A. Models of Central-Local Relations

The relationship between local government and central government has been problematic from the nineteenth century (when a pattern of elected local authorities for all areas of England and Wales was finally established) to the present day. There is a substantial literature analysing that relationship.Footnote ¹⁴ In the mid-twentieth century, the “conventional wisdom” was said to be that there had been a historical trend from a “partnership” model to an “agency” model of central-local relations.Footnote ¹⁵ In a partnership model local authorities are co-equals under Parliament and have considerable discretion; in an agency model, local authorities implement national policies under the supervision of central departments and have little or no discretion.Footnote ¹⁶ The trend was to be characterised by increasingly tight control over capital expenditure and increasing dependence of local authorities on central grants, and an increase in the administrative controls exercisable by central departments over local authorities.Footnote ¹⁷ Work in the latter part of the twentieth century demonstrated that this was both an inadequate framework to capture the complexities of central-local relations and not supported by the historical evidence.Footnote ¹⁸ A different perspective is provided by Rhodes, who argued that concepts of control and hierarchy were less appropriate than an analysis of the mutual power dependency of tiers of government. Here the relationships were complex and multi-faceted and each tier consisted of “pluralistic organisations with shifting political resources for power-bargaining”.Footnote ¹⁹ For some writers, this “power-dependence” model, which recognises that central and local government cannot be seen as equal partners but that, nevertheless, local authorities have significant resources of their own that they can exploit, is seen as a more persuasive elaboration of “partnership”.Footnote ²⁰ Yet while the “partnership” and “agency” models are crude and neither accurately captures the position at any particular stage of the history of central-local relations, the ideas that underlie them can help explain and compare aspects of the story. Indeed, the position in any one period may be seen to be the product of the tension between these two forces, the strength of each of which has varied over time.

B. Factors Affecting Central-Local Relations

Consideration of the history of central-local relations suggests that there are many factors that have been influential on the nature and degree of autonomy enjoyed by local government. The major ones appear to be these.

First, there is the position of local authorities in the constitutional framework. On the one hand, they are established by statute and, unlike many quangos, cannot be straightforwardly abolished by ministerial decision. However, the unitary nature of the constitutional framework means that they enjoy no entrenched legal position. Both individual authorities and classes of authority have been abolished as part of the periodic bouts of reorganisation that many governments have found it necessary to effect. There are no powers conferred on local authorities that cannot be taken away; many have been. This point is developed further below.

Second, uniquely for bodies other than Parliament, local authorities are directly elected, and by an electorate that is essentially the same as that for parliamentary elections. Local government thus enjoys a special position that has generated at least an element of respect in dealings with central government.Footnote ²¹ It also provides a justification in contemporary government policy for expecting local authorities to take on a role in community leadership, working in partnership with a range of statutory and voluntary agencies.Footnote ²² However, it must be remembered that until the twentieth century, suffrage for elections, both local and central, was anything but universal. It was largely focussed on the occupiers of property – the ratepayers – and local authorities could be seen not so much as representing their communities but furthering the interests of the ratepayers.Footnote ²³ This was reinforced by the so-called “fiduciary duty” owed by local authorities to ratepayers, recognised as part of local government law by the House of Lords in Roberts v. Hopwood.Footnote ²⁴ This constrained local councils from spending the rates (and indeed any of their money) in such a way as to benefit particular groupsFootnote ²⁵ at the expense of the generality of ratepayers.

Third, one of the major purposes of local government has been to deliver services that central government has wished to see delivered across England and Wales, but has not wished to manage directly. Examples include police, education and social services. These may be compared with such services as the provision of welfare benefits, which are managed through the local offices of a central agency. Why one model has been adopted rather than another is not always obvious, and the pattern that has emerged is not necessarily coherent. Where functions of this kind are allocated to local authorities, a particular tension is likely to arise. If central government is in practice regarded by the electorate as politically responsible for a service, even though formal responsibility lies with local authorities, it will naturally look for ways, legal and extra-legal, to influence outcomes.Footnote ²⁶ The centre may have the political will to implement policies it sees as desirable which is lacking (or would be lacking) in local authorities.Footnote ²⁷ A similar pressure may arise where central government enjoys or has convenient access to greater technical expertise in aspects of service delivery than local authorities (particularly where there are a larger number of smaller authorities). A related question is how the service is funded. If it is funded by central government, it is entirely proper for central government to ensure, for example through audit, and the setting of standards as a condition of paying a grant, that the money is properly spent. Indeed, one of the themes of the struggles between central and local government in the late nineteenth and early twentieth centuries was insistence by local taxpayers that truly national services should as a matter of principle be funded from central taxation.Footnote ²⁸

A yet further related issue is the tension that arises where one person's claim to respect for local autonomy and diversity is another person's invocation of the image of the “postcode lottery”. The latter is regularly deployed in public debate across public services, whether provided by local authorities or other bodies, most notably the NHS.Footnote ²⁹ Whether people are prepared to accept with equanimity geographical variations in levels of service provision may of course depend in part on the importance of the service. For example, some writers have argued that health care is an especially sensitive matter such that divergence from national norms is particularly problematic.Footnote ³⁰ Others, however, have observed that in many Scandinavian countries, “considerable diversity in the pattern of health care” is “accepted”, because it “rests on the decisions taken by locally elected politicians”.Footnote ³¹ This implies that whether variation in provision is regarded as a postcode lottery or in more positive terms will depend, to some extent at least, on whether local or national institutions are regarded as having legitimate “ownership” of the matter in questionFootnote ³² – which, in turn, will be influenced by a range of factors, including the relative health of local and national democracy and whether the service is funded from local or national taxation. It therefore follows that, as Jenkins puts it, “[d]ivergent standards are the price of localism” which, if they are to be accepted, require “people to indulge in local politics as never before, combing, challenging, questioning, voting”.Footnote ³³ On this view, the so-called postcode lottery, transplanted into a vibrant, well-functioning local democracy, becomes evidence that the system is doing precisely what it ought to.Footnote ³⁴ As the Lyons report puts it, “if the people of one area collectively choose to use the public resources at their disposal in a different way to the people of another area, it is hard to argue that this is unfair”.Footnote ³⁵ The practical point for politicians, however, is how many of the people will regard it as unfair.

Fourth, an important factor influencing the practical relationship between central and local government has been the general economic state of the country. The recent period when there was the greatest difficulty in central-local relations was during the Thatcher government in the 1980s when a major central government concern was to control levels of public expenditure during times of global economic difficulty.Footnote ³⁶ Relations have been easier in the last ten or more years when the economy has been generally strong.

Fifth, a further variable has been the political complexion of local and central government. There is a tendency in local elections between general elections for there to be a swing against the party in control of central government,Footnote ³⁷ and a proportion of authorities will in practice always be Conservative or Labour and so for periods faced by a central government controlled by the opposing party. This is, however, not to say that relations are always harmonious where local authorities and central government are controlled by the same party,Footnote ³⁸ although the most difficult times of central-local relations have been where local authorities have been controlled by very left-wing councils, whatever the party in control at Westminster.Footnote ³⁹

Sixth, an important point to remember is that neither local nor central government is monolithic. The interests of different classes of council are by no means identical,Footnote ⁴⁰ although differences are less easily articulated on the national stage with the establishment in 1997 of the Local Government Association as the single representative body for local authorities in England.Footnote ⁴¹ At the centre, while there has been and continues to be a lead department with which local authorities interact,Footnote ⁴² there have always been a number of departments with which there are relationships, usually in respect of the operation of particular services.Footnote ⁴³ It has been consistently observed that the nature of relationships with different government departments varies.Footnote ⁴⁴

Seventh, a variable of the utmost significance is the extent to which local authorities may (and do) raise their own income independently of central government. Historically this has largely been through locally-based property taxes (rates; community charge; council tax) and charges for services provided, where permitted by statute. However, the position has been bedevilled by two major problems. First, the local taxes themselves have been in different ways controversial and perceived to be unfair. Examples can be seen in the political struggles of ratepayers' representative bodies in the nineteenth century to limit the extent to which rates were used to support national services;Footnote ⁴⁵ the political failure of the community charge (widely dubbed “poll tax”) introduced by Margaret Thatcher's government;Footnote ⁴⁶ and the current refusal of the government because of fear of the political consequences to implement recommendations for the revaluation of properties to ensure that the incidence of the burden of the council tax reflects the values of property today and not in 1991. The second problem is that it has never been possible for all the activities of local authorities to be funded from local taxation and charges. While initially the use of central government grants to support local services was resisted and a variety of ad hoc measuresFootnote ⁴⁷ adopted to achieve a rough and ready balance, the introduction of the principle of central grants was ultimately inevitable.Footnote ⁴⁸ The number and purpose of central grants has varied over time, as has the basis for their calculation, but the proportion of local authority expenditure met from grants has steadily increased. A particular boost to reliance on grants was given by a substantial decrease in the community charge in 1991, paid for by an increase in VAT from 15% to 17.5%, prior to its replacement by the council tax from 1993–94.Footnote ⁴⁹ By 2006–07, only 15% of local authority income was accounted for by council tax, compared to 62% from grants and redistributed business rates.Footnote ⁵⁰ Thus, although local authorities have control over the levels of council tax (subject to capping by central government), the limits to the autonomy of local authorities in raising income are obvious.

C. Mechanisms of Central Control and Influence

When considering the relationship between central and local government, a further factor that should be noted is that there is a wide range of mechanisms available to central government to control or influence local authorities. Many have been and continue to be enshrined in legislation; many others are not. Examples of the former include (or have included) controls over borrowing, capital expenditure and revenue expenditure;Footnote ⁵¹ the setting of conditions to the making of specific grants; the extent to which functions are conferred in the form of statutory duties rather than discretions; myriad powers for the Secretary of State or National Assembly for Wales to make regulations prescribing both substantive rules governing an area of activity and the procedures to be adopted in making specified kinds of decisions; inspection arrangements; power to act in default where performance is unsatisfactory; prescription as to what officers must be appointed and their qualifications; powers to confirm bye-laws; powers to issue directionsFootnote ⁵² or guidance;Footnote ⁵³ powers to entertain appeals or grant or refuse consent to individual acts; powers to require information to be provided; powers to require plans to be prepared and submitted (and sometime approved) and the arrangements for comprehensive performance (now area) assessment.Footnote ⁵⁴ However, it must be recognised that wherever powers are conferred by legislation on a local authority, a minister will need express statutory authority to issue directions as to how they are to be exercised. This results from the application of the familiar general legal principle that the exercise of statutory powers cannot be fettered by the dictation of another person or body.Footnote ⁵⁵

The general trend over time as regards formal legal controls over local authorities has been away from detailed controls over individual operational actions. Over the years there have been a number of exercises to that end.Footnote ⁵⁶ A recent variant has been for controls to be relaxed for higher performing authorities only.Footnote ⁵⁷

Extra-legal mechanisms for control and influence by central government are also significant, and come in many forms. Examples include the issuing of non-statutory guidance,Footnote ⁵⁸ and the plethora of specific projects whereby local authorities are encouraged to bid competitively for funding (normally time-limited) to support some innovative scheme or development. This is not all one way; the well established consultative processes have enabled the local authority associations (now the Local Government Association) and individual authorities to influence policy and the detailed content of legislation.Footnote ⁵⁹

A. The Relationship between Autonomy and Democratic Health

The picture which emerges from our analysis thus far may be characterised as a vicious circle. Central government – principally via primary legislation enacted by Parliament – has made some attempts to strengthen local government and local democracy. The introduction of council executives, the creation of unitary authorities and the facilitation of a shift to whole council elections are all liable, for the reasons discussed in the previous section, to enhance the potential of local government to fulfil the key roles ascribed to it by the Widdecombe Committee and the Lyons review.Footnote ⁸⁰ However, these changes have not succeeded – either individually or collectively – in radically reinvigorating local government and local democracy. This is unsurprising for two reasons.

First, reform has been relatively modest. For example, notwithstanding the introduction of unitary authorities, two-tier arrangements persist in large tracts of England: 27 county and 201 district councils remain.Footnote ⁸¹ Meanwhile, councils were permitted (and most chose) to adopt a “cautious”Footnote ⁸² version of the executive model – the “leader plus cabinet” system; relatively few chose a directly elected mayor. And while it is now easier for local authorities to shift to whole council elections,Footnote ⁸³ the adoption of this system is not required, and election by thirds remains the norm in many areas.Footnote ⁸⁴

Secondly, attempts to reinvigorate local democracy have not been accompanied by any significant enhancement of the autonomy of local government: indeed, as we argued above, there have for decades been real limits to the independence of local government and its capacity to develop distinctive policies and approaches suitable to local conditions. The difficulty is that the position vis-à-vis the autonomy of local government cannot sensibly be divorced from that pertaining to the health of local democracy. As a Local Government Ombudsman has asked, “[W]hy should people vote for organisations that have so little power to change things on the ground?”Footnote ⁸⁵ This sentiment finds expression in empirical data: for example, reporting the findings of their research into the 2006 local elections, Hayward et al observe that “a large minority of respondents were in no way persuaded of the value of voting … , making the ongoing low turnout figures no surprise”.Footnote ⁸⁶ As Rallings and Thrasher point out, “The real key to higher turnouts at elections is engaging a greater proportion of the electorate, not simply making it easier to cast a ballot.”Footnote ⁸⁷ Such engagement is likely only if, in the first place, local government has, and is perceived to have, sufficient power and autonomy to make a genuine difference – a view which is supported by research which found that if councils had “more scope to make decisions about what happens locally”, two-thirds of people would be more likely to vote in local elections, and that greater “scope to set taxes and charges locally and decide how the money is spent” would induce 60 per cent to do likewise.Footnote ⁸⁸

Thus are the seeds sown for the vicious circle to which we referred at the beginning of this paper. As Leigh has observed, “governments have sought to correct local [democratic] failings by transferring functions to other (unelected) bodies, imposing national standards of service or periodic structural reviews of all or part of local government”.Footnote ⁸⁹ Central intervention is thus a response to the failure of local democracy, yet paradoxically it is, for the reasons set out in the previous paragraph, also liable to exacerbate such failings. So, as Jones and Stewart have argued, “At the heart of central-local relations lies a dilemma between a commitment to local government and decentralisation, and distrust [by the centre] of local government.”Footnote ⁹⁰

These difficulties – and the vicious circle to which they give rise – are illustrated by the debacle concerning the reform of local government finance in the late 1980s and early 1990s.Footnote ⁹¹ The community charge, introduced in 1990,Footnote ⁹² was a flat-rate per capita system of local taxation which replaced one founded on the rental value of properties, and had the effect of widening the tax base. Margaret Thatcher, who was Prime Minister when the community charge was introduced, later wrote in her memoirs that the intention underlying the new tax was that “everyone should contribute something, and therefore have something to lose from electing a spendthrift council”.Footnote ⁹³ Thus the justification for the new system was said to lie in its capacity to strengthen the “link between paying for local government and voting in local elections”.Footnote ⁹⁴ Local accountability would be enhanced by (in the words of the Green Paper which prefigured the poll tax) ensuring “that the local electors know what the costs of their services are, so that armed with this knowledge they can influence the spending decisions of their councils through the ballot-box”.Footnote ⁹⁵ Yet when some local authorities set high levels of community charge, it was the Thatcher administration against which local taxpayers principally vented their spleen.Footnote ⁹⁶ Although councils had on average adopted inflation-busting spending increases of over 13 per cent, an opinion poll in 1990 showed that 56 per cent of people blamed central government for the problems arising out of the poll tax; only 18 per cent blamed local government.Footnote ⁹⁷ Meanwhile, other research found that for roughly half of voters the poll tax had exerted an “important” or “very important” impact on how they had cast their ballots in the 1992 general election, notwithstanding that 78 per cent of respondents to a 1990 survey agreed that, “Leaving aside the level of the Community Charge it is a good idea in principle that everyone should pay something towards the local government services they use.”Footnote ⁹⁸

Of course, the ascription of a good portion of the blame to central government is entirely unsurprising, given that it was solely responsible both for the decision to introduce the community charge and its highly regressive nature. However, this is not the whole story. Broader considerations meant that the situation was not ripe for the sort of renaissance in local accountability which, according to the community charge's supposed underlying philosophy, ought to have resulted in taxpayers' ire being directed to a greater extent at local authorities. Indeed, a deep intellectual ambivalence surrounded the introduction of the poll tax. Protestations that its aim was to enhance local accountability notwithstanding, Butler et al point out that it was introduced against a background of “remorseless attack on the autonomy of local authorities”.Footnote ⁹⁹ The Thatcher government had already intervened very substantially in local government finance, taking the unprecedented steps of securing (and exercising) statutory powers to control expenditureFootnote ¹⁰⁰ and imposing a regime of compulsory competitive tendering.Footnote ¹⁰¹ Moreover, before eventually capitulating in relation to the community charge – one of the first acts of Thatcher's successor, John Major, was to replace it with another property-based tax – central government responded to concerns about poll tax levels by imposing caps and giving additional money to some councils from central funds, so reducing the need for the community charge to be levied at high levels but undermining the very culture of transparency and accountability which the new regime was intended to instil.

Thus the history of interference in local government finance helped to create, and the philosophically incoherent (but politically expedient) interventions in response to the new tax's unpopularity helped to perpetuate, precisely the sort of vicious circle referred to above. The success of the community charge was dependent on the existence of precisely the sort of relationship of accountability between local authorities and individuals – within which the democratic nexus is strong enough to render local elections an adequate control upon local taxation and spending – which it sought to create. For the reasons explored above, it is clear that no such relationship existed at the time of the poll tax's introduction, and it is unsurprising that it failed to establish one overnight.

B. The Constitutional Position of Local Government

The existence of the vicious circle is, of course, dependent on central government's willingness and ability to interfere in local affairs. It is therefore worth asking to what this propensity and capacity to intervene is attributable. Three factors are in play here.Footnote ¹⁰² First, and most obviously, politicians in control of central government may often have – or at least regard themselves as having – positive reasons to intervene, in order to secure maximal implementation of their policy preferences and broader political philosophy.Footnote ¹⁰³ Secondly, the United Kingdom's unusual constitutional architecture – in particular the close relationship which exists between the executive branch and Parliament – gives central government effective control of a sovereign legislature, thus providing a powerful vehicle for the outworking of any interventionist inclinations. Thirdly, it does not, of course, follow that politicians involved in central government are necessarily so inclined: some may, at least as a matter of abstract principle, ascribe preponderant value to local autonomy. Yet, even here, considerations of self-preservation are likely to incentivize intervention, since the risk arises that voters will punish central government for local government's failings precisely because of the weaknesses, already discussed, in the democratic accountability of the latter. All three of these factors are either animated by or themselves give succour to the vicious circle: acting upon interventionist inclinations undermines local government and the democratic nexus connecting it with its electorate; the weakness of local government, which is itself a function of the vicious circle, means that it is not an adequate counterweight to the central power of the executive and Parliament; and any perceived need for intervention on grounds of self-preservation only arises in the first place because voters' identification with local government is deemed insufficient to allow local democracy to function unhindered as the primary control upon local authorities.

Why does this account of central-local relations not apply with equal force to the relationship between central and devolved governments in the UK? Local government is, to a considerable extent, treated as an object of central government policy: intervention is frequent, substantial and regarded as acceptable. This is true in relation to (inter alia) the architecture of local government,Footnote ¹⁰⁴ its financesFootnote ¹⁰⁵ and its role.Footnote ¹⁰⁶ In contrast, it is clear that devolved government is not regarded as an object of central government policy: its fundamental features and characteristics are not considered readily manipulable by the centre. This is apparent (for example) from the fact that recent changes to the institutional arrangements for and extent of devolution in Wales, although necessarily enacted by the UK Parliament, were introduced to a large extent at the behest and with the assent of the National Assembly for Wales itself.Footnote ¹⁰⁷ Similarly, the current debate about the Scottish devolution settlement is being driven by Scottish politicians. The Scottish Parliament has established a Constitutional Commission to “review the Scotland Act 1998 in the light of experience”,Footnote ¹⁰⁸ a development which has been “welcomed” by the UK government.Footnote ¹⁰⁹ And, while the UK government and legislature will not necessarily implement every recommendation the Commission eventually makes, it is clear that the UK government regards itself as being much more constrained vis-à-vis intervention in the Scottish devolution settlement than in relation to local government matters.Footnote ¹¹⁰

This reflects the different constitutional positions occupied by local and devolved government. (We use the term “constitutional” in a broad, extra-legal sense here.) While both forms of government legally exist due to an exercise – and therefore in the shadow – of parliamentary sovereignty, there are nevertheless important constitutional differences between them. Put bluntly, the devolved institutions are more obviously imbued with constitutional status than their local counterparts. There are several reasons for this. First, they enjoy a particular status in popular consciousness which derives from the fact that they are bound up with – and constitute a focal point for – senses of nationhood.Footnote ¹¹¹ People are likely to identify less strongly with institutions of local government, not least due to the transient nature of the membership of many local communitiesFootnote ¹¹² and the fact that such institutions may not in any event be aligned with notions of local identity.Footnote ¹¹³ As a result, it has been observed that the Conservative governments of the 1980s and 1990s “were able to remove functions and finance because local government was not greatly loved or respected by its electorates”.Footnote ¹¹⁴ Secondly, the devolved institutions enjoy an obvious legitimacy which local government does not possess (at least not in equal abundance). For example, the devolved systems of government themselves enjoy legitimacy deriving from the fact that they were endorsed – albeit marginally in Wales – through referendums, while the democratic relationship – at least measured crudely by reference to election turnout – seems healthier in respect of devolved governments, with turnouts in the 2007 elections to the Scottish Parliament and Welsh Assembly of 52 and 44 per cent respectively.Footnote ¹¹⁵ It is worth noting in passing that the Welsh devolution settlement is less (and until recentlyFootnote ¹¹⁶ was markedly less) extensive than its Scottish counterpart, and that the Richard Commission, which carried out a review on behalf of the Welsh Assembly, found that “the most frequently cited cause for disappointment [with devolution in Wales] was the inability of the Assembly to fulfil its potential due to its limited powers”.Footnote ¹¹⁷ Indeed, research by the Electoral Commission in relation to the 2003 elections to the Welsh Assembly – in which turnout was only 38 per cent – found that a majority of people said they would have been more likely to vote in Welsh Assembly elections “if the National Assembly was given much greater powers to change things that shape people's daily lives”.Footnote ¹¹⁸ This suggests that there is a relationship between propensity to vote and the perceived powerfulness of the institution to which the election relates – a point which is of a piece with our argument about the relationship between autonomy and democracy in the local government context.

There is no shortage of evidence that central government perceives devolved institutions differently from – and, crucially, as imbued with greater constitutional status and permanence than – their local counterparts. There is an evident awareness in the relationship between central and devolved institutions of constitutional dividing lines which act as a brake on the capacity of the former to interfere. This is apparent both from the consultative approach (noted above) of the centre to the development of the devolution settlements themselves, and from the set of constitutional norms which regulate the relationship between central and devolved government vis-à-vis the implementation of the existing devolution settlements. Thus there is a very clear convention that the UK Parliament should not normally legislate on devolved matters unless the relevant devolved legislature consents.Footnote ¹¹⁹ Meanwhile, “concordats” set out the basis on which devolved governments – and departments within those governments – are expected to relate to one another.Footnote ¹²⁰ Such arrangements imply a degree of respect by central and devolved administrations for one another – and recognition by central government that its devolved counterparts enjoy a measure of legitimacy which requires relations to be pursued on a negotiated basis. In contrast, it is clear that such dynamics do not shape the relationship between central and local government. For example, Butler et al, writing about the implementation of the poll tax, argue that the episode highlighted “the freedom of a government with a subservient Parliament to rewrite the Constitution at will” by “redefining the role of local government without any semblance of its consent”.Footnote ¹²¹ This is not to suggest that local authorities are never consulted by central government about changes in policy and legislation; but there is unarguably a clear difference in the way that the constitutional status of devolved and local government is perceived by the centre.

This analysis shows that in respect of local as distinct from devolved government, a concatenation of factors positively incentivises and fails to disincentivise intervention by the centre. The weak state of local democracy acts as the incentive: so long as the democratic relationship between individuals and councils remains weak, it is in the political interests of central government to ensure that local authorities deliver key public services to a high standard. Meanwhile the absence of actual or perceived constitutional dividing lines means that there is no (effective) disincentive to intervention: such activism on the part of central government is the norm and is not, for the reasons considered above, regarded as constitutionally (or otherwise) improper. The resultant dynamic is self-perpetuating (as vicious circles tend to be): intervention weakens and prevents the flourishing of the democratic nexus between individuals and councils, thus incentivizing further intervention.

A. The Democratic Nexus

Recent constitutional history features several attempts to enhance the quality of local democracy which have ultimately failed or at least disappointed. However, in general, such attempts have been made in isolation from the other matters identified in the previous paragraph.

First, changes have been made to the voting system with the intention of stimulating voter turnout. As noted above, in the 1990s it was, somewhat bizarrely, thought that voters could best be engaged by giving them the opportunity to vote frequently – hence the extension of the system of election “by thirds”. Empirical evidence suggests that this system has the opposite of the intended effectFootnote ¹⁴² and the Electoral Commission, in 2004, therefore recommended that all English local authorities should be elected via whole council elections.Footnote ¹⁴³ That the government has accepted the case for such a change is to be welcomed,Footnote ¹⁴⁴ as is the Local Government and Public Health Act 2007 to the extent that it makes it easier for local authorities to switch to whole council elections,Footnote ¹⁴⁵ although it is regrettable that reform has not gone as far as to roll out whole council elections across the board. The government held back from doing this because it felt it would be “contrary to the devolutionary thrust” of the reforms introduced via the 2007 Act. Of course, leaving important decisions – in the spirit of subsidiarity, as European lawyers might put it – to the local level is all very well if local democracy is in rude health. But if a given measure – as in this instance – has the potential (in concert with other measures) to reinvigorate a system of local democracy afflicted by malaise, it is somewhat paradoxical to devolve to the local level the decision whether to adopt the measure.

Secondly, policy-makers have sought to simplify the structure of local government in recent years by shifting from two-tier to single-tier arrangements. This has the potential to render the system more transparent and more comprehensible by making it clear that a single authority is responsible – and can therefore be held to account – for all local government matters. Such demystification should help to strengthen the democratic nexus between individuals and councils. Of course, the adoption of unitary arrangements is not in itself a panacea. For example, subsuming several district councils into one unitary authority covering a geographically large or socially diverse area may breed a sense of disenfranchisement incompatible with encouraging participation.Footnote ¹⁴⁶ This implies that it is necessary to give careful thought to (inter alia) the size of new unitary authorities.

Thirdly, we saw above that there have been very significant recent changes to the internal structure of local government, through the introduction, via the Local Government Act 2000, of distinct executive bodies within councils, but that most councils adopted the most cautious mode of reform. It is therefore perhaps unsurprising that the 2000 Act was found not to have succeeded in enhancing the visibility of – and thus public awareness and engagement in – local government,Footnote ¹⁴⁷ prompting the enactment of further reforms in 2007. Most significantly, given that it is the directly elected mayor model which is acknowledged to have the greatest potential to enhance the visibility of local government, the Local Government and Public Involvement in Health Act 2007 makes it easier for councils to switch to that systemFootnote ¹⁴⁸ and the 2008 White Paper proposes that it should be easier for the public to petition for a referendum on switching to a directly-elected mayor.Footnote ¹⁴⁹ These reforms are welcome as far as they go – but they hardly constitute the sort of radical change which is likely to breathe new life into local government.Footnote ¹⁵⁰ Nor do suggestions in the 2008 White Paper that people might be incentivised to participate in local elections by entering voters into a prize draw.Footnote ¹⁵¹

B. Autonomy

Those of the elements of the 2007 Act that are designed to promote local autonomy are in truth relatively modest. They include the following. Local authorities' powers under Part 1 of the Local Government Act 2000 to promote the economic, social and environmental well-being of their areasFootnote ¹⁵² will be extended to high performing parish councils;Footnote ¹⁵³ a welcome development but one that will only affect relatively minor matters. The change to exempt the few, larger, parish and community councils currently subject to best value duties from those dutiesFootnote ¹⁵⁴ will certainly give them more discretion, but is in substance a small change.

Of greater significance is the new legislative structure provided for partnership working.Footnote ¹⁵⁵ This requires county, unitary district and London borough councils (“responsible local authorities”) to submit to the Secretary of State a Local Area Agreement specifying local improvement targets. The agreement is prepared in consultation and co-operation with specified partner authorities (a wide range of local government bodies for the area, including district councils in two-tier areas, the police authority and the chief officer of police, the fire and rescue authority, NHS Trusts, the development agency, the local probation board and the youth offending team). Targets are to be for improvement in the economic, social or environmental well-being of the responsible local authority's area. They may apply to the responsible or partner authorities and, with their consent, other persons. Authorities must have regard to these targets in exercising their functions. The Secretary of State may designate targets. Targets other than designated targets can be changed by agreement among the parties. Designated targets can only be changed through a formal revision process involving submission to the Secretary of State. The process of local agreement to these targets and the fact that they are in terms “local” undoubtedly reinforces local autonomy. It remains to be seen how the powers of control retained by the Secretary of State will be exercised. It does not, however, seem that these developments will be supported by new money. The “carrot” seems to be an increase in the flexibility over the use of mainstream resources, with some £5bn being moved from a large number of specific grants of various sizes into non-ringfenced general grants over the Comprehensive Spending Review period.Footnote ¹⁵⁶

There are new powers for the Secretary of State to make regulations providing for classes of byelaws that will not have to be confirmed by him or her and for byelaws to be enforceable through fixed penalty notices.Footnote ¹⁵⁷ The former was seen by Unlock Democracy, a joint campaign by Charter 88 and the New Politics Network, as “arguably the most significant devolution of powers in the Bill”.Footnote ¹⁵⁸ If this is so, it does not say much for the rest of the Act. The White Paper stated that this change would enable communities to set standards of behaviour and rules affecting their localities, improving the quality of their environment and creating pleasant, safe local public spaces which can be enjoyed by all.Footnote ¹⁵⁹ The Explanatory Note to the 2007 Act states that the government initially intends to apply the change to byelaws confirmed by the Secretary of State for Communities and Local Government: “These byelaws regulate matters such as low level nuisance in local spaces (for example parks and beaches, the use of market places and the cleanliness of barbers' and hairdressers' premises). The powers could be used in relation to byelaws in other areas in the future.”Footnote ¹⁶⁰ This is hardly the stuff of a new constitutional settlement. Furthermore, it will require considerable ingenuity on the part of local authorities if they are to use the new freedoms to add a new, distinctive dimension to the plethora of criminal offences and other processes already on the statute book, designed to control anti-social behaviour. Perhaps exceptionally clean barbers' shops will be of particular interest to some communities.

Important features of the Act are the opportunities that have been taken to reform the law governing the Local Government OmbudsmenFootnote ¹⁶¹ and ethical standards.Footnote ¹⁶² Most of the changes involve tidying up aspects of the respective legislative regimes in the light of experience, rather than fundamental changes. The major feature of the changes concerning ethical standards lies in transferring responsibility for dealing with complaints of breaches of the local authority codes of conduct in England from the Standards Board for England to local authorities. This can be presented as an increase in local autonomy. In one sense it is, but the policing of what is in effect a nationally prescribed code is incidental to the main business of local authorities.

The main changes affecting central-local relations arguably lie not so much in the Act, but in new arrangements for performance assessment. The essential elements are these.Footnote ¹⁶³ Each major local authority must develop a Sustainable Community Strategy after wide consultation. National priorities were identified as part of the Comprehensive Spending Review 2007.Footnote ¹⁶⁴ This “set out 30 national Public Service Agreement targets focused on delivering cost-cutting outcomes”.Footnote ¹⁶⁵ A single national set of 198 indicators was also published in October 2007 “that significantly reduces local reporting burdens”.Footnote ¹⁶⁶ By June 2008, 150 Local Area AgreementsFootnote ¹⁶⁷ between local authorities and a range of local partners, facilitated by the Government Offices for the Regions, had been entered and approved by ministers. Each Agreement includes up to 35 national priority targets (plus statutory education and childcare targets),Footnote ¹⁶⁸ and may include others, not necessarily drawn from the National Indicator Set. Performance of each local authority will be measured against all 198 indicators through a new methodology for Comprehensive Area Assessments, which replaced the Comprehensive Performance Assessment regimeFootnote ¹⁶⁹ in April 2009. This is intended to support “a sharper focus on key priorities, a more collaborative approach to achieving outcomes, and a reduction in burdens on frontline services”.Footnote ¹⁷⁰ There should be fewer inspections of local services, mostly risk-based, after it is introduced.Footnote ¹⁷¹

Finally, what of the government's response to the Lyons Inquiry? This was somewhat terse.Footnote ¹⁷² It was said that the core proposals supported and extended the government's commitments to strengthen local government. However, capping powers would remain; there were no plans for revaluation during the life of the present Parliament. The government would legislate as soon as possible to remove the current business rate relief for most empty properties and consider Sir Michael's proposals for a local supplementary business rate. It did not intend to introduce a tourism tax. There was no comment on central-local relations in general. The prospects for a significant increase in local financial autonomy seem bleak. Proposals concerning the rating of empty properties and the introduction of new powers for upper tier authorities to levy supplements to the business rate to support local economic development have been taken forward.Footnote ¹⁷³

C. The need for a New Constitutional Settlement

Our analysis so far leads us to the conclusion that there are essentially three possible models of local government. In the first, which we call the agency model, local authorities have no real autonomy at all; they are merely agents of the centre charged with implementing its policies and delivering services in particular geographical areas. This falls far short of the requirements in the European Charter of Local Self-GovernmentFootnote ¹⁷⁴ but is the logical end-result of the vicious circle we have sketched in this paper. Secondly, there is the virtuous model – the product of our virtuous circle – under which local authorities have a very high degree of autonomy to decide what policies to pursue, the powers to pursue them, less financial reliance on central government and a strong democratic relationship with their electorates. The third possibility is what we term the disguised or hybrid model, which has many of the trappings of the virtuous model – including superficial democratic credentials born of the (apparent but underdeveloped) commitment of (central government) policy-makers to local democracy as an ideal – but with genuine autonomy, save at the margins, stifled by the policy straightjacket, targets, statutory duties, controls and financial impotence which result from central government's inadequately curbed instinct to intervene in local affairs. Local government in England approximates most closely to the third model: and we have argued that realising the virtuous model would be possible only if the vicious circle were broken by addressing concerns relating to both the autonomy of local government and the democratic nexus between local authorities and their electorates.

We conclude, however, by arguing that none of this is likely to happen unless the constitutional position of local government is radically reconceptualised; and that (paradoxically) constitutional change in this sphere is itself unlikely without enhancements to the autonomy and democratic status of local government.Footnote ¹⁷⁵ In this way, we contend, all three sets of concerns – autonomy, democracy and constitutional status – are inextricably bound up together, such that the creation of a virtuous circle in this sphere is possible only by tackling these matters in an integrated manner.

In articulating this argument, it is helpful to begin with White's contention that “[w]ithout some notion of what the EU calls subsidiarity within the nation, some ground-rules, local government will always be at the mercy of an aggrandizing and hubristic centre” – which, he contends, has resulted in “near-terminal damage” to local democracy as a result of “five and a half decades of parliamentary dictatorship”.Footnote ¹⁷⁶ It is, on this view, the lack of clear dividing lines between central and local government – and so the absence of any widely-recognised sphere which is the exclusive preserve of the latter and upon which trespass by the former would be perceived as unconstitutional – which undercuts attempts sustainably to establish the sort of virtuous circle which we advocate.

Of course it is, as we noted above, precisely such rigid dividing lines which the British constitution, at least prima facie, lacks. With no higher constitutional norms constraining the capacity of Parliament to legislate – including on the allocation of functions to different institutions of government – powers can be removed from local authorities as easily as they can be given. But, while correct in strictly legal terms, this analysis is incomplete. Notwithstanding its unwritten nature, the British constitution actually contains some rather rigid dividing lines. Most obvious is that which now traces the boundary between matters over which the UK is competent to legislate and those which must be left to the European Union. Even though, as a matter of constitutional theory, it may be possible for the UK Parliament to override EU law or for the government to negotiate withdrawal, it is perfectly clear that there is now a very clear and rigid distinction between what may be done at national level and what may be done at EU level. A similar point, as we noted earlier, applies to devolution: in spite of Westminster's theoretical sovereignty, it is now accepted – and enshrined in convention – that the UK Parliament should not normally legislate on devolved matters without the assent of the relevant devolved authority. Once again we see the emergence of clear dividing lines which, legal theory notwithstanding, are difficult if not impossible to breach.

Without equally clear – and fixed – dividing lines, attempts to reinvigorate local democracy are liable to fail over the long-term. Giving local authorities greater autonomy and strengthening the democratic nexus between local government and the electorate are, as we have argued, essential; but there would remain a real risk of interference by the centre in local affairs. Part of the essence of democracy is that governing authorities must be given the scope (within appropriate legal and constitutional limits) freely to pursue their policies and to be judged on them by the electorate. The capacity of local democracy to flourish in this way is stunted by the instinctive desire of central government to intervene when it perceives that its local counterpart is failing. Such intervention distorts the democratic relationship between local authorities and their electorates, reducing the likelihood of local democracy functioning as an adequate mechanism of control, and thereby incentivising further intervention by the centre.

Of course, improving local democracy would reduce the perceived imperative on the part of central government to intervene in local affairs; but the constitutional position of local government must be reconceptualised such that central intervention is not merely disincentivised but also curbed. The creation of clear (small-c) constitutional dividing lines, so as to carve out a constitutional space within which local government may function, is necessary if White's “aggrandizing and hubristic centre” is to be prevented from acting out its interventionist instincts. The (short) history of devolution teaches important lessons in this regard. It suggests that there must be a positive commitment – on both sides – to the creation of constitutional space within which local institutions are largely protected from the reach of central government's legislative and executive tentacles. This was explicitly done in relation to devolution through the articulation, by means of concordats, of clear norms of behaviour – a step which, the authors of the Power Inquiry argued, should be applied to the relationship between central and local government, too.Footnote ¹⁷⁷ In fact such a concordat was recently entered into between the UK government and the Local Government Association (on behalf of English local authorities);Footnote ¹⁷⁸ but, by way of conclusion, we suggest that for three reasons it is unlikely to establish for local government anything resembling the sort of constitutional space which we have argued is necessary if it is to realise its potential.

First, the Central-Local Concordat is drafted in largely aspirational rather than prescriptive terms. For example, while it states (in line with the European Charter on Local Self-Government) that “there should be a presumption that powers are best exercised at the lowest effective and practical level”, the concordat supplies no real basis for determining what constitutes the province of local government: it does not establish a realm of matters – analogous to the category of devolved matters for which devolved governments are now responsible – which are the constitutional preserve of local authorities. As such, the concordat signally fails to create, or even lay the foundations for, the sort of dividing lines which are needed if a genuine constitutional space is to be carved out within which local government can thrive.

Secondly, it is noteworthy that the concordats pertaining to devolution are in effect a set of political agreements which bite upon a clear pre-existing legal framework within which the respective realms of central and devolved government are clearly demarcated.Footnote ¹⁷⁹ On both administrative and legislative levels, the central/devolved dividing line is fixed by legislation, and the role of conventions and concordats is to finesse difficulties that might arise in the outworking of the relationships ordained by the devolution statutes. For example, in legislative terms, the Sewel Convention, by conditioning the exercise of the Westminster Parliament's theoretical sovereignty, ensures that the Scottish Parliament in effect enjoys exclusive competence within the realm of devolved matters. And, on the administrative level, a series of detailed concordats establishes a set of ground-rules for the interrelationship of particular central and devolved bodies when issues arise which cut across their statutorily-determined spheres of authority. The Central-Local Concordat, in contrast, does not exist against the background of a legal framework which clearly demarcates the central and local government realms; and nor does it make any serious attempt to constitute such realms. It follows that in the absence of legally or politically entrenched notions of where central government power stops and local autonomy begins, it is highly unlikely that the Central-Local Concordat will succeed in carving out a genuine constitutional space within which local government might flourish.

Thirdly and finally, changes to the constitutional status of local government can successfully be made only if tackled in conjunction with the other areas of difficulty considered in this paper – viz the democratic legitimacy and autonomy of local authorities. This follows – in two distinct but complementary senses – from the interconnectedness of the issues to which we have drawn attention in this paper.

On the one hand, strengthening the democratic quality of local government – which, we have suggested, is itself only possible if its autonomy is enhanced – ought to be regarded as a condition precedent to the creation of the kind of constitutional space which, we contend, local authorities should inhabit. Endowing local government with constitutionally protected autonomy would be appropriate only if there were reason to be confident that a healthy, functioning system of local democracy would be an adequate mechanism of control.

On the other hand, conferring new constitutional status on local government would only be possible if its autonomy and democratic legitimacy were radically enhanced. This follows because of the nature of the British constitution itself. New constitutional space for local government cannot simply be legislated into existence, just as, for example, the inviolability of the Scottish Parliament and Executive's competence over devolved matters could not straightforwardly be constituted by statute. This much is elementary constitutional law: the Westminster Parliament's sovereignty and the absence of a written constitution conspire to preclude the creation of legally entrenched constitutional dividing lines in the UK. Instead, to the extent that such lines exist, they must develop organically. For instance, the constitutional status of the Scottish devolved institutions has grown out the high degree of perceived legitimacy – the reasons underlying which we explored above – that they enjoy. The reverse side of that coin is the perceived illegitimacy of uninvited intervention by London in devolved matters.

The upshot of this analysis is that a genuine constitutional space for local government can only emerge if circumstances develop such that the relevant actors come to regard interference in local affairs as improper. Then, and only then, may devices like a concordat between central and local government be useful, as a means of formalising understandings as to the location of the dividing line reflecting the spheres within which the two tiers of government may act with perceived legitimacy. And such circumstances are, as we have argued, liable only to emerge if, in the first place, local authorities come to occupy a much more significant role in the democratic life of the communities they serve – which, in turn, is likely only if the autonomy of local government is substantially augmented.