Local thoughts from abroad

Author: eGov Monitor   |  

It’s a commonplace now that England is one of the most centralised countries among the advanced democracies – if not the most centralised.


While the centre may have declared an end to its thirty years’ war on local government, and there are some signs of reappraisal across the political spectrum, progress is modest. This is all the more incongruous when decentralisation has been a common theme in many other countries.


It was in this context that Localis and the Local Government Association (LGA) agreed to work together on a study comparing our experience of local government with that of a number of other European and Commonwealth countries. Our peer group – Denmark, France, Germany and the Netherlands in Europe; and Australia, Canada and South Africa in the Commonwealth – offered a range of perspectives, covering unitary and federal states, small countries and transcontinental federations, long-standing democracies and a country that has recently made the transition from authoritarian government. This should help us understand what is distinctive about English experience, how we got to where we are and how we might want to change it.


One clear conclusion from our work is that there is no localist utopia to be found. The pressures faced by local government – in terms of finance, performance management, reorganisation, the transfer of unfunded burdens from other tiers of government – are common to much or all of the peer group. Nonetheless, if we look at how different countries have responded to these pressures, England has usually gone for the more centralist option.


There is no single explanation for this. In part, it is because of the informality of our constitutional arrangements – it’s just easier here for governments to act unilaterally and change the rules of the game. Nor does local government have the position in national politics that it does in some other countries, notably France, where national politicians build and retain a base in local politics. It also makes a difference that England is not a federal state, nor is it likely to become one. Federations are not always kind to local government – it is often the sub-national tier above local authorities that arrogates the power – but they do put some constraints on the centre. In addition, sub-national governments often take on the large-scale public services such as education and social care that in England are a key part of local authorities’ work.


This brings us back to the familiar subject of finance. Our local authorities have quite wide-ranging functions, but a narrow funding base: that is their core problem. In some Commonwealth countries (such as Australia), local authorities are similarly dependent on a property tax as their sole source of tax income. However, those authorities have a narrower range of functions, and even they are now finding that base inadequate.


The strongest common theme that ran through our findings was the degree to which local government is treated as a partner. The Netherlands provides a striking example. There are some similarities between the experience of Dutch and English local government. Both operate within unitary states. Both have limited financial resources. Both have experienced encroachments from the centre in terms of their finance and functions. In the Netherlands, however, central government and the two bodies representing the tiers of local government negotiated a ‘Code of inter-administrative relations’, which goes much further than the British Concordat. This is partly because of local government’s role in the constitution, and partly because of the links created between local government and national policy-making. Another example is the mechanism by which Danish local authorities are compensated for the costs of policy changes by national government; there local government negotiates directly with spending ministries, rather than being a mere consultee to a process kept within Whitehall. In the very different experience of South Africa, organised local government has a strong voice (though not a vote) in the upper house of Parliament.


Thus some of our key recommendations focused on entrenching local government’s role in decision-making. One way of doing this could be through a parliamentary resolution, drawing on elements of both the 2007 Central-Local Concordat and the European Charter of Local Self-Government (to which the British government has been a signatory since 1997 – with no very obvious effect on its behaviour). Another is to strengthen local government’s role within Parliament, whether through representation in a reformed upper house or through special parliamentary procedures for bills affecting local government. A third is to adopt the Danish approach to negotiation of new financial burdens for councils.


Just as there is no single explanation for English local government’s predicament, there is no one way out. Our recommendations also focus on finance, drawing lessons from the peer group on the clear need for more varied and flexible sources of funding; some of this could be through assignment of taxes or portions of them, as well as full taxing powers. There is also a need to examine the scale and nature of central oversight, and in particular to distinguish more clearly between those policy areas in which local government is contributing to issues for which national government is in part accountable, and those where it is not. There are some interesting parallels from the peer group, notably Germany, that distinguish between areas in which local government acts entirely on its own authority and those in which it acts on behalf of other tiers of government.

In Victorian England, local self-government was seen as an important element of national identity; for many other countries, it provided a striking and attractive model. That situation persisted for several decades into the twentieth century, but by mid-century it had gone; we are a long way from it now. By learning lessons from other countries, we can claim a bit of our own history and identity back.