Shock election result leaves local government fumbling in the dark
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Richard Harbord
Well, so much for strong and stable government. An article immediately after the election looked to be very straightforward: landslide victory, clear manifesto, the place of local government assured.
Unfortunately, it has not quite turned out like that and I don’t suppose that the Conservative manifesto can be considered as a blueprint for the future. So where does the election leave us practitioners in local government finance?
There is a feeling which has been regularly expressed in post-election comments that this election is the end for austerity. I can see that voters generally are concerned about the current economic position and pay and inflation but I can only see that central government has a considerable deficit which still needs at some point to be eliminated. For that reason, I find it difficult to be optimistic about the amount of additional resources to come to the aid of local authority services.
There are many issues but there are two really major ones. The first of these is the need to find some acceptable and long-term solution to the funding of social care. This, of course was where a major difficulty occurred in the election campaign. Factually we know that the Cabinet Office has assembled an excellent team to look at this problem and to produce a green paper which was expected very early in this Parliament. That team, I am told, were totally surprised by the political announcement on social care made during the campaign. The announcement was incomplete, not thought through, and not sustainable. It would have been better just to say that a green paper would soon be produced and leave it at that.
That paper may be subject to some delay now as it will be necessary to take a wider view on its likely support. Although as a consultation paper, the sooner it comes out and professional input is given to it, the better. I am strangely optimistic that the green paper will produce a sustainable future system.
The second issue is about whether or not the Conservatives will achieve enough support to actually be able to govern. The alliance with the Democratic Unionist Party is, it would seem a relationship of convenience but it’s exact nature is not yet known. I did do some work in Northern Ireland and I was very impressed with their clear minded views on local taxation but, of course the local government system is very different in Northern Ireland. The major services tend to be provided centrally and all local taxation is collected by a central government agency. They were however very supportive of business rates and the consultation brought very little change. The big concern for local authorities here is whether the 100% retention scheme will be enacted or whether despite all the work that has gone into it we shall stay as we are. The Conservative Party did commit to a thorough review in their manifesto and that was echoed to a greater or lesser degree by the other parties. There are big challenges here about additional reliefs, the degree of support for small businesses, the cessation of grants, additional responsibilities and whether the work on the new fair funding review continues. That is needed to update the needs of local authorities comparatively.
The difficulty will be finding sufficient consensus for issues to be agreed. I imagine discussions around additional funding for the NHS and police will get wide support but other suitors for public resources may find the going difficult. The big elephant in the room is the negotiations with Europe which are due to commence on 19th June. These will be difficult and consume considerable resources and may leave little time for other matters to be handled. The opportunity to change our approach to these negotiations means that local government needs to be involved and their voice needs to be heard.
We may be heading up a cul-de-sac to another election. I hope not because there are many urgent problems requiring the government’s attention and another election may not take us any further forward.
Richard Harbord is the former chief executive of Boston Borough Council
