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It is always a great pleasure to follow the noble Lord, Lord Bird, with his very many direct experiences of local government. I declare my interest as a vice-president of the Local Government Association. I very much share his views about the importance of local authorities to vulnerable people, people who have suffered, people who just cannot manage—yet cuts to local government have hugely increased over a period of an unprecedented increase in poverty.
There is evidence of that all around us. The number of rough sleepers has increased by 15% over the last year and by 169% over the last eight years. Some 4.1 million children are living in poverty. Some 24% of refuges for victims of domestic violence have closed. We have elderly and vulnerable people frightened for their futures as they read about the number of homes shrinking due to lack of council funding. Libraries have closed as funding has been cut by £12 million in the last two years. I have to say that in my community there is a general feeling that there is nothing for many people and that they and their families are not valued. Even with several jobs, many parents find it difficult to provide for their families’ basic needs. All this comes as we see major cuts and changes to the benefits system in the form of universal credit.
Local councils, with their range of services, are by far the most able to deliver universal support for people moving on to universal credit, yet the Government have not provided the funding needed: instead, they have commissioned the CAB to deliver this. Of course, CAB is a marvellous organisation, but the pressures on its services at the moment are enormous and we are often told that many of the people on our streets are there as a result of their inability to access their benefits. The noble Lord, Lord Kerslake, told us that the UK is one of the most centralised and geographically unequal countries, and he gave evidence of this. Certainly, in my time as leader of my council I felt the frustration of 80% of local government funding coming directly from the Treasury. Many people asked me, “Why on earth should we vote for you? All you do is administer the Government’s cuts”. It certainly is a very good question.
If we look at other countries, we can easily see that the UK has one of the most centralised systems in the world. There is plenty of evidence that the whole system needs to be overhauled. We have seen how the constitution, in its informal form, has broken down in Westminster, and if we look across the country we can see that it is breaking down there as well. Many people say to me that there is a view that we have two countries: one is called London and the other is called the rest of the country. That is not to say that there are not a host of problems in London, but they are different from those elsewhere. As one of the most successful world cities, London attracts large numbers of the most wealthy in the world. It certainly receives far more in capital investment than any other English city, yet the struggle for the less well-off to meet the cost of living in the capital is intense. Other cities desperate for investment—for example, in transport—must queue up at the Department for Transport to be told that they have to wait their turn.
As for investment in the local economy, such devolution as has taken place requires legions of lawyers wrangling with government officials for sums of money that would cause derision in any international context. Indeed, as a leader of a UK city I met leaders of other cities, particularly in Europe, and their mayors and leaders were absolutely astounded at the few powers afforded to leaders in local government here. While being tightly controlled by central government, local authorities do not even have confidence in their woefully London-centric and very often incompetent masters when it comes to delivering on local needs. How much potential to achieve higher growth, greater productivity, more well-paid jobs and high levels of investment is there in our UK cities? There is massive potential.
The evidence is everywhere—in the City Growth Commission’s report; in the report of the inquiry chaired by noble Lord, Lord Kerslake, and commissioned by the APPG on devolution; in the ResPublica report, Restoring Britain’s City States; in reports by the non-metropolitan commission, the Local Government Association and many others. All of them demonstrate the potential for innovation, enterprise, inward investment and growth in our regions if they are freed from the dead hand of central government and given real powers.
A Core Cities report cites the potential to add £70 billion to £90 billion to GDP if cities and regions are given the powers to do so. In my view, there is a need for a new constitutional settlement that defines the relationship between local and national government. Again, we are told that local government controls a fifth of national spending, yet the relationship, responsibilities, rights and accountabilities are nowhere clearly defined in any one document.
The success of strong, devolved local powers can be seen particularly in our European neighbours, who have local tax-raising powers and the means of raising capital and investing in public infrastructure. Local government must also have these strategic powers. It must have the powers to raise long-term capital; economic strategies must be decided locally; and training for skills must be evaluated locally, with funding allocated according to local needs. If local government is to be effective, it needs to be transparent and accountable to the people who pay for it.
The local needs of support for the vulnerable, for social care and the civic fabric are a matter for the local electorate, not for the command and control of Whitehall. Those of us who do not live in London appreciate the differences between regions—we heard from the noble Lord, Lord Liddle, on Cumbria, and from colleagues in Cornwall and Yorkshire. Their needs, priorities, strengths and weaknesses, and their wealth of experience should be reflected in their local government.
Following the upheaval of Brexit, more and more people will demand not just to take back control from Europe but to take back local control—to demand that their local needs are met and to see to it that there is fair funding and fair investment for their part of the UK. They will hold their leaders accountable, both locally and nationally, and it is our job to take those ambitions and aspirations seriously and move forward.