BLAIR’S BRITAIN, 1997–2007
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Minister. But the London reform created an elected single-person executive, subject only to scrutiny by a small assembly, and who could not be
removed between elections.
What was the Blair government seeking to do?
The single word most used by ministers within the Blair government to
describe their approach to local authorities was ‘modernisation’. It
appeared again and again in Green and White Papers. It was used by supporters of the government and (as a term of abuse) by its opponents.
Different parts of the government were more committed to this process
14 Committee on Standards in Public Life, Standards of Conduct in Local Government in
England, Scotland and Wales, Third Report, Cm. 3702 (London: TSO, 1997).
15 Department of the Environment, Transport and the Regions, New Leadership for London
Cm. 3724 (London: TSO, 1997).
of modernisation than others. Downing Street and the Treasury were
strongly in favour of changing the culture of local councils and councillors, whereas the Department of the Environment, Transport and the
Regions was more modest in its aspirations. Many Labour supporters in
local authorities and constituency parties were amongst the most bitter
opponents of modernisation.
Tony Blair explained his own vision for local government in an
Institute for Public Policy Research pamphlet published in 1998.6 In it,
Blair claimed change was needed because: (i) localities lacked a clear sense
of direction; (ii) there was a lack of coherence and cohesion in delivering
local services; and (iii) the quality of local services was too variable.
He went on to criticise local authorities for a number of failings before
offering an olive branch. First: ‘Britain comes bottom of the European
league table for turnout in local elections’. Second: ‘most people do not
know the name of the leader of their council’. Third: ‘the committee
system takes up an enormous amount of time . . . A radical reform is
needed’. Fourth: ‘the government will intervene if authorities are incapable of improving their performance’, and finally ‘councils that are performing well could be given more freedom and powers’.
Labour’s modest proposals for local government were backed up by
the kind of public rhetoric and private ministerial comment that
amounted to a powerful critique of local government. Although the
Prime Minister and his advisers believed in the constitutional importance of elected local authorities, they did not much like its existing manifestations.
The Blair view of local government went well beyond the distaste felt
by senior Labour politicians such as Neil Kinnock and John Cunningham
as they had battled with the left during the 1980s.7 By 1997 virtually the
whole of local government – including former hot-spots of militancy
such as Liverpool and Lambeth – was under the control of conventional
politicians, whether Labour, Conservative, Liberal Democrat or others.
Downing Street was concerned with the ‘complacent average’ authorities
that appeared to coast along with outdated and inefficient political leadership and which were gradually, it was believed, losing public support.
The new Best Value policy was resented within local councils as a technocratic, top-down incursion into local democracy. The policy required
16 Tony Blair, Leading the Way: A New Vision for Local Government (London: IPPR, 1998).
17 David Butler, Andrew Adonis and Tony Travers, Failure in British Government. The Politics
of the Poll Tax (Oxford: Oxford University Press, 1994), pp 256–7.
detailed service-by-service performance plans, including dozens of
targets and key indicators. It was viewed within local government as
bureaucratic and intrusive. After it started operating in the spring of 2000
many councillors found it difficult fully to understand how Best Value
worked.
Local government appeared more comfortable with the Local Public
Service Agreements (PSAs) that were invented in 2000.8 Local PSAs were
designed to sign local authorities up to a national pattern of improved
public service provision: the Treasury could negotiate with the Local
Government Association about outputs and outcomes to be derived as a
result of public spending increases.
A further Blair government initiative designed to drive up quality was
the beacon council scheme.9 An independent panel was appointed by
DETR ministers to select councils that excelled in particular services.
Such authorities were awarded beacon council status for a fixed period of
years. A council that qualified as a beacon authority in a number of services could apply for overall beacon status. Such authorities were in
future to be given wider discretion over service provision.
The policy of introducing elected mayors stirred up a determined
response from councillors of all parties. Most council members believed
their existing pattern of committees, departments and service provision
was reasonably effective. The idea that every council would be forced to
choose between a cabinet, directly elected mayor or mayor-plus-councilmanager model, eventually outlined by Labour in 1998,10 proved hugely
unpopular within local government.11 It appeared that only a handful of
councils appeared likely to opt for holding the referendum that might
lead to the election of a mayor.
Local authorities also supported the government’s decision to give
them a power to promote the ‘social, environmental and economic wellbeing’ of their populations. This change was partly real, in that it gave
councils greater freedom to use resources for certain purposes, and partly
symbolic, because it suggested that local government could be trusted
with (limited) additional freedoms.
18 HM Treasury, 2000 Spending Review: New Public Spending Plans for 2001–2004, Cm. 4807
(London: TSO, 2000), para. 33.3.
19 Department of the Environment, Transport and the Regions, Modern Local Government
in Touch with the People, Cm. 4114 (London: TSO, 1998), p. 21.
10 Ibid., pp. 26–30.
11 Local Government Association, Modern Local Government: Taking the Initiative. An LGA
Survey of Local Authorities (London: LGA, 1999), p. 21.
Financing local government
Few issues had taxed successive British governments more than the
country’s Byzantine local government finance system. The Thatcher and
Major governments had undertaken three separate reviews of the subject.
The introduction of the ‘community charge’, popularly known as the poll
tax, in 1990 (1989 in Scotland) and its replacement – by council tax – in
1993 lived on in the memories of politicians as a terrible warning about the
dangers of over-ambitious reforms of local taxation. Moreover, New
Labour fought the 1997 election on a platform of fiscal rectitude. Every
effort was made to convince the electorate that the election of a Labour
government would not lead to a return to the bad old days of the late 1970s.
Local authorities, on the other hand, had long imagined that if the
Conservativ
es were vanquished from national government it would be
possible to move to a world of greater funding autonomy. In particular,
they wanted three financial reforms: the abolition of tax capping (Labour
had long been committed this); the return of local control over the nondomestic rate; and a fairer system of distributing government grants to
councils. Many Labour and Liberal Democrat councillors (and nationalists in Scotland and Wales) also hoped that council tax would be
reformed so as to make it less regressive.
Labour abandoned ‘crude and universal’ capping soon after taking
office. However, in a sign of how far the Treasury intended to keep a grip
over council finances, two conditions were set. First, the threat of selective
capping would remain. Second, a scheme was introduced to penalise councils that increased their council tax by more than a Whitehall-set figure.
In committing itself to making the Revenue Support Grant (RSG)
fairer, Labour had made a promise that was to prove hard to keep. A
major review of the grant system was undertaken during 1999 and 2000.
International experience was researched. Other ways of allocating grants
were considered, notably bid-based or performance-based systems. The
Department for Education and Employment fought for ring-fenced education grants. There was even discussion in the press about removing
education from local government altogether. However, councils successfully defended education as a core local government service.
The conclusions of the government’s review of finance were published
in a Green Paper during the autumn of 2000.12 None of the options for
12 Department of the Environment, Transport and the Regions, Modernising Local
Government Finance: A Green Paper (London: TSO, 2000).
reforming the grant system was ruled out, though none was signalled as a
particular priority. A future government might continue with formulabased general grants or, alternatively move to bid-, performance-or planbased specific grants. No full reform of the system could, it was argued,
take place before 2003–4.
London
Ever since the Thatcher government abolished the Greater London
Council in 1986, Labour had been committed to re-create a system of
London-wide government. In the 1987 and 1992 general election manifestos it was clear that any new authority for the capital would be a slimline (‘strategic’) version of a conventional British local council.
The death of John Smith and the election of Tony Blair as leader of the
Labour Party led to a change in policy towards London government. Blair
became convinced that the capital should have Britain’s first directly
elected executive mayor. Immediately after Labour’s 1997 victory a Green
Paper13 was published to flesh out the details of the London policy. There
was to be a Greater London Authority, consisting of a directly elected
mayor, who would be held to account by an elected Assembly. Elections
would be by a form of proportional representation (the ‘additional
member’ system). Services would be delivered by four ‘functional
bodies’, whose boards would be appointed by the mayor. The Authority
would be able to set a council tax precept.
Following consultation on the outline scheme in the Green Paper, a
White Paper was published during the spring of 1998.14 Immediately
afterwards a referendum was held to test public opinion. Although the
turnout was low (34%), the result strongly endorsed the White Paper
proposals for a mayor and an Assembly (by 72% to 38%).
After a long and difficult parliamentary process (during which the
government decided to amend the legislation so as to introduce a
complex public–private partnership to finance the reconstruction of
London Underground’s infrastructure), the Greater London Authority
was elected for the first time in May 2000. Although the legislation
created a strong mayor (and a correspondingly weak Assembly), it also
left ministers a number of fall-back powers of intervention just in case a
13 Department of the Environment, Transport and the Regions, New Leadership for London,
Cm. 3724 (London: TSO, 1997).
14 Department of the Environment, Transport and the Regions, A Mayor and Assembly for
London, Cm. 3897 (London: TSO, 1998).
mayor indulged in too many policies that proved unacceptable to central
government.
The process of electing the capital’s first directly elected chief executive
was sufficiently exotic to have generated a separate book in its own right.15
Both the Conservative and Labour parties became involved in highly
publicised and chaotic efforts to choose a candidate. In a country with no
history of primary elections of the kind commonplace in the United
States, both parties had to invent processes to select their candidates.
The Tories first chose Lord (Jeffrey) Archer, who later had to resign
because of a newspaper allegation about perjury in a previous court case. A
second attempt to find a mayoral candidate was thrown into disarray when
the favourite – Steven Norris, who had been defeated by Archer first time
round – was ruled out of the contest by the party selection committee.
Eventually Norris was reinstated and went on to become the candidate.
However, the Conservatives’ efforts were positively well choreographed
compared with the Labour Party’s. Ever since the 1997 election victory
and the certainty that London would soon have a directly elected mayor,
there had been speculation that the final leader of the Greater London
Council, Ken Livingstone, would stand as Labour candidate for the new
role. However, to Blair and the New Labour machine, Livingstone embodied everything that was wrong with the party’s previous image with the
electorate. He was seen as extremist, oppositional and dangerous.16
Blair and his New Labour colleagues were determined to stop the exGLC leader. A complex electoral college was set up to select a candidate.
Tony Blair and Gordon Brown made speeches denouncing Livingstone.
The process resulted in Frank Dobson, previously Health Secretary, being
chosen as Labour’s candidate. Livingstone then decided to stand as an
independent.
Blair’s apparent efforts to martyr Livingstone, like those of Margaret
Thatcher when she abolished the GLC in the mid-1980s, proved wholly
counter-productive. ‘Ken’, as he was universally known, was seen as an
underdog and a London populist. He was also strangely glamorous. It
was small wonder that, on 5 May 2000, Livingstone became London’s
first-ever directly elected Mayor.
In office Ken Livingstone adopted a number of Blairite characteristics.
Efforts were made to be consensual and to adopt more moderate policies,
particularly towards big business. What became known by some as the
15 Mark Darcy and Rory Mclean, Nightmayor (London: Politico’s, 2000).
16 John Carvel, Citizen Ken (London: Chatto and Windus, 1984).
‘Kenocracy’ proved, in many ways, to be the least-worst version of a
Livingstone reg
ime imaginable from Tony Blair’s point of view.17
However, when efforts were made by Livingstone supporters to seek the
Mayor’s re-admission to the Labour Party, the view within the party leadership remained one of ‘wait and see’.
The English regions
Labour’s approach to regional government in England outside London was
muddled. Progress was made by the introduction in 1998 of Regional
Development Agencies (RDAs), though these were appointed, not elected,
institutions. RDAs were charged with improving the economic competitiveness and success of their areas. At the same time that RDAs were created,
regional ‘chambers’ (which generally became known as ‘assemblies’) were
set up to oversee them. These chambers or assemblies, which were intended
to secure some form of local political accountability, were indirectly
elected, with members drawn from local authorities within their areas plus
a minority of individuals from other representative organisations.
The Blair government made no move towards fully fledged regional
government in England. Despite a genuine shift of power to Scotland,
Wales, Northern Ireland, devolution in England (apart from the capital)
proved a reform too far for New Labour’s constitutional modernisers.
Press reports between 1997 and 2001 suggested the cabinet remained split
about the issue.
By 2001, devolved government had arrived in three parts of Britain
and, haltingly, in Northern Ireland, but it remained a shadow or compromise in England outside London. Possibly the consequences of a transfer
of powers to Bristol, Birmingham, Manchester, Leeds and Newcastle was,
at least during a first term of office, seen as providing Westminster with
too great a threat to its power.
2001–2005
Labour in office
The second Blair government continued to evolve policies that created
new service-delivery units for education, health, regeneration, housing
17 See Tony Travers, The Politics of London Governing an Ungovernable City (Basingstoke:
Palgrave Macmillan, 2004); and Ben Pimlott and Nirmala Rao, Governing London
(Oxford: Oxford University Press, 2002).
and policing. It also sought to create consistency between different providers and to reduce the extent to which Whitehall departments handed