Labour has been hard at work on local government for the past four years. Compulsory Competitive Tendering has gone and been replaced by Best Value. Structures have been radically altered: the convoluted merry-go-round of committees has been radically reshaped with the split of local government functions into those of executive and scrutiny. Elected mayors are firmly on the agenda: Brighton, Watford and a number of other local councils are in the early stages of referenda to bring about polls for new elected chief executives, with potentially revolutionary consequences for the long standing and still shadowy system of political groups, pre-meetings and whipped votes in the council chamber.
This is all about the life of the council itself. But around local government, a more profound revolution has taken place, largely unmarked by legislation, but with similar far-reaching consequences. We are now firmly in the world of the ‘initiative’ – Labour’s chosen way of making the link between pro-active policy and target development at the centre and the perceived sluggishness of the implementation and attainment of these targets at local level.
From the centre, this way of doing things looks to be both practically sound and philosophically right. Labour has been impatient to make a real difference on the stubbornly immovable evidence of social exclusion and neglected estates in swathes of urban Britain. Earmarking funds, targeting areas of deprivation, setting targets for achievement and then providing the mechanisms for action looks like a winning combination. And there is no doubt that a number of these initiatives have been outstanding successes. Education action zones, the single regeneration budget, Sure Start, health action zones, neighbourhood renewal schemes and many other initiatives have made a real and measurable difference.
From a minister’s point of view, they also make practical sense. Funding can be allocated and controlled. The sense of tipping vast sums of money into a metaphorical swamp is alleviated. Councils can bid to receive the funds, and ministers can choose the brightest and the best to get programmes going. Targets can be set and realistically monitored. There is a real sense of connection between the policy promoted and the outcome on the ground.
But how does it look from the point of view of local government? In many places, initiatives are both welcome and work well, but with the burst of initiatives comes a plethora of management problems for local government in general. For a start, they are supposed to bid for many of the initiatives. This takes money and officer time. Other funding from elsewhere in the budget may need to be diverted to support the bid if successful. Some local authorities may have a number of initiatives, each defined by a different geographical boundary, within their area. Each is fuelled by the need to consult, and the same people may be consulted over and over again. But what does one do with the consultation? The attainment of targets and the adjustments that may need to be made in the light of meaningful consultation are simply incompatible. The success of an initiative may at the same time be destabilising for wider and more long-term relations within the community, especially since many initiatives are time limited, and the local council and community will pick up the pieces once the initiative has departed.
What we have is a paradox. More money is going into local government on any measure either in terms of the mainstream funding from settlements, or from earmarked money going into initiatives. But many local authorities complain of having less money to work with. This arises simply because ten percent of local authority revenue is now earmarked, and over and above this, ‘transferable’ money is ‘fixed’ alongside it.
There is also a second paradox. Each of the initiatives is supposed to introduce more ‘power to the people’. But local government itself has never felt less powerful. The elected representatives of the people are reduced, in many instances, to standing alongside a variety of appointed, self-nominated or ‘emerged’ board members, business leaders and community tribunes debating the implementation of initiatives and the allocation of the resources they bring.
Labour has, in recent months, recognised that this all presents a problem. The Cabinet Office report Reaching Out reported that ‘departments’ programmes targeted at particular local areas are poorly co-ordinated and waste scarce local capacity: they do not always work well with mainstream programmes. Progress on delivering the government’s priorities is being slowed down as a result.’ The report identified a number of ways forward, including the establishment of regional initiative co-ordination.
The favoured device currently is the development of local strategic partnerships which bring together representatives of all the initiatives and agencies – health, education, the police, the community, local businesses, the local council – to bring order and co-ordination into a fractured landscape. The new neighbourhood renewal programme, itself effectively a series of new initiatives, has been engineered so that access to its funding at local level is contingent upon a local strategic partnership being up and running.
The establishment of local strategic partnerships is a sensible and useful development as far as it goes. But, in other ways, it seems to miss the point, or, rather, to duck the choice that Labour now needs to make as it seeks to consolidate the real gains it has made in the impact of public service, and the rolling back of the cynical market-driven destruction wrought by the Thatcher years.
This is simply, the choice of local democracy. This is a practical as well as a theoretical issue. A recent MORI poll asked the question ‘would you like elected local councillors to be replaced by administrators’, and the resounding answer was ‘no’. For all its faults, electing people locally provides an unassailable method of taking final decisions on competing priorities, with the added advantage that you can throw those who make the choices out if you don’t like the choices they are making on your behalf. Granted, there remain areas of the UK that are long-standing one-party states as far as local government is concerned, but the relatively straightforward introduction of proportional methods of electing local councillors would put that right. The problem with initiatives, however good their content may otherwise be, is that decisions in them are usually made by appointees. Setting a up a grand committee of appointees to co-ordinate decisions made by other appointees does not solve the problem, and the language of partnership and participation which accompanies the whole exercise simply confuses the two notions of holding to account and giving an account.
There is, further more, a growing body of evidence about the reasons local communities and towns work well or less well. The presence of a high degree of so-called social capital in a community is important to how well it works. The existence of community associations, voluntary organisations, allotment societies and so on makes the community flourish: this spins off, or is paralleled by, a high degree of civic engagement, characterized by confident communicative civic management, and responsive, legitimate local governance. This is, in part, the vision that Labour has for local government. We need more and better councillors coming forward to take those local decisions, and we need vibrant communities to work with them. These two developments are the long-term guarantors of any turn around in estates, in neglected inner city areas and in the confidence of a town or a city to move itself forward.
The directness of the initiative way for local governance provides the nourishment but does not, in general, plant next year’s crops. Labour’s initiatives must, therefore, be seen as a transitional phase of rebuilding local government. The task for the second term must be to examine ways to build capacity for sustained community and locality self-organisation, since this will be the way that Labour’s attack on social exclusion and local neglect will be incorporated into the long-term working practices of governance at a local level.
There is no great puzzle about how this can best be achieved. Capacity-building, and the long view that this form of politics entails, requires government to establish a stable framework within which local government can work, and then stand back to allow it to mature. It also means acknowledging the centrality of elected local government as community champion, community animateur, and community project broker. This suggests a number of specific guiding principles for central relations with local government.
First, the confusion presently apparent in the construction of partnerships where the decision-making authority of the partners is clearly widely different must be cleared up. The primacy of local government in such partnerships should be underlined. A straightforward way to do this would be to establish procedures to allow local authorities to bid for the incorporation of initiatives operating in their areas into the wider working of the local authority, if they could demonstrate their ability to take over programmes through the stability of working practices and community links.
Second, further consideration will need to be given to the way in which funding for local government is raised, and the extent to which local fund raising is seen to be part of elected authority’s accountability to the electorate. As matters stand, there exists only the most tenuous relationship with only a little over 20 percent of the average local authority’s revenue being raised by taxation decisions reached locally. The government’s efforts to put in place a finance system which supercedes the Standard Spending Assessment formula are laudable, but are almost certainly doomed to failure if they do not take into account the destructive gearing effect of local authority finance raising. For every 1 percent of funds the authority wishes to raise for services, a 5 percent increase in council tax levy must be decided upon, assuming the government grant element stays stable. This makes any meaningful appeal to the electorate virtually impossible. On the contrary, it produces local electoral contests where parties claim the credit for arbitrary swings in financial fortune entirely beyond their real control, and castigate opponents if financial misfortune, equally beyond local control or influence, has been visited upon the area.
A review of local authorities financial arrangements need not include the issue of the business rate, tempting though that may be to resurrect. An imaginative recasting of local taxes would recognise that UK local government has recourse to the smallest base of possible tax sources (ie one) in Europe. A variety of other local taxes, such as landfill levy, road fund licence, and airport taxes, could be collected and applied locally with the aim of radically increasing the proportion of taxes levied in the name of the local authority, and thereby reducing the gearing effect to meaningful levels.
The third guiding principle for local-central relations is that the government needs to think through the local government consequences of regional devolution in England. If it is to be meaningful, regional devolution needs to assume responsibility for functions presently undertaken by central government and the government offices for the regions. It should not suck up functions presently lodged at local level. The emergence of elected regional bodies will, however, produce pressure, if this principle is maintained, for them to exercise scrutiny and co-decision-making in a number of bodies operating on regional structures: the health service, arts councils and tourist boards, to name but a few. This will, in turn, point towards far greater involvement of local authorities in the scrutiny of the local functions of regionally organised quangos and government departments.
In short, in the long term we might conclude that the local strategic partnerships themselves should be seen as transitional bodies. A revitalised, stable and confident local government will be in a position to take the lead in co-ordination and decision making at local level: not running all services, but performing the role that it has the capacity for, of making decisions on behalf of local people, and being accountable to them for their consequences.