Contact : Malcolm Cole Ext 7385

1. Introduction

1.1 This White Paper subtitled `Revitalising the English Regions' was published in May 2002.

1.2 A detailed report on the proposals contained in the White Paper was considered by the Cabinet on 27 May 2002 and by Policy and Resources Policy Review Committee on 6 June 2002.

1.3 This report for Council provides an opportunity for all Members to consider the main strategic issues set out in the White Paper and to debate the issue in the light of the previous discussions undertaken by Cabinet and Policy and Resources Policy Review Committee.

2 The White Paper Proposals in Summary

2.1 The Government proposes to move incrementally to an elected system of regional government in England with assemblies based on the existing 8 Government office areas ie in the South East, the existing GOSE/SEERA area.

2.2 Specific activities in respect of setting priorities, delivering regional strategies and allocation of funds proposed for the new regional assemblies are:-

· economic development

· skills and employment

· land use and regional planning

· housing

· transport

· arts, tourism and sport

· public health

· rural policy

· environmental protection, biodiversity and waste

· crime reduction

2.3 Before an elected regional assembly can be established a referendum must be held and a "yes" vote by a simple majority obtained. The Government will determine, in each region, when the time is right ie by "assessing the level of public interest...." In two tier local government areas, a review of the structure of local government will be undertaken in advance to determine the appropriate form of "unitary" local government to be implemented upon the successful outcome of the regional assembly referendum.

The number of members to be elected to the new Assembly will range between 25 and 35 and will be elected partly by geographical representation topped up with a form of proportional representation (Additional Member System).

2.5 Regional Assemblies are to be funded primarily by Central Government but will have the power to raise funds by a precept on the council tax. The Government "will expect council tax payers to contribute the equivalent of around five pence per week for a Band D council tax payer". A higher level may be allowed in some cases but a `capping' regime will be applied.

2.6 The White Paper clearly envisages an incremental take-up by the eight regions and the North East is expected to be first in line. The perception seems to be that the first regional assembly will not be established for some years - one, possibly two referendums may take place within the life of the current Parliament with the first assembly being established in the life of the next Parliament.

2.7 The Prime Minister's introduction to the White Paper Summary states "No region will be forced to have an elected assembly".

3 Issues considered by Cabinet and the Policy and Resources Policy Review Committee

3.1 The report to Cabinet and Policy and Resources Policy Review Committee raised a number of issues for consideration arising from the White Paper proposals, namely:-

Added Value - the White Paper provides little evidence that the regionalisation proposals would improve the current governance arrangements in the South East.

Devolvement of Powers - despite protestations to the contrary, the White Paper shows little or no sign of powers being devolved from central government, rather a case of powers being taken from existing local government.

Democratic Deficit - 35 members of a regional assembly for a population of 8m in the South East combined with a `unitary' system of local government is a major reduction in democratic representation and accountability.

Scale - the South-East region is on a totally different scale to most of the others - 8m people compared to 2.6m in the North-East. The White Paper's example of a £350m budget for a North-East Assembly makes a curious comparison with Hampshire County Council's budget of £1.2bn.

Local Government in a Regional Structure - taking into account capacity and community identity arguments, there are real issues which would confront a unitary structure in Hampshire.

Public Opinion - A MORI survey undertaken by the Council around the time of the White Paper revealed only 35% of residents supporting the idea of regional government. Furthermore while 45% of respondents support devolving powers from central government they do not want it at the expense of Hampshire County Council. The data suggests the more informed about regional government residents become, the more likely they are to oppose it.

Financial issues - concern about running costs, tax precept powers and costs of local government review are not adequately covered in the White Paper. Bearing in mind the costs of the last local government review in Hampshire were estimated at £43.3m, it is doubtful that enthusiasm for a future review would be increased by an examination of likely associated costs.

4 Outcome of the deliberations of Cabinet and Policy and Resources Policy Review Committee

4.1 The Cabinet shared the concerns raised in the report, including in particular those relating to democratic deficit and the drawing up of powers from County Councils rather than down to them. They agreed that a formal response should be made following consideration of the report by the Policy and Resources Policy Review Committee and Council and that copies of the report should be forwarded for information to the Hampshire Members of Parliament. The report's recommendations (as follows) were adopted subject to these additions:-

"To work with South Eastern Counties to develop a common view, if practicable, on the potential benefits/disbenefits of Regional Government for the South East of England.

To build on the existing work with MORI in co-operation with other South East Counties, with a view to seeking a clear and objective indication of the Hampshire and wider South Eastern community's desire to embrace the concept of regional government."

Consideration by Policy and Resources Policy Review Committee was wide ranging and a summary of the comments made is attached as Appendix 1. In addition, this Committee adopted a further resolution as follows:-

"That the Committee sees little benefit for Hampshire people but considerable disbenefit to them if the proposals are implemented as envisaged in the White Paper."

5 Conclusion

5.1 Discussions on this subject and the various issues it raises are now being undertaken within the South East through

· South East Counties Leaders' meetings

· South-East Regional Assembly

and nationally through the CCN and LGA.

Following debate by Council and, in the light of information gleaned from the above networks and survey work, a formal response by the County Council to the White Paper will be made.

Section 100 D - Local Government Act 1972 - background papers

The following documents disclose facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of this report.

NB the list excludes:

1. Published works

2. Documents which disclose exempt or confidential information as defined in the Act.

File None Location

White Paper - `Your Region, Your Choice'

A summary of comments made at the Policy and Resources PRC on 6 June 2002.

- unanimous criticism of the degree of `democratic deficit' associated with the proposals

- no real indication of devolvement of powers from central government. More a `shuffling of the pack' or the acquisition of powers from local government

- why does the White Paper `dodge' the issue of democratic accountability of QUANGOs and not propose absorbing them into the regional arrangement?

- if a regional tier of government is to be introduced, it should decide upon the structure of local government in its area.

- there is likely to be a real issue of `capacity' of unitaries in the South-East to deliver Education and Social Services. Capacity can give effect to both economies of scale or higher council tax.

- the proposals are a clear move to centralise power, reduce democratic representation and meet a common European standard for regions.

- how will the decision on the timing of a referendum be taken? There is no clear guidance

- democratically elected councils exist at all levels except at the regional level where SEERA is not directly elected, but the White Paper proposals are `deeply flawed' and while democratic representation is to be supported - not on the terms now on offer.

- pity the White Paper was not a green paper so a real debate could be held.

- what is the logic of a review of local government before a referendum?

- the `strategic' role will be taken from local government leaving only `service delivery'

- there is a real danger of `local wars' about unitary configuration

- although the White Paper may be designed to meet expectations in the NE and NW, once started on this policy - how long before `compulsion' is applied?

- the rules and structures agreed in the areas which take up the option first, may well become the `norm' and applied irrespective of regional differences.