Blue is the colour

The odds on the Conservatives forming the next Government shorten by the day. Shaun Campbell examines the party’s proposals for local government reform

June 2009

Even before the latest round of local elections the Conservatives were the dominant political force in town halls across England and Wales. They did rather more than consolidate that position on 4 June, tightening their grip on the councils they already controlled and taking four long-held Labour authorities: Derbyshire, Lancashire, Nottinghamshire and Staffordshire. Of the 34 councils that were up for grabs on 4 June, the Conservatives won clear majorities in 30 and are the largest party in two others.

The Tories are proposing more power for local councils, like this one in ManchesterThe national picture is similarly blue tinted. The Tories are now in charge of 209 councils with Labour down to 35, the Liberal Democrats 26, and 94 under no overall control. Across England and Wales there are now 9,410 Conservative councillors, which is more than Labour (4,088) and the Lib Dems (3,917) combined.

So the time has surely come to examine what a Conservative victory in a general election – no more than 11 months away – would mean for local government.

The Tory blueprint for council reform was laid out in a green paper, Control Shift: Returning Power to Local Communities, published in February. In the foreword, Conservative leader David Cameron wrote: ‘An essential step towards tackling the great challenges of the day – rebuilding our battered economy, repairing our broken society and restoring hope in our political system – is decentralising responsibility and power. Localism holds the key to economic, social and political success in the future.’

Key proposals include abolishing all process targets by getting rid of the Comprehensive Area Assessment, cutting right back on the powers and funding of regional government, and reducing the degree to which central government funds to local government are ring-fenced for specific purposes. The green paper also argues for an end to capping council tax rises, transferring this power to the electorate, which would vote in a referendum if a local authority proposed a council tax increase above the national threshold. This measure appears to be a one-way street, though. Residents are not being offered the power to veto council tax cuts however unhappy they may be over reduced service provision, nor to propose council tax rises.

Directly elected mayors are firmly on the agenda. Although councils have been given the freedom to go down this route for several years, few have chosen to do so. According to the green paper, ‘vested interests can act as a powerful blocking force for local change’, so the Conservatives plan to hold referendums in England’s 12 largest cities to force this issue into the hands of the electorate. They are also keen on directly elected police commissioners, rather more so than many of their councils.

On the surface many of the proposed measures look pretty radical and they certainly chime with the belief, widely shared across the political spectrum, that too much power is held centrally rather than locally. But how truly radical are the Conservative plans? How much change can we really expect to see?

The Local Government Association (LGA) has largely welcomed the Conservative proposals. ‘The stated aim of giving more power to local councils and people is an excellent step in the right direction,’ said LGA chair Margaret Eaton. ‘The LGA has been encouraging all the political parties to move towards a more localist approach and away from central prescription and this demonstrates how our work has paid off.’

There has also been support from other quarters. Andy Sawford, chief executive of the Local Government Information Unit thinktank, said: ‘The green paper is going in the right direction. We welcome many of the proposals… The move to end capping and make decisions on council tax locally accountable is very welcome.’

But the positive response has been far from unanimous with several critics suggesting that the green paper is long on rhetoric but short on specifics, particularly over local tax reform. ‘The thorny issue of the financing of local government is ducked rather than addressed in the green paper,’ said Lisa Harker, co-director of the Institute for Public Policy Research (IPPR). ‘It says nothing about reforming council tax and only tinkers with the very limited revenue-raising powers that local government currently possesses. Having greater control over revenue generation is a pre-condition for the rejuvenation of local government.’

The New Local Government Network (NGLN), a thinktank, has similar reservations. ‘The Conservatives should clarify whether they intend to replace council tax or not,’ said director Chris Leslie. ‘They should say more about whether they would shift the central-local balance of power by addressing the imbalance of current funding created by the dependency on Treasury grant for 80% of local government; and they should clarify whether or not local government services will be one of the areas in which they will match the Government’s investment plans – as they have committed with health, defence and education.’

Tony Travers of the London School of Economics, a long-standing champion of the localist agenda, is another sceptic. David Cameron ‘should promise that this set of proposals is only the first step towards a different kind of England’, he said. ‘The revaluation of council tax and local taxation reform cannot be ignored forever. Control Shift must be seen as merely a start. The country needs radical constitutional reform from whichever party wins the 2010 election.’

Labour has steered clear of council tax reform. The three-year independent inquiry headed by Sir Michael Lyons concluded in March 2007 that the whole issue was too fraught with difficulties to justify changing the system. The Conservatives, whose last attempt to reform local taxation resulted in the electoral disaster of the Poll Tax, clearly have no appetite for overhauling the system either. Radical change is simply not on the agenda.

You can download the Conservative green paper from their website.