By Richard Johnstone | 28 June 2012
Whitehall has been urged to devolve more powers to local government as soon as possible to give councils a greater role in economic development.
The call, issued in a report at the Local Government Association conference yesterday, follows a survey of what English councils are doing to boost their local economies, and what additional powers they would like.
Peter Box, chair of the LGA economy and transport board, said the powers were needed ‘not in ten years time, not in five years time, but now’. The findings of the report, Local leadership, local growth, followed ‘months’ of meetings with councils, business leaders, Local Enterprise Partnerships and the voluntary sector, he said.
‘Give councils and business the powers to deal with these barriers to growth – local management of skills to get people back to work, local management of transport to let us help business in difficult times,’ he told delegates at the conference.
The call comes after cities minister Greg Clark told Public Finance that the government would outline how authorities could bid for greater powers once the initial range of ‘city deals’ with England’s core cities were agreed.
Box said that if such ‘local growth deals’ were rolled out to all councils, ‘we'll work quicker, we'll work more effectively, and costs will be less’.
Concerns over skills and transport ‘came up every meeting’, he said. ‘If you need to deal with investors, it takes Whitehall and the Highways Agency too long to make decisions on transport. We can’t afford that kind of delay.’
Local Enterprise Partnerships have been created and ‘many of them have grabbed the new but limited devolved powers,’ he said, but there was a need to go further.
Also speaking at the conference, CBI director general John Cridland criticised the government’s decision to hand only 50% of business rates growth to local authorities.
He said the decision reduced the incentive councils would have to back new developments. ‘I’m disappointed that the business rate retention measures being debated in Parliament aren’t more ambitious,’ he said.
Cridland also called for authorities to consider pooling their business rates to allow them to enter into Tax Increment Finance deals to help new development, which could ‘unlock infrastructure where there’s growth potential’.
The New Local Government Network also published its Localist manifesto yesterday, calling for a ‘Devolution Act’ to give local government large chunks of the budget for skills provision, the criminal justice system and benefits administration. The funding for these services would be cut from national taxation and added to the local tax base.
However, such devolution should only be to city- or shire-wide combined authorities, similar to the Greater London Authority, it said. These would drive strategic economic development and help share services.
The manifesto, the conclusion of the NLGN’s year-long Next Localism Commission, also called for compulsory voting for local elections.
Director Simon Parker said: ‘The government needs an answer to the English question. This doesn’t require expensive new parliaments with yet more politicians – it can be done by giving more power to towns and cities. That way, local people are in the driving seat of change.’
