04Conclusion

These proposed changes to local government may sound daunting. But they are not impossible, and there is lots of room for political choices along the way. Many of the objections are status quo biases that will dissolve upon a successful reform.

We have done this before. Reform of local government from 1972-1974 across Britain was a far more complicated task, and we have unitarized Wales, Scotland, and Northern Ireland to little complaint. The poll tax was unpopular not because it was a change of local finance but because of its regressive nature, a feature council tax now shares. Council tax when initially introduced to replace it was met with no controversy.¹⁴

Furthermore, reformed, financially stable, and well-incentivised local government provides a foundation for future public service reform, especially planning reform and employment support. Even just lining up public administration with consistent new geographies would provide enormous savings to taxpayers simply by reducing the complexity of governance, let alone actual devolution of public services.¹⁵ Some immediate examples include NHS Integrated Care Boards, Police and Crime Commissioners, and School Commissioners.

Stronger local authorities that have scale and are consistent across England are essential if the Government is serious about devolution and joined-up governance. In the long-term, it provides a way to reduce the role of quangos that act in single-minded pursuit of their mandate, by returning their responsibilities to mayors and sheriffs who can internalise the costs and navigate the trade-offs between different policy areas.

Some might say that local government is not ready for this level of devolution. But this is the wrong way around – local government is in the difficult situation it is in due to a lack of autonomy over its finances and its fragmentation. The crisis is not just a funding shortfall, but the culmination of enduring problems caused by structural issues within the system of English local government.

Unless things change, the Government risks a tide of municipal bankruptcies, failing local services, and improvements to the national economy that remain intangible to large parts of the country.

The Government must tackle the short-term challenges of local funding by resolving the long-term issues in English local government over this Parliament. The forthcoming devolution framework should use High Skill TTWAs as the basis for FEA geography, and aim to implement these reforms over this Parliament.