Labour needs to get local

by Richard Watts

Today Jon Cruddas is set to speak to the New Local Government Network on what could be the answer to the key political question for Labour: how can we change the lives of people in this country with far less money than the last Labour government spent?

All political parties talk a good game on localism in opposition, but haven’t delivered in government. It was one of my criticisms of the last Labour government, and while David Cameron and Eric Pickles have talked about ‘giving power back to the people’ the reality has been a disastrous local government legacy that has seen real term budgets slashed and services up and down the country hanging by a thread. At the same time, ministers like Michael Gove have centralised power in Whitehall at a speed that would have Lenin nodding with approval.

But this time, even if Labour return to power in 2015, things for local government will be very different.  By 2015 my council will have lost over £100 million a year of funding; that’s around 40 percent of our budget. Funding isn’t likely to return to pre-2010 levels and borough’s like mine are being faced with two undeniable trends, a rising demand for services and shrinking budgets. Westminster politicians need to wake up to the fact that council budgets will fall off a cliff in 2015 and 2016 without a change in the way local government is funded.

However Britain wastes public money by spending far too much of it on managing problems through top-down national initiatives that smarter investment could have avoided.

The perfect example of this is government spending on housing benefit. Over the last ten years spending on housing benefit has doubled, in large part due to a lack of affordable homes that has meant more and more claimants are being subsidised in the private rented sector. Yet house building is currently at the lowest level since the 1920s. This has meant that for every £100 we spend on housing, just £5 is invested on building and £95 goes on housing benefit. This isn’t a sensible way to spend public money.

Another symptom of this British disease is that one family I spoke to had to tell their story 14 different times to different public servants as they tried to get services for their autistic son because different agencies weren’t talking to each other.  A massive waste of time and money and, more importantly, very distressing for the family.

This economics of the mad house isn’t the fault of one person or one party – it has built up over time and no major national politician has had the bravery or vision to reverse it.  Because, at heart, the problem of how we spend public money is caused by two very deep-rooted and intertwined problems: our over-centralised state and our political culture.

I say this because the current pattern of public spending, characterised as it is by initiative after initiative each designed to solve the problems caused by the last one can only be mended by the kind of wholesale transfer of power and responsibility to a more local level that John Cruddas is arguing for.

Take Andy Burnham’s work on joining up our health services, which we’ve already been piloting in Islington.  Joined-up health and community care is not currently the norm and this is Labour effectively responding to the health and social care crisis facing local government.  The up-shot of this could be money invested in keeping older people healthy, well-nourished and in their own homes, rather than spent treating avoidable illnesses in hospital.

But this kind of change can only be achieved with more devolution of power. Effective work between the NHS and social services can’t be mandated by Whitehall. It can only effectively happen through the local co-ordination of services.

In Islington we’ve also implemented a similar scheme to join up local services for families in need in the borough. In the past families may have had to speak to lots of people in different organisations (sometimes as many as 15) to get help. Now we’ve created a single contact in their local area who can offer help on a range of issues such as money worries, housing, parenting, physical or mental health and support with finding employment.

This has made a huge difference for families with multiple needs and makes It much easier for them to get the right type of support, while also saving the council vital resources.

Recommended in the Islington Fairness Commission, our First 21 Months initiative focuses on providing children with the best start in life through better coordinated and integrated services through pregnancy up to the first birthday.  For example, Islington’s GPs have shifted many of their antenatal services into Sure Start Children’s Centres so parents can link-up early with the other support available. A small change, but one that many families are benefiting from; and one that could only be arranged locally.

I’ve also been making the case for more control over localised employment budgets. In Islington we do a good job with the limited resources at our disposal, but the majority of the money spent in my borough getting people back to work is still on disastrous government controlled initiatives like the Work Programme. As Councils we have superior local knowledge and contacts with claimants through social services, schools and other services and would produce far better outcomes for our unemployed residents if given the same budgets.

In Islington we recently mapped the youth unemployment support in the borough for young people relating to work and skills opportunities. For young people between the ages of 13 and 24 we identified 27 national, regional and local agencies including the council, delivering 55 different schemes and programmes. This lack of coordination means that no matter our own efforts locally, young people can still fall through the gaps and vast amounts of public money is wasted on duplication.

So, a radical and reforming Labour government can really make public services work for people, but only if it has the bravery to let go and hand power down to local communities, and their representatives. This goes to the heart of why our over-centralised state and political culture is the problem.

Every party believes in localism in opposition, but the reality is when in power is it’s much harder to give away. It’s hard because ministers don’t want to give up the comforting illusion that they have their hands on the levers of power. It’s increasingly clear that the levers of power in Whitehall aren’t connected to anything, but ministers still like to make announcements as if they were. What’s more ministers that don’t play the game get criticised for inactivity and then inevitably get sacked.

It’s the army of civil servants (particularly at the Treasury), journalists, campaign groups and lobbyists that insist power must be held nationally that actually scupper attempts to devolve power. For them it’s far too convenient to keep decision making centralised in Westminster.

Today’s announcements and this week’s focus on public service reform has been much welcomed – especially to those of us in local government.  But for Labour to truly make devolution work, empower communities, make public services and public spending work for people, the party needs to be ready for a battle. I’m glad Ed Miliband and John Cruddas have decided this is a battle worth fighting.

Richard Watts is leader of Islington council


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4 Responses to “Labour needs to get local”

  1. swatantra says:

    Labour really does need to look at the Co-operative Party policies about giving actual power to the people; they’re quite capable of working co-operativrely to find solutions to local problems. whether it generating wind energy for local communities or housing coops managing their own estates instead of the council., even coop schools. Denmark leads on co-operative management in all areas, and we should learn from them. football fans can even get their Clubs to become co-operatives, working for the fans not for the sheiks and big business based abroad. The point is all the profits go back into the community to regenerate the economy, and even build their own flood defences. Labour really does need to open its eyes and wake up to the fact that The monolithic Stae cannot provide all services.

  2. Tafia says:

    And yet here in Wales- which is more staunchly Labour than England has ever been, we are toying with the ideas of reducing the number of councils, reducing the number of councillors, increasing centralisation and increasing the number of Assembly members as well as increasing their role and remit

  3. Martin stone says:

    The emerging policy on local government is almost incoherent. There is no indication of how power will be devolved nor how the Labour Party will address the implicit competition between local authorities established by the coalitions erosion of the principle of cross subsidy between LA’s inherent in the old mechanism for pooling local business rates and LA rents. If the management of social policy is reduced to a dichotomy between a centralised state or a local authority with devolved powers we are missing a trick. We need a coherent national consensus that frames what people can expect from health, education, welfare etc and a collective agreement on quality and standards, delivery can be devolved to local areas but the mechanisms for funding and monitoring need to be national if we are to avoid growing inequality between areas.

  4. Well said Richard. I joined the Labour Party thirty five years ago because we are the only party that would set up a Fairness Commission, as you have in Islington, even when budgets are being cut by 40%. I hope other Labour Councils follow. If Labour supporters read the Spirit Level, the book that inspired the Fairness Commission, it will tell you why we are right to be Labour and aim at wealth redistribution.
    I think it’s wonderful that Local Authorities are looking at efficiency. For too long I have stood on doorsteps in Leeds, London Boroughs and Bristol, asking for Labour votes knowing in my heart that Labour Councils of old were unnecessarily bureaucratic, and that Labour was not making a serious attempt to stop families in need having to explain their problems to 14 different public servants. Labour needs a mentality that is not obsessed with spending, or theoretical policy, but also the well managed best possible delivery of a policy. All too often our last government was not aware of this enough. We should aim for Labour Councils that voters know they can contact and get a swift, clear and straightforward response. This is not a ‘by the way’ – it should be at the core of the Labour proposition at a local level.

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