UK: Recent Select Committee Reports Show Tensions Between MPs Over Localism

Last Updated: 21 February 2013
Article by Angus Walker

The Public Accounts Committee's (PAC) report on local transport funding published last week packs a double punch. As well as stating that the Department for Transport (DfT) does not have adequate systems in place to monitor transport funding given to local authorities, the report also suggests that devolving transport funding powers could be a 'risky move'.

The PAC report is the latest in a series of select committee publications considering the pros and cons of localism over centralism but its conclusions are at odds with the findings of other committee reports.

The primary conclusion of the PAC report relates to DfT and argues that it does not have a firm handle on the Ł2.2bn given to local councils to spend on transport projects. MPs on the committee argue that the DfT has failed to put systems in place to assess value for money and identify failures.

A secondary conclusion of the report is that going ahead with Government's plans to devolve transport funding powers for major projects to newly created Local Transport Bodies (LTBs) by 2015 may be a 'risky move'. The PAC report argues that this may further erode the already 'limited' accountability structures that are in place.

What seems to have really struck a chord with council chiefs is the suggestion that Whitehall's apparent confidence in the ability of LTBs to make sufficiently strategic and joined up decisions in the face of tough financial pressures is 'misplaced'. The Local Government Association (LGA) issued an angry response to the suggestion branding it as a 'slap in the face' and 'baseless speculation'. A strong but, arguably, reasonable reaction?

Well, other recent committee reports considering issues such as local-centre relations and the management capabilities of DfT do seem to have taken a different view on the capabilities of local government.

The Transport Select Committee's 'Rail 2020' report published in January recommended that some rail franchises, such as the Northern franchise, should be devolved to local or regional bodies. The report also stated that the DfT lacks the commercial skills and expertise to let and manage franchise contracts effectively and suggested that these should be outsourced to an arms length body with more commercial nous.

The Political and Constitutional Reform Committee published a report last month examining the prospects of codifying relations between central and local government. It found that the balance between the two was skewed in favour of central government and needs to be addressed. The committee outlined a code which gives councils more autonomy and fiscal powers, which the committee argued in its report, is required for local government to better shape public services for the communities that they serve.

These differing conclusions perhaps justify the angry response from local government and are also quite revealing about tension between the centralism and localism amongst select committees.

The PAC's conclusions are also confusing because the comments about LTBs seem to suggest that Whitehall departments 'do it better' than local government but the report also criticises DfT's monitoring of transport spending by local councils.

To be fair to the PAC, the 'minimum requirements' that DfT published last November as guidance to LTBs developing their assurance frameworks are quite light on detail. In terms of reporting requirements there is not much more information provided beyond the need for LTBs to submit annual reports to the DfT and that DfT will conduct 'periodic assessments' of spending decisions.

But the committee's concern seems to stem from the belief that LTBs spending decisions need to be monitored stringently because they will not be able to make sufficiently strategic decisions in the face of financial pressures. This is perhaps unfair as it ignores examples of good work being done up and down the country by many local authorities to be more radical, innovative and collaborative in the approach to public services. This assertion also assumes that this knowledge will not filter through to LTBs of which local authorities are an integral part.

As LTBs get ready to submit draft frameworks this month to the DfT for consideration, it will be interesting to see how far beyond the minimum requirements they will go.

In addition, given that this is the second report in just over a fortnight criticising the Department's capacity to manage, the PAC report suggests that there is more food for thought here for the DfT than for council leaders.

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