Christopher Booker's Notebook
(Filed: 19/10/2003)

Regional assemblies become private firms
A rare happy ending
EC welches on farmers' bribe
Pure waste of money

Regional assemblies become private firms

If Mr Blair announced he was planning to set up the Government as a limited company, allowing ministers to make lucrative private deals with their own officials and even to sell the Government off, there would be uproar. However a not dissimilar move is the latest twist in John Prescott's campaign to divide up England under regional governments.

Several of the unelected "regional assemblies" he has set up as embryo governments, which receive millions of pounds of public money and are playing an increasingly important role in local government, are now turning themselves into limited companies, not least to protect their members against legal claims for misuse of public funds.

The South-East Regional Assembly Ltd has already been set up, in response to Mr Prescott's initiatives. Others, including the East Midlands assembly, are following suit. The North-East Assembly is dividing itself into no fewer than three companies.

What makes this even more bizarre is that the members and directors of the new companies - appointees of local authorities and representatives of local bodies such as the CBI and trade unions - are being given extraordinary privileges, including the right to benefit financially from contracts made with the assemblies, and even to sell their assets.

Copies of the memorandum and articles of association proposed for the East Midlands Assembly Ltd, obtained by George West, a tireless campaigner against Prescott's plan for elected regional governments, show that a director "may be party to or otherwise interested in any transaction or arrangement with the Assembly" and that he shall not "be accountable to the Assembly for any benefit which he derives from any such office".

Furthermore, "no member shall (as such) have any right of inspecting any accounting records or other book or document of the Assembly". Section 3.25 of the memorandum even gives directors and members the right to "sell" the Assembly.

One spur for this move, according to Mr Prescott's office, is that it makes it easier for central government to fund the assemblies directly. Another was the victory won earlier this year by Neil Herron's North-East Against a Regional Assembly campaign.

The district auditor upheld complaints that the North-East Assembly was misusing funds contributed by 25 local councils by publishing propaganda promoting an elected assembly before Mr Prescott's planned series of referendums. This was in breach of the Local Government Act, prohibiting use of public funds for political purposes.

What makes the move even odder, however, is that these "private companies" already exercise considerable powers, transferred to them by Mr Prescott. They already exercise a key planning role, co-ordinating regional plans in accordance with the EU's European Spatial Development Perspective (control of strategic planning was handed over to the EU under the Maastricht Treaty).

Under one such plan, the county of Northamptonshire - which will be abolished if the East Midlands gets an elected regional government - is to have its population increased by 50 per cent in the next 30 years.

Mr Prescott's game is to give these unelected bodies such an important role that, when his referendums are held, voters will be told the only way to ensure that their new regional governments are democratically accountable will be to vote for elected assemblies. But to turn these organs of government into private companies first was a twist not even the most cynical observer of the degrading of Britain's local government could have predicted.

A rare happy ending

Last month, West Country papers reported the sad plight of a small firm in the Cotswolds town of Bourton-on-the-Water, threatened with closure because it could not afford to comply with EC safety rules.

For over 30 years the team of craftsmen who work for Rupert Duester at Sunningend Joiners and Cabinet Makers have been making furniture and fittings for clients which included Windsor Castle and the Sultan of Brunei, on vintage, cast-iron machines dating from the 1940s.

The machines never caused a single accident. But in 1998 the Health and Safety Executive gave Mr Duester five years to comply with the Provision and Use of Work Equipment Regulations, issued to implement various EC health and safety directives.

These required the machines to stop within 10 seconds, be fixed to the floor and be fitted with guards, extractors and other safety devices not invented 50 years ago.

Mr Duester realised he could not afford the £20,000 required to make the machines EC-compliant and last month, as the deadline approached, he told local reporters that on December 5 he would have to close the firm and lay off his workforce. He did add, however, that the firm might be saved if there was "someone out there young and enthusiastic enough to take over", with enough cash to meet the EC requirements.

Among those who read this was Simon Hall, another Bourton resident, who recently completed a 10 year stint as projects manager for the Bahreini royal family. Having trawled the world for top-class furniture and fittings, he recognised the quality of the firm's work and last week he took it over.

An overjoyed Mr Duester is to stay on part-time to ensure the firm's transition to a new, expanding future. At the eleventh hour a tiny chunk of Britain's beleaguered manufacturing economy has been saved from the devastation inflicted by that tidal wave of Single Market regulations which a decade ago British businesses were told would "liberate" them to sell their products on a "level playing field" to 340 million customers.

It is not often that this column is able to report a happy ending to such stories. But Sunningend's new owner is keenly aware what a farce that "liberation" turned out to be in practice. He is determined that this is one business which will not follow the fate of so many others.

EC welches on farmers' bribe

Gordon Brown's sums were thrown into further disarray last week when it was reported from Brussels that the European Commission is likely to withhold £700 million claimed by the British Government towards the cost of the 2001 foot and mouth epidemic.

The Commission confirmed that it cannot contribute to the cost of destroying eight million healthy animals under the "pre-emptive cull" scheme, because compensation can only legally be paid for the slaughter of infected animals. It also claims the sums paid to farmers were excessive anyway.

What the reports did not point out was that the pre-emptive cull policy was initially "recommended" by officials of the Commission's own Food and Veterinary Office when they visited Britain between March 12 and 16, 2001, even though the culling of healthy, unexposed animals was unlawful.

The chief reason why ministry officials were willing to pay over the odds was that they thought this was the only way to persuade farmers to accept a policy the illegality of which was recently confirmed in a paper by two Cardiff University law professors.

In other words, the Commission is now refusing to pay for a policy launched to comply with the instructions of its own officials; and which could only be implemented by bribing farmers with the money it is now threatening to withhold. Thus do the crimes of Mr Blair's ministers come back to haunt them; except that it is we the taxpayers who must foot the bill.

Pure waste of money

When it was reported last week that water bills are likely to rise by as much as 70 per cent, even the BBC grudgingly conceded that this was due to the billions of pounds water companies must spend to comply with the unending flow of EC water directives (nearly 200 items of legislation at the latest count).

What the BBC did not report was that much of this expenditure is unnecessary, because standards of water purity demanded by the EC are so ludicrously over the top. Much of the cost goes to extracting chemical residues so minute they can scarcely be measured (the equivalent of half an aspirin in an Olympic swimming pool).

What the BBC also did not report was that among the countries that largely ignore the EU rules is Belgium, which has notoriously failed to implement the Urban Waste Water directive (91/271). Anyone walking round Brussels may be assailed by the stench of human sewage, much of it poured into the river Senne. It is symbolically apt that every time the Commission officials flush the lavatory, they are thus abetting the breach of their own law.