Third-term lucky? By George Jones and John Stewart

19 May 05
Labour's first two terms saw local government marginalised and under ever greater central control. So how can new minister David Miliband improve the central/local relationship? George Jones and John Stewart offer some advice

20 May 2005

Labour's first two terms saw local government marginalised and under ever greater central control. So how can new minister David Miliband improve the central/local relationship? George Jones and John Stewart offer some advice

The big question to be asked of the new Labour government is what its attitude will be towards local government. The early signs look favourable, but they could be deceptive. Labour's electoral campaign called for decentralisation, and for power to be devolved. Local government now has its own ministry, Communities and Local Government, headed by an able Cabinet minister, David Miliband, who was a policy adviser close to Tony Blair in opposition. But, as a junior member of the Cabinet, Miliband is shackled by not having full control over his own department. He is subject to Deputy Prime Minister John Prescott, who was reluctant to give up departmental responsibilities to become just a co-ordinating minister.

If Miliband champions local government, he will face opposition from Cabinet ministers heading the departments dealing with the prime minister's priorities of education, health and crime. These are not friends of local government, and wish to bypass elected local authorities in favour of their own agents. If Miliband really wants to promote local government, he will have to win some fierce battles against Cabinet colleagues defending their silos. To win, he will need the backing not only of the prime minister and deputy prime minister, but of Gordon Brown as well.

A few years ago, local government looked shut out of Labour thinking. The party's consultation exercise, the Big Conversation, made no mention of it and saw the future of decentralisation as involving 'regions and communities'. Elected regional government was knocked out by the Northeast's referendum, smashing Prescott's dreams, although Labour's manifesto promised to allocate 'further responsibility to existing regional bodies in relation to planning, housing, economic development and transport'. Prescott will be supporting this agenda, rather than allocating further responsibility to elected local authorities. Miliband needs to persuade his boss to love local rather than regional government.

Emphasis on the word 'communities' should worry local government, since it usually denotes enhancing either sectional interest groups or sub-local government institutions, both undermining town halls. But more optimistic signs for representative local government can be found in the consultation papers issued by the Office of the Deputy Prime Minister in January about sustainable communities, vibrant local leadership and citizen engagement, and in the election manifesto. The papers are part of the department's push to develop a ten-year vision for local government, known as Local:Vision.

They made a welcome declaration in favour of the primacy of representative democracy and of elected councillors, who would play the roles of community leaders for both their local authorities as a whole and the neighbourhoods and communities in each locality. The manifesto promised to 'strengthen the community leadership role of local authorities', and pledged there would not be a new tier of neighbourhood government.

Despite this support for local government, a major worry about Miliband is whether he has shaken off his previous centralist assumptions. The past two Labour governments assumed that local government was mainly an agency for carrying out national policy; that councils could not deliver services effectively unless they were instructed, monitored and inspected; that they needed targets and guidance; and that they could not be relied upon to know what local people wanted.

The second Labour government attempted to relax central controls. New 'freedoms and flexibilities' were to be granted, but only to local authorities judged by the centre to be performing well according to its criteria. This new localism seemed another device to force local authorities to do what the centre wanted in ways that met central approval. The manifesto promised that this approach of earned or conditional autonomy was to be continued, 'with even greater freedoms for top-performing councils'. Again, a central government assessment is to prevail over the verdict of local voters.

Miliband needs to jettison one centralist assumption above all: that central government should protect council tax payers from the decisions of their local councils. The ODPM paper, Sustainable communities: people, places and prosperity, contained the menacing sentence: 'The government is clear that excessive council tax increases would not be justified, would not be acceptable to local people, and will not be permitted.' The manifesto is equally blunt, declaring ministers 'will not hesitate to use our capping powers to protect council tax payers from excessive rises in council tax'.

We urge Miliband not to accept the conventional assumptions about central-local relationships that support this approach. He should think afresh whether they are justified. For too long in the past, it was assumed without question that central government needed to control local government spending for economic reasons. That assumption underlay the many attempts by Conservative and Labour governments to do this, culminating in the capping of councils' own taxation. But no justification was ever put forward to explain why spending covered by local tax created economic problems, and there are powerful economic arguments to the contrary.

Central government no longer argues that local government spending financed by local tax needs to be controlled for economic reasons. Now it argues that controls are needed to protect local taxpayers, the reasoning ministers used to justify the Labour government's reintroduction of capping. The assumption now is that central government has to protect local tax payers against their own elected councils.

The question that needs asking is, why? How do ministers know that local tax payers need or even want such protection? Nobody wants to pay higher taxes, but local people might prefer higher taxes to reduced spending on services. They, and the councillors who represent them, are better placed than central government ministers to make such judgements. Their weapons lie in local elections, and in their voices, which bring home their views to their representatives, with the implied threat of defeat or success at the next election. There is no more local issue than the level of local tax, and its implications for local spending on services.

Local democracy means local people determining local issues through representative democratic institutions and sustained by citizen participation. It is not about having local issues determined by national politicians. With that meaning accepted, the Local:Vision exercise should work out its implications not only for local government but also for central government. This view of local democracy is not compatible with central government acting to protect local tax payers. The government should face up to the implications of its own actions, and recognise the contradictions of its approach.

It should also consider whether intervening in so-called 'failing' or 'weak' local authorities is consistent with its Local:Vision. We do not accept that the government can know which are 'failing' or 'weak'. It relies on the inspection process, but we do not accept the doctrine of the infallibility of inspectors. The inspection process can give a useful outside view on the work of a local authority, which should be seriously considered by local people and the local council. But no inspector's report or a Comprehensive Performance Assessment justifies central government intervention against the wishes of an elected council and its electorate. Such interventions are inconsistent with the Local:Vision, since they show little central government trust in the capacity of local people and local councils to run their services and develop local government.

Intervention breeds intervention, encouraging the attitude that the government 'must act for local people', or that 'national standards must be maintained', or that 'the government has a national responsibility'. It is too easy for central government to intervene, on the assumption it knows what should be done. Once this right is conceded, it takes over, sustained by assumptions about the weakness of local authorities and the superiority of central government. It sabotages any attempt to build local democracy. In this scenario, people with worries about their local council are encouraged to press central government rather than their local council.

The centre's right to intervene is too readily accepted by many in local government as well as in central government.

The way ahead is to make local representative government stronger rather than to accept the need for central government to act for local people. We favour an approach that challenges centralising assumptions and reflects a new vision based on the assumption of the potential strength of local representative democracy.


George Jones is emeritus professor of government at the London School of Economics and John Stewart is emeritus professor of local government at the University of Birmingham