Manchester Town Hall: Labour has come up with a New Deal for England, involving devolving powers. Photo: Getty
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Labour’s New Deal for England will end a century of centralisation

The shadow communities secretary and head of Labour's policy review explain why Labour will adopt a radically different approach to delivering public services, moving away from top-down central control.

Politics is at a turning point. Too many decisions are top-down and state-driven, and too much is about structures rather than individuals. Our current way of doing things is based on centralisation and a culture built on expectation of, rather than obligation to, others, both of which have left us, for example, with insufficient and unaffordable childcare, too many young people out of work, and a care system for older people that is creaking under the strain. 

We know there are lots of people with ideas and determination to change things, but feel powerless to act. Communities with huge energy and potential. And those at the frontline know better than anyone back in Whitehall how, through local reform and innovation, that they could deliver better services.

So how should a future Labour government respond? Labour is clear that we cannot simply spend more money to deal with the growing pressure on services, but we also know that the Tory approach of cutting back services and leaving communities to sink or swim is failing.  And so, at a time when there is less money around, a Labour government will have to adopt a radically different approach to delivering public services. Instead of the old model of top-down central control, we will have devolve power to communities and users to deliver the public services they want. 

Today, the Local Government Innovation Taskforce has published its conclusions on how a Labour government could achieve this. Their proposals for reform are based on three principles: pushing power down; collaboration so that services are joined up around the needs of people and place; and prevention to stop costly problems before they arise. 

The central recommendation, which we strongly endorse, is that a Labour government should agree a New English Deal with councils to devolve powers and resources down to communities. In return, local government will enter into new public service contracts with their communities to deliver five outcomes:

·         the care needed to live independently;

·         opportunities for young people to get a decent job;

·         community safety and reductions in crime;

·         help for excluded families;

·         early-years support for every child in the community.

To do this a Labour is committed to the principle of multi-year funding settlements for local services to give councils the flexibility to redesign services around the needs of local people and the ability to keep savings gained through reforms locally. And that's not all. Further areas for devolution proposed by the Taskforce that could also form part of the deal include:

·         Greater powers locally to bring together health and social care around the ‘whole person’ through a collective commissioning plan and a pooled budget based on ‘year of care funding’ for people with long term conditions.

·         Local control over the vocational skills budget for 19 to 24 year olds so that areas can decide what further education colleges should provide. 

·         A new local service for under 21 year olds to help young people get the skills and help they need to get a decent job. This would bringing together Jobcentre Plus and local authority support for young people under one roof.

·         Stronger powers for local authorities to appoint local police commissioners, set priorities for neighbourhood policing and improve value for money and performance; and       

·         Powers to broker childcare support for parents and join-up early years services in Sure Start Centres, matched by stronger local accountability of all schools through the appointment of Directors of Schools Standards. 

Hand in hand with this radical new approach will be a commitment to local accountability and scrutiny, with councils setting up strong councillor-led Local Public Accounts Committees. As Whitehall’s budget and local budgets are increasingly pooled to provide local services, it is at the local level that scrutiny of that expenditure and its effectiveness should take place. A single body with the power to assess all public services in an area will not only drive better value for taxpayers but create much stronger and more visible accountability for decisions.

This is one important part of Labour's New Deal for England, but our centralised state is also holding back growth. It is madness that plans for transport investment, for example, have to make the long, slow journey all the way to Whitehall to get the go ahead instead of being decided, and implemented, locally. That is why last week Andrew Adonis’ report on devolving power over economic development and infrastructure to councils and to groups of councils that come together, working closely with local business leaders, is also so significant.

A Labour government will transfer £30bn of spending from Whitehall to the Town Hall over the lifetime of the next Parliament and allow groups of councils that form combined authorities to retain 100% of business rates income. This is an offer not just to our great cities, which were once the silicon valleys of the industrial revolution and are now home to new industries, but also to our counties. After all, where is the centre of global innovation in motorsport engineering?  Oxfordshire. Where can you find the home of Europe's foremost biotechnology cluster? Greater Cambridge.

What this is all about is letting go so that the talent and vision you can find in every community can flourish. Last weekend, we saw what this could achieve as Leeds, Harrogate and Sheffield - along with the glory of the Yorkshire Dales - played host to the Tour de France. That's what you get when you devolve power. Just imagine what more could be done if we set free all this local creativity, energy and passion.

As Michael Bloomberg, the former mayor of New York, said: "We're the level of government closest to the majority of the world's people. While nations talk, but too often drag their heels, cities act."

That's the case for the New Deal for England that Labour will be offering next May.

You can read the full report here.

Hilary Benn is Labour MP for Leeds Central and shadow communities secretary; Jon Cruddas is Labour MP for Dagenham and Rainham and he heads Labour's policy review

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Forget gaining £350m a week, Brexit would cost the UK £300m a week

Figures from the government's own Office for Budget Responsibility reveal the negative economic impact Brexit would have. 

Even now, there are some who persist in claiming that Boris Johnson's use of the £350m a week figure was accurate. The UK's gross, as opposed to net EU contribution, is precisely this large, they say. Yet this ignores that Britain's annual rebate (which reduced its overall 2016 contribution to £252m a week) is not "returned" by Brussels but, rather, never leaves Britain to begin with. 

Then there is the £4.1bn that the government received from the EU in public funding, and the £1.5bn allocated directly to British organisations. Fine, the Leavers say, the latter could be better managed by the UK after Brexit (with more for the NHS and less for agriculture).

But this entire discussion ignores that EU withdrawal is set to leave the UK with less, rather than more, to spend. As Carl Emmerson, the deputy director of the Institute for Fiscal Studies, notes in a letter in today's Times: "The bigger picture is that the forecast health of the public finances was downgraded by £15bn per year - or almost £300m per week - as a direct result of the Brexit vote. Not only will we not regain control of £350m weekly as a result of Brexit, we are likely to make a net fiscal loss from it. Those are the numbers and forecasts which the government has adopted. It is perhaps surprising that members of the government are suggesting rather different figures."

The Office for Budget Responsibility forecasts, to which Emmerson refers, are shown below (the £15bn figure appearing in the 2020/21 column).

Some on the right contend that a blitz of tax cuts and deregulation following Brexit would unleash  higher growth. But aside from the deleterious economic and social consequences that could result, there is, as I noted yesterday, no majority in parliament or in the country for this course. 

George Eaton is political editor of the New Statesman.