Henry Smith, one of the co-authors of 'Direct Democracy' discusses the role and financing of local government
Q1 There is a consensus among both sides of the aisle in the parliament that we public services should be delivered based around the needs and aspirations of local communities. How do you think that the issue of local government finance should be best addressed to increase accountability locally and also ensure delivery of high quality public services?
One of the generally accepted historical reasons for the loss of the American colonies was the growing grievance of their people encapsulated by the cry “no taxation without representation”. I don’t want to sound melodramatic but the disconnect in this country that now exists between those who are supposed to be elected to represent local communities and their ability to actually fulfill and finance policies in response to local priorities is severely restricted.
Local government is increasingly local administration of Whitehall departments with central government massively controlling the funds available to local authorities under one of the most centralised systems in the democratic world. Added to this is a burdensome inspection regime that demands compliance with national directives; all this effectively means that elected members can at best only nuance policy and service delivery. The people have sussed this, that is why electoral turnout is low and disillusionment is high.
Councils need to be trusted with much greater freedom and that means being able to set policies to match local circumstances; in turn this means having the ability to finance their delivery. The present council tax system was never designed to bear the burden of central government’s recent grant formulae, it has become a form of central stealth tax, which, of course, has disproportionately affected those on low or fixed incomes, like pensioners.
An interesting alternative that appears to work well in other countries is a local sales tax in place of VAT. Coincidentally the amount raised in VAT in the UK is almost the same amount we spent on local government. Such a system would actually also put a downward pressure on taxation too. I’m not saying this is absolutely the answer, there are other interesting models, but I do think we need a radical shift in the way we fund local authorities.
Q2 Neither NHS trusts or Police Authorities are directly democratically accountable. Do you think that imposing local democratic accountability on Quangos would be beneficial to there management?
As a democrat I believe in representative, transparent governance. Understandably, health and law & order issues are consistently top of individuals and communities most important stated priorities. Both services also have significant local dimensions in their delivery and impact, therefore, I have always been perplexed by the almost minimalist approach taken in this country, again almost uniquely, to the level of local accountability and control accorded to them.
I have come across almost an arrogance whereby the thought of politicians sullying the professional administration of these services at local level exists. This attitude deeply concerns me. Government, at all levels, affects every aspect of our lives, so it is perverse that those areas of particular importance to the local citizen should be effectively excluded from democratic guidance and scrutiny. Although admittedly heavily controlled from the centre, other service areas are entrusted to elected councils without compromise to the professional integrity of those services. This doesn’t make the complex and difficult decisions that surround health and policing any easier but at least they would have the greater legitimacy of reflecting local communities priorities and that by definition is better management.
Q3 Many MP's have stated that they have to deal with issues which ideally should be the role of the councillor. In many ways, the central government directives and budgetary control have made local councillors almost redundant as they do not have any executive authority. What effect do you think this has on local democracy and how can this be best addressed to ensure effective governance that reflects the wishes of local votes and create a cohesive society?
Most council leaders and elected members with executive responsibility for a particular service area will tell you that their local MPs frequently pass on constituent enquiries for resolution, because so many relate to local authority services - state of neighbourhood roads, school admissions, housing issues and so on. The irony is that central directives and budgetary control effectively often mean that only minor matters can be influence by the councilor in response. I agree, local representatives should indeed largely deal with local issues but to achieve this, of course, MPs and government need to legislate for real authority to be vested in councils.
National politicians also express concern at falling turnout, particularly in local elections. However, it is precisely because people know that their council election vote carries such little authority or ability to change much in their area, regardless of political party or profile of individual candidate, that they increasingly don’t bother to turn out at all. Initiatives such as increased ease of access to voting via post or electronic means are seen, wrongly as the answer, rather than just the additional conveniences they ultimately should be. People will vote if they know that their decision carries the power to make a real difference.
Q4 What effect do you think devolving power to smaller neighbourhood local government would have and do you think that it would make sense to have significant structural changes in English local government?
I believe that power should start with the individual and be lent up to the appropriate level of government. There are many issues affecting the immediate neighbourhood that require solutions unique to that particular area that may not be applicable elsewhere within a local authority. Therefore, to see a strengthening of parish councils in rural areas and the establishment of community councils in urban areas would, I believe, empower local people to make the most local decisions more relevant to their priorities. In local government we ask the centre to devolve more power to us, which is right, but we need to guard against being hypocritical ourselves and accept that power should not just come to us, but through us, to the most local communities.
This isn’t the same as saying there should be endless tiers of government; more direct democracy doesn’t mean more bureaucracy. Efficiency and avoiding duplication are essential if local governance isn’t to simply mirror the growing central state. Most people identify with their local community, then their county or metropolitan area. Underneath national government I believe local authorities are best structured on such natural, identifiable and historical communities.
Q5 What do you think is the appropriate role for local government in British society?
We are truly fortunate in that historically as a nation we have had a strong and well established tradition of individual liberty, yet a sense of civic and social responsibility largely through a system of identifiable local government. My regret is that over the past half century or so we have started to lose touch with that legacy.
Democratic local government should be at the very heart of every service which has a significant element of local delivery. There is a great deal of talk about localism across the political spectrum; whether we deliver on this or not will be a true health check of our nation’s democracy.
The book 'Direct Democracy' is available from the Direct Democracy website