Under my leadership, Labour will radically overhaul local authority funding

Lisa Nandy

After our worst general election defeat since 1935, we are further from power than at any time in living memory. We need to learn some lessons and we need to learn them quickly. Responding to defeat by perpetually changing the leader and hoping the results improve is a route to further, heavier defeats. People are watching us now to see if we understand this. We must show that we do, and that we have changed.

Shocking losses in local elections should have warned us that all was not well. We lost Darlington council in May 2019 and then the constituency of Darlington six months later. We have seen the same pattern in places like Bolton, Walsall, Stoke, Ashfield and Derby. It’s a pattern that is also familiar to our party in Scotland and one that we can ignore no longer.

I know for myself the power of great, reforming councils who are ambitious for our communities. While I was working for the charity Centrepoint, I approached Hammersmith and Fulham Council about a teenage girl they had housed in temporary accommodation who was being sexually harassed by the B&B owner. Their incredible response – moving not just her but all 16- and 17-year olds out of the B&B and into supported housing – convinced me that what matters as much as the law is what you do with it. We persuaded the Labour government to follow Hammersmith’s example and legislate to ensure it never happened again. It was that experience that led me to stand as a councillor in the same London borough and later become our lead member for housing. 

The road back to government runs through those town halls and civic centres across our country where Labour is in power and is getting it right – showing we can be trusted again. From Blackpool to Bristol, Newcastle-upon-Tyne to Norwich, we are translating our principles into policy, leading by example and showing the difference Labour makes.

Why is it that we so seldom talk about it? While we rightly talk nationally about the renationalisation of our railways, Nottingham City Council operates an award-winning and profit-making municipal bus service. We propose spending billions in subsidies to the Big Six, while the Plymouth Energy Community is already disrupting the market with energy co-operatives that create affordable, zero-carbon energy. As Shadow Energy Secretary, I was proud to work with Labour councils including Plymouth to show how together, we were putting place plans to cut 15% off the UK’s carbon footprint, even as the Tory government cut clean energy schemes. We may not be in power but we should never believe that we’re powerless.

Many of the successes of Labour-led councillors are achieved despite – not because of – central government. It is the consequence of a broken and failing system which holds on to power at the centre and strips power and resources from the rest of the country.

Government ministers and officials – sitting behind desks in Westminster and Whitehall – can change the lives of people hundreds of miles away at the stroke of a pen, in places they’ve never been and communities of which they have no understanding. Budgets can be slashed by 60% or more but responsibility for some of the most fundamental pillars of a civilised society like children’s services and social care can be pushed onto councils without the resources to properly deliver them. I will put this right.

Behind the upheavals in the country in recent years, is a clamour for a more accountable, responsive local system where power sits much closer to people. We must show not just that we understand this but that we can create it in ourselves, building a movement that pushes power down and out – internally to our members and our councillors, and externally to the communities we seek to serve.

In government, Labour must be ready to invert the power structures that have pushed local government to breaking point. It cannot be right that big employers like ASOS and Amazon can game the system to pay a fraction of the business rates they should, while holding the threat of relocating jobs to the neighbouring borough if the local council refuse to play ball. A council cut to the bone by the Tories is now forced by a broken Whitehall system to give millions of pounds to one of the richest companies in the world, instead of using it to end the social care crisis.

We cannot rely on Whitehall to fix injustices and tackle the climate emergency. It begins with giving local authorities more direct powers over rate setting and collection, forcing tech giants and multinationals to pay their fair share. Businesses that want to go green should be given new rates relief, helping to rejuvenate local high streets and support green innovation at a local level. Labour in local government has always been at the forefront of innovation and ambition – now is the time to learn from those successes, to showcase the difference Labour makes in power and to empower, rather than inhibit, our councils to deliver real change.

Local authorities must be better resourced if we want to deliver radical and ambitious local industrial strategies. Local Enterprise Partnerships (LEPs) in England have received over £12bn to drive economic growth in their local areas. However, as the Public Accounts Committee reported last year, there is clear evidence that many LEPs have underspent their allocation. There has been criticism of their lack of diversity and democratic accountability, as well as a set of confusing geographical settlements which cut across local authorities. Perhaps most worryingly, we still have no way of measuring whether their interventions have made a difference locally, or that the billions allocated to them has gone to those areas most in need.

Under my leadership, the money currently allocated to LEPs will be handed directly to local authorities, democratically accountable to the people they represent. Billions of pounds ring-fenced for local councils to meet the challenges our local economies face, particularly those in ex-industrial and coastal communities. But in return, we must see a tangible return for this investment in towns and cities across the country, with councils that better reflect the diversity of the communities they represent.

It starts now, not on April 4th. Local government must be given a real voice in the decisions we take and empowered with a greater influence at every level of the party. From driving our national campaigns from the ground up to shaping the decisions taken by our national executive committee, councillors are uniquely positioned to translate the challenges facing their communities into relatable policies that resonate with voters. Climate change is an area where calls for a green industrial revolution mean little, until a Labour mayor or council steps forward to show how it can cut energy bills, create better, cleaner public transport and create new jobs.

The Association of Labour Councillors represents thousands of elected councillors who are collectively the second largest contributor to party coffers. Our council leaders and councillors should form part of our frontbench teams to develop policy – especially in areas where we have lost MPs, and our annual conference should devote more time to give a platform to our successes in local government. If we can’t champion those successes, who will? The party I will lead will be a confident, empowered party with an ambitious story to tell about the future. We can earn the right to govern again, but we will only win together.

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