Sarah Boyack, MSP for Lothian and Shadow Cabinet Member for Local Government and Planning, says that the Smith Commission needs to focus on devolution of power to local government.
The argument that we get the best of both worlds, a strong Scotland backed by pooling and sharing across the UK, underpinned the recent referendum debate. The Smith Commission now has the task of delivering consensus on modernising our devolution settlement.
But with the focus on strengthening the Scottish Parliament, how do we create the political space to discuss the devolution of powers from both the UK and Scottish levels of government to our local councils and on to local communities?
Local government services have a huge influence on our lives but the independence referendum crowded out a much needed discussion on strengthening local democracy.
While local councils have a theoretical general power of competence, in reality the severity of the financial straight jacket imposed by the Scottish government, has led to service cuts, increased charges for services and the loss of 70,000 local council staff since 2008.
Scottish Labour’s vision for local government is to see decisions about our local communities taken locally. In our Devolution Commission, Powers for a Purpose we argued for Double Devolution and a reversal of the trend under the SNP government to centralise local services and control funding.
While the debate around the Smith Commission focuses on greater accountability on funding and new funding streams for the Scottish Parliament, Scottish local government is faced with a tightening financial straight jacket. We need to see devolution from both the Scottish and UK governments. While English local government is facing even bigger cuts than Scottish councils, initiatives such as City Deals are opening up new opportunities and new resources for local authorities to work together to promote investment in infrastructure, jobs and training.
Powers for a Purpose recommended significant devolution of financial resources in relation to employability programmes, training provision and housing benefit. We wanted to enable local authorities to secure better and higher quality training opportunities appropriate to the needs of local social and economic priorities. And we wanted to increase the capacity of local authorities to deliver better value in housing support and to increase the availability of affordable social housing.
We also argued that the agenda set by the Orkney, Shetland and Western Isles Councils needed to be embraced and acted upon.
And we set out 3 principles for local government funding.
- It should be the aim to establish a system which commands cross-party consensus, to deliver a long term solution to funding local government services so that local finance is no longer a political football.
- A system should be put in place that establishes a clearer distinction between the roles of central and local government in determining council
- A system should be created which ensures that an updated and fairer system of property taxation continues to play an equitable part in supporting public services in the long run.
In August the Commission on Local Government published its final report. It set out seven principles: sovereignty, subsidiarity, transparency, participation, spheres not tiers of government, interdependence and wellbeing. Its recommendations focused on making local democracy local, creating local tax and spending choices, securing local democracy and making participation work.
The report set out four criteria by which proposals for funding local government and local services should be assessed: sufficiency, efficiency, equity and transparency. It discussed three broad options for change resulting from the evidence submitted to the Commission: to build on Scotland’s history of property taxes, to move to tax sharing and to empower local councils to create new taxes.
In June the Scottish Parliament’s Local Government and Regeneration Committee recommended that reform of local government funding “must be addressed at the earliest opportunity involving all political parties”.
I believe that the recommendations in Powers for a Purpose would enable a much needed injection of new resources to enable our cash strapped local authorities to address two of the key challenges that face local communities – creating jobs and training opportunities and to address the shortage of affordable social housing.
There are also opportunities that could be created by devolving power from the Crown Estates Commission to coastal communities, by supporting a new generation of community renewables in both urban and rural communities which could create new income streams and by looking at new options such as a pm optional tourist levy which councils could use.
So Double Devolution needs to be on the Smith Commission’s agenda. But we also need an urgent discussion about how we support local government services now and in the future.
The challenge to the SNP Government is to engage in that debate – not continue to pretend that the underfunding of the council tax freeze is not damaging local services and increasing costs for the most vulnerable in our communities. It also must surely mean a rethink for the SNP of their hated local income tax policy which would have to be 5.4p not 3p and which wouldn’t be local.
But that still won’t be sufficient to provide stable, sustainable finance to fund our services. So we need an honest debate about how we fund vital local services and think through what new funding options we need to make available to our local councils.
The game changing turn out in the referendum mustn’t be a one off. We need to seize the opportunity to reinvigorate democracy at every level. That means devolving decision making to the local and community level too. Involving people in the choices faced in budget decisions will help increase understanding of the huge pressures our councils face in providing the range of services we all rely on. Edinburgh Council’s “Take the Budget Challenge” is a good example of how to increase participation and debate http://www.edinburgh.gov.uk/budget
Our Labour Councillors and some in other parties too are using their leadership to make those changes, but they have one hand tied behind their back. That potential for civic leadership needs to be supported not crushed by year on year financial settlements which leave local authorities making increasingly unpalatable decisions.
We need to restate the principle of the engaged, supportive state helping tackle the root causes of poverty and inequality and engaging the support of the third sector and local business in that ambition.
Only the Scottish Labour Party has the vision and the commitment to deliver the powers and finance needed to make the reinvigoration of local government a reality. We don’t see council decisions as a stepping stone to another debate – they’re how we ensure local democratic accountability and empower our communities. But that needs a focus on how we use power. Our Labour values of social justice, fairness, solidarity and community need to be at the heart of the debate.
3 thoughts on “Time for double devolution”
Pretty much spot on. The only role central government should have in local government finance is one of evening out imbalances – some areas desperately need more money spent on them than they can easily hope to raise, while others have money to spare. The method of local government funding should be locally based and not subject to national constraints: the best basis is probably to use some feature that is unavoidably local in nature, e.g. fixed property and land. For a start, the current situation could be greatly alleviated by devolving the business rate back to local authorities.
It is now anticipated that the Scottish Independence Referendum will act as a catalyst for some devolution within England, which may be based on city-regions. If this is the case, Manchester, Birmingham, etc. will have a range of additional self-government powers and responsibilities. These could include powers over personal and business taxation as well as responsibilities for health, economic development, housing and structure planning.
If in Scotland these powers are retained at Holyrood, Scottish cities will be at a considerable disadvantage to the English regional cities and city-regions. The Commission should therefore also consider recommending that devolution should be extended to Scottish city regions, especially Greater Glasgow and Edinburgh/Lothians.
These could have a similar status as the German Hansestädte (Hamburg, Bremen) and Berlin which have a similar constitutional position to the federal Bundesländer (Brandenburg, Bavaria etc.) As in the case of Germany, this position also reflects the history of these cities which had been founded on international mercantile and industrial relationships, and were therefore anomalous in their domestic context. This is especially so in the case of Glasgow (‘Second City of the Empire’.)
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