Going local

Posted by: Jules Birch

27/10/2009

One way or another localism is going to be crucial in the next decade but does anyone know what it really means?

The Conservative vision put forward in the party’s white papers on planning and housing seems to offer an attractive alternative to top-down targets and centralised funding. The flagship policy of matching the additional council tax for each new home built for six years should give local communities an incentive to be pro-development (although most of it is not new money).

And even if the Tories do not win the general election, a consensus is emerging across the political spectrum about the need for more autonomy for local authorities and stronger public-private partnerships.

A clutch of reports and consultation responses out this week show just how widespread that debate is becoming - and how complex some of the issues are.The British Property Federation (BPF) responded to the Conservative white papers by welcoming localism and ‘plans to pay councils to build’. But its response - for some reason accompanied by a picture of the Spitting Image puppet of Margaret Thatcher - is also a plea to the party to adopt existing BPF priorities such as tax increment financing, build to let and empty rate relief on new development.

The New Local Government Network (NLGN) published a report yesterday warning of a public sector ‘tsunami’ next year as public spending cuts hit investment in transport, schools, housing and other facilities and calling for new freedoms for local authorities to raise funds.

Local authorities get 75% of their funding from central government, it points out. Much of the rest is dependent on the market and income from capital receipts and section 106 contributions has slumped. Unless action is taken, it warns of a return to the 1990s backlog of public investment.The report calls for a range of innovations including reform of the private finance initiative (PFI), user charging, municipal bonds, mutualisation and new forms of partnership with the private sector. ‘The constitutional circumstances which have created a local government community almost totally reliant on Whitehall now risk leaving much of our public services and facilities bereft of investment,’ said NLGN director Chris Leslie. ‘We urge preparedness within the sector for the looming political obsession with national debt which could see a Treasury cutting capital grant and loan availability severely.’

All of those proposals can be lumped together under the heading ‘localism’ but so too can freeing local communities to be nimbys. So can the government’s ‘total place’ initiative to treat local government spending as a single sum rather than separate ring-fenced budgets.

Localis, the think-tank at the heart of the debate within the Conservative party, has called for more radical localism and much greater devolution of financial power. It is also one of several right-wing think-tanks calling for local authorities to be freed from national obligations on allocations and security of tenure.Scrapping top-down targets and making funding less centralised is one thing but abandoning control from Whitehall and national legislation is quite another. How local will the -ism really be?