England & Wales, Global Finance

Politics may be coming home

Photo by Jon Tyson on Unsplash

Local government had a ‘pretty good showing’ during the party conferences says Dr Jonathan Carr-West. He hopes it could be the start of a much-needed public debate on the local state.

Is domestic politics back? On the face of it this seems like a foolish question. Media coverage of the party conference season just finished was dominated by Brexit and by the not-unrelated questions about internal party politics.

But, at the conferences, politicians in all parties were attempting to wrest the discussion back on to domestic policy issues. In part this is because both Labour and the Conservatives are deeply divided over Brexit, whereas they can attempt to project more unity and a more coherent political identity in other areas. There is also a realisation that while Brexit is undoubtedly an epochal political issue, it will one day be done. A party which stands before the electorate without a clear domestic programme will be found wanting.

So, not only was there a focus on domestic politics, there was even a good showing for local government.

At the Labour conference, John McDonnell was tweeting about the burden of cuts on local government while Andrew Gwynne, the shadow communities secretary, wrote an op-ed arguing that local government funding is not fit for purpose and reiterating Labour’s commitment to consider replacing council tax with a land value tax which he claimed could raise money to pay for ‘neighbourhood services’.

Most striking of all, Jeremy Corbyn himself opened his speech by listing Labour local election victories and praising Labour councils for protecting people and services.

Local government was also heavily represented at the Conservative conference. Matt Hancock announced an additional £240m funding for social care – a pittance compared both to the scale of the social care spending gap and the billions being conjured up as a birthday present for the NHS, but it’s the thought that counts.

Liz Truss, chief secretary to the Treasury had an uncomfortable time, grilled on local government finances by Emily Maitlis on Newsnight, who was armed with figures from this year’s LGiU/MJ Finance Survey: nine out of 10 councils raising charges, two-thirds dipping into their reserves, eight out of 10 fearing for their financial sustainability.

Ms Truss’s assertion that: ‘We are not making cuts to local authorities. What we’ve done is given them more revenue-raising power’ caused bemusement in the sector, although she was careful to indicate that all public services would be under review in next year’s Spending Review.

The Prime Minister’s announcement that the Government would be lifting the cap on housing revenue account borrowing. This returns more fiscal autonomy to local government and will help build much-needed houses. It is, as the Local Government Association said, fantastic.

Of course, we don’t yet know the details, or when this will happen or what caveats the Treasury – which has always hated this idea as it adds to net borrowing – will seek to impose. And, without a greater share of right to buy receipts, councils still face powerful disincentives to build. Nonetheless, we should welcome progress when we see it.

So, there was a greater emphasis on local government this year than we normally see. It was certainly enough for me to mothball my annual ‘why did no-one talk about local government’ polemic. But it is probably safe to say that none of the announcements made or ideas proposed were truly transformational. None spoke to the profound crisis in local government funding, for example.

Meanwhile, out in the real world, the drum beat of despair continues relentlessly. Scarcely a day seems to pass without a story about a council cutting its services back to the statutory minimum or being challenged in court about the legality of their provision. Austerity may be over in the conference hall but it is very much alive in the town hall.

While we couldn’t really claim all this added up to a battle of ideas about the future of local government, it does provide some evidence that deep in the corridors of Westminster the penny is dropping that there is only so far you can degrade the local state before the fabric of civic life stretches beyond endurance.

Once people start to notice this, there may be electoral consequences. Maybe that is a triumph of hope over experience. Or maybe it is the beginning of the public debate about local government we so desperately need.

Jonathan Carr-West is the Chief Executive of LGIU. This article was published by The Municipal Journal.

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