Political and Constitutional Reform CommitteeWritten evidence submitted by the Local Government Information Unit (LGiU)

Introduction

1. The LGiU is an Award Winning Think-Tank. Our mission is to strengthen local democracy to put citizens in control of their own lives, communities and local services. We work with local councils and other public services providers, along with a wider network of public, private and third sector organisations. Through information, innovation and influencing public debate, we help address policy challenges such as demographic, environmental and economic change, improving healthcare and reforming the criminal justice system. We convene the national Children’s Services Network and have launched two social enterprises Local Energy ltd and the Centre for Public Service Partnerships. LGiU welcomes the opportunity to submit written evidence to the Committee, and would value the opportunity to expand on the issues we have raised in oral evidence.

2. LGiU welcomes the Committee’s Inquiry, which comes at an important point in evolution of the relationship between central and local government. Some important steps have been taken towards empowering local communities, but governance in Britain remains among the most over-centralised in the world. LGiU has welcomed the moves in accountability from the centre to community partnerships and away from constraining targets, but believes more is needed. A fundamental shift is needed in the balance of power from Whitehall to local communities. At present, decisions about services and public spending priorities are taken too far from the people who will be affected by them, and who want to influence them. Yet challenges for communities at a time of scarce resources, societal and environmental pressures can be best managed at local level. It is urgent that communities, neighbourhoods and citizens are engaged on issues that affect them, and strong responsive councils should be the framework for achieving this.

Should the relationship between central and local government be codified?

3. LGiU believes that the ability of locally elected representatives to make democratic decisions and to represent and support the participation of people locally should be protected within the constitutional framework. The chequered history of local government over the last fifty years shows how the relationship between central and local government has been subject to the widely varying views on the role and responsibilities of local government on the part of central government. We support a broad statutory statement of the role and responsibilities of local government in order to:

Create the foundation for a positive and sustainable partnership between central and local government by providing clarity and mutual recognition.

To provide a coherent framework, necessary as the complexity of multi-level government expands.

To underpin further devolutionary measures.

To bring balance to the framework incorporating the three spheres of central, local government, and the citizen, confirming that the primary accountability of local authorities is to local electorates.

To energise local government by providing authority for the responsibilities which will be handed down in the Localism Bill.

Should codification of the relationship between central and local government be considered in the context of a wider constitutional codification?

4. The 1998 Devolution Acts have set the UK on a course of constitutional renewal unseen since the passage of the 1911 House of Lords Act. This and the Coalition Government’s emphasis on political reform have opened up the debate for further constitutional change and the LGiU believes that this should include consideration of the place of local government in the constitution.

If codification is appropriate, what degree of independence from central government and what powers should local government be given?

5. The Coalition Government has set out new powers for local councils in the Decentralisation and Localism Bill. Through extra borrowing powers, the removal of ring-fencing and the general power of competence, the Government have devolved power to councils and this is to be welcomed.

6. The LGiU believes that democracy is strongest and the state is most effective when it takes action at the appropriate level, and in a proportionate way. In most areas of activity by the state there is an important role for both central and local government.

7. Codification of the role of local government should recognise the local democratic mandate, the leadership role of local government and of councillors in the world of local governance, and include:

(a)A statement of the purpose of local government, for example:

(i)to promote the economic, social and environmental well-being of their areas; and

(ii)to enable and promote democratic understanding and participation in communities and neighbourhoods.

(b)A statement improving local accountability by recognising and protecting the roles and responsibilities of elected representatives.

(c)A commitment by government to consult and involve local government on all matters affecting its responsibilities.

(d)A statement that administrative arrangements for ensuring local authorities comply with their responsibilities should be proportionate and serve a clearly defined purpose, and that any intervention by central government should be proportionate and with the aim of supporting improvement.

(e)A commitment that local authorities be able to control and exercise discretion over their financial resources, so enabling them to tailor expenditure to local needs and priorities.

(f)Provisions strengthening arrangements to ensure that central government expectations are fully funded.

8. Specifically on finance, the LGiU produced a paper on the future of local government finance (Paying for it, attached) in which we support local taxation as one of the cornerstone foundations of local democracy. Without the ability to raise funds locally, local government is entirely financially dependent on national government which undermines the ability to act upon local views and needs. Without local taxation we arguably lose local government, to be left with only local administration. People want to know how their local taxes had been set, what they provided, and who was accountable for the level of tax and the services. For all the very welcome localist rhetoric of the new government, until local government wins its financial freedom it will not truly be free. Strong local democracy is about meeting community needs through listening and leading to weigh competing interests and priorities. Resources are critical to this. The national political debate at the last General Election was dominated by the tax and spend plans of the different parties. Tax and spend must become fully a part of the local political debate, or our local democracy will remain profoundly flawed.

How, if at all, should the status of local government be entrenched, or protected from change by central government?

9. LGiU firmly believes that local government is part of the elected, accountable state and as such should be protected within a constitutional framework. At present local government is a creature of statute, subject to the political priorities of central government. The principles of subsidiarity and local self-government that inform the balance of power between central and local government that are embodied in the European Charter of Local Self Governance should be given formal effect in UK law. This would need to balance the various obligations and recognise the overall responsibilities of local authorities and their interaction with citizens and central government in one place.

10. Parliament should have an oversight role in respect of any new constitutional settlement or codification.

Does the devolution settlement provide a relevant model for a possible codification of the status of local government?

11. The Scottish Concordat between the Devolved administration and Scottish local government sets out a relationship based on “mutual respect and partnership”. The Concordat is an active consideration throughout policy making in Scotland, acknowledging that while the Scottish Government must set the over-arching outcomes of policy, it pledges to stand back from micro-managing service delivery.

12. The Scottish example also provides a good example of the pitfalls of a Concordat with complaints from Scottish authorities that the deal is not binding on individual councils, only being signed by the Convention of Scottish Local Authorities (COSLA) and the First Minister.

13. The demarcation lines set out in the 1998 Scottish, Welsh and Northern Irish Devolution Acts provide a much sounder basis for an on-going constitutional arrangement. Lines of funding, roles, and responsibilities between the administrations and Westminster are clearly set in law and cannot be reversed on the whim of the Westminster Parliament. This has enabled the devolved regions to move forward with confidence in their responsibilities with the knowledge that these will not be removed.

Are there examples of constitutional settlements between central and local government in other countries that are relevant to an appropriate model for the UK?

14. The Australian constitutional settlement provides a good model. The Danish and Swedish models are also helpful to consider.

What is the value of existing attempts to codify the relationship between central and local government, through: the Central-Local Concordat or the European Charter of Local Self-Government? Should this Charter be placed on a statutory footing?

15. The LGiU has long argued that the principles of the Charter should be incorporated into the UK constitution.

16. The European Charter of Local Self-Government provides us with a current statutory basis to entrench the roles and responsibilities of local government.

17. The following issues must be addressed in order to comply with the European Charter:

A statement of the purpose of local government, for example:

to promote the economic, social and environmental well-being of their areas; and

to enable and promote democratic understanding and participation in communities and neighbourhoods.

A statement improving local accountability by recognising and protecting the roles and responsibilities of elected representatives.

A commitment to a formal concordat between central and local government.

A commitment by government to consult and involve local government on all matters affecting its responsibilities.

A statement that administrative arrangements for ensuring local authorities comply with their responsibilities should be proportionate and serve a clearly defined purpose, and that any intervention by central government should be proportionate and with the aim of supporting improvement.

A commitment that local authorities be able to control and exercise discretion over their financial resources, so enabling them to tailor expenditure to local needs and priorities.

Provisions strengthening arrangements to ensure that central government expectations are fully funded.

Central-Local Concordat

18. There has been a profound failure of the central-local concordat to function in any significant way, as was made clear from evidence to the CLG committee inquiry into the Balance of Power in 2008. Evidence from other central government departments including the Department of Work and Pensions and the Department of Health indicated that they had little or no knowledge of the Concordat. In practice the Concordat was one between the Local Government Association and the Department for Communities and Local Government, having little meaning in other parts of Whitehall or wider understanding and support in localities.

19. LGIU believes that a renewed concordat would have to be a contract with the whole of Government in order for it to have any weight. The previous concordat was essentially an extension of regular meetings between the Local Government Association and CLG, something that was not inclusive to local government or its wider partners. The negotiations for a renewed Concordat should be transparent and accountable to parliament. Those with a stake in local government should be allowed to contribute in a consultative phase. Accountability could be achieved either through increased powers to the CLG Committee, or through a Joint Committee of both Houses of Parliament, tasked to scrutinise legislation to ensure that takes account of local government.

20. A set of principles incorporated into a statutory framework should have a clear set of objectives and provide:

(a)Clarity in three spheres: among politicians locally and nationally; among civil servants in departments responsible for services that have an impact on localities; in the courts, as a guide to the interpretation of legislation.

(b)Sustainable partnership: in the form of a concordat giving practical effect to the partnership and providing a positive culture among both national and local politicians, civil servants and officers.

(c)Strengthened Parliamentary oversight: with the submission of annual reports from government to the Joint Committee, enabling the Committee to monitor the operation of the concordat and of the central-local partnership. Other options include pre-legislative scrutiny for the implications for local government of Public Bills, assessing the appropriate degree of subsidiarity in the allocation of responsibilities and level of decisions, and the funding of mandates.

(d)Continuity: because careful parliamentary and sectoral consideration would be needed before it was amended in the future; the framework will be stronger if the principles are based on a consensus when they are agreed.

7 December 2010

Prepared 28th January 2013