All three UK political parties talk of "localism", but this is meaningless so long as local government lacks proper constitutional power and independence.
Both coalition partners and the Labour party proclaim their allegiance to "localism", but in all their cases it is a sham. The localism currently being gifted by central government to local authorities is a dishonest manoeuvre to allow them to shoulder much of the blame for the cuts in services that the coalition is enforcing and that are bound to follow; and at the same time, local government is just as much a captive of the centre as it was before May, and what has been given can be taken away just as quickly as it has been offered.
Any localism worth the name has to be the right and the property of local government, not the centre. Most comparable countries have independent local government, backed up by constitutional guarantee. For this to work in the UK would require constitutional independence, accompanied by the devolution of powers to local authorities and financial autonomy too.
So here is a real challenge to the three parties. Since you all agree that localism is vital to renewing democracy in the UK, then agree now to introduce genuinely independent local government before the end of the year. This is a bold and surprising idea, true, but if they could all agree, the newly autonomous local democracy could rapidly become anunquestioned and unrepealable part of the political scenery in the UK as it is in most other western democracies. On the advent of a new government, talking of a “new politics” and local renewal, the moment is upon us.
The disgracefully low turnouts for modern UK local elections underline the fact that it is time either to create genuine democratic local government or stop the pretence, wind it up, give Government Regional Offices a new lease of life and make council chief executives into a Prefecture openly appointed by the centre. We should have the vision now to stake a claim for nothing less than constitutionally independent local government for the UK - a concept which would sustain local government and its financing, and electoral participation in its affairs, long into the future and end the annual begging bowl round which humiliates both the central government "giver" and the "beggars" in local government.
Given the reduction of local government over recent decades to little more than an agent of central government, this proposal would amount to the largest denationalisation ever undertaken and the restoration to the public of their ownership of their own local government. Those who lead local government - hobbled by years of supplication -need to straighten up and state their ambition for freedom.
The centralisers in British politics have had their day. Over the last 40 years, whatever success they have had nationally, they have delivered neither economic nor social progress at the local level. We see short-term finance, interference, distortion of local priorities, people spending much of their time bidding or working to protect the future of their jobs, a plethora of schemes and bodies to circumvent local democratic decision-making, barely understood by anyone but a new cadre of local professionals. The clash and reconciliation of free political institutions is reduced to a formalised dance between national and local bureaucrats. Virtually every democratic nation and every business has concluded that the current economic complexities are way beyond the capacities of a command economy. They speak, and deliver on, the language of decentralisation, devolution, local budget holding, participation, and team working. Yet the way our masters in the UK govern us seems stuck, Brezhnev-like, in command politics. This is seen at its starkest and its most wasteful in central control of local government - a concept both alien and hilarious to most western democracies.
Free local democracy could provide more diversity and independence in our political system which in turn will lead to more creativity, sensitivity and innovation throughout our society and economy. Merely to remove some of the worst excesses of centralism such as ending the capping of local spending, democratising quangos, releasing capital receipts and adding a drizzle of "localist" jargon has not been enough. We need to put local independence beyond the reach of central government and to admit that the man in Whitehall does not know best.
So what should we campaign for?
First, in order to guarantee their independence, local authorities must be created in law as independent and sovereign entities. They would then be able to undertake as of right all those duties for which they are elected locally and which subsidiarity [a concept which requires legal force in the European constitution] recognises as being local. They should be free to do whatever is not prohibited by law, turning on its head the present injunction which prohihits them from doing things which are not expressly allowed by law. Local councils, like all other public bodies, would have to perform their duties within a legitimate inspection regime and according not only to the civil and political rights protected under the Human Rights Act, but also the social and economic rights that our citizens are now not allowed to enjoy.
Secondly, while we may return the ownership of their local government to local people, we must also restore control to them. Political independence for councils would mean nothing without financial independence. Of all local authority spending, the bulk (more than half) is now provided by central government and only a fraction (one eighth) is raised locally by the council tax. This dependency must end. Central government must be removed from the financial equation and local independence given monetary teeth. To do so, a radical new settlement needs to be implemented on taxation - by, for example, divvying up the proceeds from income tax to allocate half the take to local government, and half to the Chancellor. Interested parties and politicians, like Graham Allen MP, have worked out mechanisms for bringing this financial revolution about; and they suggest that while central government would be legally excluded from tampering with mainstream local authority income, ministers could continue to be free to assist councils with time limited funding on particular problems, just as the federal government of the United States and many European States already do. Local councils, assured that most of their expenditure was securely funded, could then raise the remaining part of their income however they wish, from a menu of revenue raising powers, ranging from property rates to sales taxes.
Local authorities already have a record of financial expertise and economic management which bears comparison with the central government that so often wishes to lecture them. However, as a constitutional safeguard, local authorities would be obliged to operate a "balanced budget provision" - a self discipline operated by most US state governments. Annual income would have to match annual spending. Local borrowing, providing its costs were met from annual income, need not be controlled by Whitehall or appear in the old PSBR, now called the Public Sector Net Cash Requirement. Indeed, local councils who established an excellent credit rating would be a magnet for partnership funding and the development of a whole range of Bond issues for locally needed investments.
Returning real decision-making power to local areas would give a much needed stimulus to local politics. Many individuals, who have opted out of local politics rather than simply rubber stamp the decisions of central and regional bureaucrats, would be drawn back into local public service. Once again it would really matter who got elected locally and how well they were politically prepared and technically trained to handle the onerous local duties of independent local government. We could see the creation of an active network of citizen politicians of all parties, in touch with their communities, close to their constituents, empowered and empowering their local areas. Of course, this would mean that some councils could take decisions that would be contorversial - one might develop job opportunities and introduce vocational training in schools, another may wish to reinstate grammar schools. Such diversity should not be centrally repressed but be fought out nationally and locally, in the melting pot of a revitalised local politics.
You could describe making a reality of localism in this way as a building block for a genuine big society.
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