Simon Baddeley, whose experience and publications on local government, may be seen here, reflects – in his personal capacity – on this question.

“Osborne’s Budget clearly demonstrates how economic policy drives ideologically inspired policy objectives especially ‘rolling back’ local councils  – in the government’s eyes probably the least desired part of the public sector, lowest of the low.

“To ensure that Total Managed Expenditure (TME) is kept as low as possible, the so-called ‘unprotected’ services have been squeezed disproportionately hard and of course local government expenditure is a large part of the overall unprotected total expenditure.

“To bring public finance back into balance public expenditure has to fall from 45% of GDP to 38% – a massive drop, with no growth, or tax increases the only option is further cuts and in a disproportionate way which hits LAs hard.

“Whitehall has done better than LAs. If its TME overall had fallen at the rate of local councils then it would have dropped from £694 billion in 2010 to £632billion by 2014.

“In fact, Whitehall’s TME will have increased to £720billion”.

“If Whitehall had reduced its spending at the same rate as LAs, the public sector deficit would have been around £35billion. Instead the figure will be £120billion. This demonstrates the distorted relationship between Government and LAs and how our masters value, or not, the two so-called partners.

“Given the near non-existent LA tax base it is difficult to find much to be cheery about when looking at local democracy and how it can be put on a firmer footing (when we are all skidding down the hill !).

The new feudalism: the distorted relationship between Government and LAs

“If you want further proof of Government’s contempt of local democracy look no further than their response to the Communities and Local Government Select Committee:

  • ‘The Government is quite clear that councillors are and should be volunteers and does not wish to see any move towards professionalism through becoming full time’
  • Local councillors should ‘not qualify for extra allowances to make up for lost income’.

“Graham Sharp, the former housing minister and Tory party chairman likened calls for additional allowances to paying scout leaders for voluntary work. Councillors are also going to be banned from inclusion in LA Pension Schemes”.

Baddeley sees this response as blighting and diminishing the prospects of local leaders, noting that when councillors prove less than adequate, as now and again they do, they get the calumny and not the authors of the new feudalism – ministers and MPs with salaries, expenses and perks and final salary pension schemes.

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Local government – ‘the Budget’s great unloved’

We add relevant content from the Chartered Institute of Public Finance and Accountancy blog, by visiting professor and director of the Greater London group at the London School of Economics, Tony Travers. He writes:

“You wouldn’t know it from the headline figures, but local government, along with some other unprotected and unloved public services, looks likely to face at least 50 per cent spending cuts between 2011-12 and 2017-2018 . . .

“The government’s problem is that it wants to hold down Total Managed Expenditure (TME) but cannot control Annually Managed Expenditure (AME), which largely consists of welfare, tax credits and debt interest.  AME current expenditure will rise from £303 billion in 2010-11 to £414 billion in 2017-18 . . .

“Over the full period from 2012-13 to 2017-18, Departmental Expenditure Limits (DEL) mostly for local government, defence, the police, fire, transport, business services and justice, will face further cash spending reductions of 25% in the next four to five years. Annually managed expenditure (AME), by contrast, will grow substantially. . .

“It now seems likely that local government, along with some other un-ringfenced services, will face real terms reductions of at least 50 per cent in expenditure over the period 2011-12 to 2017-18 . . .

“An historic change is under way which will radically alter the shape of the British state”.

 

 

 

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