Headlines: November 24th, 2010

The Institute for Public Policy Research North says the Secretary of State, Eric Pickles, is paying lip service to localism which will only be achieved if local councils are raising 50 per cent of their finance from local taxes. At present, 80 per cent comes for central government grants.

The Institute’s report sets out the foundations on which genuine localism must be built. It argues for arrangements which give powers for much greater local financial autonomy. The target should be that local councils raise 50 per cent of funds locally through a reformed local taxation system which combines local income and property taxes.

Any approach to more local decision-making must carry with it a considered understanding of the most appropriate scale over which any given service, public investment or policy intervention can be efficiently and effectively delivered. A framework for efficiency and effectiveness needs to be developed to provide a clear and transparent rationale for decision-making at every tier of government.

To ensure equity and to avoid post code lotteries, a set of national minimum outcomes should be agreed so that every citizen is guaranteed a level of service within a system of greater de-centralization and local flexibility.

Localism must sit at the heart of a drive for social justice. Central government’s desire to iron out local variations needs to be managed through a set of national minimum outcomes and through a fresh, transparent approach to equalisation in relation to central-local finances.

Ed Cox, Director of ippr north, said: Localism is certainly not achieved simply by ‘handing down the axe’ and leaving councils to make cuts dictated by central government policy. But central government has a role to play in ensuring that local autonomy does not result in services dropping below nationally agreed minimum standards. All of this could be achieved if there was a clear constitutional settlement which formally established where the balance of powers lay between central and local government.”