Councils are Labour’s most powerful weapon to destroy austerity

In many ways, it is deeply ironic that the first local authority to have collapsed under the weight of austerity should be Tory-run Northamptonshire County Council. Whilst failures of local leadership have made it worse, be in no doubt that Tory austerity is the cause of the crisis in Northamptonshire – and that other councils could soon follow them into virtual bankruptcy.

Austerity has been a disaster for local government and the residents who rely on the vital services that we offer. But perhaps what is most astonishing is that councils like Northamptonshire are only now starting to collapse, considering that many councils have lost over 50 per cent of funding they receive from central government since 2010. And the need to put every spare penny towards the rising demand for adult and children’s social care, with 60 per cent of council expenditure likely to be spent on these services by 2020, means there will be increasingly little to fund street cleaning, leisure centres, or libraries.

This would be different under a Labour government. We are an anti-austerity party, and the 2017 Labour manifesto included a commitment to put an immediate £2bn towards the £5.8bn gap we face by 2020. But despite unexpected gains from the Tories we lost the election and austerity continues, and Labour councils are increasingly faced with impossible choices.

But anyone with any direct experience of working in local government will know that it has always been the most efficient, and the most resilient, part of the public sector. Labour councils have examined every budget line to cut out every ounce of fat they could find to shield their communities from the Tories cuts – what Jeremy Corbyn has praised as “amazing creativity in the toughest of times”. We have to do this because we don’t have the luxury of waiting for the next Labour government – we have to fight every day to protect the residents who rely on us. And it is this very experience of stretching every penny of the increasingly scarce resources at our disposal that offers a glimpse of what Labour in local government could deliver if we were properly funded, and freed from the centralising constraints of Whitehall.

An early task for the next Labour government is finding a way to make local government funding fairer and more transparent – and to increase our independence from central government. This is a huge task, and unless work begins in opposition there is little hope that the first day of a Labour government would have an immediate long-term solution.

But Labour should provide some increased freedoms for councils from Day One – recognising that councils are democratic, transparent, and accountable at the ballot box. This should include immediate abolition of the council tax referendum limit, increased powers to levy higher council tax on empty homes, the ability to look at local taxes such as land value tax or tourism tax, and possibly even local retention of a portion of income tax. We should be able to use the combined spending power we have from procurement, investment and pensions to the maximum benefit for community wealth building in our local economies.  Labour councils such as Preston have made a start on this but there are still technical and legal obstacles which a Labour government could help remove. All of these solutions could be brought in quickly, while the harder job of finding a truly sustainable long-term funding settlement continues.

If John McDonnell wants to see an irreversible shift in the balance of wealth in favour of working people, then he must take steps to ensure a similarly permanent shift in the balance of power from Whitehall to local communities. By trusting in local government’s democratic accountability, understanding of communities, and experience of making every pound count, he can deliver immediate and visible improvements to people’s lives. It is local government – efficient, transparent, and closer to communities than any civil servant sitting in Whitehall could ever dream of being – that can be the most powerful weapon in destroying the effects of Tory austerity. It will be up to the next Labour government to unleash it.

Cllr Sharon Taylor is leader of Stevenage Council.