

This could prove to be particularly relevant in the context of the Sheffield, D2N2 and Leeds City Regions, as authorities work towards establishing new arrangements to formally work together that more closely reflect the economic linkages between them, rather than historic administrative boundaries.

2. New clauses to allow for the creation of sub-national transport bodies (STBs) outside of London.

Proposed by the Government, this new section of the Bill essentially allows for the creation of “Transport for London” style bodies across other conurbations and areas – such as Transport for the North.Where created, STBs will be charged with preparing a transport strategy for an area, coordinating transport functions across constituent authorities to improve effectiveness and efficiencies, and developing proposals regarding which functions should be exercised locally to improve transport services.

Although it is stated clearly that the primary focus of STBs will be transport, there are also general powers of competencies included within the Bill to afford STBs with scope to engage in “anything it considers appropriate for the purposes of the carrying out of any of its functions”. In practice, this could, for example, see such bodies engaging in strategic asset management or other commercial activities to help support the provision of transport services across an area – although the legislation is explicit that STBs will not be able to borrow to fund their activities.

Other amendments were also adopted, including a range of updates to facilitate the devolution of health responsibilities to combined authorities, and requirements to report on the progress of devolution to Parliament.

Just as important though, were the amendments that did not get voted through, in particular Amendment 58, which sought to decouple major devolution deals from requiring a Mayor, or Amendment 2 which would mandate the staging of referenda for the introduction of them. The Government resisted both of these amendments on the basis that they would run counter to the commitments made in the Conservative Manifesto, and that a mayor should be required to provide the level of accountability necessary to oversee substantial devolution.

And finally, it is worth noting that no amendments were carried to the original clauses of the Bill that explicitly prevent mayors from borrowing to fund activities – a factor which will in practice significantly limit their scope to invest in economic growth.

How have the politics of the Bill played out?

Even before the Bill arrived in the Commons it was evident that it may not face an easy ride. Devolution is not an issue where there are clear Conservative and Labour positions that would divide the House – enthusiasts and sceptics exist on both sets of benches. But it was immediately clear that the Labour frontbench had resolved that the Cities Bill was intrinsically linked to the Government’s broader policy of austerity, and therefore set about resisting it. The frontbench –to the dismay of some of its own backbenchers and city leaders – tabled a “reasoned amendment” to deny the Bill a second reading on the grounds that the legislation would essentially facilitate the delegation of funding cuts.

Having been unsuccessful in this attempt to derail the Bill, the attitude of the Opposition has shifted gradually through the debate, with Shadow Secretary of State for CLG Jon Trickett declaring in the Commons yesterday that the party would support the Bill as a “faltering step” in the right direction, even though it was not ambitious enough, and paled in comparison to the devolution of the previous Labour government’s to London, Scotland and Wales. Trickett also confirmed that the Party will go ahead with its own constitutional convention in the months ahead. It remains to be seen how this consultation process will impact on the emerging devolution deals that are being agreed across the country.

For their part, the primary stewards of the Bill, Greg Clark MP and James Wharton MP, adopted a deliberately consensual and flexible approach, making a virtue of the fact that the Bill would allow for different devolution arrangements to be developed in different places. This has proven to be very important in diffusing persistently difficult issues raised by Conservative and Labour backbenchers alike regarding the introduction of metro mayors, the accountability of new local government structures, and the role of MPs in scrutinising devolution agreements in the years ahead. However, many Tory backbenchers remain concerned regarding the implications of the Bill, and may yet apply pressure to the Secretary of State during 2016 and beyond.

What are the implications for the Bill clearing its final hurdles?

Now that the Bill will return to the House of Lords for a final consideration of amendments, it is difficult to foresee anything significant disrupting the final passage of the legislation before the end of 2015. Despite the fact that many Labour and Lib Dem peers held reservations regarding elements of the Bill when it was introduced in the Summer, the political context regarding the role of the House of Lords in the legislative process following their rejection of Government changes to Tax Credits, combined with the Labour Party’s (albeit somewhat reluctant) support in the Commons, makes any attempt to send the Bill back to the Commons highly unlikely.

With that in mind, the Government remains on course to support city-regions and counties to progress with the implementation of their devolution deals during 2016, with a view to the first elections for metro mayors to take place in May 2017.

Before then, a series of orders will be passed through the Commons to set in place the details on policies and powers that will underpin specific deals – including, for example, the cancelling of Police and Crime Commissioner elections where those posts are being amalgamated with the new post of mayor. And of course, given the enabling nature of the Bill, the fact that many areas of the country have yet to secure a deal, and the tendency of Government to continually “top up” devolution agreements over the last 12 months, you’d be very brave to bet against more major devolution announcements being made ahead of May 2017.

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