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Two Years From Bankruptcy

Two Years From Bankruptcy

To resist local authority cuts, we need to build a mass movement, not make futile gestures, argues Peter Chowney, Leader of Hastings Council

DURING THE 1980s, SEVERAL LABOUR COUNCILS took a stand against rate capping and government cuts. We set an illegal budget, risking our personal assets being seized by the district auditor. But there was a real possibility that, if enough councils did it, we could trigger a constitutional crisis, and force the government to back down. But the movement collapsed, and Thatcher won.

After that, everything changed. The government brought in laws that made all councils appoint a Monitoring Officer and a Section 151 Officer. These officers have a statutory duty to make sure the council never makes illegal decisions, and always sets a balanced budget. Since then, if a council were to vote to adopt a budget where spending wasn’t matched by income and reserves, the Monitoring Officer would strike it from the records, and the S.151 officer would set a budget without the involvement of councillors. There would be no surcharge, no immediate disqualifications, no heroes and no martyrs, just a group of well-meaning but foolish-looking councillors who had relinquished control of their own budget.

As for council staff, it’s unlikely they’d engage in industrial action in support of their rebellious councillors. Trades unions are weak in most councils now - last time we had a one-day national strike in Hastings, there were more councillors than council workers on the picket lines.

And local residents are not yet all that angry about council cuts. Since 2010, the money Hastings Council gets from government has been cut by around 60%. That rises to 80% by 2020. Two hundred jobs have gone. But mainstream services have been largely protected. So far, councils have been very good at containing budget cuts. So there is, as yet, no mass outrage.

For some councils, particularly district councils, there’s still more that can be done to protect services, and even develop new initiatives. We can use reserves, although they’re fast running out. We can further explore bureaucratic remedies: zero-base budgeting, applying for services online, more efficient workload planning... but these save money by cutting jobs, when it would be so much better to be using ‘efficiencies’ to redeploy stafinto new services. Then there’s income generation - raising money by trading services, bringing services back in house, even setting up a housing development company. In Hastings, we already raise around £12m a year from fees and trading - increasing this by just 10% would go a long way to bridge the gap.
But for counties and unitaries, having to bear the costs of adult social care, it’s much harder to make ends meet. One Labour leader of a unitary council recently told me that they were ‘two years from bankruptcy’. There are longer term problems piling up too. Deteriorating council-owned infrastructure isn’t being repaired. In Hastings we have an entire 1930s seafront that’s nearing the end of its life, with no prospect of being able to a afford the millions it will cost to rebuild.

So we do need a mass movement. To achieve that, we need to convince local people, who all depend on council services, that the current local government funding regime is unsustainable, and will lead to the collapse of core services. But the gesture politics of approving meaningless illegal budgets isn’t going to help with that, unless and until the masses are really behind us.

Letter

Corbyn Watch

Corbyn Watch