William Eichler 23 November 2017

Budget 2017: Council chiefs warn against ‘devolution deadlock’

Local government leaders today warned of the dangers of ‘devolution deadlock’ in their response to the Autumn Budget.

Philip Hammond unveiled a number of devolution deals in the North of Tyne region and the West Midlands as part of yesterday’s Budget and said the Government would get ‘all parts of the UK firing on all cylinders’.

The Local Government Association (LGA) welcomed the new deals but warned Whitehall that many more were needed to ‘reverse the growing sense of stalled progress and missed opportunities across much of the country.’

‘Councils want their residents to be able to enjoy ‘devolution delight’ rather than suffer ‘devolution deadlock,’ said Cllr Mark Hawthorne, chairman of the LGA’s People and Places Board.

‘The longer it takes to secure new devolution deals, the longer communities will have to wait to benefit from the opportunities currently available to areas where devolution has taken place.’

Cllr Hawthorne called for greater powers and funding to improve local transport, housing, health and social care, and skills.

‘Government needs to engage in an honest and open debate about the best form of governance able to foster thriving local economies across the country, including non-metropolitan areas, to ensure that opportunities for inclusive growth are not lost,’ Cllr Hawthorne continued.

He also called for further detail on the proposal for a common devolution framework and for an annual devolution report.

Mr Hammond confirmed a £1.7bn Transforming Cities Fund, with half the cash going to the metro mayors and the rest open to competition — an announcement the County Councils Network (CCN) criticised as being ‘city centric’.

Cllr Paul Carter, chairman of the CCN and leader of Kent County Council, said: ‘Government promised to spread growth to all four corners of England, and while we welcome the Housing Infrastructure Fund extension, many of today’s announcements, particularly the money for metro-mayors, were city centric.’

Cllr Carter said the Government’s Industrial Strategy ‘must ensure resource stretches beyond the cities’ and warned against an over reliance on Local Enterprise Partnerships when it comes to developing and delivering localised strategies.

‘CCN will engage with proposals when announced, ensuring county authorities receive a fair share of investment and are at the forefront of delivering the industrial strategy, underpinned ambitious devolution proposals and their role securing sustainable growth,’ he added.

Local government funding also remains a major concern for councils. Cllr Carter noted the NHS received an injection of cash while local authorities were left unsure about their financial future.

‘Counties face a £2.54bn funding gap, and while the NHS received yet further resources today, we are left waiting for the local government finance settlement to see whether we will receive further much needed support through the extension and increase in transitional funding,’ he said.

‘We hope the secretary of state for local government will be provided with financial flexibility to support local government.’

District council representatives have also made the same point, calling on Whitehall to provide more clarity on funding. They were particularly concerned by the chancellor’s decision to change the method of calculating business rates from RPI to CPI two years earlier than expected. 

Cllr John Fuller, chairman of the District Councils’ Network (DCN), said: ‘The impact of the changes to business rates from RPI to CPI must not result in local government funding reducing.

‘We await confirmation that local government will be no worse off next year as a result of this earlier switch and all future changes to business rates must be cost neutral for districts.

‘We also need further certainty around the move to 100% business rates retention.’

The National Association of Local Councils (NALC) reiterated this concern.

Cllr Sue Baxter, chairman of the NALC, said: ‘The budget does nothing to alleviate the growing pressure on parish funding, where local councils are continuing to take on more and more services including from principal (county, district, borough, and unitary) councils.

‘Measures announced on business rates should again go further and provide a share for local councils to support their work in the local economy.’

There was a more positive reaction to Mr Hammond’s announcement of a £1.5bn support package to help address concerns raised about the delivery of Universal Credit (UC).

The DCN’s Cllr Fuller said: ’The changes to Universal Credit are important for district authorities and will reduce the demand on our services for those in need who require emergency help and are concerned about homelessness and arrears.’

‘We know that universal credit is causing significant hardship and that the lengthy waiting time for the first payment is a significant problem,’ said Gavin Smart, deputy chief executive at the Chartered Institute of Housing (CIH).

‘Today’s measures to help people suffering as a result of the delays are welcome. We hope to see further progress on some of the other issues affecting universal credit claimants, including administrative delays and lack of information.’

The National Housing Federation (NHF) also welcomed the announcement on UC, describing it as the ‘highlight’ of the Budget.

‘The undoubted highlight of today’s Budget was the announcement of changes that will make a huge difference to the thousands of tenants struggling on Universal Credit,’ a spokesperson said.

‘The seven day wait will be removed from the start of a Universal Credit claim, which effectively gives claimants an extra’s week’s money and reduces the amount of time they will wait. Universal Credit claimants will also now continue to receive Housing Benefit for two weeks, which will help prevent tenants falling into arrears.’

‘These are welcome changes and combined are likely to relieve some of the difficulties tenants and housing associations have faced since the start of the Universal Credit roll-out,’ they added.

Image: Sovastock / Shutterstock.com.

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