Memorandum by Essex County Council (BOP
27)
SUMMARY
— Local authorities have a democratic mandate
and a responsibility to their local electors.
— The debate needs, primarily, to focus
on finding the best way to deliver services citizens want or need.
— Tax-payers have the right to be able
to hold public services to account. Where it is not possible to
combine scrutiny with a direct vote, the most effective way is
through enhanced local authority scrutiny functions.
— Greater financial freedom would support
local authorities' community leadership role. A self-funded council
sector would be better able to place-shape and provide the community
leadership some authorities struggle to deliver under the current
system. Moreover. locally-funded, locally-accountable local government
could help revive local democracy.
— Given their unsurpassed local knowledge,
it makes sense for local decision-making to take precedence and
influence local services. Citizens not central government should
determine their council's local priorities. This means that local
governments recognise that, for many issues, the buck stops with
them and that central government acknowledges that priorities
will vary between locations.
— Local authorities can make more use of
their powers to charge, trade and promote wellbeing. Certainly,
barriers to their wider use are not exclusively imposed from the
centre. The appetite for using these powers will vary and decisions
must rest with individual authorities.
— While we welcome the Central-Local Concordat,
Essex County Council believes central government does not fully
adhere to its principles. The concordat has yet to make a noticeable
difference to Essex County Council's relations with central government.
— There is little that Parliament needs
to do to protect local governmnet's position. However, we would
call on Parliament to ensure that national ministers do not presuppose
to answer local government matters.
THE BALANCE
OF POWER:
CENTRAL AND
LOCAL GOVERNMENT
1. Last year, Sir Michael Lyons concluded
three years of work when he published his final report into the
form, function and funding of local government. Yet, as evidenced
by this inquiry, the role, rationale and responsibilities of local
government remain up for debate—as does its relationship
with the centre.
2. Words matter. Talk of a "balance
of power" brings with it an unhelpful linguistic baggage—competing
jurisdictions, uneasy truces. To an extent a pluralist democracy
makes this inevitable. But we need to remember the commitment
to improve things which motivates people to enter public service,
whether at the national or local level. The parent whose child
has just started school, the entrepreneur setting up a small business,
the pensioner living alone—none are concerned about which
tier of government delivers the services they need, they simply
want the services to meet their expectations. We need to move
beyond turf wars and consider instead how to improve the quality
of life for our citizens.
3. Essex County Council is clear that our
primary goal is to deliver the best quality of life in Britain.
We recognise that this is best achieved through permissive mechanisms
that allow local communities to choose what works for them. We
want to see central government concur. The debate cannot focus
on two competing ideologies, centralist and localist; it needs
to be about finding the best way to deliver services citizens
want or need.
FURTHER DEVOLUTION
Does local government need greater autonomy from
central government? If so, in what ways?
4. The very act of granting autonomy does
not suggest a relationship of equals. From the outset we want
to make clear that local authorities have a democratic mandate
and a responsibility to their local electors. However, one must
be pragmatic; with the dominant mindset in central government
still one that views local government as a delivery arm of Whitehall,
it appears the debate about responsibilities and relationships
needs to be couched in those terms.
5. Greater autonomy is, of course, desirable
(primarily in the financial sphere as we make clear later in our
submission) but it would be equally helpful if local government
were trusted to deliver its functions—and not simply those
that are outlined in statute but also those areas local councils
engage in as community leaders.
6. If decisions were based on capability,
local government would have received greater autonomy long ago.
While the arguments about capacity are well-known it is still
worth mentioning in passing that local government as a sector
more than holds its own against not only central government departments—despite
their improving Capability Reviews—but also the other organisations
that constitute the public sector landscape.[6]
7. Over the last eight years, the focus
on economic, social and environmental wellbeing and a number of
broadly permissive Acts mean that the concept of ultra vires
should be less limiting now than in the past. For those authorities
that are able or willing to act—as Essex County Council
did when it replaced the regional development agency as lead partner
and kick-started the stalled regeneration of Jaywick, one the
most deprived areas in England—the wider powers are, broadly,
already there. Simply put, to achieve greater autonomy many local
councils need to seize their opportunity and central government
needs to let go fully.
Do local government's role and influence need
to be strengthened in relation to other public services, such
as policing and health?
8. Robert Peel famously said "the
police are the public and the public are the police".
Yet the centralisation of a range of public services has historically
served to weaken their links to the communities they serve while
at the same time increasing the influence of Whitehall departments
which, by their very nature, are less attuned to the concerns
of the man in the street. The health sector has, of course, been
a national construct since 1948, but the emphasis on central control
has again served to remove local accountability and local influence.
9. Of course, high-performing local partners
are able to collaborate effectively—witness the good work
being done in Essex to reduce youth crime and improve community
safety, and the collaboration that resulted in a Joint Strategic
Needs Assessment which allows for a more forensic understanding
of our communities' health profiles and informs better preventative
work.[7]
Yet not all areas are high-performing, and not all partners are
willing to engage. By loosening the ties that bind other parts
of the local public sector to central government, the centre could
break down the vertical hierarchies that can militate against
horizontal partnership working.
10. There is more to consider here though
than simply the way in which local authorities collaborate with
other public bodies. At heart, local councils are fundamentally
different from the police, health or non-departmental public bodies—they
are rooted in a democratic franchise.
11. Essex County Council wholeheartedly
supports the idea that the tax-paying public have the right to
be able to hold public services to account. Ideally, scrutiny
should combine with a direct vote through the ballot box. Where
this is not possible, perhaps the most effective way is through
enhanced scrutiny functions.
12. Over the last four years or more, our
Health Overview and Scrutiny Committee has been able to point
to improvements in specific health services as a result of their
activities. Following the Local Government and Public Involvement
in Health Act, our emerging Local Involvement Networks now allow
for improved scrutiny of the wider health economy.
13. If at all possible, robust scrutiny
should emerge organically as public partners recognise the value
the process brings. However, one has to be realistic and recognise
that, for a range of reasons, not all public bodies will willingly
submit themselves to external scrutiny. In these cases there needs
to be a strengthening of local government's role and influence
as community leader. This should primarily come from the local
authority itself, but central government departments could support
the process by making explicit to their locally-based colleagues
that local government has both the right and the responsibility
to hold others to account for the delivery of satisfactory local
services. It is in the public's best interest to have locally-appropriate
and locally-responsive services. Scrutiny can help deliver this,
but in order for this to happen, scrutiny needs bite.
FINANCIAL AUTONOMY
To what extent do the current arrangements for
local government funding act as a barrier to local authorities
fulfilling their "place-shaping" role? In particular:
— Does local government need greater
financial freedom? If so, in what ways?
— Should local government be able to
raise a greater proportion of its expenditure locally?
— What effect does the capping of council
tax rises have on local accountability?
14. The current funding regime militates
against engagement, accountability, and transparency at the local
level. While local authorities are best placed to provide community
leadership, the current structure sees councils' financial flexibility
constrained. As a result, it is difficult for councils to make
the most of their place shaping potential.
15. From a technical perspective, the reliance
on a single locally-raised and retained tax has created a situation
where Council Tax is as overworked as it is disliked. The current
fiscal set-up helps to create an environment where local government
is neither particularly local nor able meaningfully to govern.
As a result, local democracy risks being ill-served and efforts
to "place-shape" are hindered.
16. Simply put, local services need to be
better aligned to local desires and local needs. If they were,
public services would become more responsive. To help achieve
this, local government finance needs to be reformed. Central grants
and redistributed funds do little to persuade the electorate of
the capacity of local authorities to represent their aspirations
and desires.
17. There is no doubt that greater financial
freedom would support local authorities' community leadership
role. Essex County Council has argued in the past for the
reform of local authority funding as a means by which to improve
local democracy.[8]
Locally-funded, locally accountable local government can help
revive local democracy.
18. Local authorities must have the tools
to shape local fiscal policy. Only then will they be in a position
to create local incentives and shape local behaviours. Therefore,
they must also have the means to establish, strengthen and weaken
the relationship between tax demands, the ability to pay, and
the consumption of local government services.
19. Essex County Council firmly believes
that local government should be able to raise a greater proportion
of its expenditure locally. This does not mean making even greater
use of the Council Tax. The precise composition of this locally-raised
expenditure would need to be developed, but a broader range of
tax options—which could include an alternative property
tax, local income and sales taxes, and relocalised business rates—would
offer a range of fiscal levers and help revive local democratic
accountability.
20. Local government finance is notoriously
opaque. This lack of transparency serves only to confuse and weaken
the links between local choices and local charges. We should not
be surprised that few citizens recognise that Council Tax typically
only provides a [quarter] of their local authority's funding.
Efforts to bridge the gap between Formula Grant and budget demands
are hamstrung by the centre's decision to cap Council Tax—the
only tax available to local authorities.
21. A self-funded council sector would be
in a stronger position to place-shape and provide the community
leadership some authorities struggle to deliver under the current
system. By making explicit the relationship between local public
services and local taxes, local accountability could be improved.
22. The extant framework within which local
authorities and central government operate exemplifies the exercise
of central control. Central assessment of spending needs, based
on Formula Grant, presupposes the centre is best placed to recognise,
and respond to, local needs and aspirations. This simply isn't
so.
23. There are few examples of the centre
having either the appetite or the necessary local knowledge to
act in a locally-responsive way. Slough Borough Council's adaptation
to a rapidly-changing local demographic, swollen by migration
from the EU accession states or Essex County Council's successful
community campaign to re-open Post Offices closed as part of a
national efficiency programme while high-profile cases, are not
unique.
24. Any new financial settlement needs to
be grounded in the principle of local autonomy. This would
mean an end to capping and abolition of ring-fenced grants in
their current form. Central grants, capping, and Whitehall
imposed definitions of "acceptable" limit the capacity
of democratically-accountable councils to deliver the local government
local people want. Most people now acknowledge the truism that
"one size does not fit all", but we are still some way
off from recognising local variation in services as a sign of
vibrant pluralist democracy.
EXISTING POWERS
To what extent are local government services a
product of national or local decision-making?
25. Local authority services are an amalgam
of national and local decision-making. This is unsurprising given
current funding arrangements but it does little to support the
primacy of local choice.
26. There are primarily two ways in which
national decision-making can influence local services. On the
one hand, a local authority and central government can agree to
contract with each other to deliver a mutually desired outcome.
The contractual relationship is entered into willingly and a specific
grant is provided to delvier a specific outcome. One the other,
national priorities are imposed on local authorities regardless
of need or appetite. While no one can mind the former, the latter
is little more than the naked exercise of power.
27. The optimist would contend that there
has been a dimunition of the second approach to some extent over
recent years—they would point to a slimmed-down national
indicator set, and Local Area Agreements with 35 locally-selected
priorities.
28. The realist would counter by referencing
the Local Transport Plans, Public Library Service Standards, and
a raft of inspections—all collecting data that sits outside
the 198-strong National Indicator Set. They would cite examples
of Local Area Agreement negotiations where it has been necessary
to take a firm stand to ensure that central government objectives
which—having been rigourously assessed and interrogated
alongside local evidence—were found to lack local applicability
were not included in the final locally-driven agreement.
29. And, of course, targets can deflect
service delivery. National priorities can displace local. In a
financially-constrained environment, funds focused on delivering
someone else's outcome means that spending risks being diverted
from issues that matter locally. We support the Local Government
Assocation's proposal to "reestablish that audit and inspection
of local government was about value for money and probity rather
than also being about compliance with Ministerial policy".[9]
Essex County Council has spoken about this before,[10]
the problem, though, remains.
30. It is perhaps unsurprising that a local
authority would argue the case for the importance of local decision-making.
The rationale though, is practical not parochial. Good local authorities
know their patch. They make the effort to engage, consult, and
inform. Our recent Essex Strategy—the county's sustainable
community strategy—benefitted from the input of some 20,000 Essex
residents. This wealth of data has helped us better to understand
what matters to our residents. Our three-year Local Area Agreement,
our four-year programme to improve the quality of life in Essex,
EssexWorks, and our Corporate Plan are all about refocussing our
efforts so as to deliver the improved outcomes Essex citizens
want. Central government's understanding of a local area cannot
compare. This is not a criticism—it's a simple statement
of fact.
31. With unsurpassed local knowledge, it
makes sense for local decision-making to take precedence and influence
local services. Citizens not central government should determine
their council's local priorities. This requires that local governments
have the courage of their convictions and central government recognise
that priorities will vary between locations.
32. Whether we term this, pace Lyons,
"managed difference" or view it as a "postcode
lottery", pluralism—if we are committed to—requires
us to accept variations in services.
Does local government make adequate use of its
existing powers, such as its well-being, charging and trading
powers? What scope is there for greater use of those powers?
33. It is not easy to gauge whether the
entire local government sector—better considered local governments—makes
adequate use of their existing powers. We can speak of Essex County
Council's work to improve the quality of life for our local residents
and there are prime examples of authorities that have made use
of the powers available to them—Sheffield's efforts to place
shape through "Creative Sheffield", Westminster's commercial
activity based on the strength of their communications expertise,
South Tyneside's efforts to regenerate the Horsley Hill estate.
34. Our programme to reopen a number of
Post Offices in Essex shows what can be achieved through the use
of wellbeing powers. This campaign has put Essex firmly at the
forefront of articulating neighbourhood concerns about the loss
of valuable community assets. With almost 200 British local
authorities contacting Essex to ask for guidance, and Post Office
Limited issuing guidance for other councils wanting to follow
the Essex approach, it is clear that the appetite to make use
of wellbeing powers is there.
35. The issue of charging and trading is
more complex—legal opinion is, unsurprisingly, divided as
to how aggressively commercial activity can be undertaken. The
sector is still too risk-averse and deep commercial acumen is
not common in many local authorities. Essex County Council launched
Target Tracker, a suite of applications which use Windows
based software to easily record, track and chart pupil progress
during their time in school, in 2001—it is now in use in
over 2,000 schools in the UK and overseas.[11]
Few have gone as far as Manchester City Council and the other
nine district councils that, as shareholders in the Manchester
Airport Group, own Manchester airport. Perhaps risk avoidance
or taking too literal an interpretation of competition law has
limited the appetite for commercial activity.
36. On balance, we would suggest that authorities
could make more use of their powers but that barriers to use are
not exclusively imposed from the centre. The decision, though,
must rest with individual authorities.
IMPROVING THE
RELATIONSHIP BETWEEN
CENTRAL AND
LOCAL GOVERNMENT
What difference has the central-local concordat
made to central-local relations?
37. We warmly welcomed the concordat and
were particularly pleased to see that it contain some of the most
important principles of central-local government relations. These
include:
— Clause 4—"there should be
a presumption that powers are best exercised at the lowest effective
and practical level"
— Clause 10—"councils have the
right to address the priorities of their communities…without
unnecessary direction or control."
— Clause 15—"we…work towards
giving councils great flexibility in their funding, to facilitate
the wide degree of autonomy referred to in the European Charter
of Local Self-Government".
38. However, we believe that central government
does not fully adhere to these principles in practice yet and
the concordat has yet to make a noticeable difference to Essex
County Council's relations with central government.
39. To ensure the subsidiarity principle
would require a deal of work to reverse the trend of aggregating
local authority functions at the regional level. Both the Sub-National
Review and the central-local concordat point toward a recognition
that solutions to problems are best dealt with at a smaller geography
than the national. Essex County Council contends that the optimal
geography is the local not the regional. A commitment from HM
Treasury and the DBERR to scaling back the role of regional government—hamstrung
by a lack of electoral legitimacy and an absence of popular support—would
be welcome proof that the spirit of the concordat has been embedded
throughout Whitehall.
40. The concordat's principle of reducing
unnecessary direction or control is to be welcomed. Again, we
would be keen to see this commitment better communicated to other
central government departments and indeed made clear to those
quangoes and inspection regimes that look to central government
for direction and yet work closely with local authorities. We
would like to draw attention to the growth in "guidance"
and "guidelines", which seek the same end as direction
or overt control but couch demands in softer, collegiate, language.
41. In September and October 2008 alone,
there are more than 30 deadlines for consultation on legislation,
guidance or regulations which will affect local government directly
or indirectly from "Schools' role in promoting pupil well-being",
"Future of the Local Area Agreement Reward Scheme",
"Consultation paper on the third sector's strategic voice
within Communities and Local Government" to "Proposed
Changes to Planning Policy Statement 6: Planning for Town Centres"
and "Consultation on Changes to the Local Government Act
1972 to Allow Local Authorities in England to Work Together
on Animal Health". Although some of the legislation consulted
on would be supported by Essex County Council the sheer amount
reflects the detail, micro-management and severe command and control
regime local government remains exposed to. Whether by direction
or guidance, there are few instances where it can be appropriate
for central government to explicitly state how local services
should be run.[12]
42. A greater degree of flexibility with
regard to funding (clause 15) is very much welcomed. A buoyant
local tax base, as endorsed by the European Charter of Local Self-Government,
could provide local authorities with the financial levers that
support more effective place-shaping—a position mentioned
in detail earlier in this response. All of this is, of course,
predicated on the concordat being embraced across Whitehall departments.
Should an independent commission be established
to oversee the financial settlement for local government?
43. Essex County Council supports the Local
Government Association's proposal of setting up an "Independent
Public Finance Commission" based on the Australian model
and a "Single Conversation" at a national level, which
should include negotiations over new burdens, led by the Treasury
and involving the main spending departments, particularly the
Department for Children, Schools and Families and the Department
of Health.
44. However, our priorities for local government
finance reform are referred to earlier in this response.
THE CONSTITUTIONAL
POSITION
Given the UK's constitutional settlement, what
protections should be placed in law to ensure local government's
ability to fulfil its responsibility as a balance on the powers
of central government?
45. The ability and appetite of local governments
to fulfil their wider responsibilities will differ between local
authorities. However, the extended "wellbeing" powers
in the Local Government Act 2000 and the Local Government
and Public Involvement in Health Act 2007 are used widely
by Essex County Council—as evidenced by our nascent Local
Involvement Networks, our Post Offices campaign, and our recent
proposals to help low-income households by reducing their Council
Tax, for example.
46. Although potentially a long-term issue,
local government's position vis-ˆ-vis the centre does not
urgently have to be clarified by placing it within a renewed/written
UK constitutional settlement. Cross-party support for the wellbeing
powers, the wider powers available to local government in the
Sustainable Communities Act, and the efforts of innovative local
authorities to show just what an ambitious councl can achieve,
are better vehicles for delivering improved outcomes for our citizens
than a constitutional settlement. Yet, as the Chamberlain Group—a
cross-party body supporting devolution to local government—suggests,
if there were any future constitutional reform, it should be made
with localism in mind.
47. It has been noted elsewhere by the committee's
chair that councils cannot expect central government to hand over
more power if they are unable to communicate what they want, and
how it will benefit the public.[13]
We do not disagee.The problem is less the need for more powers
but more the need for central government to truly devolve those
powers local government already has.
48. Some local authorities can, perhaps,
be charged with complaining about ring-fencing and then demanding
specific grants for specific tasks—having their cake and
eating it too. Yet we would contend that there is no problem if
central and local government, wanting to achieve a particular
outcome, look to individual local governments as the bodies best-placed
to achieve this, and the centre provides a grant to deliver a
specific outcome. Outside of these specific contractual realtionships
(grant to deliver specified outcome), however, Essex County Council
holds that decisions on priorities and the funding of these priorities
should rest with individual local authorities.
49. Some parts of local government may still
need to recognise that increased autonomy means there is less
recourse to the centre if things do not go to plan. This should
be self-evident and is certainly reasonable. At the same time,
central government needs to recognise that if a power is devolved
to local government, the centre's desire to retain control through
direct command or guidance is limited. Both parties need to recognise
where the buck stops.
What role should Parliament have in the protection
of local government's position within the UK's constitutional
settlement?
50. While Essex County Council believes
there is little that Parliament needs to do to protect local governmnet's
position, we would call on Parliament to ensure that national
ministers do not presuppose to answer local government matters.
51. The frequency of waste collection, the
provision of social care, or any other matter relating to the
way in which a local authority delivers its services are matters
for the council and its citizens. Ministers need to be comfortable
with the thought of acknowledging that the issue is a local, not
central, government responsibility and referring it to the relevant
local government body, be that the Local Government Association
or an individual local authority. In this respect local government
should be treated in the same manner the devolved administrations.
September 2008
6 The most recent data shows 83% of local authorities
were assessed as either "excellent" or "good",
compared to less than 25% of central government departments placed
in the top two capability review categories. Back
7
The Essex, Southend and Thurrock Joint Strategic Needs Analysis
is available online at http://www.thurrock-community.org.uk/lsp/healthy/pdf/jsna_2008_full.pdf Back
8
See Probert and Gordon, He who pays the piper. Reforming local
government to reinvigorate local democracy, (Essex County
Council, September 2007). Back
9
Memorandum by the Local Government Association. Evidence 27 to
the Joint Committee on the Draft Constitutional Renewal Bill,
June 2008. Back
10
Probert and Raynes, "Trust is good, control is better"?
Refocussing the control framework, (Essex County Council,
June 2006) Back
11
http://www.targettracker.org/index.php Back
12
See, for example, Defra's thirty-one page Preventing Cigarette
Litter in England. Guidelines for Local Authorities (2007)
where councils, who are responsible for streetscene and waste
collection issues, are advised that "[a]shtrays are an integral
part of a sustainable solution to reducing cigarette litter".
A further Whitehall insight suggests that local authorities "[c]onsider
whether the ashtrays need to be weather proof. Also consider whether
the ashtray has a `hood' to ensure that it does not become filled
with water during rain (a small amount of water obviously is little
to be concerned about)". Not all guidance is quite as ludicrous
and unintentionally comic as this; however, it does serve to highlight
the extent to which central government departments appear unable
to let go. We are still some way off the elimination of "unnecessary
direction" promised in the concordat. Back
13
Local Government Association-webpage "The Power Divine"
[sic]. Opinion piece by Phyllis Starkey MP, 24 July 2008.
http://www.lga.gov.uk/lga/core/page.do?pageId=841179 Back
| 
