Policy, campaigns & research

The next government should decentralise power – but will it?

Jay Kennedy discusses decentralisation and why it would benefit the charity sector and society as a whole.

The recent local elections will be the last poll before the next General Election, which the Prime Minister Rishi Sunak has unexpectedly just called for 4 July.

These elections resulted in massive changes in the political composition of many local councils across England, new Police and Crime Commissioners, and some notable results in a few Mayoral administrations. Yet the vote was mostly interpreted by the national media as a barometer on the national picture; another data point for speculation about the likely General Election result.

The problems with the UK’s over-centralised governance 

This odd focus on national politics even during local elections may have been heightened given the imminent General Election. But it’s also a consequence of the UK, and specifically England, being widely recognised as one of the most centralised political systems amongst the larger ‘advanced’ economies of the world. You can see it across so many policy areas: from the way the health service functions, to how the national curriculum is set and schools are inspected, to the lack of fiscal autonomy for local authorities.  

The UK has substantial economic and regional inequalities, which various national governments have attempted to address, mostly by prescribing solutions from the centre, rather than from the bottom-up. National politicians in the UK are expected to have control over areas which in many other countries would be clearly delegated to regional or local governments. The system for funding local government is nonsensical, badly out of date, and doesn’t encourage local accountability 

Even in policy areas where Ministers don’t have direct control, they often have powers to intervene and override local decisions – for example in planning. Eric Pickles, the local government minister during the Coalition government, provided a textbook illustration of this kind of central over-reach, by even getting involved in debates about council bin collections!

Levelling Up: a ‘feudal’ paradigm 

The current government has put substantial effort into its so-called ‘Levelling Up’ agenda. This vague concept seeks to boost or ‘level up’ areas that have not had the same level of economic development as the rest of the country. Although there was significant intellectual weight put behind it in theory, in practice it has largely taken the form of local areas bidding to the Treasury for funding to deliver local projects, with the national government setting the parameters and picking the winners. There has been criticism of the slow pace of funding distribution, the cost of making bids, and a bias in successful areas towards those with Conservative councils or MPs.

I’d call this the ‘feudal’ paradigm of localism: local barons petition the King for help on behalf of his subjects, and in his beneficence he may decide to bestow some wealth depending on whether he finds favour. It’s particularly evident whenever there is ring-fenced, central grant funding to be administered to local areas from the centre. It always comes with plenty of strings and the need to pay homage, but it’s low on strategy and evidence. 

Regeneration: a ‘statist’ paradigm 

The last Labour government invested quite a lot of money and political capital in a different approach, which I’d call the ‘statist’ paradigm of localism. This is where the central state plays a much more interventionist role in economic development and what was termed local or regional regeneration, largely by deciding what the disparities in need are across regions and setting priorities for investment from the centre. Like the feudal paradigm, it’s not genuine localism either; the big difference is that it’s almost strategic for its own sake. 

In the early 2000s, this took the form in England of introducing entities like Regional Development Agencies (RDAs) and Government Offices for the Regions, tasked with driving economic development and coordinating implementation of national policy. This included blizzards of ‘Regional Development Indicators’, ostensibly agreed with local governments, to channel their priorities and decision-making. These were scrapped almost overnight in 2010 when the Coalition government came to power, along with many huge funding streams.

This ‘statist’ paradigm dovetailed with the various EU funding streams like European Regional Development Funds, often coordinated through the regional offices and RDAs. These funds were also intensely bureaucratic and hard to influence, operating above the heads of local-decision makers – i.e. ‘statist’. 

Devolution and Mayoral areas 

However, I’d argue two policy initiatives over the past quarter-century have seriously pushed back against the overwhelming centrifugal force in British governance: devolution in Wales, Scotland and Northern Ireland, and the creation of ‘metro mayors’. 

The devolved administrations are now well established, especially in Wales and Scotland, where they have diverged administratively and politically from Westminster over the past decade. The mayoral administrations initially began with the Greater London Authority and then were extended on a different basis to large conurbations like Manchester and Birmingham in England, where Mayors like Andy Burnham (Labour) and Andy Street (Conservative) were able to forge their own brands, sometimes gently against the grain of their national party. 

Although these offer the possibility of a more multi-polar type of political universe in England, their establishment so far has been ad-hoc. Because each area has individually agreed the scope of its powers with central government, they vary substantially. It will be very interesting to see how and if the next government further develops this idea, by extending the number of areas, and standardising or boosting their powers. 

Genuine localism must reinforce local decision-making and accountability 

There are other political parties, for example, the Liberal Democrats, Greens, or Reform, whose policies on localism may have a bearing on the next government and future iterations of localism, especially if there is a hung parliament and some kind of coalition. For example, the Coalition government included the Liberal Democrats, and this had a bearing on the Localism Act 2011. But absent an unlikely insurrection by local councillors, we’re still going to be reliant on national politicians and parties giving up power – and in particular the purse strings – if we’re going to rebalance the scales. Will they really? 

This matters to the charity sector because most charities are small and local, and if they have any direct or indirect relationship with a government body it will be with the local council. What the council does matters: whether it’s charitable business rates relief on premises or providing access to council buildings, funding services via grants or contracts, or supporting charity shops on the high street. Also, when councils stop doing things, the already over-burdened local voluntary sector has to step in to fill the gaps. 

Increasingly, councils are in huge financial trouble, and this is having a knock-on effect on local charities in the form of funding cuts and increasing demand for many services. Six councils have issued so-called ‘Section 114’ notices in just the past few years, which is kind of equivalent to going bankrupt. More may follow soon, unless the next government provides more emergency funding to stop their collapse. 

But that’s just a short-term fix – and would be in itself a symptom of the flawed current paradigm. The next government needs to seriously reform how councils are financed, giving them more fiscal autonomy and boosting their democratic accountability. Central government needs to stop treating local government as little more than quangos – but this will require legislative time and a culture shift.  

Charity folk know that local government isn’t always easy to deal with – but surely that’s in large part because central government so often ties its hands, overrides its decisions, and cascades problems down onto it without assent or financial support. Changing this could I think benefit the charity sector too, for the benefit of the people that both charities and local governments serve. 

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