Power Failure - Democracy has blown a fuse

Published in New Local Government Network Essay Pamphlet: The Age of Regions - Rethinking Regional Governance on Thu 7th Jun 2007

They are just making it worse

Over the last forty years local government has been reorganised and restructured so much that the electorate no longer know, or for the most part care, who does what or why. They feel they have no part in any of it and feel that their engagement will make no difference. Falling voter turn-out, squeezed budgets, and sinking morale in local government are all outcomes of this 'Whitehall knows best' mentality.

In that time central government has stripped councils of decision-making powers over schools, social house building, public transport, sewage, police, careers, further education, and probation, to mention just a few. Whitehall now provides three quarters of the money for what's left, and expects to be obeyed in every detail from how committee chairs are elected (oh, sorry, you can't have any), to the time taken to decide a planning application, from the number of homes you can (or must) provide for, to the council tax you can charge.

New Labour talk about changing this, and devolving power. But their ten years has only made things worse. Not only has more and more decision-taking been snatched from the local democratic level, but the surge in central government spending has been funnelled not through Town Halls, but through a Byzantine network of quangos and agencies, appointed nationally, and accountable to no-one. Learning and Skills Councils, Foundation NHS Trusts, Housing Corporation, the list goes on, long, impressive, and literally unimpeachable. Beyond the reach of voters.

The creation of regional assemblies and regional offices for Whitehall could have paved the way for greater devolution. However Labour has continued to use regional arrangements as a way of keeping power in the hands of Whitehall. Unelected quangos now have more, not less, impact on people's daily lives than a decade ago, and locally-elected councils have less.

Astonishingly, in the one Region in England where there has been some democratic devolution, with the creation of the London Mayor and Assembly, far more money is still spent each year by the Government Office for London than by the elected Assembly. In every other region of England it is worse, with billions of pounds spent by an ever growing army of quangocrats, and no pretence of local control at all. Government ministers actually boast that these Quangos are free from the 'interference' of locally elected representatives. They are deliberately designed to ignore inconvenient local realities.

The upshot is that England is now the most centrally-directed country in the developed world, with a higher proportion of all public spending dictated by Whitehall compared to that by regions or local government than any other EU member (except Malta, which only has the population of Portsmouth).

From the bottom up

The result is bad in nearly every respect. It certainly doesn't provide better value for money. Local councils consistently show up better than central government departments for that, and are better at making savings, too. It doesn't make it easier to get things put right, or get services that meet local needs. Have you tried to get a bus route altered, or sign on for adult education recently? Do you know who decides these things any more, or how to speak to them? It certainly contributes hugely to a deep sense of alienation by the public from local democratic participation. Politicians hear it every time they go on the doorstep: what is the point of voting for or against a local candidate who if elected does nothing except blame someone else?

To break out of the corrosive straightjacket binding public administration and service delivery we must start with unprecedented decentralisation of powers, money, and decision-taking. A healthy local democracy with power and vision is the best route to the creation of communities that are socially, environmentally, and economically sustainable.

Decisions on local service delivery, and on local taxation to pay for it, should be taken at the lowest possible level, by people and communities acting through fairly elected, accountable local authorities. No longer should policies designed to work in Reigate be imposed on Rotherham, nor rigid plans dreamt up by Whitehall amateurs be compulsory from coast to coast. Central targets should be scrapped, councils should be raising a far higher proportion of their spending through fairer, not higher, local taxes, and communities should be able to decide for themselves what style of council leadership suits them.

Providing that level of devolution will allow local communities to generate and attract the investment needed to achieve the economic development they want.

Where there are functions that are too big for an individual council to deliver, such as major transport infrastructure and strategic planning, councils need the flexibility to collaborate and innovate to serve wider areas. That co-ordination and collaboration should be locally grown, not centrally imposed. Many councils already have joint boards running police, fire services, waste disposal and more. So why not Primary Health care commissioning too? It would be up to local communities through their councils to decide on the structures that would best give them the capacity to deliver.

And where the public want it, we would champion elected regional government, devolving as many powers as possible from central government to this tier. We most certainly must get existing regional budgets back under properly accountable control.

Celebrating regional diversity

We should celebrate Britain's regional diversity and build upon the strengths and unique qualities of different areas. The key environmental, economic and social policies needed for such diverse circumstances as are found in London, in the rest of the South East, in the Midlands, and the North are different. That is why Liberal Democrats have long advocated democratic regional government. There are differing issues facing different regions, and a policy that benefits one can be actively harmful if applied willy-nilly in another.

Back in 2000 progress on this seemed feasible. But Labour's bungled plans for 'rolling regional government' were tabled without conviction, finishing up like the proverbial horse designed by a committee. Except that, as the 'no' vote in the North East showed, it was a turkey they produced, not even a camel.

Despite this drastic set-back I am convinced that there is a place for genuine devolved regional government in many areas of the country. It is also clear that 'asymmetry' will continue. London already has different regional governance arrangements, and there could in future be more variation in powers and governance to meet local circumstances. Spain has already shown that it is no handicap for powers and responsibilities to differ between regions.

One model is the long-standing Liberal Democrat policy of a directly elected regional assembly, set up to take powers away from central government, not from local councils. Regional government would set strategic priorities for the area, bring decision-making back from Whitehall, closer to people, taking on many of the functions presently carried out by quangos and regional government officials, and passing the rest on to an enhanced local democracy. In the future, directly elected regional assemblies could take powers over secondary legislation, too, if approved by people of the region.

But first sensible and recognisable regions need to be established that reflect natural communities and identities. The current boundaries were designed by central government for their own purposes. Some do reflect the local realities, but some, especially the South West and the South East, definitely don't. A review would most likely lead to an increase in the number of regional assemblies or even the creation of what are, in effect, sub-regions.

Where there is no appetite for that model, retaining the existing regional chamber arrangements unreformed will not do. Constituent councils of such a regional area will need to play a part in creating new governance arrangements that will be more democratic, accountable and transparent to the individuals and communities they serve.

Members would be elected from the councillors covered by the region, by the councillors covered by the region (by STV of course). Non-elected members of these chambers would have a role, but as a consultative group. The chamber would have powers to manage and raise finance for regional transport networks, and to scrutinise regional bodies such as the Regional Development Agencies and regional health authorities.

Ending the quangocracy

Democratising regional governance, and cascading power and budgets down from central government ministries to regions and councils would bring billions of pounds back under the democratic control of elected representatives of local communities. That would end the absurd position where, for instance, for every £1 spent by Liverpool City Council in their area, £8 is spent by unelected public bodies.

The future shape and scope of the residual quangos must be for local government to decide. They would have the power to scrap quangos or reduce or transfer their powers and functions to councils or other accountable bodies like regional assemblies.

But let's not get carried away. The local authority, as the democratic embodiment of its community, should remain as the basic building block of government and public service delivery for its area.

And none of this progressive devolutionary vision can be achieved without getting the basics in place first. Local government itself needs democratic reform. Most glaringly, the first-past-the-post election system leads to distorted representation in many authorities, and often leaves communities within them without a voice, let alone a route to power. Liberal Democrats want to see fair local elections by a single transferable vote system to ensure that local government is responsive to the needs and wishes of the community it serves.

Liberal Democrats have been making the case for local democracy, devolution, and decentralisation of power for years. We are still at the forefront of the devolution debate, and are delivering innovative solutions on the front line across the country. In many of those councils where we have power or influence we are well ahead of the rather timid proposals in the current Local Government Bill on engaging the community. The best local authorities are strongly committed to tackling local issues on behalf of their communities. They work hard to lever in resources, they provide dynamic civic leadership. They take seriously the need to deliver sustainable communities. They resist, despite all the pressures and set-backs, the temptation to lapse into victim mode, and simply await the next Whitehall directive.

But local determination and innovative skill is not enough. The whole system has to be refocused. Central government has to let go. So will they?

Brown's Britain

With Blair gone all eyes turn to Brown to see where his leadership will take local government and the debate on decentralisation. Unfortunately I doubt this will be towards the devolution of powers, finances and decision-making that local democracy desperately needs. Even his worst enemy wouldn't call him a devolutionist.

In 10 years as Chancellor he's clamped down on local government grants and Business Rate income, imposed the confiscatory landfill tax, snitched housing revenue surpluses, and now aims to take away S106 money via PGS. Not to mention his absurd rules on capital spending and his insistence on the re-introduction of council tax capping.

Will he have either the will or the courage to slash Whitehall's army of quangocrats, and give their powers to accountable, elected bodies? It doesn't look good. In fact the rumour is that he is tempted to centralise local government financial controls even more.

So what does the Liberal Democrat CSR wish list contain? How long have you got?

Let's start with a commitment to transfer the Business Rate back to local councils, an end to the confiscation of Housing Revenue surpluses, permission to reinvest council house sales money in new social housing, a planned start to a transition to Local Income Tax, underwriting for a programme of 100,000 new social homes a year, and a 3 year phased transfer of Quango budget decisions to duly elected regional and local representatives.

One thing is certain - until we mend the fuse, democracy stays dead.

END