Dominique Lazanski says giving local government more budgetary responsibility would make them budget more responsibly
We have recently heard – to no great surprise – that in spite of Eric Pickles’s announcement of £1.166 billion in local government cuts, councils are still hiring for a wide variety of jobs, to put it politely. Some of the most outrageous examples were featured in ConservativeHome’s Local Government section over the weekend.
When all is said and done, it seems some councils just won’t stop advertising for highly paid positions or spending money on things that they can’t justify. Pickles’s cuts, and the proposed requirement for
the publication of expenses of £500 and over are a great start to curtailing local spending, but it is just a start. The coverage of local government waste affirms how little citizens of the UK now respect their local councils, something mentioned by Mark Wallace.
To restore the public trust is going to need more than micro-management from Whitehall. Giving local councils the ability to raise revenue and control their budget at a local level would be a better way to ensure that councils made the right decisions and were held accountable for their own financial decisions.
In an ideal world, local councils would be able to remove themselves from the administrative and financial constraints of central government immediately. Councils would be given the ability to raise funds immediately – through local sales tax, or land tax, or council taxes. These taxes would have to be set at a reasonable rate or residents would vote in several different ways – either by moving or by voting out local councillors. Democracy and localism would work in balance with the needs of the local residents and the ability of the
local council to respond to those needs within a budget.
It is not an ideal world, however, and we are stuck with the centralised system of local authority funding that we currently have. If councils could have a bit more control than they have now then it would be a step in the right direction. How about leaving a portion of the business rates raised in the council to the council itself? It would be a small concession for central government to cede, but it might be a good one to start out with.
There is much complexity in local authority funding from central government. The calculation Whitehall makes to distribute the funds from the pot of money raised by local councils is eye watering. However, if local councils had the ability to control their own funding and their own budgets then you would see more responsibility by councils of all means – and greater efficiencies by the already effective and efficient councils.