Running out of road - time for change

9 Oct 18

Fiscal devolution and a reconfiguration of political economy in localities will become the battleground of domestic policy in the post-Brexit general election, argues Jonathan Werran.


‘A week is a long time in politics’ was a truism bequeathed to the nation by Harold Wilson – a Labour prime minister who, let it not be forgotten, won the referendum he called on Britain’s membership of the then European Union (EU) in 1976.

We haven’t had a full seven days to enjoy the momentous news from this year’s Conservative Party Conference that finally, after eight years, the era of austerity in public finances is apparently over.  

A main recollection of the conference atmosphere was that the main energy and ideas were shared, debated and battled over in an energetic fringe.  While chancellor Philip Hammond hectored an half-empty hall, conference delegates packed poorly-ventilated to standing room only to discuss, in our case, whether local government finances are fixable.

Unaware that the drop was soon going to be pulled on austerity, council leaders and experts could only suggest fairer redistribution of existing slices of the funding cake, radical fiscal devolution and a modicum of respect, trust and consideration from central government as three mainstays of future sustainability.

We will have to wait and see what kind of policies can be formulated to end austerity come next spring’s Spending Review – to be conducted in the immediate aftermath of the UK’s departure from the EU.  The strong suspicion remains that local government’s demand for, in what that unlikely conference champion of fiscal devolution, Boris Johnson, would term “a fair suck of the sauce bottle”, will, if anything, only deepen.

Post-Brexit the case for a fundamental reform of local government’s strained relations with central government will become paramount.  

Localis is embarking on a research project ‘Hitting Reset’ to ask - against such an unprecedented repatriation of international powers, budgets and responsibilities - how far and fast must the central government machine adapt and relinquish control so local areas can be free to shape local economies and reform local public services to their needs and strengths.

Our fringe event for Core Cities brought these demands sharply into focus.  

Conservative ‘Festival of Ideas’ man George Freeman MP, declared that the promise made to those who voted for Brexit would be broken were Whitehall’s command and control mentality and stifling of devolution (both fiscal and economic) allowed to prevail.

He argued that Brexit, the underlying causes and the process suggests the need for a reorganisation of Whitehall, expressly to put people and place at the forefront of public policy-making.

Bristol Mayor Marvin Rees declared the “bid and beg model” of central/local relations would have to end, arguing the assembled voices of the Core Cities with the M8 group of combined authority mayors could secure the attention of an otherwise deaf and inwardly-focused government machine.

What had clearly spooked many Conservative delegates was the unity and sense of purpose achieved by the Labour party in Liverpool the preceding week.  In particular, the party political broadcast ‘Our Town’ – evocatively established England’s left-behind towns and small cities as key battlegrounds for the next general election seemed to resonate with a certain valency.

Localis will explore such territory at the annual ‘Battle of Ideas’ festival this weekend.  

Our session “Can we revive Britain’s rust belt?” will involve David Goodhart, author of “The Road to Somewhere”, co-chair of the All Part Parliamentary Group for the Northern Powerhouse, Caroline Flint MP and Daniel Dewsbury, director of BBC2’s critically acclaimed documentary series “The Mighty Redcar”.

We certainly don’t imagine another impassioned and lively dialogue and vibrant exchange of views is going to change the world, let alone herald a new England.  

However, the future prosperity of localities must be founded in strong values and well-honed ideas that can lead the march of the times.

Fiscal devolution and a reset of political economies will be necessary journeys to be undertaken within localities, regardless of how Brexit finally breaks.  

For ultimately, there is only so much road down which it is possible to kick the can.   The political tide is turning against incrementalism. 

Similar to how, in the mid 1950s, public impatience forced ministers to put an end to rationing - a system of control naturally beloved in Whitehall – “make do and mend” must yield before a powerful restatement of purposeful localism.

As Mr Wilson informed the Council of Europe in 1967, before the UK had even joined the then European Community as was: “He who rejects change is the architect of decay. The only human institution which rejects progress is the cemetery.”

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