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Speech to LGA conference

Date of speech	5 July 2006

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Draft text of the speech - may differ from the delivered version.

Jeremy, thank you for that characteristically warm introduction. It is a privilege to be here today to talk to your annual gathering, a gathering of some of the people who help keep our services and our democracy so healthy.

I'd like to play tribute to the work of Sir Brian Briscoe, who was crucial in the formation and development of the LGA. He will be sorely missed. But in Paul Coen I think you have a very able replacement. And I would like to thank Sir Sandy for the way he has worked with me, both in my time at DfES and since I have been at Communities and Local Government.

I'm very pleased to be talking to you as the first Secretary of State for Communities and Local Government and I look forward to meeting many more of you as I travel around the country listening and learning.  

My Department is built on the old ODPM but in many ways is quite new and very different. The addition of key responsibilities, from the Home Office and DTI, gives us a big opportunity to think about communities in a more rounded way. Many of you will know about the great work that Phil Woolas has already been doing in Oldham on this agenda, and both he and I are determined that we use the creation of Communities and Local Government to make a real difference to communities up and down the country.

It was at last year's conference that many of you will have first heard of the terrible events in London on 7/7.  Local government rose to the challenge that day - and during the following days and weeks. You reached out to the people affected across the country, worked to hold your communities together and ensured the speedy return of normal life.

So let me start by thanking all of you here, and all of your staff, for the leadership you provided and for the hard work you have put in.

Up and down the land, you are representing the concerns of your communities, holding local public services to account through effective scrutiny, and working on the front line to champion the interests of your neighbourhoods.

Leaders, mayors and executive members have been making tough decisions to support the long term interests of their citizens and their communities.

I start in this post convinced that this is an exciting moment for the way we govern ourselves.  I think that we are at a tipping point for our democracy where, working together, we can usher in a new and unprecedented era of devolution.  Today, I want to set out where I see this agenda going and what both you and I need to do to make it happen.

If we are to seize the opportunity we need clear thinking. That means, as I have said in previous speeches to LGA gatherings, making sure both power and accountability are devolved to the right level, so that citizens benefit from responsive government.

Of course, on some issues we can only deliver with a strong role for central government - on the economy, on equity, on welfare, on a core of national minimum standards that must be delivered to every citizen, whatever their background, wherever they live.  A localism that ignores this reality is not one that I could embrace.

But often we need to be looking to other levels of government.  Sometimes this will be at the level of the 'nation'. We should never forget that it was this Government that insisted on devolution to Scotland, and to Wales. It was opposed very strongly by some at the time but by very few now.

Sometimes and on some issues power needs to be located at the regional level but sometimes the city or city-region.

But it is at the crucial local authority level where we expect to see the sort of action that creates communities that work. The action that turns a run-down estate, or a soulless suburban street, into a neighbourhood where people are proud to live and proud to say they come from.  We all want to see councils as the clear local leaders able to make communities better places to live in. Better places to raise a family in. And better places to work and invest in. 

So I agree with Sir Michael Lyons' vision of councils as 'place shapers'. Councils that have the right powers and relationships to make sure that all local services - whether they are the responsibility of local authorities or not - work together to meet citizens' needs. Councils that have the levers to plan local growth, create mixed communities and ensure a pleasant local environment. In short, councils that have the clout to get things done and to respond to local concerns.

Over the coming months, I intend to work with you to identify precisely the powers you need to make this a reality. To see how you can play a bigger role in improving health, housing, education and safety in your area, as well as other crucial local public services.

This is the vision that will move us into a new more devolutionary era of politics. I think we are ready for the move, and I want to explain why.

Over recent decades - until quite recently in fact - the debate between central and local government has been far too focused on shifting blame and tussling over power, rather than on a debate about how to improve communities and services for citizens.

When we came into office in 1997 we took some tough action because, to be frank, there was an urgent need for investment from the centre and for improved performance in the delivery of local public services on the ground.  We all know that there were too many councils not giving adequate services to their citizens.

That had to change - and it did. You should take much credit for the fact that only a small number of councils are seriously underperforming - although I think we would agree that many councils could still do a lot better. Two-thirds of councils now have three and four stars, even under the tougher ratings. Nearly all performance indicators are going the right way. So while there is more to do no one can doubt that things have improved.

And this improvement didn't happen by chance. It was through your hard work and our hard choices.

It happened because the Labour government invested in councils. By 2007/08 we will have seen a 39% real terms increase in grant since 1997 and that followed a period when the reality for many councils was year on year funding cuts in real terms. And now there is the added stability provided by two and then three year settlements.

It happened because local authorities embraced improvement. There is now a much stronger culture of performance and improvement right across local government.  Peer based review and support through the LGA and IDeA have been important here, as has the Capacity Building Fund that we run jointly with the LGA. 

So over the past 9 years the nature of the debate between us has been transformed.  Indeed the LGA's interesting document "People and Places" has convinced me that now, more than ever, we have a largely shared view of where we need to go from here.  We all know that the next phase of public service reform - with more personalisation, choice and innovation - will work better if decisions are made closer to citizens.

For the Government's part, we have learned from our experience in power. Yes, we had to be tough and push improvement from the centre in our first years. But governments, just like people, fall into habits. And we got into the habit of responding to too many new challenges with what some would call a centralising measure. A ring fenced grant. A new initiative. A new central unit.  At first, prevailing wisdom said that innovation and change would only come from the top-down. But experience has shown that real change needs to be bottom up - national initiative combined with  local ownership, commitment and energy.

So there is a growing realisation in Whitehall that we must get off the centralising treadmill and I believe we are in the process of learning a devolutionary habit. If we get it right our instinctive reaction to a new challenge will be to empower others rather than to take power at the centre.

And this is why I'd say we are at a tipping point.

I believe that once you begin the process of devolving more power to locally elected leaders and local communities, and show that it works, then a new political dynamic is created. Momentum builds up that favours further devolution, just as we can see happening in London.

Similarly, I believe that the increased confidence and improved performance of local authorities is changing the climate of opinion in Whitehall and creating a new interest in working with local authorities.

So let me share with you the direction that I want to go in as we build towards the local government White Paper I will publish in the autumn.

These are the key themes.

Above all, citizens must be at the heart of everything we do. They must be informed, engaged and, wherever possible, have choice over the service they use and the way they use them. Like tenants in the 90 local authorities which now offer choice-based lettings for social housing. If it can be done in these councils it can be done in others - and I'll be looking for progress on this front.

Next, I want to see people able to get things done in their neighbourhoods quickly and easily. This means community groups able to play an important role in running local community centres and facilities if they so wish and can do it well. Like the local action group in Cumbria, which with parish and district council support, took over and restored the derelict village hall and put the social heart back in a community hit by foot and mouth. Doing more to enable community groups to play this sort of role will be a key part of the White Paper.

I'm clear that in all our councils we need strong and accountable leadership with the mandate, the time and the space to make tough decisions.  The new cabinet system we introduced was controversial at first but is now widely accepted. Elected mayors too have shown that clear and visible leadership can resonate with citizens and it is a model that I think has many attractions. But  there is no 'one size fits all' solution here. So I'm also interested in the LGA's recent suggestion that the appointment of a leader should be for the full term of the council.  I need to work with you to see how we can secure stable and effective leadership in all councils. We must, together, get this right.

And as I have already said, local authorities must play a major strategic and scrutiny role on both local public services and other issues in their area. Like Bradford Council's obesity review that led to obesity becoming one of the main themes of the Healthier Communities and Older People block in the Local Area Agreement.  If councils are to be true community leaders they must be able to respond to the key challenges facing their citizens.

I also want to see our great cities get the powers they need to address their own particular challenges and drive urban renaissance and economic prosperity all across the regions of England.

Indeed I want to see councils everywhere playing a full role in the economic growth of their area - although we've made progress on this issue, I cannot help think that we need stronger incentives for councils to support growth than we have at present.

And last, but certainly not least, I want to see a set of government departments that realise that their job is to set clear frameworks for delivery and reporting, not to interfere and micro-manage.

To summarise, I want us to move

• from the 'top down state' to the 'trusting state',
• from 'earned autonomy' to 'presumed autonomy',
• from a process driven system to a people driven one.

I know this is ambitious, but I don't think it is a pipe dream. I guess you have heard some of this vision before and are asking –'is it for real this time?' I'm clear that it is.  Because our vision for local government is rooted in realism - the best councils are already showing that it works. And because central government is prepared to work with you in new ways.
 
Just look at what is happening in childrens' services with councils responsible for children from 0-19 and the specific new roles they have been given in the last year over the 14-19 age group.

Just look at the strong - and largely successful - case we have made  for PCT boundaries being more co-terminous with LA ones.

Just look at the progress we are making through Local Area Agreements where we've already pooled over £700m worth of funding from an average of 9 funding streams rising to 25 or more next April. And I'm acutely aware that we need to make sure that LAAs are not overwhelmed by bureaucracy.

Consider what we are doing on the inspection reform agenda, reducing the number of inspectorates - from eleven to four and the burden of inspection by nearly a third.  What's more, the Audit Commission will have a gatekeeper role ensuring that inspections of councils are risk-based and proportionate.

And since 2002 we have reduced the number of separate local authority plan requirements by 75 per cent, and for better performing councils the load is even lighter.

But we need to be more radical still if we are to allow you to do your job better. Today I am publishing a new report about burdens on local government. While it is of course only one side of the story I was struck by some its findings.

It says that 80% of the performance reporting produced by councils is information required by Whitehall and only 20% is of direct local benefit. This has got to change.

I'm clear that we need much less red tape. This means a dramatic reduction of as many centrally set targets and indicators as is possible.

So today I can announce that we are setting up a practitioner group - the Lifting Burdens Task Force - and I am delighted that Michael Frater, Chief Executive of Telford and the Wrekin, has agreed to be its Chair. It will tell us which requirements cause the most aggravation on the ground and which add the least value - so that we can then agree packages of burden reduction through the Central Local Partnership.   We will get our own house in order first and start with Communities and Local Government.

So we are making progress. Of course, I want to go further. But I'll need your help to do this. Whatever we may feel in this Hall, there will be others less confident of the ambition that we share and our joint ability to deliver it. 

I know the pressures on Ministers in key delivery departments.  I have been there!  I know that is why, historically, oppositions talk the talk on devolving power but often fail to deliver when they get the opportunity. But I believe that we can build on the progress made so far, take on the challenge, and prove the sceptics wrong. But we'll need to work together.

What does that mean?

If I am to successfully argue your case in Whitehall then these are some of the challenges you, in local government, must take on.

You must be prepared for very tough action on underperformance. One council's failing makes all of our lives that much more difficult.

You need to focus on your strategic leadership role - and not be obsessed with who runs what service.

You must keep close to your electorates and council tax payers. This means avoiding excessive increases - I don't want to be forced to use capping powers but you can be sure that I won't hesitate to if I think they are needed.

Where we pass on powers to you it is in the context of you all seeking to pass power to your own neighbourhoods and communities. Power devolved to the town hall and from the town hall.

You will also need to continue to secure more efficiencies. But there is good news here because you are likely to hit the local government efficiency target of £3.1 billion a year early. 

Now I know some people think that local government would work much better for citizens and the taxpayers if we had full unitary government everywhere. I also know that there are some areas where there is a widely held view that this is the right way to move. In such cases, where there is a broad cross-section of support for change and where our criteria are met, I won't stand in their way. But let me also assure you that I am far more interested in outcomes for citizens than lines on maps. So we will have a short window of opportunity for that small number of councils who are keen for change and who meet our criteria to seek unitary status. But I have no desire whatsoever to create a great distraction of activity on the restructuring issue.

In the clear majority of county areas two tiers will remain and in all of these areas we will need better joint working. The status quo
is not an option. I'm also clear that there is huge potential to make efficiencies and improve outcomes through councils working more effectively together and with other public services. I know the LGA will play an important role with us in driving this forward.

So this is how I believe we should go on from here.

I will set out a radical vision in our White Paper. I want it to deliver immediate moves that result in a concrete shift of powers and responsibilities. It will flesh out the vision that has been shaped by our work with local government and the LGA, and it will set out where we want to go further.

What I know you want to do is take those powers and opportunities and show that you can make them work, solve problems and improve lives.  The momentum for further devolution will then be unstoppable.

I am up for the challenge. But I need you to be too, if we are to succeed. I look forward to working with you in this vital agenda of our times.