PLC Public Sector reports:
On 29 January 2013, the Political and Constitutional Reform Committee published its report on the prospects for codifying the relationship between central and local government. The report proposed the introduction of a code that would give local government greater control over its own affairs and clarify which responsibilities should rest with central government and which with local government. For information on the report, see Legal update, Political and Constitutional Reform Committee publishes report on codifying relationship between local and central government.
Given the support in local government circles for a code governing the relationship between central and local government, the government’s response to the report’s recommendations for a new constitutional settlement for local authorities in England that might achieve greater autonomy for local government has been eagerly awaited. That government response has just been published (see Government Response to the House of Commons Political and Constitutional Reform Committee Report (May 2013)).
Localism and decentralisation
In response to the Committee’s recognition of the commitment of all parties to the concept of localism and the government’s willingness to devolve powers from Whitehall to local government, the government:
- Welcomed the Committee’s recognition that progress on the concept of localism is being made.
- Confirmed its belief that power should belong at the lowest appropriate level and that there are benefits (such as stronger democracy, innovation and local growth) in moving power away from Westminster and Whitehall.
- Outlined the steps that it had already taken to free local government in England from the control of Whitehall, such as removing the regional tier of government (see Legal update, Government commits itself to abolishing Regional Strategies and returning decision-making powers to local councils) and passing power down via the Localism Act 2011 (LA 2011) with the general power of competence contained in section 1 of the LA 2011 reversing the position on local authority vires. For more information, see Practice note, Localism Act 2011.
- Confirmed that responsibility for commissioning public health services has been decentralised to local government in the new commissioning structure for health services contained in the Health and Social Care Act 2012. For more information, see Practice note, Health and Social Care Act 2012: commissioning structure.
- Cited City Deals, a series of tailored agreements under which certain powers (and funding) will be transferred from central government to the city, as an example of what it is willing to devolve to help deliver economic growth at a local level, see Legal update, New City Deals launched.
- Confirmed that it will be taking forward the majority of Lord Heseltine’s recommendations in his review on economic growth, see Legal update, Heseltine review on economic growth published.
- Considered that, taking all of the above issues into account, local authorities have unprecedented freedom and power to innovate and support their communities and there has been a shift in the balance of power with local communities in charge of their own affairs.
Therefore, although the government welcomed the Committee’s interest and ideas for further localism it considered that these should be seen in the context of the action that the government is already taking.
Codifying the relationship between central and local government
The Committee recognised that the draft code was not a finished product and that central and local government should engage to define the code further. In its response, the government:
- Referred to previous failures to codify the relationship, citing in particular the 2007 Central-Local Concordat. It believed however that these failures had occurred because such documents were about processes, rather than policy intended to improve outcomes.
- Was concerned that, instead of liberating local leaders, the codified relationship proposed might simply focus energy on theoretical debate rather than shared endeavour, problem-solving and action.
- Advocated an approach of introducing policies, linked to legislative changes where necessary. That approach avoids a “one-size-fits-all” approach and allows different responses to different challenges rather than seeking to establish a “rigid, constitutional blueprint” through a statutory code.
Financing greater local autonomy
In response to the report’s recommendation that local authorities should have unlimited ability to introduce their own taxation policies, subject to agreement from the local electorate, the government:
- Commented its belief that there is little public appetite for the introduction of additional local taxation and that it has no plans to do so.
- Confirmed its view of the merits for greater local control. For this reason, it had introduced new protections for council taxpayers through referendums and direct democracy.
A statutory code for relations between central and local government
In its response to the Committee’s recommendations that a statutory code setting out a stronger constitutional basis for local government could be beneficial to both tiers of government; and that it proposed turning the illustrative code into a draft Bill, the government:
- Expressed concern that any new statutory code could support an increasingly litigious culture, at a time when it is seeking to tackle red tape and safeguard judicial review as a critical check on the power of the state. For more information on the proposed changes to judicial review, see Legal update, Government announces outcome of consultation on judicial review.
- Indicated it would be interested in the substance of, and the reaction to, any draft Bill published by the Committee but that it did not believe that a case has been made for any amendment to the Parliament Acts 1911 and 1949 or for treating legislation affecting local government differently from other statute.
Next steps
In relation to the Committee’s proposals for continuing the dialogue, including hosting a conference to consider the next steps for the relationship between central and local government, the government welcomed the prospect of the conference and indicated that it was willing to participate in a debate about devolving responsibility and the options for practical reform. We will be watching further developments with interest.