Localism Bill

Word counts of the Localism Bill reveal a lot of the thinking behind it. Despite all of the rhetoric that preceded and accompanied its launch, ‘vision’, ‘freedom’, ‘growth’ and ‘deregulation’ are not mentioned at all.  If there is no room for principles, then there are nine mentions of ‘democracy’, but only in relation to repealing the duty on local authorities to promote democracy. There is one mention of ‘prosperity’, which is to abolish the LDA Prosperity Board.  There are, however,  six ‘penalties’ cited for local authorities to watch out for and over 360 ‘provisions’ (legal instructions) included. Let’s review some of the claims to see if there is real intent and not just rhetoric behind the Bill.

“Lifting the burden of bureaucracy”

We all need some bureaucracy to record changes, agreements and to plan. What most people sense as the ‘burden of bureaucracy’ is the interference of the state and unappointed third parties in their affairs and this includes development. However, proposals in the Bill extend the planning system, rather than dismantle it. Developers will be required to consult on significant schemes with further regulations on this requirement to come. We can expect developers to have to persuade up to 51% of residents in a local area to support a scheme before it is viable. In fact, the planning system will be strengthened by national planning statements, local plans and, in future, neighbourhood plans, all of which any development will need to comply with. In effect, landowners will have less and less control over the development of their land. The local authorities will still be able to apply levies on the land to pay for existing and new services and infrastructure. Neighbours and environmental groups will need paying off. No doubt, utility companies will continue to extract value where they can from any development. In addition, unappointed agencies, such as the Commission for Architecture and the Built Environment (CABE), will continue to demand “quality”, as defined by them. The Bill is over 180 pages in length and is complex in that it covers several local government functions, including property, planning and local tax raising, with many references to current legislation. Even planning lawyers have complained at its lack of clarity, pointing to one of the main beneficiaries of the Bill being the courts and solicitors. This will increase, not reduce, the legal burden upon and interference from third parties in development proposals.

“Empowering communities”

The Tory election manifesto referred to a new model for development as ‘open source planning’, using the analogy from IT software, where geeks share software creativity and their products with others in the hope of mutual and wider benefits. This populist image and message, written by policy wonks at the ‘Localis’ web site, is an interesting analogy. IT developments, including software, require only hardware and network capacity, that can be made available anywhere in the world. Anyone with the means to do so can buy the hardware off the shelf. New homes and infrastructure, however, differ significantly in that they require land, which is very much fixed by its location. Every parcel of land is unique, manifested by an array of geographical characteristics, both physical and human. It is also unique in its ownership, as it may, even if it is state owned in some form, have only one owner. Ownership interests can be changed, sold, split, shared and sub-divided in capitalism, but there is always only one set of owners. Until the Town and Country Planning Act 1947, the freehold interest in land had the freedom to develop it in a relatively unfettered manner. Post war planning legislation changed all that. Effectively, the right to develop your own land was appropriated by the state. The planning system was built to specify what development the state would permit. Although the scope of development permitted by the state has varied over the past 60 years or so, there has been no attempt to reverse the nationalisation of development rights. The Localism Bill presented the coalition government with the opportunity to dismantle the planning process, but they have opted instead to dilute further the control and ability of landowners to develop their land. In effect, the ‘community right to get involved’ with development is no more than interference, so as to extract a benefit from or share of the value that the landowner adds to his land when he develops.

Open source planning and empowering communities are populist attempts by the coalition government to reconnect with ordinary people. Many new government ministers and advisers have come through the local government system, either as elected Council members or as officers. They would have spent much of their time with environmental busybodies and disgruntled householders, whose house value has been negatively affected by new development nearby. The coalition government’s proposals in the localism bill to empower local people is a cynical move to provide short term political gain at the expense of increased provision of new homes and jobs. The specific regulations in the bill only add to the difficulties developers have in bringing forward schemes. Open source planning assumes that anyone can share in the development of land and buildings, so diminishing the role of the owner, who will be even less inclined to take the initiative in proposing schemes. Communities, however, progressive in their determination to build new homes, still require the land and co-operation of owners to do so, and all parties have to have some sort of plan they can trust will deliver some of what they want.

“Increased local control of public finance”

Several radical sounding phrases have been espoused by Ministers around devolving the state and enabling local people to finance the decisions they make locally. Austerity measures that significantly reduce resources for services and infrastructure at the local level have been masked by this rhetoric. So, what are the specifics? Well there is Tax Incremental Funding, which is a local tax raised on businesses and development in a defined area to pay for new infrastructure and current services. Then there is the Community Infrastructure Levy, another form of tax, but specific to particular development and its infrastructure. The Coalition Government have promised that  some of the funds will be able to be passed to neighbourhoods where the development has taken place, although these may not then get spent on infrastructure necessarily. Funds will be able to be spent on the ongoing costs of infrastructure, as well as the initial capital costs and the charges will be ‘independently examined’. In addition, councils may retain some of the Council Tax paid by occupants of new homes built in their area up to 2016, as an incentive to encourage new house building. Further regulations will also be brought in to establish a ‘Community right to buy’ of public assets.

Councils have long performed a role of owner of last resort to prop up local property markets, particularly in the period after the last war, but also to enable town centre redevelopments. One can envisage sharp division over such assets as inner city parks, where local communities will be split between those who want to receive benefits from taking over their ownership and development, and others who would want the park to remain for their use. The Bill offers no more than the prospect of protracted legal battles. Similarly, rural villages and urban ‘parishes’ could obtain the ability to grant themselves planning permission, if more than 50% of the electorate support it. This could be by one of two ways. A community right to build will be specified in further regulations and ‘eligible parishes’ (eligible to whom?) will be able to adopt neighbourhood plans, so long as they conform to the local authority and national development plans. These neighbourhood plans could include development orders that allow for certain schemes to be automatically permitted, for example all back extensions along a particular road. In fact, most of these ‘provisions’ exist in current legislation, so their continuity from the past to the present government is strong. One new area is  the rent hike for council and housing association tenants, who will have to pay 80% of market rent, causing many rents to double or treble in the near future. This is supposed to help fund the construction of new homes, but is unlikely to compensate for the removal of all social housing subsidies to councils that previously used to pay for the repairs and maintenance of crumbling housing stock. Council chief executives and finance directors are also looking longingly at the increased rents to help pay for other non-housing services (one of the ‘freedoms’ introduced in the Bill), so council tenants will help subsidise services enjoyed by their owner-occupying neighbours. So much for ‘fairness’ and ‘community cohesion’.

All of the financial changes proposed in the Bill are technical models of funding existing and some new infrastructure by deferred local taxation arrangements into the future. The net result is a massive increase in the tax burden on owners and developers and rental burden on tenants. The choice will be to increase local taxation, or stop services. Whose local control of public finance is this, apart from those ministers, civil servants, local authority members and senior officers aspiring to join the future elite in society?

“Ending public sector monopolies to increase opportunities”

As many councils are already considering the sale of their town halls, parks and libraries, in order to make budgets balance in the face of ‘austerity’, it is not surprising that the Bill points towards alternative forms and models of service provision. Staff buy-outs, along the John Lewis Partnership lines are said to be much in favour with ministers. Powerful, directly elected mayors in the 12 most significant provincial cities is also set out in the Bill.

Local people will be able to force referunda on local councils, although the Bill makes it clear that the council need only ‘consider’ the results and is not obliged to act upon them in any way.

Economic development and regeneration, traditionally the most innovative services in councils, are almost completely being dismantled, as a result of the cuts and focus on localism. These last remaining outward looking, research and investment part of many larger councils have been the first to be sacrificed in the retreat into parochialism and retrenchment of councils.

“Provide for more public scrutiny”

Making the salaries known of senior officers and councillors is hardly going to do more than demoralise those that are so scrutinised. Surely it is more important that they are judged by results, rather than what pay cut they are willing to accept. Chief executives and directors should be paid what it takes for them to deliver of their best, and not be reduced to mediocrity to justify lower pay. It is also the assumption that they must work without the protection and benefit given by personal privacy and contracts that is so galling, and which very soon will be applied to all who work in delivering public services. Hence every item of £500 expenditure is to be made public. Such transparency will do little more than drive indecision and inertia into all ranks of public services. Those so scrutinised will no longer be accountable to their elected bosses, but to third party scrutineers, with no democratic accountability.

“Strengthen accountability to local people”

The increased ‘rights’ to challenge services, scrutinise every action and demand referenda will make service delivery incredibly bureaucratic, lengthy and convoluted. It reflects the increasing distrust between ourselves as members of the same community/society that we are in danger of further changing the relationship of those individuals serving the state at the local level and those who they are supposed to serve. The Bill further reduces the authority of elected members, officers and service workers to deliver according to the political priorities of their electorate. The absence of clearly defined political programmes at both national and local levels has disenchanted the electorate into believing there is nothing, or no one worth voting for. The only way for our political leaders to distinguish themselves, therefore, is to hatch more ways to ‘shape places’ and ‘shape behaviour’, using the language and techniques of management sciences, such as economics, environment and psychology. It has long been the complaint of senior managers in most councils that their members concern themselves with the minutiae of management, but increasingly leave strategic choices to others, usually so-called experts. Now they will have to contend with external third parties also getting involved with day to day tactical and strategic decisions.
All of this adds up to national politicians abrogating political responsibilities to local representatives, increasingly unelected and self-appointed, and officers and front-line workers increasingly having to take the blame. Many parts of local government do need shaking up and there is great scope for efficiencies, but the Bill does the opposite. It reinforces the planning system, local taxation and local busybodies. There is no real political vision or story that can come out of it. Instead we will all need a friendly legal companion with us at all times to protect us from the indecision, inertia and impoverishment to come. What a way to serve the public and to receive what should be public services!

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