4 March 2011
Local government will remain at the mercy of Whitehall’s ‘boom and bust’ approach to spending as long as it lacks powers to raise the bulk of its own finance.
That is the message from Genuine localism, part of Redefining local government, a report to be issued by the Public Management and Policy Association next month.
It will argue that genuine localism can never be realised unless central government gives up its control of tax sources.
Authors Professor John Stewart, Professor George Jones and TonyTravers say local authorities should receive most of their funds from taxes levied locally at rates they determine, instead of from Whitehall grant.
Local government will otherwise remain dependent on the whims of central government, they say.
This process would also require allocation of any remaining grant by a comprehensible and transparent formula, and restoration of the ‘Total Place’ approach to combined public sector budgets in each area.
They will also call for a formal codification of the relationship between central and local government, which would set boundaries around local responsibilities to prevent Whitehall encroachment. A joint committee of MPs and peers would monitor observance of the rules controlling this.
This concept is under consideration at present by MPs on the politicaland constitutional reform committee.
Travers, director of LSE London at the London School of Economics, said: ‘Councils cannot appeal to their voters for tax revenues to finance local services they might have wanted to maintain.
‘This reduces councils to little more than central government’s delivery arm, rather than real government for local communities.’
