The expansion of arms-length government is not necessarily at odds with democratic accountability

02/03/2015 / inlogov / Leave a comment

How democratic is arms-length government? Catherine Durose, Jonathan B. Justice and Chris Skelcher argue that those who consider it to be an undemocratic phenomenon over-simplify, and make the case for assessing the question in a more citizen and community focussed manner.

It is relatively uncontroversial to assert that modern democracies should aspire not only to democracy but also to efficiency and reliance when and as appropriate on expert, evidence-based judgments in designing and implementing governing arrangements and public policies. It is also frequently accepted that these values are often at odds with one another. Can we have both democracy and efficiency in governance? The still-expanding practice of decentralization and delegation of a variety of activities from national and subnational governments to a variety of non-state organizations has been portrayed as evidence supporting both negative and affirmative answers to that question.

Is this practice of “arms-length government” – the use of organisations other than government departments or ministries to undertake public functions such as developing policies, allocating resources, delivering services, and performing a variety of regulatory and adjudicatory functions – counter-democratic? Our research suggests that the answer is something like “not necessarily,” and “it depends.” Close centralized state control is not in every case necessarily democracy-enhancing, but neither can it be dispensed with thoughtlessly.

The challenge for institutional designers and operators is to distinguish the specific combinations of objectives, contexts, and governing designs that can achieve a favourable balance of democracy, expertise, and efficiency. More controversially, we suggest that many well intentioned advocates who share those three broad goals may need to abandon their familiar state-centric perspectives on the problem if they hope to solve it.

One dominant, state-centric perspective on arms-length government sees it as delegated governance, and suggests that agency problems and conflicts of interest will tend to lead to a democratic deficit when governing tasks are delegated (by the elected representatives who lead the state, which is the seat of legitimate collective authority) to independent agencies or quasi- or non-governmental organizations.

From this perspective the use of “arms-length” or “third-party” entities may be portrayed as a way to ensure market efficiency, reliance on technical expertise, and consistent decision-making and implementation, albeit at the expense of diminishing democracy by reducing the directness of elected representatives’ control over decisions and operations. Or, in some variants of the argument, this delegation trades “democracy” in the form of maximizing individuals’ welfare against “democracy” in the form of engaging individuals actively and expanding their capacity for collective self-determination.

An alternative, “polycentric” perspective articulated in the work of scholars including Elinor and Vincent Ostrom, Bruno Frey, and Archon Fung, views the state not as the sole seat of legitimate governing authority but rather as one locus of democratically legitimate decision making and authority: often necessary, but not always an optimal or sufficient instrument of self-governance and collective action.

This perspective views individuals and communities rather than the state as the basic locus of legitimacy, and suggests that questions about the normative desirability of governing and service-provision arrangements should be approached empirically and on a case-specific basis. This approach complicates the task of design and evaluation by offering only “it depends” as the generic answer to the arms-length question, but compensates for the additional effort by offering a way for us to see and realise possibilities that might be missed by dismissing non-state institutions of collective action out of hand.

We recently completed a multi-year project, funded by the ESRC, that brought together scholars, practitioners and activists from several countries, sectors, and types of organisation to explore the question of “arms-length government” or “governing beyond the state” in research seminars we organised at the University of Birmingham and De Montfort University. We took away from those discussions an appreciation of the manifold ways in which the polycentric perspective offers not just a valuable theoretical framework for designing and evaluating governing arrangements but also a way to make sense of the astonishing variation in the types and quality of arrangements in use today.

One set of lessons drawn from the seminars is compiled in the pamphlet Beyond the State: Mobilizing and Co-Producing with Communities. In the first part of the pamphlet, organizers Alejandra Ibañez and Lina Jamoul and researcher Liz Richardson demonstrate how community organizing and self-organization can potentially mobilize local resources for the co-design and co-production of services and empower diverse communities through constructive advocacy and negotiation. They trace the progression from oppositional mobilization to the negotiation of arrangements that generated shared power to and within case studies from Chicago and London. In the second part, Catherine Needham, Janet Newman, Chris Sherwood, and Jess Steele note that the language of co-production encompasses both the liberation and empowerment of power to and power with, and a darker side of more coercive personalization of centrally designed and dispensed services.

In a subsequent review of academic literature on arms-length government, we built on a key insight we gained from the contributors to the pamphlet. A shift in perspective from the state-centric model of legitimate and accountable governance to a polycentric perspective facilitates the analysis of approaches to collective choice and public policies in ways that engage with the potential for undemocratic or inequitable results as one relevant design consideration, rather than as an inevitable product of “delegation” by elected officials. (The article, published in Policy & Politics, is available here.)

In short, blanket generalisations about the negative implications of arm’s-length government for the quality of democracy, based on narrowly state-centric models of democratic legitimacy and accountability, are often factually incorrect and unnecessarily limit the scope of analysis in ways that may foreclose opportunities to increase both democracy and efficiency. At the same time, in the world of political practice, the increasing frequency and diversity of applications in a variety of contexts provides an abundance of material for thoughtful empirical assessment, particularly if we approach it in a way that views strong state institutions as one part of a larger configuration of institutions, rather than as the only legitimate seat of democracy.

And in fact, it is clear that citizens, practitioners, and scholars around the world are taking up the challenges of designing, implementing, evaluating, and then redesigning configurations of institutions and practices that sometimes manage to increase community power (to and with) and democracy.

Jonathan Justice

Dr Catherine Durose is Senior Lecturer and Director of Research in the Institute of Local Government Studies at the University of Birmingham and works with the Public Services Academy.

Jonathan B. Justice is Associate Professor, School of Public Policy & Administration, University of Delaware

Chris Skelcher is Professor of Public Governance, Institute of Local Government Studies at the University of Birmingham

This blog also appeared here.

The future is analogue – confirms local government’s Honey Man

26/02/201526/02/2015 / inlogov / Leave a comment

Chris Game

Of all the reactions to Northamptonshire County Council’s controversial ‘Next Generation Model’ – abandoning service provision in favour of outsourcing everything to ‘specialist social enterprises’ – few can have been as measured and dispassionate as my colleague Ian Briggs’ reflections on the merits or otherwise of Public Interest Companies (PICs).

Personally, it came as a bit of a blast from the past. Typing that opening paragraph, I really couldn’t recall when I last consciously thought about that particular three-letter initialism that once seemed to feature in a good proportion of my lectures. Especially following the 2004 Companies Act, PICs were ubiquitous, and taxonomising them – and/or CICs (Community Interest Companies) – quite a fad: national and local, companies limited by guarantee, industrial and provident societies, limited companies owned by service users, unincorporated associations, social firms, share trusts, mutuals, co-operatives.

So, rusty as I am, I admit to being curious about how Northamptonshire’s down-sizing vision works out once it leaves the drawing board. This blog’s concern, though, is not Northamptonshire’s or any other single council’s future, but that of English local government as a whole – which, in a neat triad of happenstances, was also addressed last week, in the final report of the Independent Commission on Local Government Finance (ICLGF), Financing English Devolution.

The third part of the triad, unfortunately, is directly relevant only to those of us residing within reach of Birmingham’s fine Repertory Theatre, which also last week staged a highly successful production of Tyrone Huggins’ play, The Honey Man. So, three disparate events from which, if you’ll bear with me, I’ll attempt to draw a coherent theme.

The ICLGF was established by the LGA and CIPFA, and is chaired by Darra Singh. The former chief executive of Ealing and Luton Councils bears little physical resemblance to the St Kitts-born author/actor Huggins, but, if his report has the transformative impact he obviously hopes, he could reasonably claim in, say, a decade’s time, to have been English local government’s Honey Man.

Digitals see the world in terms of ones and zeros, black and white, right and wrong answers, clearly defined systems. Analogues understand and deal in approximations, probabilities and muddle, 50-plus shades of grey.

Successive governments – ministers and civil servants both – have tried for years to run local government as a single, centrally controlled, one-size-fits-all digital system. ‘Honey Man’ Darra Singh’s message is that, while local services will be delivered increasingly digitally, the delivering ‘system’, insofar as there is one, will be increasingly analogue.

Huggins’ Digital Projects have not been that extensively performed. Even so, it would be hard for their collective impact to have been any less than that of the first three efforts in the Local Finance Reform Quartet: the Layfield Committee (1976), the Balance of Funding Review (2004), and the Lyons Review (2007). All three started from the premiss that the status quo is unsatisfactory – lacking transparency, fairness, balance, and accountability – and major reform vital. Yet all were either ignored or, in Lyons’ case, attacked and effectively rejected by ministers within hours of publication.

This time, the reflex rubbishing was administered by Local Government Minister Kris Hopkins, who immediately dismissed the Commission’s proposals for local areas to determine the number and value of council tax bands, and for tax increase referendums to be abolished.

No change there, then – and clearly there won’t be from the present Conservative-led coalition. The question is whether the new lot after May accept that this time the Commission really isn’t crying wolf: that the future now facing many, if not most, councils – severely less money, increasing and more complex service demands, and cripplingly limited scope to raise additional revenue – really has regressed from unsatisfactory to unsustainable. And recognise too that, following core grant cuts of 40%, radical reform is no longer urgent but imperative – if, that is, anything resembling a viable, democratically accountable, service-providing local government sector is to have a future.

There is of course, and always has been, an alternative: the wholly Contracting Council, famously envisioned in the 1980s by Conservative Environment Secretary Nicholas Ridley as meeting once a year to award all the council service contracts to private firms. A number of councils in recent years have gone some way down that road – most notably perhaps Suffolk and Barnet – and now Northamptonshire is preparing to go a good deal further.

Northamptonshire County Council, employer ten years ago of nearly 20,000 full- and part-time staff, plans in future a workforce of 150 max, with services formerly provided by the council or by council-run companies and partnerships being commissioned from external organisations: a Children’s Services Mutual, an Accountable Care Organisation for vulnerable adults, a Wellbeing Community Organisation, and a Place Shaping Company “to deliver services to improve Northamptonshire as a place”.

It’s analogue service provision alright, and pioneering, but not in the quite the form the Commission’s final report sets out. Nor last October’s interim report, although, reflecting the quite startling speed with which events have moved since the Scottish independence referendum, the two documents do have differing emphases.

The interim report, Public Money, Local Choice, underlined the need for council tax reform and for a desperately overdue property revaluation and banding revision. But the headlines it earned were all about how, through full – rather than the present partial – retention of business rates and appropriate ‘equalisations’ between richer and poorer councils, English local government could by 2018-19 become financially self-sufficient and independent of central government grant funding.

There was an interim vagueness about how these equalisations would be managed, and a somewhat cavalier assertion (p.18) that “there is less disparity in wealth between the different parts of the country than in often assumed.” The brief equalisation discussion, though, like the report generally, focused on individual local authorities, even down to numbers of toppers and toppees: “On 2018-19 projections, self-sufficiency would require 247 councils to ‘top up’ 106 councils. Most of this could be managed through transfers between councils in the same area.”

There was a passing reference to Combined Authorities perhaps playing a part in this redistributive process, but otherwise no mention of these institutions that since then have so dominated local government discourse – while the Pioneer Authorities that take centre-stage in last week’s final report weren’t even embryonic.

The Commission’s blueprint isn’t as immediately arresting as Northamptonshire’s and its timescale is inevitably longer. But, if even substantially implemented, the shift of the central-local balance from Whitehall and Westminster to English cities and regions would be profound. Following a 10-year devolution programme, more than £200 billion of annual public spending would be controlled at ‘sub-national’ level – or twice the current total of English local authorities’ net revenue service expenditure.

The key analogue feature of the Commission’s programme is what tekkies would call its two- or variable-speed gearbox. All councils would have multi-year funding settlements, freedom to set council tax and tax discounts, and would retain 100% of business rates and business rate growth.

But there would also be ‘Pioneer’ authorities: combined authorities wishing and judged able to reform at a faster pace. These could vary council tax bands and undertake their own revaluations, have access to new or devolved taxes like stamp duty, tourism and airport taxes, and, most significantly, would control single place-based budgets covering a full range of public services, including transport, community safety, and – starting already with Greater Manchester – health.

As the Honey Man’s Commission notes, the analogue principle of variability has already been established, with city deals and devolution packages to Combined Authorities. These latter are clearly the key – which is why the honey coming the way of Birmingham and the West Midlands so far has been mostly the unblended stuff, while Greater Manchester is already onto the organic.

Chris Game is a Visiting Lecturer at INLOGOV interested in the politics of local government; local elections, electoral reform and other electoral behaviour; party politics; political leadership and management; member-officer relations; central-local relations; use of consumer and opinion research in local government; the modernisation agenda and the implementation of executive local government.

An earlier, more Birmingham-focused version of this blog appeared in The Chamberlain Files.

All eyes on Manchester

25/02/201526/02/2015 / inlogov / Leave a comment

Catherine Needham

If you live in Birmingham, like I do, you could be forgiven for feeling slightly green-eyed at what is going on in Manchester at the moment. After the unprecedented devolution package that the city secured at the end of 2014, it has today been announced that Greater Manchester will be given complete control of its £6 billion NHS budget.

This means that Greater Manchester, led by a directly elected mayor, will have control of the budgets for social care; GP services; mental health; and acute and community care, as well as public health. There is clearly enormous potential here for the Manchester region to make integrated health and social care a reality. Whilst the dust settles on the details of the new arrangements, there are a few issues to consider:

There are increasing calls for integration to be at the level of the individual rather than the system, to avoid some of the problems of previous attempts at structural integration such as Care Trusts. Further structural reorganisation will also be resisted by local NHS bodies, still recovering from the Lansley reforms. Can the region be imaginative in its approach to integration, and learn lessons from what has worked and not worked in the past?

A new Greater Manchester Health and Wellbeing Board is being created to oversee the budget. Health and Wellbeing Boards are increasingly seen as the host for tackling all sorts of complex health and social care issues, and researchers at the University of Manchester have warned of placing ‘unrealistic expectations’ on the ability of boards to deliver on these agendas.

Will the notoriously centralised Department of Health really be willing to let go control on such a grand scale? Who will bear the reputational risk when problems occur?

The success of directly elected mayors has been distinctly mixed where they have been tried elsewhere in the UK. In the Greater Manchester context, where a mayor has been forced on the region by Whitehall, how likely it is that there will be sufficient public interest and support for the role to make the holder of the office a dynamic political force?

Does the announcement signal the end of the National Health Service, and if so should we mourn its passing? Local political control is very attractive in what has previously been such a centralised state, and is clearly in line with what is happening in Scotland and Wales already. However fragmentation brings the inevitability of postcode lotteries and the need for a robust political response to such differences, but it may also create new entry points for other political agendas, such as an increase in privatisation.

It must be a very exciting time to live in Manchester, although the role of pioneer can also be a rather exposed and risky place. Let’s hope that Birmingham and the other core cities can watch, learn from what’s worked and what hasn’t, and be ready soon to work with their own near neighbours to secure more local control.

Catherine Needham is Reader in Public Policy and Public Management at the Health Services Management Centre, University of Birmingham, and is developing research around public service reform and policy innovation. Her recent work has focused on co-production and personalization, examining how those approaches are interpreted and applied in frontline practice. Follow Catherine on Twitter: @DrCNeedham.

This blog can also be found here on the Health Services Management Centre’s website

Getting to Grips with Public Interest Companies

23/02/201526/02/2015 / inlogov / Leave a comment

Ian Briggs

The recent announcement by Northamptonshire County Council heralding a move towards a ‘next generation model’ where four public interest companies are to be established to deliver front line services and leaving a core client organisation of around 150 employees adds to the growing number of councils (and other parts of the public sector) who are seeking to adopt this model. What is interesting here is that is goes far beyond the tired rhetoric of what is best, direct public provision or privatisation? The establishment of what are increasingly referred to as ‘public interest companies’ (PIC’s) has been slowing gathering pace in recent years, often quietly and tentatively by local authorities who may seek cost and value advantages in working with arm’s length bodies but wish to retain certain controls whilst at the same time offering freedoms to compete in open markets.

There may be a longer history to this model of provision than many may believe; however this approach does beg some interesting questions and exposes the relative lack of research and meaningful data as to the overall efficacy of the approach. Near the top of the list has to be what might this do to the market for services? Putting a potentially highly efficient, skilled and savvy organisation into the market place might be seen as a threat to any commercial provider who currently occupies part of this market space. The example of an East Anglian council who established a comparatively small arm’s length company to manage property services some years ago has grown into a successful organisation that operates in many parts of the UK, trading services within a growing number of public and commercial clients. The efficiency returns for the growing number of public sector clients will be welcomed but it can potentially have the effect of diminishing the returns of existing commercial organisations – there may be no inference at all that the trading position is in any way illegal but where staff are transferred to public interest companies they do so with a great deal of knowledge and intelligence as to what both the client and community requirements are that can be both difficult and expensive for a commercial provider to obtain.

The second interesting question is one that can be summed as ‘mind-set’. The strategic leadership of public interest companies face unusual challenges; given that the shareholding is exclusively within the public sector that shareholder will have more than just an economic interest in success, it can and does demand more than economic viability. It must ensure that the needs of the public are met and that the social value of delivery matches the economic value, something that it can be argued is not always present in wholly commercial shareholdings. Reconciling this is a new challenge for those within PIC’s. In most recently established PIC’s most of not all staff are being transferred over from the public sector and work has to be undertaken to develop a mind-set that meets the challenge of delivering to a commercial agenda as well as a public one. Failing to do this successfully can be handicap hard to overcome and may be ultimately a cause of commercial failure. This leads to the third and crucial question. Even with a small and proficient client organisation are there the right skills there to create the conditions to enable the next generation model to prosper and provide successfully for the communities served? If the right depth of commercial analysis has been undertaken and the politicians driving the new model are confident that the model and market is correct are they able to act as an intelligent shareholder on behalf of the community? It may be no good having a fresh, hybrid mind set within the PIC if it is not matched with understanding and the correct support from the client organisation. Getting beyond a vanity decision and having a realistic expectation that anything as new as a next generation model provider will need a bedding in period to operate within the tensions between a commercial market and public expectation requires tolerance and understanding of councillors and senior managers.

With a growing number of councils actively exploring this approach there may be a lesson for those who are dithering – being late to the game could leave no space to enable PIC’s to be established as your neighbour has done it for you! Whatever direction this takes it is perhaps one of the most fundamental shifts we have seen since the days of CCT, no longer public bad – private good but a half-way house creating demands for new skills both within PIC’s and in slimmed down intelligent clients. Get in wrong on either side of this equation and retrieval could be more problematic than getting off the ground in the first place. That a growing number of PIC’s are already out there quietly getting on with it may suggest that the decision Northamptonshire has taken is not merely brave but one that is based upon sound good sense.

Ian Briggs is a Senior Fellow at the Institute of Local Government Studies. He has research interests in the development and assessment of leadership, performance coaching, organisational development and change, and the establishment of shared service provision.

Pickles’ Shock-horror News: Biggest Councils Have Biggest Tax Arrears

19/02/201526/02/2015 / inlogov / Leave a comment

Chris Game

Communities and Local Government Secretary Eric Pickles is famed for his sensitive news antennae. I wonder therefore just what – in a week dominated by revelations of his party’s and government’s moral flakiness on the whole tax collection business – persuaded those antennae that it would be a good time to attack local authorities’ tax collecting record.

Actually, I don’t wonder. I assume that, as with the many other Pickles’ Passions – from council newspapers and biscuits at meetings (bad) to street parties and weekly bin collections (good) – he just can’t stop himself.

Councils’ uncollected taxes and hoarded revenue reserves have become Pickles’ winter perennials – a reassuring sign of approaching spring – and three league tables of the supposedly guiltiest councils were duly posted by the DCLG last Tuesday.

As a Birmingham City Council taxpayer, I was naturally interested to note that Birmingham featured prominently on two of these naughty lists – first of the 10 councils with highest council tax arrears, and fourth of those with highest non-ringfenced reserves – and, to be honest, slightly surprised that it didn’t register at all on the third. Doubtless to the minister’s disappointment, DCLG hadn’t found a single “surplus fixed asset, not directly occupied, used or consumed in the delivery of services”.

There’s no attempt to percentagise these lists, or acknowledge that there might just possibly be some relationship with, say, the size or relative deprivation of councils’ populations. So Pickles’ shock-horror story amounts to large councils having bigger tax arrears, reserves, etc. than small councils.

It’s hardly headline stuff, but Local Government minister, Kris Hopkins, was determined we should share his boss’s outrage. During that same day’s Commons debate on the recent local government finance settlement, my and the University’s Birmingham, Edgbaston MP, Gisela Stuart, had questioned the fairness and sustainability of Birmingham’s share of that settlement. In customary Commons style, the minister, rather than answer that tricky question, preferred to tell the House about the council’s tax arrears:

“I am afraid that poor leadership in Birmingham and the fact it has not collected some £100 million in council tax arrears may explain some of the issues it is facing. Stronger leadership and the ability to carry out the simple function of placing a charge on an individual and collecting it will assist it” (col.671).

In the heat of the moment, Hopkins omitted to explain that this arrears figure was a cumulative one covering the whole 21-year life of the council tax, or that it includes costs incurred in collecting unpaid taxes. Nor, even more unfortunately, was there time for Gisela Stuart or anyone else to observe that the biggest councils have not only the largest cumulative tax arrears, but also, equally unsurprisingly, the largest tax receipts.

For, by Hopkins’ reasoning, Birmingham’s having collected £63 million more last year in council tax and non-domestic rates than any other English authority outside London presumably reflects rather positively on the quality of its political leadership (Table 5).

Returning from Planet Hopkins to the real world, the key statistics – and they are key – are those for tax collection rates: not pounds collected but percentages collected of the total sum due.

The 2013-14 council tax collection rate for all English authorities was 97%, ranging from shire districts’ 97.9% to 95.4% for Inner London boroughs and Birmingham’s most obvious comparators, the 36 metropolitan districts. Birmingham’s 95.3%, therefore, was fractionally below the met district average, but, as it happens, second highest among the 10 large authorities in the DCLG’s naughty list – behind only Croydon (96.2%) and way ahead of the coalition’s current favourite Labour council, Manchester (91.7%).

Certainly not the disgrace, then, that its heading of the naughty list suggested, but yes: both improvable and costly. If ever decimal places matter, it’s here. Though respectable nationally, Birmingham’s 95.4% collection rate was lowest of the seven West Midlands metropolitan districts – behind Solihull (98.6%) and, in a perhaps less expected second place, Sandwell (98%), ranked 9^th most multiply deprived of England’s 326 local authorities against Birmingham’s 13^th. With each percentage point worth nearly £3 million, if Birmingham had achieved even Sandwell’s rate, it would have collected an additional £8 million – and a similar sum each year.

The DCLG’s non-ringfenced reserves naughty list is even more contestable. There is no set or professionally agreed formula for an ‘appropriate’ level of reserves, or for the balance between earmarked/ringfenced and unallocated reserves. But when CIPFA (Chartered Institute of Public Finance and Accountancy) asserts that councils increasing their cash reserves “is essential for protecting frontline services” and finance officers advise that, with council funding over the next few years being exceptionally uncertain, it’s only prudent to set aside reserves in anticipation, it’s hard for councillors – and should be for Pickles – to argue otherwise.

Birmingham’s prominence on this particular list – again, a consequence of its sheer size – is just perverse, given repeated warnings by the council’s external auditors about the councils’ reserves being, if anything, too low. In fact, last month’s Annual Audit letter noted specifically a concern regarding the “relatively low levels of general fund reserves (£85.8 million compared to a revenue budget of £3.5 billion)” (p.7).

Returning to tax collection, if there are numbers of individual councils that find it difficult to, as the minister put it, “carry out the simple function of placing a charge on an individual and collecting it”, what should we make of Her Majesty’s less than exhaustively tenacious Revenue and Customs (HMRC)?

One of HMRC’s helpful ancillary services – or hostages to fortune – is its annual report detailing all the taxes it doesn’t collect: in 2012-13 just the £34 billion – or 6.8% of the total it should have managed. In other words, all but the very worst council tax collection rates exceed the average managed by the people whose sole job is tax collection.

If we take that most “simple function” of individual taxation, English local authorities failed to collect £734 million (3%) in council tax, while HMRC failed to collect £14.2 billion (5.3%) in income tax, NI contributions and capital gains tax. From businesses, councils failed to collect £478 million (2.1%) in non-domestic rates, while HMRC failed to collect £12.4 billion (10.9%) in VAT, and £3.9 billion (8.7%) in corporation tax.

As Matthew, the Galilean tax collector-turned-gospeller, might have put it: You hypocrite, Pickles; first take the plank out of your own eye, and then you will see clearly to remove the speck from your brother’s eye.

Core Activities: notes from the Core Cities Summit, February 2015

13/02/201513/02/2015 / inlogov / Leave a comment

On the 11^th February over 300 people from across the public sector met for the Core Cities Summit in Glasgow. This post summarises the point reached so far and some of the conference’s live issues, and suggests three areas for further consideration: how to involve MPs and MSPs more fully, engaging communities in the debate and considering what kind of country the UK should become.

Core Cities at the forefront of innovation

The Core Cities buzz continued in Glasgow on 11^th February at its well attended summit which launched the next stages in cities-based devolution discussions. The Core Cities’ approach to innovation through collaboration has challenged the government by setting the pace. It was a cross-border event which included a look at how the next round of devolution proposals will affect Glasgow, as an indication of the next stages of the development of the Core Cities campaign.

The event pages are online and the Twitter hashtag #devosummit is searchable for reactions. The summit launched both the Core Cities charter for devolution ‘A Modern Charter for Local Freedom’ and the Respublica report Restoring Britain’s City States.

A charter for devolution and recommendations for action

The Charter sets itself in the context of the 800^th anniversary of Magna Carta and the waves of change emanating from the 2014 Scottish Referendum vote. It calls for action to consider what a ‘modern, mature state for the UK’ would look like, one which enables prosperity, equality and democracy. It sees itself as being applicable to the whole of the UK and not just to the Core Cities.

Devolution to local places is at the heart of its proposals with local freedom to make strategic decisions, to tax and invest, and to determine the shape of strategic planning and service delivery at the sub-regional level. To enable this, it calls on the Government to establish an independent body to facilitate devolution and oversee change, while ensuring that communities are strengthened, key investments are made, services are transformed and decision making devolved further to the appropriate level in communities, neighbourhoods and individuals.

Respublica’s report, Restoring City States, focuses on city devolution. It seeks to build on the recent city deals with Manchester and the Sheffield City Region in order to forge a ‘rebalancing of the relationship between central government and cities. Many of the issues set out in the Charter for Devolution are explored in more depth and underpin the report’s eight recommendations.

Core Cities’ case for change

Opening the Summit, Cllr Sir Richard Leese stressed that the summit was about a constitutional settlement, not just the devolution of powers. Ben Page highlighted the fact that whilst people are dubious about whether devolution is of relevance, they are concerned about inequality and there is potentially the space to try something new and to engage them in debate, as shown in the Scottish Referendum. In the Scottish context, Jim Murphy MP sought greater devolution by the Scottish Government to its cities. However Keith Brown MSP wondered whether local government could make more of its existing powers and was uncertain whether legislative change was really needed to achieve the Core Cities’ aims, a rehearsal of some of the debate nationally.

Considering reform to powers and fiscal matters, Danny Alexander MP wanted to see the government look at the devolution of stamp duty, amongst other measures, with a clear fiscal base to municipal re-empowerment. Philip Blond, Respublica, considered that the post 1945 model of the state was no longer fit for purpose and sought a new model to deal with a much more complex public service challenge. He considered that there might need to be some intervention in some ‘trailing’ cities to jump-start change, but considered cities to be the only agents nationally capable of bringing equality in an age of globalisation. Cllr Nick Forbes called for the next Comprehensive Spending Review to be based on place, rather than the individual spending limits of departments.

On the future form of devolution, Cllr Nick Forbes also stressed the need for cities not to be ‘walled cities’ but ones open to their surrounding partners, rooted in their local hinterland, pulling together to develop infrastructure, and linked into ideas about social justice. Pat Ritchie highlighted the need for devolution to be capable of adaptation to the different needs of different places. And Mayor Jules Pipe, speaking for London Councils, highlighted a need for devolution thinking to extend nationally, with further change needed in London, for example, to meet the extent of empowerment sought by the Core Cities.

Gaps and challenges

The focus of the day focused more on the growth agenda that it was on the social development of cities, although they are of course entwined, there were also some interesting gaps and unresolved issues.

The first gap relates to national politicians, the devolution debate has made much of devolving from government to city or place, but little has been said about the role of MPs (or MSPs). All of the cities involved in the discussion have numerous national representatives who are currently not part of the picture. There was talk on the day about the development of local Public Accounts Committees but as yet no sign of the development of a shadow version to see if it might work and help to hold a core city to account.

The second gap points out there has been little discussion of the quality of community in cities and aspirations for their development. Perhaps understandably much of the discussion has been aimed at central government, but the relationship of local people to each other and to the local state needs to be as much a part of the desired debate about the modern form of the state as a whole as any of the issues highlighted at the summit.

The third gap relates to the fundamental question of the kind of state the UK wants to be in the future (and here it is worth pointing out that this has been almost solely a local government led debate which of necessity does not yet include key local players in national services such as the NHS). This is a debate which perhaps should be at the core of the general election campaign, but is currently not on the agenda.

Next steps for everyone?

In its submission to the Political and Constitutional Reform Committee’s consultation on the constitution, INLOGOV said (amongst other things):

English devolution to a system based around London and the core cities would carry considerable risks if it becomes an exercise which bolts-on powers without thinking through the systemic change that is needed. We need to resolve the question of responsibilities, of citizens, communities, cities and regions, before the reallocation of powers.

… The UK’s greatest potential is contained in its networked nature, and the same can be said of the best cities and counties. What is needed is therefore constitution which does not just chunk up centralised power and devolve it.

… There should be a clear agreement about how power is shared (rather than devolved) between different legitimate and competent parts of the UK state, including local, regional and national governments.

So the current debate is a necessary one about devolution, but perhaps needs to develop into one about power sharing. To return to the Magna Carta theme, the Barons sought limitations to the exercise of central power and a clear basis for sharing it. They also did not rely solely on rational argument but potentially had the means to force King John to comply with their demands. It will be interesting to see how the Core Cities muster their forces and deploy them during the coming election and beyond.

As Sir Richard Leese recognised, the number of places that can be considered as core cities is necessarily limited. However it is clear that the approach that Core Cities have set out is one which has its application across England especially and the UK as a whole. All can benefit from the learning about ‘what works’ in creative, collective approaches to change and the development of confident, positive narratives about places and their people. And INLOGOV is uniquely placed to offer support by sharing learning and exploring approaches which challenge barriers of stagnation, short-sightedness, parochialism or old rivalries, all of which get in the way of what is important: long-term development based on outward-looking collaboration.

Daniel Goodwin is an Associate Fellow of INLOGOV. He was previously Executive Director of Finance & Policy at the Local Government Association and Chief Executive of St Albans City & District Council.

INLOGOV Blog

The Institute of Local Government Studies, University of Birmingham