Letter from Eric Pickles about the Localism Bill and Local Government Finance Settlement

A new relationship between central government, local government and local people starts today.

Like all Conservative Councillors in England, I've just received a letter from Rt Hon Eric Pickles MP, Secretary of State for Communities & Local Government, with some information about the Localism Bill and Local Government Finance Settlement. I thought it would be useful to post the letter in full. Here is is.

Dear Colleague,

Localism Bill and Local Government Finance Settlement

Today the Coalition Government has published the Localism Bill and announced the provisional Local Government Finance Settlement for English councils. I wanted to take the opportunity to outline some key political points on these two major announcements.

Local Government Finance Settlement

Local government finance is notoriously arcane and ridden with Whitehall jargon. So my department has published a plain English guide to the settlement, to help explain the detail. It can be found at: www.communities.gov.uk/documents/localgovernment/pdf/1796186.pdf

· This is all about how we raise and spend taxpayers’ money. Every part of the public sector needs to do its bit to help reduce Labour’s legacy of debt and the massive overdraft they left the nation. The Labour Government had been living a credit card lifestyle at taxpayers’ expense, and now it is time to pay off some of those bills.

· This is a progressive settlement – we are taking into account that some councils are very dependent on central government grants, and we are taking steps to mitigate the effect of spending reductions in those needy areas.

· The settlement will be fair between different parts of the country – north and south, rural and urban, metropolitan and shire. Unlike Labour, we will not play one part of the country off against another for narrow partisan gain.

· We are limiting the reduction in councils’ spending power. Making savings to grants is not the same as reducing council spending by the same amount – this is since councils raise money from council tax and other sources.

· Council tax bills more than doubled under Labour. So we are providing additional funding to help England’s councils to help freeze their council tax bills this year. This will provide real help to struggling families and pensioners.

· Councils can protect frontline services by sharing services and back office functions, improve procurement to get more for less, bring escalating senior pay under control, and use transparency to empower the public to see how their money could be better spent. Next month, councils should be publishing online their spending over £500, creating an army of ‘armchair auditors’ to cut out waste and deliver better value for money.

A Government press release with top-line local figures on spending can be found at:

www.communities.gov.uk/news/corporate/1795445

Localism Bill

· The Localism Bill overturns decades of central government interference and gives power back to local communities. We are not just devolving power to local councils – we are also giving more power to citizens, community groups and neighbourhoods, to help local people shape and influence the places in which they live and help build the Big Society.

· We are giving more freedoms and flexibilities to councils, from reducing ring-fencing to bringing in a general power of competence in the Localism Bill. By cutting the red tape and Whitehall micromanagement which holds councils back, this will give them the ability to protect frontline services and focus their spending on local priorities.

A Government press release on the Bill can be found at:

www.communities.gov.uk/news/corporate/1794946

My Ministerial colleague, Greg Clark, has also today published a pamphlet on our decentralisation agenda which is available at:

www.communities.gov.uk/publications/localgovernment/decentralisationguide

Key policy initiatives in the Bill which may be of direct interest to your ward include:

· The abolition of Labour’s Regional Strategies and top-down system of planning. This legacy of John Prescott threatened environmental sustainability, and it completely failed to deliver the homes that communities wanted by fuelling resentment at development.

· A new system of neighbourhood planning to put local communities in charge of the look and feel of their locality. Parish councils and new neighbourhood forums of local people – rather than town hall officials – will lead the way in shaping their community. Incentives, such as the New Homes Bonus and a reformed Community Infrastructure Levy, will ensure that local people directly benefit from new development.

· Protection for local taxpayers from Labour’s planned tax hikes. We are abolishing Labour’s bin taxes, cancelling Labour’s planned council tax revaluations in England and Wales, and giving local residents new powers to veto future excessive council tax rises via local referendums.

· New rights to protect community facilities and build the Big Society: A Community Right to Buy will give local groups new rights to protect vital community asset including local shops, pubs, libraries and leisure centres, giving them the opportunity to take over services which face closure. An accompanying Community Right to Challenge will open the door for local community and voluntary sector groups, as well as parish councils and council employees, to bid to take over and improve local council services.

We have a strong message that the Coalition Government is championing the interests of local taxpayers in difficult times, and is putting more power and responsibility into the hands of councils, communities and citizens.

Yours truly,

Rt Hon Eric Pickles MP

Secretary of State for Communities & Local Government