Memorandum from CSS (formerly the County Surveyors' Society) (BOP 15)

 

Summary

 

· CSS welcomes continuing the debate on devolving powers and responsibilities to the local government level. We consider that devolution to this level has the effect of increasing direct democratic accountability to communities and enabling improved responses to local situations.

 

· CSS considers that while there have been advances in the powers available to local authorities, there has not been accompanying progress in supplying the local government level with the required resources to fully exploit available powers.

 

· We would offer broad support to reforms to the local government funding frameworks, including allowing a greater proportion of local government expenditure to be raised locally.

 

 

Introducing CSS

 

1. For over 120 years, from its origins as the County Surveyors' Society, CSS has been providing the leadership and expertise required to tackle some of the country's most pressing issues. The Society represents an extensive range of local authority senior technical and professional specialists working at the forefront of the sustainability challenge.

 

2. Operating at the strategic tier of local government, our members are closely involved in crucial transport, waste management, environment, planning, energy and economic development issues. We also have the experience as strategic leaders to comment on a whole range of agendas.

 

 

Increasing local autonomy

 

3. Our members have responsibility for delivering a range of services, infrastructure and initiatives to support their local communities and contribute to 'place-shaping'. We experience first hand the difficulties inherent in balancing central prescription and resource allocation with locally identified priorities and needs.

 

4. We support the existing initiatives to empower communities and ensure that decisions affecting local areas are taken at the local level, except where there is a compelling case for central government to intervene. This approach allows local government to provide strong leadership and better reflect and respond to the aspirations and needs of their communities.

 

5. Despite the provision of extended powers, such as those relating to well-being, there remain barriers preventing local government from fulfilling their place-shaping role. In particular, a lack of financial autonomy hinders the local ability to fully exercise these powers.

 

6. While Local Area Agreements have provided a welcome opportunity for local government to identify and agree targets based on local priorities, we would argue that at present there remains a strong theme of central control underpinning this system and demanding certain targets be set. We consider that the decision-making and accountability within the LAA system should be firmly set at the local level.

 

 

Financial barriers

 

7. CSS has concerns that in the current system of financial settlement, the damping arrangements within the local government grant system have the undesirable consequence of placing a greater demand on local Council Tax. In particular, government support for the financing costs of capital spending is no longer outside of the revenue grant settlements. Capital spending is therefore subject to the same constraints as revenue and this has seen a number of authorities having to significantly reduce spending on areas such as transport.

 

8. Furthermore the fact that, in effect, council tax is capped by central government leads councils to limit local services and reduces scope for using new powers. Moreover, defining capping in terms of percentage increase rather than an absolute level is a further challenge for those local authorities that have historically kept rates low for their residents, but are now obliged to find additional funds to provide services.

 

9. The combined pressures of limitations with the grant system and the threat of capping can result in local government finding itself without the resources to invest in longer-term, structural and preventative action. Instead, it is driven to address immediate and shorter-term issues, which often deliver less value for money than a more strategic approach. Consequently a new approach to financing that provides local government with the opportunity to take a long-term approach to address local matters is required.

 

10. CSS is also concerned about centrally imposed fiscal instruments, with potentially detrimental effects on local authorities. For example, in March 2007, central government more than doubled the Landfill Tax escalator with very little notice. Despite assurances from the Secretary of State for Environment, Food and Rural Affairs that mechanisms have been put in place to reduce financial pressure on authorities, CSS remains concerned at the lack of a clear demonstration about how Landfill Tax is being returned for the purposes of investing in waste infrastructure. This necessarily inhibits the capacity of local government to contribute to the development of sustainable waste management.

 

11. Furthermore, the whole Landfill Allowance Targets system is widely acknowledged to be a blunt fiscal instrument from central government that has driven significant progress whilst diverting resources from other local authority services. The proposals for a system of carbon trading - whilst it is acknowledged that the implications of climate change must be addressed - is therefore a potential cause for concern as another such fiscal instrument.

 

12. There are also financial barriers specific to certain sectors. The inclusion of maintenance and integrated transport allocations in the forthcoming RFA process raised concerns within CSS that spending could be transferred away from maintenance and integrated transport in total. The suggestion that a region might change the distribution of monies allocated to local authorities seems to undermine the considerable work of recent year to develop a formula basis, broadly based on need and past performance. CSS considers that the balance between maintenance and integrated transport and how those elements are spent should be a local decision.

 

 

Raising income locally

 

12. The call for evidence introduces the issue of increasing the amount of Council expenditure that is generated locally. CSS considers that this would improve the connectivity between local spending and raising finances. We support the Local Government Association's views on generating local income and the need to apply some degree of equalisation where Councils struggle with the capacity to raise funding locally.

 

13. We would however draw attention to existing situations where central government policy has sometimes constrained the freedom of local authorities to spend locally generated income in the most appropriate fashion. For example, the 2004 Traffic Management Act places a duty on local authorities to ensure "expeditious movement of traffic" and allows for mechanisms such as permit systems to raise income at a local level. However, any funding generated is ring-fenced to that particular activity, leaving other implications of the Act - such as funding the role of traffic manager and providing notices of work - without the necessary resources to implement them effectively. As such, the capacity of authorities to address local issues of congestion and traffic flow can be restricted.

 

 

An independent commission

 

14. With regards to the suggestion of an independent commission to oversee financial settlements, CSS considers that, while there may be some value in providing a depoliticised opportunity for those authorities wishing to question the distribution of settlements and the basis for such allocation, there are concerns over a non-representative body undermining the democratic mandate of national and local politicians who are held accountable for the decisions regarding financial settlements by the electorate.

 

 

Closing remarks

 

15. Broadly, CSS welcomes the continued interest in improving the balance of power between central and local government. We are supportive of the principle of enabling greater self-determination at the local level. However, if further devolution is pursued, this must be done with due consideration of the different tiers of local government and the most appropriate scale at which activity should take place. Furthermore, while new powers and responsibilities for the local level are warranted, these must be accompanied by increases to funding and resources and an appropriate balance between the raising of funds locally and centrally, as well as the freedom to apply resources as best fits the local circumstances.

 

September 2008