Gareth Bacon is the Conservative regeneration spokesman on the London Assembly
It is widely recognised that local government has borne the brunt of public expenditure cuts.
Where the NHS and international development budgets have been protected, local government grants have been reduced by 36 per cent in real terms since 2010. With the next round of fiscal tightening due to come during this parliament, councils will once again be asked to trim their budgets. Getting to grips with the deficit and chipping away at the national debt are clearly and justifiably a top priority for the Government, but there will be consequences that flow from doing this.
It is perfectly true that financial discipline is essential for the delivery of efficient and sustainable public services, and local government has had some fat that needed cutting. However, with the deep and swift cuts that have been made to the Revenue Support Grant and the prohibition on Council Tax increases beyond two per cent without expensive and risky local referenda, there is a limit to how much local government can do without a dramatic deterioration in local service provision.
The Conservative-controlled Local Government Association has recently stated that local authorities will not be able find more savings without serious consequences to community life. Some Conservative council leaders have also said that we have reached a “tipping point” beyond which it would be “very difficult to continue” making cuts. Bankruptcy could become a real fear for some councils.
Worryingly, London will be particularly hard hit by future cuts.
While the counties surrounding London have been asked to make 1.3 per cent cuts during the next financial year, London boroughs will need to trim their budgets by 6.3 per cent. Given that London’s population is likely to reach nine million by 2020 and 10 million by 2030, delivering public services in a climate of shrinking budgets and rapidly increasing local populations presents obvious difficulties. The problems facing councils in London are so substantial that the next round of spending cuts could pose serious existential questions for the current ‘borough council’ model in the capital.
London’s boroughs have been a permanent fixture of the city’s local government apparatus since 1899, but the number of boroughs and their geographical boundaries were borne more of political expediency than anything more pressing. Lord Salisbury, the then Conservative Prime Minister, established the borough system to siphon power away from the larger London County Council, which was then dominated by the rival Liberal Party.
With comparisons to Margaret Thatcher’s abolition of the GLC, these reforms had a political air to them – they were not, despite what is usually argued, the product of a localist movement or of a desire for greater efficiency. They were, from the outset, designed to part-nullify the power of London-wide government.
The current ensemble of boroughs was determined following the 1957 Royal Commission on Local Government. To reflect the need for greater local accountability at a local level, the Commission had originally recommended that 52 London boroughs be established (in comparison, New York has 51 districts). But in the end the Macmillan Government decided upon the 32 boroughs that currently exist).
The structure of local government in London presents real difficulties. As it stands, the boroughs are both too big and too small. They are too big to be truly ‘local’ authorities, with the average population of a London borough standing at 270,000.
Conversely, London’s boroughs are too small to be truly strategic. The creation of the Greater London Authority has enabled large infrastructure projects, such as Crossrail 1, to be given the go-ahead. Given the vast political differences between the 32 boroughs, as well as their own parochial interests, it is difficult to see how this project could have been achieved without pan-London government.
Indeed, the very same could be said of the London 2012 Olympics and the new Old Oak development, both of which have required the creation of Mayoral Development Corporations to provide the coherent strategic impetus needed. In essence, it would be almost impossible to quickly and efficiently deliver the homes and infrastructure London needs without a level of governance much larger than that of London’s boroughs.
Taking these structural failings and financial difficulties into consideration, it is not absurd to suggest that the Capital will have fewer than 32 boroughs by 2030.
Indeed, the early steps of such a change have been taken, with the decision of three West London boroughs to create the Tri-Borough Partnership, the boroughs of Wandsworth and Richmond recently announcing the merger of almost all back-office functions, and several other boroughs exploring the possibility of sharing services.
So what next for local government in the Capital?
It is clear that there is an appetite to devolve more powers downwards from Whitehall, but key questions are to what level they should be devolved and whether existing institutional arrangements are fit for purpose to deliver on behalf of local residents. In the face of further budget cuts and infrastructure demands, it is distinctly possible that the number of London boroughs will need to decrease over time.
If that does indeed prove to be the case, then the form of local government in London will become a subject of intense debate. Any structure that is ultimately created will need to be able to fulfil many different functions – it will need to be democratically accountable, financially sustainable and capable of evolving on sound strategic footings. One option might be to follow the boundaries of the London Assembly’s 14 regional constituencies (formed from two or three existing London boroughs) which could be a model for future boroughs. Or perhaps London could follow the New York system where all services are run directly from City Hall, apart from community issues like parks and planning – New York is a city of similar size and population to London, so such a model could well work here.
Either way, the future of the current 32 borough model in London needs to be debated. The Capital is the workhorse of the British economy and home to some of the most deprived communities in the country (as well as some of the most affluent) so getting local government right in the city is integral to ensuring future national prosperity. As more cuts begin to bite, it will become increasingly clear that the 32 boroughs are not in a position to secure this future. The sooner we have this debate, move beyond the current outdated model and consider different alternatives the better.