Tees Valley Mayor, Lord Ben Houchen, will this week present the names of the men who will succeed him as chairs of the area’s three mayoral development corporations (MDCs) – South Tees, Hartlepool and Middlesbrough -to the Tees Valley Combined Authority (TVCA) cabinet.
He is able to name them, without requiring cabinet approval, because of constitutional amendments also being put forward at the cabinet’s annual general meeting (AGM) on Friday, changing the legal basis on which MDC board members, including the chairs, are appointed.
Until now the mayor has proposed board members and the cabinet has approved them. This has included proposing himself as chair of all three MDCs, and the cabinet has always acquiesced.
Following the independent Tees Valley Review last year and the issuing of a Best Value Notice by the Ministry of Housing, Communities and Local Government (MHCLG) in April, Houchen came under political pressure from the government to stand down from the chairs of the MDCs.
The constitutional changes being put forward on Friday will enable him to use an older Act – the Local Democracy, Economic Development and Construction Act (2009) – to get his nominations through than in previous years. Previously the Localism Act (2011), as amended by the Tees Valley Combined Authority (Functions) Order (2017), has been applied.
The official report being presented to the cabinet on Friday sets out the necessary constitutional amendments being made to the TVCA constitution, which it says came into effect on 8 May 2017 and is legally binding.
The Localism Act
Schedule 21 of the Localism Act 2011, says the cabinet report, “provides the legal framework for the membership and remuneration for MDCs. This legislation needs to be read in conjunction with the TVCA (Functions) Order 2017… Schedule 1, which amends the wording of the Act.
“The Act as amended by the Order states: ‘A[n]…MDC is to consist of such number of members (being not less than six) as the combined authority [not the mayor] may from time to time appoint. The combined authority must appoint at least one elected member from the local authority area the MDC sits in [Redcar & Cleveland in the case of South Tees]. The combined authority must appoint one of the members of an MDC to chair the MDC.
“When appointing a member of an MDC, including a chair, the combined authority must have regard to the desirability of appointing a person who has experience of, and has shown some capacity in, a matter relevant to the carrying-out of the MDC’s functions, and must be satisfied that the person will have no financial or other interest likely to affect prejudicially the exercise of the person’s functions as member. The combined authority may require any person whom they propose to appoint as a member to provide information to ensure they do not have any prejudicial financial interest.
“In respect of remuneration the Act as modified by the Order states as follows: ‘An MDC may pay remuneration, travelling expenses and other allowances, and sums in respect of pensions and gratuities. Remuneration and/or pension payments cannot be made to any elected member of the Tees Valley area, unless they act as the chair in which case they can be remunerated for that role. The combined authority determines rates and eligibility criteria in respect of the above.’
That seems clear enough: the combined authority (i.e. the cabinet) appoints MDC members and chairs (albeit on a recommendation from the mayor).
The Local Democracy, Economic Development and Construction Act (2009)
Then abruptly, in the next paragraph, without any explanatory preamble, the report to Friday’s cabinet says:
‘…the 2009 Act states that the functions above conferred to the combined authority are general functions exercisable by the mayor. Therefore, the appointment of board members to the development corporations, the appointment of the development corporations’ chairs, and the ability to determine rates and eligibility criteria for remuneration are functions that only the mayor can exercise. The mayor can exercise these functions personally or delegate them to the deputy Mayor or an officer of the combined authority.’
Constitutional amendments
The constitutional amendments required by these changes are confusing, to say the least. According to paragraph 21.6 on page 46 of Friday’s cabinet report: “Following the decision of the Tees Valley Mayor to step down as chair of the MDCs, no combined authority constitutional amendments are required.
“However, the development corporations constitution will be amended to reflect that position [the mayor’s resignation] at their AGM and shall then be brought to cabinet in September for combined authority approval. The TVCA constitution has been amended to reflect the mayor’s decision to not be appointed as chair of the Freeport Board.”
In accordance with the new Tees Valley doctrine of MDC governance, the cabinet will just be asked on Friday to ”note” appointments to the three MDC boards, whereas it is being asked to approve or ratify a list of other decisions (pages 25-6). It does have to approve changes to the constitution, but according to the cabinet report these are only minor, for updating or clarification purposes, to correct typographical errors or to include references to new legislation.
That is not quite right, however. Reading as far as paragraph 93 of the TVCA constitution on page 320 of the cabinet papers -that’s right, page 320 out of 485 – we find that the words: “The mayor shall make proposals to the cabinet to appoint the chair and members of the MDC[s]…” have been edited to read: “The Mayor shall appoint…”
Comment – what’s going on?
The replacement of the 2011 Act (as amended by the 2017 Order) by the earlier 2009 Act only has one plausible explanation. The 2009 Act enables Houchen, having been prevented by the government from chairing the MDCs himself, to ensure his chosen successors can take over without having to worry about the cabinet not approving them. Given the cabinet’s history of quiescence, this is not much of a concern, but better safe than sorry.
More puzzling is how no one in Tees Valley has noticed before now that it is the 2009 Act that provides the appropriate legal framework for appointing MDC members and chairs – if indeed it is. The later Localism Act and TVCA (Functions) order seem to the layman to be more likely candidates, just by virtue of being more up to date.
It is ironic that if the 2009 Act is after all the correct one to use, Houchen has not been taking advantage of it all along, as it gives him greater freedom to appoint whoever he wants. It is uncharacteristic for him to subject himself to such a self-denying ordinance, even if his colleagues have always accepted his self-nomination.
PS: who are the new chairs?
Following Houchen’s announcement of his resignation from the three chairs, the cabinet held an informal meeting on 2 May and presumably agreed an appointment procedure. Adverts were placed, shortlisting carried out and interviews conducted by the mayor, chief operating officer and respective chief executives. So the process was not unstructured. The names to emerge, to be “noted” by the cabinet on Friday, are:
- South Tees -David Smith, longest-serving member of the STDC board and vice-president of GEODE, the European association for the electricity and gas distribution networks. He sits on the Government Industry Contact Group on Distributed Energy;
- Middlesbrough -Tony Parkinson, former chief executive of Middlesbrough Council; and
- Hartlepool -Mark Robinson, a retail and regeneration expert who previously chaired the UK’s High Streets Task Force,
