Headlines: June 4th, 1997

The Labour manifesto commitment to end compulsory competitive tendering for local authorities has been honoured with the announcement that it is to be abolished. Hilary Armstrong, the local government minister said it would be replaced by a “best value” scheme. She set out a three stage process starting with a review and consolidation period, followed by new regulations later in the year.”The Government has an open mind on contracting,” she said. “Either way there needs to be an effective partnership, and fair and open competition where this is called for.” “Achieving best value will not just be about economy and efficiency, but also about effectiveness and the quality of local services. The new framework will be a demanding challenge to local authorities, seeking continuous improvement in service cots and quality. It will be a permissive framework which emphasises local choices and local accountability. But it will also ensure that every local authority makes improvements.”

Local government leaders welcome the news. Replacing CCT with a ‘best value’ regime will be good for local democracy, says the Local Government Association. It pledged to work with the Government to take the issue forward.

“The announcement places great trust in local authorities and challenges them to find a replacement for CCT. Local government will rise to that challenge,” said Sir Jeremy Beecham, chair of the Association. “The Government is offering councils the chance to build a new approach to services rooted in excellence and innovation. It is an opportunity local government will not let pass by.” He went on to say that: “Competition is important but it is only one of many management tools for improving the quality of council services. Equally important is giving councils the freedom they need to find local solutions to local problems. And that means trusting councils to put quality at the heart of their work.”

Because of the complexity of the regime in England, the Government has not yet suspended CCT as is happening in Scotland and Wales. An urgent review of regulations and guidance, taking 4-6 weeks, will be carried out in consultation with the LGA and other interested parties. There will then be consultation on new regulations and guidance in the Summer. In the meantime, local authorities must continue to meet their statutory obligations. The review will also consider whether local authorities can also carry out work for others, for example, the utility companies.

Mick Graham, the GMB national official covering local government, described the announcement as a welcome first step.