For eighteen long years Labour local government stood between local communities and services and a Tory administration bent on marginalising local democracy. Notwithstanding the antics of a few town hall extremists who played into the Tories’ hands, Labour’s record in local government, in particular in protecting education and social services and staking out new ground in economic development and environmental policy, was highly creditable and helped pave the way for victory in 1997.
Coming into office, Labour did much to improve the relationship between central and local government, signing the European Charter of local government and creating the Central-Local Partnership, which brings together senior cabinet ministers and the leadership of the Local Government Association in a constructive dialogue.
The last four years have seen a significant increase in resources (albeit never enough and with arguments over their distribution) and a much greater degree of certainty in financial planning. The replacement of compulsory competitive tendering with service-driven Best Value was a major step. And the adoption of the Local Government Association’s concept of Local Public Service Agreements encourages the achievement of stretching goals at a local level on the basis of innovation and greater freedoms and flexibilities. In addition, the government has indicated it will reform the capital expenditure system to move away from detailed controls.
So far, so good. However, there have been less welcome developments stemming, in part, from the understandable impatience of ministers to push forward a programme of reform and achieve quick results. There has been a temptation to rely too much on prescription regulation and inspection (with a superstructure now costing £600 million per annum) and a somewhat naïve belief that ‘business knows best’. The quango state has been extended, with local government very much the junior partner in structures such as health trusts and learning and skills councils.
The prevailing Whitehall view has been to regard local authorities as, at best, agents of central government in a command society in which ministers, their civil servants and advisers are seen as able to ordain what happens at a local level.
The current debate round the issue of private sector involvement in public services illustrates another aspect of this dilemma. It would seem that the private sector is to be regarded not merely as a resource, but as a principal means of delivery – for example in education – whether or not the public service is deemed to be failing.
We clearly need some principles to govern the mixed economy of provision, which should include the overriding requirement that private sector involvement should not shape public policy or distort the pattern of provision.
In the controversial area of local democracy, the government was right to challenge local authorities to reform, but the one-sided approach to the idea of elected mayors, with all its potential for gridlocked local conflict and the erosion of local party politics, could be extremely damaging.
Lately, some very positive signals have been forthcoming. Before the election Hilary Armstrong was calling for a roll-back of the rising tide of specific grants, which often distort local spending priorities and diminish flexibility at a local level to determine priorities.
But the increased investment in public services, and the need to deliver now, implies the need for more effective partnerships at a local level between central and local government, including the private and not-for-profit sectors. It is all the more disappointing that the crucial question of the balance between central and local funding has not been materially addressed. The failure to return to the non-domestic rate still means that for council expenditure above the level of standard spending assessments, council taxes rise disproportionately. An increase of one percent in council expenditure represents an increase of four percent in council tax. This undermines local democracy, for if people cannot understand the relationship between local expenditure decisions and their local taxes, they can’t make informed judgements about the performance of their council.
For our part, local councils, particularly Labour local councils, have an obligation to press forward with the improvement of local services and the enhancement of our role as community representatives and leaders. This will mean effective scrutiny arrangements, greater public involvement and genuine local authority-led local strategic partnerships. We must also look to broaden the base of our representation to attract more young people, women, ethnic minorities, the disabled and the unemployed, not least by offering them an effective role, but one which does not preclude the existence of life outside the town hall.
Speaking to the LGA Annual Conference at Harrogate, Stephen Byers emphasised his commitment to partnership with local government, promising to press forward with the deregulation of local government and cutting back on bureaucracy and the voluminous guidance flowing from government departments. We need the same commitment across government, and the party, through its policy-making process, must ensure that, in this crucial second term, Labour nationally and locally combine to deliver.