Memorandum by The Department for Communities
and Local Government (BOP 53)
SUMMARY
1. This evidence is from Communities and
Local Government.
2. Substantial progress has been made in
recent years in shifting power and influence from central government
to local government, through policy and legislation. Local authorities
have gained significant powers, responsibilities and financial
freedoms. The relationship between central government and local
government has been recast and there is new-found confidence in
the sector. This draws on measurable improvements in performance
and a new role in strategic and democratic leadership in local
areas. This new relationship is enshrined in the Central-Local
Concordat, signed in December 2007.
3. Our guiding principle is that there should
be a presumption that powers are best exercised at the lowest
effective and practical level. We are confident that devolving
power can often represent the most efficient and effective means
of improving places, public services and civic and democratic
life. Local government has improved substantially in the past
10 years. This has given us confidence to devolve powers
in recent White Papers. But continued devolution depends on local
government, working with the third and private sectors and other
agencies to deliver continued improvement and efficiency at the
local level. We believe there is still more to do and many of
the challenges faced by central and local government must be addressed
in a way that builds on this progress.
4. We look forward to the Committee's inquiry.
INTRODUCTION
5. This submission sets out evidence from
Communities and Local Government.
OUR ORGANISATION
AND APPROACH
6. Communities and Local Government has
policy responsibility in Government for local government, empowerment,
planning, housing, economic development and regeneration, community
cohesion and fire and resilience.
7. Our guiding principle is that there should
be a presumption that powers are best exercised at the lowest
effective and practical level. We are confident that devolving
power can often represent the most efficient and effective means
of improving places, public services and civic and democratic
life. Local government has improved substantially in the past
10 years. This has given us confidence to devolve powers
in recent White Papers. But continued devolution depends on local
government, working with the third and private sectors and other
agencies to deliver continued improvement and efficiency at the
local level.
8. This involves not only devolving from
Westminster and Whitehall to regions, sub-regions and local authorities
but also from all layers of government to local institutions (eg
schools and hospitals), to neighbourhood and community groups
and to individuals. It is the role of central government to set
national priorities and delivery frameworks and minimum standards,
while providing support within an overall system for delivery
and a fair distribution of resources.
9. Devolution should not, however, merely
be construed as a process to shift responsibility from central
agencies to local agencies. Rather it should be seen as a shift
in power and responsibility which changes the emphasis towards
locally-driven solutions, within an overall delivery system in
which both central and local agencies play a vital role. We have
worked closely with local government and others in designing the
new local performance framework that supports this aim.
10. This new approach to delivering outcomes
operates in different ways according to the challenges faced (eg
climate change, obesity or improving educational attainment) and
the optimum role of different central and local agencies in addressing
these challenges. The optimum approach will also vary in different
places, according to needs, circumstances, local political priorities
and capacity. The development of the new local performance framework
has emphasised the drive towards improving outcomes for local
people, whilst at the same time reducing the burdens placed on
local authorities and their partners, allowing them to focus on
the achievement of priorities identified in Local Area Agreements.
Local partnerships will be the main managers of performance, whilst
central performance management will recognise success. The reduction
of central prescription will allow more space for local partnerships
to respond in an innovative way to local needs and make the best
use of available resources.
PROGRESS
11. In 1997 the new Government's priorities
were to bring about a step change in the quality of local services;
to reinvigorate local democracy; and to modernise local government.
It wished to put central-local relations on a wholly new and more
constructive basis.
12. The Local Government White Paper 1998 Modern
Local Government: in touch with the people set out a strategy
for reform and modernisation of local government in England. It
provided the backdrop for reforming and renewing our constitution,
devolving political power in Scotland, Wales and Northern Ireland,
and setting up the Greater London Authority and Regional Development
Agencies.
13. The White Paper also set a demanding
agenda for change, with a commitment that central government would
take this forward in partnership with local government. Central
to this programme was the recognition that local government was
uniquely placed to provide vision and leadership to their local
communities.
14. The Local Government Act 1999 placed
a duty of Best Value on local authorities in England and Wales
to secure continuous improvement in exercising their functions,
having regard to a combination of economy, efficiency and effectiveness.
15. The Local Government Act 2000 radically
overhauled decision-making and accountability in local government.
Central to these reforms was the clear separation between executive
councillors and the majority of council members. A significant
new power of well-being was introduced for local authorities -
aimed at providing substantial scope to improve the economic,
social and environmental condition of their areas.
16. The 2001 White Paper Strong
Local Leadership—Quality Public Services aimed to incentivise
performance through Local Public Service Agreements (LPSAs) and
build in strategic decision-making with local partners through
Local Strategic Partnerships (LSPs). The introduction of Comprehensive
Performance Assessment (CPA) brought about a sharper focus on
outcomes and performance.
17. The devolved decision making review
of 2004 established the importance of a devolved approach
and identified reforms to increase local autonomy to enable continuous
improvements in public services. and local authorities on progress
The review set out the aim of matching ambitious national standards
with vigorous local autonomy and flexibility, in order to maximise
efficiency and equity. The review set out the case for a devolution
of responsibilities from Whitehall and the need for greater transparency,
incentives and local flexibility and managerial autonomy
18. The Local Government White Paper
Strong and Prosperous Communities 2006 (LGWP) set out
ways to give local authorities and their partners more freedom
and powers to meet the needs of their citizens and communities
and enable citizens and communities to play their part.
19. Government offered:
— a stronger role for local authorities
to lead their communities, shape their areas and bring local public
services together;
— more space for local authorities and
other local service providers to innovate and respond to local
needs;
— stronger focus on top priorities;
— a new local performance framework giving
greater responsibilities to local authorities and partners in
securing service improvements; and strengthening accountability
to local citizens and communities; and
— streamlining of inspection to provide
a more coherent approach to assessment, based more proportionately
on risk.
In exchange for:
— more bottom-up accountability;
— stronger local authority leadership;
— better and more efficient services; and
— stronger support and engagement when
things go wrong.
20. In March 2007, Sir Michael Lyons published
his final report Place-shaping: a shared ambition for the future
of local government that argued a developmental approach to
reform was required, in order to build relationships and trust
and increase public confidence in local government over time.
The Government welcomed the Lyons report and have taken forward
ideas and proposals set out in the report.
21. The Governance of Britain Green
Paper, published in July 2007, set out the Government's vision
and proposals for constitutional renewal: a new relationship between
Government and citizens. It argued for power to be devolved from
national government to national Parliament but also stated that
power must rest with communities.
22. The Sub-National Review of Economic
Development and Regeneration, published in July 2007 as
part of the Comprehensive Spending Review, set out a framework
enabling central and local government to work together more effectively
to maximise economic prosperity in England (see para. 31(d). It
recommended a mixture of devolution of decision making and delivery
and streamlining of existing sub-national structures. The SNR
reforms form part of a wider devolutionary programme which will
help to ensure that decisions are taken at the right level to
be effective and that decision makers have the right tools at
their disposal.
23. The Sustainable Communities Act 2007 aims
to promote the sustainability of local communities. The first
invitation to local authorities to make proposals under this Act
will be issued in October 2008.
24. The Local Government and Public Involvement
in Health Act 2007 included provisions to:
— provide statutory underpinning for local
partnerships by placing duties on local authorities and named
partners to co-operate to agree Local Area Agreement targets and
to have regard to those targets once agreed;
— introduce a new duty on Best Value authorities
to involve local people in local services;
— enable councils to submit proposals for
restructuring;
— enable overview and scrutiny committees
to review and scrutinise the actions of key local public service
providers;
— reform the regime for the conduct of
local authority members;
— enable councils to adopt all out elections
and single member wards; introduce stronger leadership models
for councils to chose between a directly-elected mayor and an
indirectly elected leader;
— introduce measures to improve community
governance including extending the power to promote well-being
to certain parish councils; and
— empower councillors to raise issues with
overview and scrutiny committees as part of expanding the Councillor
Call for Action to cover all local government services.
25. The 2007 Act also introduced a
new duty on Best Value authorities to involve local people in
local services, and policies to improve community governance including
extending the power to promote well-being to certain parish councils.
26. The National Efficiency and Improvement
Strategy, published in January 2008, set out proposals to agree
priorities for improvement and development in councils and local
partnerships. Central and local resources should be focussed on
those priorities to support value for money and improvement. Regional
Improvement and Efficiency Partnerships, working closely with
the IDeA, through Regional Associates and Government Offices will
ensure that a wide range of support is available for local areas
to help them deliver better outcomes for local people, with an
emphasis on self-improvement led by the sector itself.
27. The independent Councillors Commission
established by Communities and Local Government looked at the
role of councillors and communication between councillors, councils
and citizens, as part of its review of the incentives and barriers
to a wider range of people taking up the role. Many of the recommendations
made by the Councillors Commission in December 2007 have
been taken forward through the White Paper Communities in Control:
real people, real power.
28. The White Paper Communities in Control:
real people, real power, published in July 2008, aims to pass
power into the hands of local communities by generating vibrant
local democracy in every part of the country, and to give real
control over local decisions and services to a wider pool of active
citizens. Related issues on local accountability for police and
health services were considered in the Police Green Paper, From
the neighbourhood to the national: policing our communities together,
which was published in July 2008, and in A consultation on
The National Health Service constitution, which was published
in June 2008, respectively.
29. Local authorities too have made substantial
progress in improving performance and delivering quality public
services:
— under the Comprehensive Performance Assessment
(CPA), four out of five authorities are rated good or excellent;
three out of four are improving well or strongly;
and—for the second year running—none is in the lowest
performing category according to the Audit Commission;
— Council Tax rose by 3.9% in 2008-09—the
second lowest since the tax was introduced 15 years ago;
— £3.2 billion of cash releasing
efficiency gains have been generated over the past four years;
and
— Council Tax collection rates rose again,
for the eighth year running, to 97.1% in-year.
30. This all demonstrates that a substantial
amount has been achieved in recasting the relationship between
central and local government, with enhanced powers directed at
economic, social and environmental improvement, being exercised
at the most appropriate level. In turn this has been underpinned
by a more mature and collaborative way of working between central
and local government at all levels.
31. It is worth noting, however, that research
and reports suggest that the extent to which the powers that are
available are used varies between authorities. Research tells
us:
— councils generate £1 billion
a year through their powers to trade, but only a quarter of the
minority that use these powers aim to make a surplus;
— nine out of ten LSPs are aware of the
well-being power but fewer than one in twelve are using it; and
— only 60% of local authorities have used
the significant new freedoms of the prudential borrowing regime
introduced in 2004.
32. Councils need to use the powers available
to them.
KEY DEVELOPMENTS
33. Our guiding principle is that there
should be a presumption that powers are best exercised at the
lowest effective and practical level. We are confident that devolving
power can often represent the most efficient and effective means
of improving places, public services and civic and democratic
life. This section highlights some of the key developments in
our broad ranging programme to deliver on our commitment to devolution
and to locating all decisions at the right spatial level.
34. Of the many changes that have taken
place, the negotiation of Local Area Agreements (LAAs) will be
vital to effective delivery in the next three years. They
require national government, local authorities and local service
providers to work in partnership to deliver better services and
an improved quality of life for local people. They mean finding
out what local people need most, prioritising those needs and
putting action in place to deliver results. They combine national
and local priorities into a plan for prioritising and delivering
local services through to 2011 and beyond. But no two agreements
are exactly the same, because every area has different needs.
35. The new framework gives more flexibility
to local areas in order to focus effort and resources on the priorities
that matter most locally. In return, this should be matched by
improved performance.
36. Performance will be monitored through
a robust and independent system called the comprehensive area
assessment (CAA). Assessment and inspection under CAA will be
proportionate, risk-based and focus on outcomes. CAA will find
out how well local peoples' needs are being met both by listening
to their opinions and checking progress against the national performance
indicators and, in particular, local priorities. Progress reports
will be published so people can see how well their local service
providers are performing under CAA and hold them to account for
delivering results.
37. There have been six further important
developments in the past year:
(a) the Central-Local Concordat (attached) has
helped clarify respective roles and responsibilities of central
and local government. The Concordat is a powerful statement of
principles for how central and local government should work together
to serve the public. It consolidates the achievements of recent
years and looks forward to developments in the relationship to
come. It sets out reciprocal rights and responsibilities for central
and local government. It acts as a clear point of reference as
to how the relationship should develop in the future;
(b) the first-ever three-year finance settlement
has given local government the flexibility to make longer-term
plans and investments. This covers not just the rising £23.5 billion
core grant allocated to English local authorities each year, but
also:
— 61 specific grants from seven departments
also confirmed for three years at the same time;
— 43 grants now paid in a single sum each
month through the new Area Based Grant with no strings on how
the money can be spent;
— moving £5.6 billion into general
grants which are not ring-fenced by 2010-11; and
— £384 million to support improvement,
innovation and efficiency in local government.
(c) publication of Business Rates Supplements—a
White Paper, which proposes a new power for local authorities
and the GLA to raise and retain—for spending on economic
development—local supplements on the national business rate;
(d) the Sub-National Review of Economic Development
and Regeneration has set out a new framework for economic leadership
at the local level. In particular, the recent consultation Prosperous
Places: Taking Forward the Review of Sub-National Economic Development
and Regeneration set out the Government's ambition to strengthen
local government's economic role. Proposals include the introduction
of a new duty on local authorities to assess their area's economy,
further devolution of decision making and delivery activity from
the regional level, and new tools for localities to collaborate
to tackle issues shared across local authority boundaries, namely
Multi-Area Agreements;
(e) Transforming Places; changing lives: A Framework
for Regeneration sets out Government's vision for regeneration
and outlines ambitious proposals for reform. It takes a holistic
approach—ensuring physical, social and economic regeneration
are planned and delivered together to improve outcomes for those
places that are most in need. In doing so, the Government has
consulted on proposals to devolve power: decisions about where
to invest should be made as locally as possible; and
(f) crucially, publication of the White Paper
Communities in Control: real people, real power.
38. The percentage of citizens who believe
they can influence decisions in their local area has fallen since
2001. Public attitudes to traditional systems of government are
changing. Expectations on service standards are rising, including
in demands for information and high quality personalised services.
Opportunities for influence and control should be available for
all, but some groups (for example young people or disadvantaged
groups) may need more support to take advantage of these.
39. Citizens rightly demand and expect more
information, improved engagement, more say on decisions, and more
scope to demand answers and action when things go wrong. They
want to be able to call those making decisions to account directly—and
have others to do so on their behalf. They expect systems of government,
public service provision and local democracy to match their lifestyles
and expectations.
40. Local democracy is central to strong
communities. Local government is often the point at which people
can best connect with politics. However, there is evidence that
people in Britain are less active in politics now:
— only 59% of the electorate voted at the
2001 general election, the lowest recorded turnout since
1945;
— when local elections are not held concurrently
with a general election, local election turnout—including
for Mayoral polls outside London—has varied between 30%
and 40%; and
— political party membership is now at
a record low; in Europe only France and Italy have seen a more
significant decline in the last 20 years.
But at the same time, underlying interest in
politics has remained relatively stable since 2003.
41. There is a broad spectrum of ways in
which citizens can become active and seek to exert influence.
What is right for one person or group may not be right for another.
People's interest, motivation and capacity will vary. But there
are clear benefits from encouraging more people to become more
involved in local communities, local democracy and local public
services.
42. So, in transferring power to citizens
and communities this means we need to:
— acknowledge that people won't always
want to participate or will want to take part in different ways;
— recognise that different solutions apply
in different situations;
— support participative and representative
democracy;
— develop a variety of mechanisms; and
— give professionals more freedom to use
their skills and experience to tailor services to individual needs.
43. The pace of change has been dramatic
and devolution is working. Today we have a framework that has
changed beyond recognition, giving local government new opportunities
to do local things that local people want them to do.
FUTURE CHALLENGES
AND OPPORTUNITIES
FOR LOCAL
GOVERNMENT
44. There are likely to be significant future
challenges and opportunities for local government and its partners;
these will vary from place to place. By empowering local councils
and their partners we hope to support local solutions to these
challenges and to ensure the right tools are in place to help
local areas to embrace the challenges and opportunities facing
their local area. The available evidence suggests key changes
may include:
— a growing and ageing UK population; and
— healthy life expectancy not rising as
fast as life expectancy.
— global economic circumstances will have
a considerable influence on local economies.
— Science and technology:
— technology is changing individuals and
communities' behaviour and allowing them to personalise consumption.
— Environmental and resource issues:
— responding to environmental constraints
will be increasingly critical to managing delivery and costs;
and
— extreme weather events will become more
frequent, and services will need to adapt.
— Citizenship and democracy:
— citizens may have a greater role to play
in mitigating problems and making positive lifestyle choices;
and
— a step change may be needed to encourage
greater public engagement in the political process.
45. Taken together, the evidence and trends
suggest that prominent future strategic challenges for local government
will be:
— Mitigating the consequences of the economic
downturn on business and on individuals.
— Meeting, within available resources,
complex new challenges such as climate change and other issues,
such as adult social care.
— Capturing the potential of new technology
in shaping how people live and work—and meeting their needs
and priorities effectively and efficiently.
— Rebuilding trust in political and government
institutions to strengthen accountability and citizenship.
— Ensuring that improvements in local public
services is self sustaining—and that improvement in services
and reputation can only be delivered by continued improvement
in service delivery across agencies and engagement and transparency
in decision making.
THE FUTURE
46. 2006 White Paper set high aspirations
on which central and local government have delivered. For example,
the new performance framework represents a powerful and flexible
new tool for central and local government to work together on
delivering and improving local services and outcomes. Government
has reduced the number of performance indicators from over 1,200 to
less than 200 and all 150 LAAs were agreed and signed
off in June 2008.
47. What we have put in place over the past
year is a good base. The next period will determine how much further
we can build on that base and many developments are in train.
The new White Paper—Communities in Control: real people,
real power—sets out how Whitehall is committed to supporting
councils in putting more power in the hands of their residents.
This is important because evidence shows that giving people a
greater say helps them feel more satisfied, improves the delivery
of services in collaboration between providers and recipients,
and helps revitalise local democracy. Moreover, many of the challenges
we face need active support from individuals and communities to
change their behaviour or expectations.
48. Our guiding principle is that there
should be a presumption that powers are best exercised at the
lowest effective and practical level and thus we seek to devolve
power where this represents the most efficient and effective means
of improving places, public services and civic and democratic
life.
49. But there are three conditions for effective
devolution:
— efficiency and effectiveness;
— capacity and capability; and
— where the need for consistency and minimum
standards outweighs the benefits of devolution.
50. This in turn leads to three conclusions:
— we accept that applying these criteria
lead to differing levels of devolution in different services and
in different places;
— in devolving power, we promote and extend
clear, visible models of political accountability and leadership
that are most suitable to the local area; and
— devolution is an ongoing and evolutionary
process. As local capacity and confidence grows, we can devolve
more power.
51. Many substantial challenges do not respect
borough boundaries, for example housing, transport, education
and skills performance, worklessness and child poverty. We believe
local government should be able to work together better to tackle
these issues. As a result, Multi-Area Agreements (MAAs) have been
signed in seven places across England. We will be watching closely
their progress and sharing good practice with others negotiating
MAAs or looking to work across boundaries. Proposals outlined
within the SNR consultation Prosperous Places would further
enhance collaborative action, providing local government with
additional tools and abilities to work on cross-boundary issues.
52. The Prime Minister announced plans for
a Community Empowerment, Housing and Economic Regeneration Bill
in the Draft Legislative Programme for the coming Session. The
Bill will give a statutory basis to the policies announced in
the recently published White Paper Communities in control:
real people, real power and policy proposals from Prosperous
Places.
53. Through a range of measures, this Bill
will give citizens a real influence over decisions taken in their
areas and which affect their lives. By giving people more incentives
to get involved, by removing barriers to participation created
by outdated legislation and by encouraging local elected representatives
and officials to involve communities in decision making, this
Bill will demonstrate that the Government is listening to citizens.
54. The proposed new duty on local authorities
to promote democracy will mean that local councils are placed
in their proper context: not as units of local administration,
but as lively, vibrant hubs of democracy. This will strengthen
their role in leading and shaping their area, established under
the Local Government and Public Involvement in Health Act 2007.
55. We are also proposing to extend the
"duty to involve" introduced in the 2006 White
Paper and 2007 Act to a new range of public bodies: the Homes
and Communities Agency, the Environment Agency, Job Centre Plus,
Regional Development Agencies, the Arts Council, the Youth Offending
Teams, and others. This means that these significant publicly-funded
public bodies will be under a duty to listen to, engage with,
and be accountable to the public they serve.
56. We want to see local government everywhere
involving local people in the decisions that make a difference
to their lives. Equally we want to see local government getting
better at giving people the opportunity to become more directly
involved in making their community a better place—for example,
through building a stronger relationship with third sector organisations
and social enterprises, or by handing over under-used assets to
community groups.
57. The current comprehensive performance
assessment (CPA) measures local government performance and covers
both organisational capacity and the range of council services.
From 1 April 2009, CPA and most rolling programmes of inspection
will be replaced by a new performance assessment framework—Comprehensive
Area Assessment (CAA).
58. The Audit Commission is working with
six other local services inspectorates to develop and implement
a methodology to deliver CAA. Key aspects of CAA are:
— the needs and aspirations of local people
are at its heart;
— there is a stronger focus on the experiences
and view of local citizens, particularly the vulnerable;
— the delivery of better outcomes for each
local area by local authorities working alone or in partnership,
rather than the performance of an individual institution; and
— the rationalisation of current approaches
to reduce the potential for overlap and duplication.
CONCLUSION
59. No part of government—department
or agency—can deal with the challenges it faces or deliver
the services it is charged with, on its own or without active
collaboration and involvement of citizens and communities. No
part of government can deliver a centralised and standardised
service if it is to successfully meet the needs, aspirations and
performance required in widely differing local areas. And no part
of government can deliver successfully without considering the
role and contribution of local government.
60. As councils step forward, central government
can further reduce the burden of appraisal and approval regimes,
the ring-fencing of funds and prescriptive guidance while ensuring
minimum standards; building capacity and providing strategic leadership—helping
us strike the right balance of national and local roles, and the
optimum sharing of responsibility for meeting challenges ahead.
61. The more councils are able to step up
to their strategic and community leadership role, the more they
improve their performance and efficiency, and the more they involve
the people they represent, the more devolution becomes a practical
and political reality.
October 2008
| 
