25 January 2011
The government’s moves towards decentralisation and pooled budgets risk stalling because some Whitehall departments don’t ‘get it’, MPs have been told.
Giving evidence to the Commons communities and local government select committee last night, Local Government Association chair Baroness Margaret Eaton said the Total Place and Community Budget pilots had proved that resources could be used more efficiently if budgets were decentralised and pooled. But, she added, ‘not all parts of Whitehall get it’.
She said health and education were moving in the right direction but other departments had ‘a long way to go’. Eaton called for the government’s new Work Programme to be localised to be ‘more effective' and revealed the LGA ‘was not getting very far’ in its talks about this with the Department for Work and Pensions.
Committee member and Conservative MP George Hollingbery had asked Eaton and fellow witness Simon Parker, director of the New Local Government Network, if decentralisation minister Greg Clark ‘was running up against a brick wall’ in his drive to shift power from central to local government through Community Budgets.
Parker told the MPs that pushing ahead with Community Budgets would be one ‘game changer’ for local government. He said local authorities should be able to bid to provide central government services, such as criminal justice and the unemployment programme, if they could prove they could commission them more efficiently.
Parker said this would result in Whitehall ‘having to give up control’ because it would need to come up with a convincing case for not devolving the responsibility.
He said other financial reins needed to be loosened too, with councils allowed to raise more money locally through new freedoms such as charging for services, particularly when they were means tested.
Eaton agreed that ‘true localism’ would involve far more local authority funding being raised locally.
But she side-stepped a question from committee chair Clive Betts. When asked if she supported a suggestion from Deputy Prime Minister Nick Clegg that the local government resources review, due to start imminently, should cover more ground than just business rates, Eaton said: ‘It’s for discussion because it’s one of those things that some members would wholeheartedly support but others would not. It needs looking at.’
Later in the evidence session, employment minister Chris Grayling and policing minister Nick Herbert were forced to defend their department’s commitment to decentralisation.
Grayling, who was berated for the lack of references to localism in the DWP’s business plan, claimed that the government’s welfare reforms were ‘national by nature but local by implementation’.
He said the payment by results mechanism of the back-to-work programme was ‘incompatible’ with local authority provision but responsibility for other aspects such as the Social Fund was being devolved.
Rejecting the accusation that the DWP ‘did not get’ the localism agenda, Grayling said: ‘Where we can devolve responsibility to local councils, we will do so.’
Herbert said the move towards locally elected police commissioners was fully in line with the decentralisation agenda.
