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Are unitary councils the shape of things to come?
Public Finance – 3 April 2009

By Mark Smulian

The local government map of England became a lot less complex and varied on April 1 as 43 councils vanished to be replaced by nine giant unitary authorities.

Cornwall, Durham, Northumberland, Shropshire and Wiltshire now have just one council each. In Bedfordshire and Cheshire, there are two each.

The two-tier system of local government, introduced in 1974, is now looking distinctly ragged and survives in 28 counties. Even among these, Devon, Norfolk and Suffolk are undergoing highly contentious reviews as to whether they should also go unitary.

David Miliband started the process in 2005/06 during his brief tenure as local government minister. He argued that many shire districts were too small to be strategic and too large to be truly local. He invited local government to submit its own proposals on which ministers would decide - mainly to avoid the political risks of Whitehall being seen to impose reorganisation.

There were exceptions, but in general the county councils advocated county-wide unitaries and the districts either no change, or clusters of smaller unitaries.

When local government minister John Healey announced the decisions in 2007, he said the new unitaries would be 'flagship councils that will lead the way on promoting prosperity, empowering citizens and communities, and improving public services'.

Each of the reorganisation submissions had to include details of how the proposed new authorities would make substantial efficiency savings after the start-up costs were met.

Proposers of unitary councils also had to devise models to ensure these gargantuan councils retained a local presence and identity, in most cases by combinations of area committees and forums, many with partly devolved budgets.

Some of the savings will come from the new councils needing fewer back-office and senior jobs. However, with frontline staff posts protected by the government as part of the process, the bulk of savings will have to come from new ways of working and economies of scale.

A small but symbolic saving will come from the considerably reduced number of councillors in each unitary, against the total of all those in former districts.

The creation of the unitary councils is clearly a massive upheaval for those in the areas concerned - and might yet be in Devon, Norfolk and Suffolk, where legal actions initiated by districts against the change have delayed any decision until at least the summer. But are unitaries the shape of things to come everywhere?

Labour clearly favours the idea. Although the Conservatives have said they will not engage in further reorganisation, the issue was difficult for them, with their councillors at odds between different tiers of local government.

Pro-unitary Tories could be expected to continue their argument and find a receptive audience among those seeking savings in public spending.

Past experience points strongly towards this outcome. The two-tier system of 1974 lasted just 12 years before the metropolitan county councils were abolished and their districts turned into unitaries.

Councils in Scotland and Wales, along with the former English counties of Avon, Cleveland and Humberside - and some 40 other areas, ranging in size from Herefordshire to Torbay - all became unitaries in the mid-1990s.

In public, at least, the districts that faced abolition all pledged to make a success of the new unitaries once the decisions had been taken.

Some resentment undoubtedly lingers. Alnwick District Council's leader, Ian Hinton, pointed out that his council ended its life with a clutch of glowing reports from the Audit Commission. 'When a council has achieved as much as Alnwick has done over the years and continues to do to the present day, it is no wonder that its imminent closing down seems inappropriate and is still so hard for many of us to accept,' he said.

Will others find themselves in Hinton's position? Tony Travers, director of the Greater London Group at the London School of Economics, says: 'It is safe to say that the direction of change is towards unitaries. There is a strong drift in that direction.'

But is such change desirable? Travers has doubts: 'I honestly don't know why, but there seems to be a growing perception - even among supporters of local government - that it has to be large, and there is some feeling that shire districts are too small, in particular if they have lost the landlord function of housing.

'We are moving to fewer, bigger councils and a view that financial efficiency is more important than local identity and sentiment. I have no idea why that should be happening in the country of the Magna Carta.'

The assorted local boards and forums are part of the unitary plans as accepted by the government but have no statutory status and could, at least in theory, later be abolished.

Travers dismisses them as 'vestigial vehicles for disenfranchised communities and neighbourhoods'.

Chris Game, a senior lecturer at Birmingham University's Institute of Local Government Studies, thinks the change is for the worse, and puts the UK at odds with other developed countries.

'I am saddened by it, as it seems to me the end of local government as we know it and as it would be recognised anywhere else in Europe,' he says.

'These will just be very large and remote authorities. Everywhere else has local government at a commune level and regional governments, and these unitary counties are neither. Northumberland will be twice the size of Luxembourg, with no tiers below.'

Game concludes that more unitaries are likely, because 'as long as central government views local government as a delivery agent of services, it will seek lower costs and efficiency savings'. But he adds: 'It is questionable whether that leads to better local government.'

A more sympathetic view of unitaries comes from Chris Leslie, director of the New Local Government Network think-tank.

He expects a pause in reorganisation until the economy is more normal, but says: 'The unitary case is quite compelling and any government will want more financial efficiencies.

'The Conservatives have said they would not want to do more reorganisation, but they may find there is quite a strong financial case.

Leslie believes that a change of government would not affect the thinking at the Treasury. He says that, regardless of the party, 'the Treasury will still be pushing this agenda because it sees savings. I think unitary reorganisation will keep coming up'.

He notes: 'It will be important for someone to keep count of the savings the unitaries actually make against those claimed.'

The case for reorganisation rested on unitary proponents claiming that they could produce a combination of large financial savings, better service quality and local engagement.

Now they have to prove it. If they do, the unitary tide might continue to flow. If not, who would bet against another reorganisation a few decades hence?