Devolved powers ‘could reduce poverty’

2 Feb 15

Councils have been urged to use powers devolved from Whitehall as the basis for new local initiatives to tackle poverty.

In a report examining the potential for greater localism, the Centre for Local Economic Strategies stated that additional powers for town halls could lead to a ‘double dividend’ of improved economies and lower inequality.

However, in order to achieve this, councils needed to develop local plans to boost skills and to use procurement powers to support local priorities.

In particular, the think-tank called on councils to become local economic ‘fixers’ by developing ‘business citizenship’ arrangements with private sector firms to improve local training and workforce development.

It also recommended that extra powers being devolved to areas such as Greater Manchester and Sheffield be used to build relationships with local ‘anchor institutions’ such as hospitals and universities that are vital to wellbeing.

Collaboration between empowered councils and these institutions could involve the formation of networks that encourage take-up of the Living Wage or help support local charities and cooperatives.

CLES chief executive Neil McInroy said English local government had been ‘battered’ by cuts and ‘must take any devolution which comes its way and demand more’.

He added: ‘It’s time for an enabled and empowered local state working with social and business partners to forge a new local social contract. A contract which delivers a double dividend of both economic success and social justice.’

However, the report also warned the Treasury’s decision to prioritise devolution to cities, without an explicit focus on tackling poverty in the deals, risked missing an opportunity to tackle inequality.

The report was supported by the Carnegie UK Trust and the Smith Institute think-tank.

Smith Institute director Paul Hackett added: ‘Local growth in all places won’t be achieved by letting the market rip and focusing just on areas of business opportunity.

‘As the report shows, our future success will depend on making more of the social value that local people can offer. The report concludes rightly that the best route to economic success is where you build strong communities that fairly share the rewards of growth.’

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