The localism agenda received a powerful boost this week, when a key Commons committee castigated Whitehall for dragging its feet over devolution to local government. In its conclusions from an inquiry into the balance of power between Whitehall and town halls, the CLG select committee called for ‘wholesale cultural change' across central government, and a reform of council finance. Going further than the 2007 Lyons report, the all-party committee called for a local income tax to run alongside council tax, the return of business rates, an end to capping, a power of general competence, and new commissioning powers for councils over health and policing. It added: ‘We can see no reason why most aspects of local health and policing should not become the responsibility of local government.' The report said that both the 1976 Layfield and Lyons reports recommended a shift in power to local government, and the evidence to the Commons committee ‘has led us to the same conclusion'. It added: ‘The Government response to both reports serves to highlight enduring Government resistance to a radical enfranchisement of local government.' The report The balance of power: Central and local government also rejected ministers' claims that they had steadily devolved in recent years, saying their record was ‘mixed.' Dr Phyllis Starkey who chairs the CLG committee said: ‘Central government must take radical steps to tilt the balance of power towards localities, and local government must become more ambitious.' She added: ‘Local authorities know their communities better than Whitehall, particularly, when it comes to local health inequalities, policing needs or tackling the local impact of the economic recession.' In response, local government minister, John Healey, said: ‘The Government has already given councils more financial freedom to meet local needs and priorities, including the first-ever three-year funding settlement, billions of pounds of grants with no spending strings attached, and new legislation to allow them to charge a business rates supplement. ‘But, it is right that the Government continues to protect council taxpayers from excessive increases.' He added: ‘Councils can already work in formal partnerships with health and police services through LAAs, MAAs and new city-region pilots so that local governance can go beyond traditional council borders to deliver across the whole local economy.' He added: ‘We have no plans to change the current structure of council tax or to introduce a local income tax.' The select committee proposed that: ministers should set a higher threshold before intervention Department of Health and Home Office should work with CLG to establish a local authority commissioning model for local policing, health and healthcare supplementary local income tax should be introduced alongside council tax with a corresponding reduction in central taxation, business rates should return to local authority control, and capping should be scrapped the Government should prove its ‘localist' credentials by introducing ‘constitutional' legislation, placing the principles of the European Charter of Local Self-Government on a statutory footing.
