We know that local government is looking at a 10% reduction in today’s Spending Review. So the traditional game played by some councils of bemoaning the lack of money is even more pointless than usual. It’s now down to us as local authorities to behave differently when it comes to delivering services, and that covers everything from social finance schemes to early intervention on troubled families.
The government has done much in recent years to drive forward public service reform, but today will make it still clearer that we can’t take our foot off the gas. There is now a golden opportunity for town halls to work closer with Whitehall to drive forward further reform, including making quicker progress on setting local areas free to drive value for money in public services and unleash our potential for economic growth. That’s why my own council and our Tri-borough partners will be seizing the chance to launch a new wave of public services that will make housing more affordable, boost jobs and growth, and tackle the long-term problems of benefit dependency and fraud against our welfare system.
If you are one of the authorities who gains from the announcements we have been led to expect on roads and housing, then that’s great. But it is clear that in the long-term, centrally allocating money from Whitehall isn’t the best way to kick-start local schemes. Councils have the local knowledge and the expertise to make public money work far harder for local economies than it can through centrally delivered projects. Freeing up restrictions and allowing councils to borrow against their assets is key to building more houses, getting more people into work, saving money and delivering better public services. The chancellor has an opportunity in today’s Spending Review to do exactly this, but he needs to be radical and not let the opportunity slip.
The government also needs to make sure, today and in the coming months, that the most progressive authorities can benefit fully from the ‘single pot’ proposed by Lord Heseltine, making it as deep and wide as possible in the funding that goes into it from across Whitehall and ensuring that it heralds a genuinely new way of doing things, not just a one-off pot of money. In the longer term, the independent London Finance Commission chaired by Professor Tony Travers, which published its report in May, was a timely reminder that cities including London will need to be able to control their own financial destiny in order to invest in growth and achieve maximum value with public money. As a whole, London is home to 13 per cent of the population but generates 18.5 per cent of the national tax take, largely driven by the West End and Central London: freeing up successful local authorities to reinvest some of the local proceeds of growth has clear benefits for the whole country.
Whether sharing services, as with the successful Tri-borough initiative, or coming together to negotiate ‘City Deals’, collaboration will be ever more crucial to local authorities going forward. This will require political maturity and cross-party working, and Westminster is playing a leading role in ensuring that the different levels of London government invest time, resources and political capital in working together to take forward new opportunities.
Philippa Roe is the leader of Westminster Council
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