Danny Kruger, writing in today’s Telegraph, thinks he has discovered the explanation for (1) apathy in local elections and (2) the success of protest parties like the BNP… Local government has no real power in Britain:
"Councillors have only the most tenuous influence on education, policing, healthcare, welfare and housing. All politicians are the same? Of course they are, because they don’t have the power to be different… The growing support for the BNP represents not (or not mostly) an emerging racism, but the angry expression of voters’ accurate perception that no one is listening to them."
For Mr Kruger the key to reversing the powerlessness of local government is ensuring that it raises the majority of its money locally and can spend it much more freely. He recommends Douglas Carswell MP’s preferred tax-raising instrument – a local sales tax. Kruger:
"There is a fact of pure serendipity: the Government raises from VAT almost the exact sum – around £80 billion – that it passes on to local councils in grants. So the solution is obvious. Give councils the power to set VAT locally and to collect the receipts. Or rather abolish VAT and replace it with a local sales tax (LST) – far easier and cheaper to administer than a tax on "added value"… LST would be set initially at 17.5 per cent – the VAT rate – but thereafter at councillors’ discretion. Councils could raise the remaining quarter of their finance as currently with council tax, or with an income tax, or a poll tax, or – best of all – not at all. Tax competition would act as a downward pressure on rates, leading to a virtuous cycle of improved efficiency and tax cuts. Rich areas would help support poor ones with a cross-subsidy formula, but the link between taxation, spending and representation would be restored."
Danny Kruger welcomes David Cameron’s commitment to localisation
– described in his Coventry speech and manifesting itself in opposition
to Labour’s regionalisation policies – but how widely is that
commitment shared within his shadow cabinet? Earlier this month,
reacting to Ann Marie Rogers’ Herceptin victory, Shadow Health
Secretary Andrew Lansley complained about Labour’s "postcode lottery"
and a lack of "national guidance". Simon Jenkins, a leading critic of
the centralisation of the Thatcher-Blair years, says that it is hard
for Whitehall to allow the "soft government" of decentralisation. This
is what he wrote in an article about Michael Howard’s centralist instincts:
“Soft government is not easy. It means some variable
standards in local services. It means a shift from national to local
taxation. It means more power to municipalities and parishes, which
means more participation and more anger. It involves redirecting…
accountability to the locality, relating doctors, teachers, police and
other public services direct to their own communities. Accountability
is through the ballot box, not the central target”.
Are the Tories ready to resist the calls for central government
intervention from the people who complain about postcode lotteries and
local inequalties? Localisation is good in theory but the politics of
localisation – in a country, like Britain, with heavily centralised
media machines (see The Sun’s Herceptin campaign) – are not for the weak-willed.