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Local government’s devolution problem: powers without money

Local government’s devolution problem: powers without money

🕔14.Mar 2014

Great minds think alike, the possibly Confucian proverb insists. While those bright RJF guys were planning their Devolution Week, some equally bright guys at the Council of Europe (CoE) in Strasbourg thought: Why don’t we pre-release our report on devolution in the UK, prepared for our Congress of Local and Regional Authorities (CLRAE) at the end of March, to coincide with the Birmingham gig?

OK, it probably wasn’t quite like that, but it’s certainly what happened, and it seemed apt to round off the week by airing some of CLRAE’s fruitier views.

First, some words about CLRAE – partly for the benefit of Daily Mail readers, who were told last weekend that it’s an “obscure committee – which includes an ally of Putin”. Obscure, that is, as in previously unknown to the Mail’s columnist, which I fear must cover a worryingly high proportion of human activity.

Briefly, the Congress of the Council of Europe (not, please, to be confused with the wholly different Council of the EU) is a pan-European political assembly, the 600+ members of which represent over 200,000 local and regional authorities in the 47 CoE member states.

Its function is to promote local and regional democracy and strengthen local authorities’ self-government, and it does this in myriad ways, from issuing statements to writing expert monitoring and advisory reports.

To give a flavour, the Congress President “condemned” this weekend’s Crimea referendum, organised “at such short notice, using closed questions, without consultation with the national authorities and in the unauthorized presence of military forces, in flagrant violation of international law” as “a travesty of the democratic process.”

No, of course it won’t stop the referendum, but it does illustrate that the Congress doesn’t mince words, either over Ukraine or UK local self-government.

The UK report was produced by the Congress committee responsible for monitoring member countries’ compliance with its European Charter of Local Self-Government, similar in nature to the European Charter on Human Rights and again nothing to do with the EU.

The Charter, introduced in 1985, commits ratifying member states, in a set of 18 Articles, to guaranteeing the political, administrative and financial independence of local authorities, and provides that the principle of local self-government be recognised in domestic legislation and, where practicable, in the constitution.

It was also the first legal instrument to set out the principle of subsidiarity – that a matter ought to be handled by the smallest, lowest, or least centralised authority capable of addressing that matter effectively.

Little known in this country, and indeed little practised, subsidiarity is a common and important principle of European law – and possibly part of the reason, along with the bits about local authorities’ financial independence, why the Thatcher and Major Governments spent 12 years refusing to sign or ratify the Charter.

As the reference to Ukraine (who signed in November 1996) reminds us, there are plenty of CoE member states in even more urgent need of monitoring than the UK (signed June 1997), and our own previous monitoring report was back in 1998.

The New Labour Government, enthusing particularly about its unfolding devolution agenda in Scotland, Wales and even Northern Ireland, managed to convince the monitors that it was already addressing some of the previous Governments’ overly interventionist tendencies that they’d observed: how, for instance, “central Government feels the necessity to put local government under some kind of ‘control’ or ‘supervision’, linked with the trend that has seen the financial autonomy of local government progressively eroded during recent decades.”

This year’s monitors included – in addition to the Chairman of a Russian Regional Legislative Assembly, conceivably an “ally of Putin”, and to the Daily Mail therefore at least a minor criminal – a German Bürgermeisterin (mayor) and a Professor of comparative constitutional and European Law.

They were certainly impressed by the establishment and operation of the devolved assemblies, but, if anything, saw it as emphasising the failure to address ‘the English question’ and other deviations from the letter and spirit of the Charter.

“Areas of concern” comfortably outnumbered the plus points:


  • “The constitutional or legislative recognition of the right to local self-government does not exist in the UK, and the introduction of a general power for local authorities does not go far enough.”
  •  “Local authorities do not have adequate financial resources, are under severe constraints as a consequence of cuts and indebtedness, and are faring worse than other public sectors and the national government in weathering the effects of the economic crisis (in spite of the very welcome government reform of 2013, localising business taxes), all of which contribute to a situation that raises issues under Article 9 of the Charter” – i.e. authorities’ lack of financial resources is restricting their ability to perform certain functions, to determine expenditure priorities, to exercise properly councillors’ political choice of weighing the benefit of services provided against the cost to the local taxpayer or user, and so on.
  •  “The status of elected councillors does not fully correspond to their responsibilities and the low turnouts at local elections indicate the necessity to strengthen the democratically elected institutions as well as the role of elected office holders who are the backbone of the local government system.”
  •  “Local authorities do not have sufficiently prominent leadership and co-ordinating functions vis-à-vis other service providers within their local area.”
  •  “Oversight through extensive reporting duties and active involvement in local affairs by various ministries of the central government poses considerable limits on local authorities’ discretion to manage local affairs.”


There is, believe me, a great deal more along the same lines – so much that it is hard to know how to summarise. I was particularly struck, however, by a paragraph near the end:

“The central problem in England might currently still be characterised as ‘powers without money’. Considerable powers are ‘given’ by central government which nevertheless retains influence and control over a large part of local government finances. Taken together with the enormous financial constraints on local authorities as a consequence from cuts and indebtedness, these limitations risk curbing local government’s freedom of action and decision-making considerably.”

It’s an unusually outspoken and comprehensive critique from an internationally authoritative and respected body – of which incidentally we are a signed-up member – which surely deserves at least a respectful and considered response. Remember, though, that the complete ‘great minds’ quotation has two parts: Great minds think alike, small minds rarely differ.

And in this case there was little to choose between the micro-mindedness of the Daily Mail and that of Local Government Minister, Brandon Lewis: “The UK Government has a strong record in promoting democracy, liberty and transparency. We welcome free debate, but we are not going to take lectures on this from Putin’s United Russia Party.” You do wonder sometimes: what awful things did local government do to deserve this?

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