The postcode opportunity

Localism tends to be viewed by many on the left with suspicion. For Tories, localism can be a convenient shorthand for rolling back the state, while for Lib Dems localism offers useful ideological flexibility to take different positions in different areas, often in opposition to their national party. Maybe in part because of the ways it is used by others, and in part because our great ambitions for social justice require a strong national vision, many on the left see more risks than gains to committing to localism. The fear of a “postcode lottery” is often touted as a reason for not allowing too much variation.

But the times we are now in call for a fundamental rethink of this approach. Politics is facing a crisis of legitimacy – increasing dissatisfaction with distant decision-makers in Westminster and Brussels is not a trend that can be ignored. A stagnating economy is leading to serious fallout as the consequences of this Government’s policies are felt sharply and directly in communities. Rising inequality, a trend since the days of Thatcher, is causing increasing polarisation as divides become ever more entrenched and communities are isolated in different ways.

For one nation to be built in this context, we need to separate means from ends. If we seek fairness for all, we need to recognise the different starting points that exist. If we desire social justice overall, we need to understand the different challenges that exist in different areas. To achieve these ends, localism offers powerful means: the devolution of power to local councils so that they can respond to the priorities in their areas can reap greater rewards than a centre-led, one-size-fits-all approach which too often misses the mark in a diverse and complex landscape.

Localism isn’t new a new concept for the left. Historically, the Labour movement was inherently localist: driven by a desire from the ground up to secure better representation in Parliament, different working class and socialist traditions combined forces. The political energy of the early Labour movement was driven by the fervent activity of local branches and societies, inspired by the values of mutuality, solidarity and reciprocity which found their greatest expression in relationships between people within communities and local institutions. The Fabian Society understood this, and locally the Fabian movement thrives to this day. The Labour Party was built on the power of this energy, association and diversity.

But over time Labour nationally turned away from localism. The grand ambition of the post-1945 Labour Government, whose social and welfare achievements are undoubted, nevertheless required top-down planning and a centralised bureaucracy. As a strong central state came to characterise governance over the ensuing decades, this also had the consequence of overriding the “untidiness” of local democracy and civic engagement.

The 1997 Labour Government did recognise that public services cannot maximise their effectiveness if run directly from the centre. The “new localism” which came to characterise their approach to local government was based on a tight operating framework and national standards, which set out expectations for local authorities to manage. Over time an increasing number of duties were placed on councils, with targets linked to Whitehall’s public service agreements, a plethora of funding streams linked to different initiatives and a complicated performance assessment framework to monitor local areas, supported by a burgeoning bureaucracy.

The motivations behind this approach may have been benign, but they had serious unintended consequences. The complex and competing requirements on councils to report back diverted resources away from the frontline and ‘up’ the governance hierarchy. Local authorities were encouraged to be little more than administrative outposts accountable to central government, as opposed to democratically elected decision-making institutions accountable to their electorate. Instead, there was actually a distancing of local democratic control and influence over public service priorities, as partnership arrangements were prescribed from the centre and regional tiers and quangos assumed greater control. These bureaucratic mechanisms lacked transparency and made decisions on behalf of people at a remove from them – the lack of a genuine sense of public ownership in these institutions was evident when the incoming Tory-led government dismantled much of these layers to little public outcry.

With Labour now out of power nationally, Labour councils are actively demonstrating the value of local-led responses. Although under this government, councils are facing cuts of a third to their funding, and poorest areas are being hit the hardest, Labour councils are finding new ways to put their enduring values into practice. The innovation emanating from Labour councils has important consequences for our party nationally: both for Labour’s future policy platform as pioneering councils know what works, and more broadly because an approach built on localism can ensure a more responsive national agenda and better outcomes overall.

Labour councils are demonstrating how social justice can be pursued in ways that identify and respond to their communities’ specific needs. Many have established Fairness Commissions to develop a clearer understanding of what equality gaps exist in their areas and inform civic strategies to address them. They are turning abstract concepts such as ‘fairness’ into tangible outcomes: so for example Islington has set up a student bursary scheme, is delivering a major affordable housebuilding programme and become an accredited Living Wage council, while Sheffield is addressing the stark geographical divide within the city by broadening access to public transport, equalising health service resource allocation and developing a city-wide standard for housing and the environment. These locally-led and -owned approaches have great potential to resonate with local people as they engage with what fairness means to them, raise awareness of the knock-on effects of deprivation and create a greater shared stake in outcomes.

While the Government’s policies are causing fracture and their Big Society rhetoric rang hollow in the vacuum created by the cuts, Labour councils are finding new ways of promoting collaboration and building community capacity. Some have taken a Co-operative Council approach and are seeking to give communities more direct power over services. In Oldham the council has devolved budgets to six district partnerships, and communities have a “call-in” power over any decision made. In Lambeth the council is placing a new duty on officers to involve local residents in all decisions and there is a new default assumption that all services will be co-produced by users and commissioners.

The actions of Labour councils are demonstrating that far from social justice and localism being mutually antagonistic, the ability to respond flexibly in different areas with varying needs is fundamental to an effective response to complex social and economic challenges. A fully localist Labour Government would need to codify the independence of local government to establish a clear legislative footing. It would also need to address the thorny issue of finance so that local government is adequately and equitably resourced with a greater balance towards financial independence from the centre.

Once legislative and financial reforms establish a stronger footing for local government, a partnership of equals can more effectively operate between councils and Whitehall. Instead of thinking in terms of a lowest common denominator “postcode lottery”, which occurs in any case in an unresponsive overly centralised system of governance, we can begin to appreciate the potential of an empowered “postcode opportunity” to address local areas’ priorities.

And what of the local authorities where Labour isn’t in power? A stronger footing for councils with real decision-making powers will only be a boost for a healthy local democracy: we then need to believe in the power of Labour’s enduring values and win the political argument.