I reckon the assertion that local government funding was broken would have been a little controversial, amongst some quarters, if stated several months ago. But now, here in February 2015, I doubt if anyone seriously contests the fact that there’s a significant structural problem with how councils across Scotland are financed?
Even the Scottish Government has now openly admitted as much, recently stating: “Scottish Ministers consider the current council tax system as a whole to be unfair and are committed to consulting with others to develop options for a fairer and more progressive local tax, based on ability to pay, later in this parliament.”
Indeed, back in November last year, their Programme for Government included the firm commitment to: “An independent commission to report on fairer alternatives to the council tax by autumn 2015.”
And the accompanying documentation outlined some further details: “The Scottish Government will invite our local authority partners to work with us to convene an independent commission to examine alternatives to the existing council tax system that would deliver a fairer system of local taxation to support the funding of services delivered by local government. We will seek the involvement of all political parties in this commission which will commence in early 2015 and report in the autumn. In conducting its work, we will expect the Commission to engage with communities across Scotland to assess public perceptions of the emerging findings and to reflect this evidence in its final analysis and recommendations.” I wholeheartedly welcome this commitment to review how Local Government in Scotland is funded. As things stand at the moment, across Scotland just 18 per cent of local income is raised through local taxation with the remaining 80-plus per cent coming from central government. A cursory glance at other European countries indicates that most empower their main tier of local government with at least circa 50 per cent of tax control.
I do think it crucial to categorically state that I’m not making an argument, per se, for more money; simply an argument that local government is more in control of its own financial destiny. Local politicians would, and should, remain answerable to the electorate for any decisions they took with any greater levels of tax control.
My argument is not one of promoting more, or less, taxation and spending: it is simply to make sure that the decisions about these issues are made locally. Real local financial powers would allow communities to reduce tax and spending if they wanted to, not just to raise it. That would be their choice where currently they have little, or no, choice at all.
I also completely accept that national grant support will always be necessary to equalise variable local tax bases, variable costs of providing services and variable patterns of need and demand. But a 50/50 split on local/central tax control would still more than adequately provide that ability.
Fortunately, this issue has already been given serious consideration, very recently, by the Cosla-led Commission on Strengthening Local Democracy.
I really hope that those on the Scottish Government’s newly established Independent Commission carefully read the Cosla document that was produced from that study – it contains many of the potential answers, and there really isn’t the need to completely reinvent the wheel here.
Frankly, if the new Independent Commission is going to report by autumn 2015, it needs to get a move on and not be shy about stealing other people’s ideas. Personally, I will be making the strongest representations about the urgent need to deliver a thorough reform in local government funding.
Andrew Burns is leader of Edinburgh City Council.