Memorandum from the British Retail Consortium
(BRC)
1. The British Retail Consortium (BRC) is pleased
to contribute to the Community and Local Government Select Committee's
inquiry into the Government's plan for localism and decentralisation
of public services.
ABOUT THE
BRC
2. The BRC is the lead trade association for
the UK retail sector. We represent retailing in all its forms
across the UK and work on the full range of issues affecting the
sector. Our aim is to ensure the UK's political and regulatory
framework supports retailers in maintaining their outstanding
record on job creation, consumer choice and product innovation.
With the retail sector employing around 2.9 million people and
contributing around 8% of GDP, we play a vital role in the success
of the UK economy.
OVERVIEW OF
BRC POSITION ON
LOCALISM
3. The BRC recognises the opportunities presented
by the Government's plans for localism and decentralisation. There
are many aspects of localism that appeal to the retail sector.
Indeed, retailers have a long history of engaging successfully
with local authorities and other local bodies through partnerships,
such as Business Improvement Districts and Town Centre Partnerships.
4. However, we are concerned that the impact
of devolving greater powers locally could create accompanying
challenges in specific areas of policy. In a policy field as broad
as localism, it is inevitable that there will be some areas in
which retailers would like to understand more about the potential
impact for their businesses. It is important that the benefits
of localism must be balanced against the possible negative impacts
on productivity. We recognise this is a particular concern for
businesses operating on a national basis which require certainty
for effective business planning.
SUMMARY OF
KEY POINTS
ON LOCALISM
- In some areas, localism could lead to more effective
public service delivery. However, there are limits to the effectiveness
of localism in relation to specific policy areas.
- Localism must not add to the already significant
regulatory burden facing businesses.
- If local variations are introduced into those
national policy frameworks that currently work well, it could
damage their effectiveness unnecessarily.
- Local government should play an important role
in delivering the Government's localism objectives. However, localism
can only be delivered effectively by local authorities that are
fully fit for purpose.
- Central government must retain a crucial role
in the oversight of policies that demand rapid changes to be delivered
consistently across the UK.
- There needs to be an overarching framework and
guidance in place to assist local decision-makers and to provide
the level of coordination that is necessary for issues which require
greater strategic consideration.
BRC RESPONSE
Question 1—The extent to which decentralisation
leads to more effective public service delivery; and what the
limits are, or should be, of localism
5. Decentralisation of local power can lead to
more effective public service delivery in key policy areas. We
recognise that, in some cases, local decision-makers will be better
placed to deliver programmes and services that address issues
of real local concern. Through their extensive national operations,
retailers are frequently in a unique position to identify and
highlight examples of good practice in local areas (for example
in relation to transport initiatives).
6. The Government has indicated that the potential
for increased localism will be a core consideration in all policy
areas and general governance across the country. However, until
greater detail as to what this will mean in individual policy
areas is made available, it is challenging for many businesses
to assess the scale of the potential impact. In our view it is
essential that localism is set within a broad framework that will
enable national businesses to work with local authorities and
communities to deliver the services their area requires. Such
a framework would enable a significant level of focus to emerge
that all parties involved can deliver against.
7. There are likely to be limits to the effectiveness
of localism in relation to specific policies. Local variations
in some policy areas could significantly increase the regulatory
and administrative burdens for business. We believe that central
government must continue to play a crucial role in policy areas
that demand rapid changes to be delivered consistently across
the UK (relevant issues in specific policy areas are discussed
below). There needs to be an overarching framework and guidance
in place to assist local decision-makers and to provide the level
of coordination that is necessary for issues which require greater
strategic consideration. It will also provide businesses with
the reassurance that a consistent and coherent approach will be
applied.
8. An overview of the potential impact of localism
on specific policy areas for the retail sector is set out below.
9. Planning: The localism framework must deliver
a number of key objectives in order to stimulate regeneration
and enable sustainable planning to be achieved. The development
life cycle is already a lengthy one and it would be regrettable
if the planning process was further slowed. If local planning
departments are to make planning decisions based on local priorities,
then a coherent national planning policy must guide that process,
to ensure that localism benefits not only local people, but also
national interests. As many local authority planning departments
are already struggling to manage their existing workloads, any
increase in their responsibilities must be matched by an increase
in their resources, including qualified staff.
10. Business rates: The proposed reforms to local
government finance, including business rates, have the stated
aim of promoting transparency and economic growth. While acknowledging
that these reforms could have some positive implications for retailers,
any new measures should not increase the tax and regulatory burden
for retailers in relation to local government or undermine the
certainty that retailers need for business planning. We support
the retention of the Uniform Business Rate and would be concerned
at changes which introduce local variation. The greater the freedom
for individual authorities to adopt their own rules in relation
business rates, the more difficult it would be for national businesses
to manage their rate liabilities. While welcome in principle,
we need to be careful that the benefits of the proposed introduction
of a new discretionary power to levy business rate discounts is
not offset by an accompanying increase in complexity and the administrative
burden for business.
11. The Government has also committed to giving
local businesses the right to vote on any Business Rate Supplement
proposal. The BRC supports this commitment from the Government.
12. Crime: The BRC recognises the benefits
of having crime and police priorities driven at the local level.
However, this needs to be accompanied by a clear national strategy
for business crime which is developed through engagement with
key stakeholders. We support the establishment of a National Crime
Agency that will focus attention on serious and organised crime
groups and the proposal to ensure better collaboration from police
forces where offences cross force borders. We are concerned that
if the local election process is used to appoint elected police
commissioners and set local policing priorities, this could act
to exclude the business community who would not play an active
part in this process.
13. Environment (green issues): Localism can
play an effective role in addressing some environmental issues
such as waste and land management where circumstances are specific
to different regions. Flexibility in terms of local delivery is
clearly important in achieving strong recycling rates. However,
a national strategy that ensured consistency of materials collected
(rather than collection mechanisms) would further improve collection
rates. It would ease the burden of communicating with consumers
regarding what can and cannot be collected and would improve significantly
consumer understanding and awareness of what can be recycled.
14. With respect to waste management infrastructure,
there needs to be strategic guidance and direction from a national
perspective. In order for plants to be appropriate they need to
be in the right place and the right size. If there are incentives
or disincentives at a local level there is a potential risk that
inappropriate infrastructure may emerge.
15. Localism alone will not allow us to address
effectively the challenges presented by reducing carbon emissions
and tackling the causes of climate change. Climate change needs
to be tackled at a national and international level, and decisions
made from a local perspective will often run contrary to central
government ambitions. If the UK is to exploit fully the economic
opportunities presented by climate change, such as the renewable
energy market, then we must be at the forefront of investment
in green technology. If more power is devolved to local authorities,
then we could see more green-tech planning applications being
turned down, with the risk that the UK is left behind.
16. Public Health: Devolving responsibility for
public health to a local level could present problems of coordination
for many national businesses. Without central government's guidance
on the commitments required to achieve the campaign's objectives
it will be increasingly difficult to achieve official endorsement
of the activity. Demonstrating to external stakeholders that this
approach is credible and will deliver the outcomes required will
be a significant challenge.
17. Alcohol licensing and pricing: Members need
consistency of licensing conditions to ensure they can operate
alcohol sales efficiently, implement national measures such as
Challenge 25 to prevent illegal sales and to ensure local competition
is not affected. Whilst we understand the key role local communities
need to play in licensing, giving greater regulatory powers to
local licensing authorities risks adversely affecting the ability
for national companies to administer licences efficiently and
responsibly. It could also have a damaging impact on local competition
in the grocery market by imposing restrictions on individual premises
on licensing hours or even access to new licences.
18. We understand that local authorities are
also considering the implementation of local by-laws for the minimum
pricing of alcohol. Local pricing of goods, including alcohol,
could present significant administrative challenges for national
businesses and have an impact on local competition. As an alcohol
licence is a key requisite for a supermarket, regulating different
pricing policies would have an impact on wider grocery sales.
Question 2—The lessons for decentralisation
from Total Place, and the potential to build on the work done
under that initiative, particularly through place-based budgeting
19. The Coalition Government should have regard
to the experience of Total Place in framing its localism proposal.
Total Place had significant similarities to aspects of the Coalition
Government's localism agenda. It provides some of the direction
and structure that national business has been looking for from
localism. The semblance of a framework that is provided by Total
Place would go some way to providing the structure and security
for national businesses to plan and operate successfully within
the Government's localism agenda.
20. Total Place recognised that there are specific
service areas that are well suited to devolved governance, but
also implied that this is not necessarily the case for all service
areas. It also demonstrated that localism has been tested by local
authorities over a period of time to gauge what can be achieved
and where. This in turn enabled them to put in place sufficient
and suitable structures to manage effectively the governance and
finance of these devolved functions.
21. We recognise the principle behind place-based
budgeting which will enable local authorities and partners to
bring together their budgets and work collaboratively to reduce
unnecessary costs and deliver better, more efficient services
to their local area. However, we would like to know more about
how this could work under the Government's localism agenda.
Question 3—The role of local government
in a decentralised model of local public service delivery, and
the extent to which localism can and should extend to other local
agents
22. Local authorities should play a key role
in a decentralised model through their responsibility for the
delivery of local public services, their participation in new
Local Enterprise Partnerships and the provision of guidance and
support to these partnerships. However, a decentralised model
can only be delivered effectively by local authorities that are
fully fit for purpose. The recruitment of sufficient qualified
staff remains a challenge in many areas of local government activity,
such as planning.
23. We support localism being extended to other
local agents but the BRC would not want to see a situation develop
whereby businesses are compelled to deal with a proliferation
of local agents with responsibility for a wide variety of local
issues. From a business perspective, it would not be practical
for businesses to be expected to engage individually with a large
number of local agents.
24. Local Enterprise Partnerships, with equal
public and private sector representation, will have an important
role to play in the future success of their local area. They must
be implemented effectively. We question whether, from the outset,
all partnerships will have the right level of skill, knowledge,
expertise and possibly the time to pursue the extensive remits
which it is proposed that they will have. In our response to the
Government's consultation on Local Enterprise Partnerships, we
recommended that there needs to be a framework and support structure
in place at the national level to assist Local Enterprise Partnerships
to carry out their role effectively.
Question 4—The action which will be necessary
on the part of Whitehall departments to achieve effective decentralised
public service delivery
25. Whitehall departments will need to retain
a crucial role if an effective, decentralised public service delivery
is to be achieved. As noted above, the Government needs to establish
an overarching support structure for local authorities, Local
Enterprise Partnerships and other local agents to carry out their
responsibilities. This is particularly important for issues which
require greater strategic consideration, such as planning and
infrastructure. It will also give businesses the reassurance they
need that a coherent and consistent approach will be applied across
the country.
26. Whitehall departments should be involved
substantially in developing the necessary support structures and
guidance for various policy areas. Staff should also be called
upon to assist and provide expert advice to local government and
partnerships in the performance of their functions. In relation
to Local Enterprise Partnerships, we have recommended to the Government
that a support structure is required to advise these partnerships
on crucial matters of economic development. This support could
be provided by a pool of central or local government officials
dedicated to giving specialist advice and promoting best practice.
27. While recognising the value of individual
policies being developed to meet local needs and circumstances,
for national businesses to engage at a local level, there needs
to be a base level of consistency in terms of the quality and
effectiveness in the delivery of those policies.
Example 1—Waste Management
28. Local authorities are currently free to design
their own systems in terms of what items are collected for recycling
and how they are collected. There are benefits under this approach
(systems can be designed to suit local demographics) but there
are also challenges. The most significant issue is that different
items are being collected by different local authorities. There
are no materials in the UK that are universally collected in all
local authorities and consumers remain confused as to what they
can and cannot recycle in their local area. The
UK-wide On-Pack Recycling Label scheme
was developed to overcome this issue. A framework that guides
local authorities on the materials that need to be collected (in
order to achieve national carbon reduction targets) would still
provide the freedom for local authorities to develop collection
systems that suit their local circumstances.
Example 2—Crime
29. A centralised strategy for tackling crime
against the business community would help to recognise and share
effective practices across each of the police force areas. We
acknowledge that it is beneficial for priorities to be largely
driven at the local level, but having a complementary national
strategy will provide support to the locally elected commissioners
and will remove duplication of effort/resources. It should highlight
the importance of businesses to safe and vibrant communities and
encourage effective engagement between local businesses and elected
commissioners. A good example of where this has worked well is
with the National Counter Terrorism and Security Office where
national leadership/training of the Counter Terrorism and Security
Advisers ensures a consistent approach across the UK based on
a greater understanding of how national businesses operate.
Question 5—The impact of decentralisation
on the achievement of savings in the cost of local public services
and the effective targeting of cuts to those services
30. It is essential that the Government's decentralisation
agenda achieves real savings in the cost of public services. The
Government should build upon the financial priorities identified
in Total Place and the case studies that have demonstrated that
significant savings can be made in local public services. However,
we recognise that such an approach will not be appropriate for
all public service areas.
31. The retail sector is supportive of the Government's
strategy to address the fiscal deficit. We recognise that public
sector spending, across both central and local government, must
be reduced significantly if the UK economy is to emerge from the
recession stronger and more competitive internationally. At the
same time, sufficient resources need to be made available to achieve
the Government's localism objectives.
Question 6—What, if any, arrangements for
the oversight of local authority performance will be necessary
to ensure effective local public service delivery
32. The BRC recognises the Coalition Government's
strong desire to move away from a top-down, target-driven approach
to governance. However, there needs to be a certain level of central
oversight over local authorities in a new localism environment.
While we are not necessarily advocating that the Government should
prescribe in detail what local authorities should be required
to do, in relation to certain policy areas, we consider there
is a case for having some performance targets for local authorities
to be determined centrally. Should the Government proceed with
plans to remove all existing centrally-set performance targets
and statutory controls, then measures are needed to help asses
the performance and effectiveness of local authorities and identify
areas of improvement. We are also keen to understand what mechanisms
will be put in place to address local authorities that continually
fail to meet the needs of their local communities.
33. The Government plans to introduce a "general
power of competence" in the forthcoming Decentralisation
and Localism Bill, which will permit all local authorities to
take action unless they are forbidden expressly by the law. With
significant cuts to local government funding expected following
the October 2010 Spending Review, we recognise that this general
competence power would give local authorities the freedom to work
in partnership with private sector organisations and local communities
to drive improvements in the delivery of local services. However,
for national businesses that have operational models that address
issues from a corporate perspective, this power needs to be accompanied
by sufficient safeguards to ensure business certainty is not undermined.
Question 7—How effective and appropriate
accountability can be achieved for expenditure on the delivery
of local services, especially for that voted by Parliament rather
than raised locally
34. Accountability for expenditure on local services
delivery can be achieved by monitoring the performance of local
authorities through their strategic business plans. Some local
authorities have established a Standards Committee for the purpose
of maintaining and promoting high standards of conduct within
the authority. It is possible that the costings for expenditure
on the delivery of local services could be assessed through these
committees.
35. However, as noted above, ultimately we consider
that central government should retain some oversight over local
authorities if they are to be held properly accountable for the
expenditure on local services delivery which has been voted by
the Parliament.
36. To drive economic development in conjunction
with delivering community objectives the Government has spoken
about the potential to incentivise local authorities to take a
business focused approach.
37. This proposal would need to be supported
with a strong framework for delivery that enabled accountability
to be demonstrated to the electorate, stakeholders and the Government.
It is inevitable that some authorities will fail to achieve their
objectives should this approach be taken and the Government needs
to be aware and in a position to take appropriate action.
October 2010
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