England & Wales

*update* Localism and Decentralisation Bill


The slightly delayed Localism and Decentralisation Bill will be published “very soon” I am told.   Bringing together what we know at this point, these are the aims of the Bill as they are expressed by coalition politicians:

• Give councils a general power of competence.
• Give residents the power to instigate local referendums on any local issue and the power to veto council tax increases.
• Grant “greater financial autonomy to local government” and community groups.
• Return decision-making powers on housing and planning to local councils and communities
• Abolish Regional Spatial Strategies.
• Abolish the Infrastructure Planning Commission and replace it with an efficient and democratically accountable system that provides a fast-track process for major infrastructure projects.
• Create new powers for communities “to save local facilities and services threatened with closure”, and give communities the right to bid to take over local state-run services.
• Abolish the Standards Board regime.
• Require public bodies to publish online the job titles of every member of staff and the salaries and expenses of senior officials.
• Create Local Enterprise Partnerships (to replace Regional Development Agencies) – joint local authority-business bodies brought forward by local authorities to promote local economic development.
• Form plans to deliver a genuine and lasting Olympic legacy.
• Outright abolition of Home Improvement Packs.
• Create new trusts that would make it simpler for communities to provide homes for local people.
• Review the Housing Revenue Account.

The Bill will completely change the current planning regime ‘returning decision-making powers on housing and planning to local councils.’ This will involve the abolition of centrally imposed Regional Spatial Strategies. Section 106 agreements between developers and local authorities are likely to change in favour of a reformed Community Infrastructure Levy. Under current Section 106 rules a developer pays costs associated with the impact of the development on the immediate surrounding area. A strengthened Community Infrastructure Levy would give the local authority more freedom to spend money where it sees fit across its jurisdiction. The issue yet to be thought through is that due to the prescriptive nature of 106 developers and councils had a clear understanding of the rules of engagement before planning permission was granted. The levy will mean that much more negotiation will be needed between the two parties before developers agree to build and councils agree to grant planning permission.

The Bill will introduce a New Homes Bonus which aims to provide incentives for councils to build new homes by matching council tax raised from new homes for the first 6 years. CLG has set aside almost £200m for financial year 2011/12 and £250m for each of the following three years to support the bonus. It is estimated that councils will receive up to £10,000 per new home allowed.

The Bill will seek to abolish regional spatial strategies as part of the removal of the regional tier of government. This has caused controversy following the legal victory by CALA Homes who issued a judicial review in the High Court in August. Key to this was the claim that the Secretary of State acted outside his powers by removing a key part of the plan-led system resulting in a policy vacuum.

As well as reforming the planning regime the Bill will also extend powers to local government including a General Power of Competence. The power will allow councils to act in the best interests of their communities as long as their actions do not cost central government extra money and that the action does not break an Act of Parliament. The original idea was for a Power of General Competence, as opposed to a general power of competence. It is not yet clear whether this means that the government have weakened the power. The General Power of Competence will build on and strengthen the previous government’s power of well-being which was ill-used by councils and much weakened by the High Court judgement in the LAML case.

The Bill will give communities the right to bid to take over local state-run services as well as new powers to help communities “save local facilities and services threatened with closure”. The Community Right to Bid and the Community Right to Run Services will be a major innovation in the way public services are run, specifically at a time where local councils may have to withdraw from the running of large-scale services (e.g. libraries). LGiU has some concern that the Government has not indicated the role of local authorities to ensure that community-run services are transparent, accountable, and are an efficient use of public funds. The Bill will seek to encourage different vehicles for service delivery including employee-run mutuals, co-operatives, charities and social enterprises. The Cabinet Office has recently announced that public sector workers will be given the Right to Provide, allowing them first refusal to take over parts of hospitals, schools, prison services and the Civil Service.

The Big Society will be supported in the Bill with funds from dormant bank accounts used to establish a Big Society Bank, which will provide new finance for neighbourhood groups, charities, social enterprises and other non-governmental bodies.

The LGiU will be providing detailed on the day briefing when the Bill is published, and we will be working closely with the Department and with MPs of all parties during the passage of the Bill through parliament.