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Neil McInroy

A localist future, needs national fairness

13 December, 2012 Posted by: -

Last week, a year on from the Localism Act, the Rt Hon Greg Clark MP published his Progress report on the Government’s decentralising work. This report highlights (and scores!) the various actions taken by Whitehall departments, to decentralise power from Whitehall. This is an enjoyable read and does recognise the need for Whitehall to have a ‘dose of its own medicine’ given out to localities across the country.  However, I worry about the context within which this localism is taking place.

Localism is generally seen as a good thing.  It is seen as virtuous that power is passed down from the centre to local government, local communities, local businesses and local citizens.  It is seen as the key element of how our public services should be reformed.

However, for many, localism must also be about advancing a genuinely fairer and better England.  For this to happen, localism needs to acknowledge the context in which it being progressed

Central to the context for localism is the entrenched social and economic inequalities, underpinned by national policy which is inadequately tackling a growing divide between the local government haves and have nots.  Some say, that we just need to accept that Localism will inevitably create variation in services  - postcode lottery.  Fair enough, if there are ‘fair’ and acceptable levels of difference at present.  That is not the case. Will localism not just deepen pre-existing divides and inequalities - whereby some areas will flourish, where there are less demands on public services, whilst the poorer areas with high demand will just have more local power to get poorer?

An elected leader of a local authority I met recently said it all: ‘the problem with localism is not about recognising the need to change or having the abilities to do it, it’s about having the context to do it, without fear’.

I also recently met the Director of neighbourhood services. She once had 3 areas of service as part of her responsibilities.  She now has 11.  Furthermore, she has lost many of the senior heads of these services to cuts. She’s smart.  She knows all about the need to change, be more localist.  But she’s fed up being constrained by time and budgets, and national policy which drips localism on one hand whilst centralising and grabbing with the other. 

Local government needs to be emboldened and have less fear.  But Central government gives out confusing centralist/localist messages, and gives little thought to the a priori context, by which a localism could grow positively. 

This context is not fettered by a reluctant local government, as some in central government would have it.  Indeed we should salute the capacity and ability of local government to delve deep.  The seeds of a new localist narrative are being planted.  For instance, the elected leader I met, has a positive localist vision.   A vision where new local cooperation with public, commercial  and social sectors can be achieved -ensuring that services are delivered more efficiently AND effectively, whilst planning to reduce demand upstream. The future is predicated on enabling local assets, people and communities to socially, economically and culturally grow.

 However this vision, cannot be just driven locally.  The vision is fettered by a country riven with pre existing divides and economic centralism. There is no localist assessment or apparent requirement of HM Treasury to advance localism in Clark’s report. We thus need a national policy, which recognises that any promise of localism is worth nothing, unless, greater national economic and social fairness happens first. 

Without this fundamental appreciation, I fear localism will be warm and cosy for a few, but cold and painful for many.

Pension potential for local regeneration

30 October, 2012 Posted by: -

There has been some talk about the potential to use Local government Pension funds for infrastructure investment and regeneration. However, a recent report (PDF) by the Centre for Local Economic Strategies (CLES), Smith Institute, Local Authority Pension Fund Forum (LAPFF), and Pension Investment Research Consultants (PIRC), seeks to bring some sensible clarity to the debate, whilst highlighting the possibilities.

Before we get carried away with the regeneration possibilities of the £150bn which rests within Local Authority Pension funds, let’s remind ourselves about what are these pension funds for? They are monies accrued by public sector workers who have been putting aside some of their income for retirement. It also includes the money of pensioned employees who have paid into this fund over their working life. This represents a sizeable proportion of the retired and existing workforce in any place. Therefore, many families are dependent on the safe stewardship of these funds. This stewardship means pension funds investing employees hard earned cash into property, infrastructure, whatever - but always ensuring a decent return on that investment.  Thus the pension funds act on employees behalf to ensure that the employee gets as much bang for their buck as possible.  So there is a responsibility that these funds are used appropriately and that return is achieved and risk is at an acceptable minimum. 

Just because many local projects are starved of investment and the funds are there and it seems like a good idea, does not mean we can take risks. The financial future for many people and families rests on these funds. However, we can do more, and to do this, we need some careful deliberation and clarity as to what is possible. 

This report found that the possible, was about respecting fiduciary responsibilities, whilst unlocking some local pension fund resource for more local impact. 

Firstly, there are some local investments which can bring a return, and could be used as investment options for pension funds. But perhaps some local areas, are not presenting them as investible options.  In this, the report recommends a national ‘clearing house’ which gathers information about potential impact projects.  Furthermore economic development agencies and vehicles like Local Enterprise Partnerships (LEPs), need to package up local possibilities and up their game, as regards identifying real investment opportunities which can bring return for pensions funds.

Secondly, risk across different pension funds, can be shared by creating a pooled special purpose vehicle in which some local government Pensions funds allocate and pool a small percentage of their funds for local projects. The pooled vehicle would then invite local authorities and other public bodies to put forward bids for investment which would bring a return.

Thirdly, we need better guidance, case studies and examples of what can be done. We already have good stuff happening like the Greater Manchester Property Ventures, however, this type of activity needs replicating in others areas and scaled up.

Fourthly, we need to review the guidance and legislation around local government pensions, enhancing the potential for greater flexibility. And government, including the treasury, could do more in underwriting some of the risk in impact investments which have a potential social or environmental benefit. It can’t be left to the pensions industry to do all of the heavy lifting.

Some things can now be done, and we need the local government community to learn more from each other and upping its collective game. However, we must ensure that we act responsibly toward the pension fund members and their families.

Comments (2)

The way forward for LEPs

23 August, 2011 Posted by: -

Local Economic Development is as much about setting the conditions for future success as immediate short term gains.  Local Enterprise Partnerships (LEPs), have to look beyond the immediate national and global economic concerns, build up power and ignite a process toward a longer term shift in the economic destiny and resilience of local areas.

Of course, all the LEPs differ in size and history, and the challenge for each Local Enterprise Partnership (LEPs) is very different.  In some areas, LEPs have emerged from pre-existing economic partnerships and groupings, with staff, some existing resources through Local government, and well established plans of action. However some LEPs are new, have no heritage, cover new economic geographies, and have limited experience of joint working. 

In some areas, LEPs are building on existing growth, as they cover areas which have some economic success and a diverse range of successful businesses. However, in many locations, due to decades of de-industrialisation and the failure to tackle systemic local economic problems, there is no short term fix. Their journey will be harder and longer.

Nevertheless, they all share the possibility of doing good, through the ‘traditional’ standard fare open to them as set out in the Local Growth White Paper.

The 22 new ‘enterprise zones’, include incentives via tax breaks and simplified planning.  There is also stimulus funding via Regional Growth Fund (RGF) and Capacity Fund, and greater connections with national priorities around digital and transport infrastructure.  I am confident that some Local Enterprise Partnerships will be make a difference.  However, even in relatively successful areas, these policies still need to avoid the pitfalls and be used effectively.

In other areas, these policies will struggle for traction and impact. This potential struggle for all LEPs is of course framed by national and global economic turbulence.  However this is beyond their influence.  Therefore, they must grab real influence on the key pistons of local growth- capital, labour and have a focus on local economic inputs such as innovation which are often ermbedded within local culture, place and society.

Many areas are starved of capital investment.  The funds through the RGF are welcome, but for some areas, offer up a meagre appetiser, to the hearty meal which is needed.  That is why LEPs’ working with Local Authorities and private finance must also strive to establish their own investment funds.  Furthermore, the idea of an ‘area growth budget’, devolving Whitehall budgets to areas (as outlined in the city finance commission report), would be an excellent means by which LEPs, working with Local Authorities, could potentially achieve greater weight around investing for growth

Many parts of the England, in their industrial heyday, prided themselves on having a uniquely skilled, inventive and productive labour force.  This is clearly no longer the case in many areas.  The RDA’s made little impact into skills; and nationally we have reorganised and tinkered with the ‘skills game’ with little success.  LEPs must not make the mistakes of the past.  They must prioritise skills, forging significant links and influence over the Skills Funding Agency ensuring that employers lead on skills.

Finally, whilst mindful of mission creep, LEPs need influence over the life of place and place-based factors which nurture creativity and innovation energy. This includes relationships with the community and voluntary sector, and factors including social capital, investment in public realm, quality of life, culture and the arts.

These aspects, may be seen as irrelevant and a distraction by some. They are also clearly the kind of things which are most likely to be forgotten or ignored by LEPs. 

However, the ways in which businesses identify and have connections with the ‘life of place’ are well established inputs and conditions for growth.  These need to be seen as powerful and are exactly the type of things which can create real penetrative and enduring depth to economic development work. Place policy is economic policy.

LEPs must move one step beyond the opportunities afforded by the standard policy fare.  Whilst short-term growth is sought, they must consider the deeper underlying economic conditions and be mindful of economic resilience in the long term.

The local state needs to act big

24 June, 2011 Posted by: -

I recently visited some local authorities in the north-west and midlands.  These LA’s have had significant cuts and no longer received regeneration monies.  These authorities had significantly reduced staffing numbers and were in the midst of transforming their services, working more effectively with reduced resources.

They are unenthused by central government and were rejecting much of the rhetoric around ‘big society’, or a free market for public services.  However, they are not some local big state, refusing to change.  They are embracing service pluralism and new ways of working. 

These authorities were mindful that a rapid and hasty divestment and outsourcing of services would be folly and a bad use of scarce resources.  Folly because they knew there was a lack of delivery capacity within their particular communities and Voluntary and Community sector.  And a bad use of resources, because they knew that rapid outsourcing may bring short term savings but longer term costs in terms of hindering service integration, shared outcomes and benefits to be accrued through strategic direction. 

They knew that to create outcomes which made inroads into an issue such as child poverty, they needed a transformation in cross departmental and cross agency behaviours, thinking and a new plural approach to the problem.  They knew this was never going to happen by just letting out a contract to the lowest bidder.

For all the central government brouhaha around the transition from a big state to big society and the need to encourage more social and private delivery of local public services, some local authorities know what needs to be done and are grasping the nettle brought on by the cuts. 

They know, as they always have, that in many instances, they are not always the most efficient or the most cost efficient provider, but they also know private or social delivery is no silver bullet. 

They know that the demand on public services will continue to increase, but they also know someone needs to strategically oversee need and demand. 

They know they cannot afford to work in the same old way, and are therefore, embarking on radical service change.

They want to and are actively encouraging community growth and building neighbourhood and resident capacity to do more themselves, but they also know this takes time.

They know that cooperatives and mutuals and a plethora of new delivery vehicles have potential, but they are wary of seeing them as cheap options.

They know that they must empower local people, but they also know that markets can disempower.

They are sharing services, but are mindful of democratic accountability and sovereignty issues.

Above all, they are creating a new era in local public service, inspired by an shared outcome focused place leadership, filled with a belief in public values.  For them, commissioning of in-house or external activity is not just about balance sheets but about building social justice, addressing inequality, nurturing the environment and protecting the most vulnerable. 

These authorities are acting big.

The regeneration hokey cokey: councils must dance to new tune

23 May, 2011 Posted by: -

 I recently gave evidence to the Regeneration Select committee, commenting on the document: regeneration to enable growth: What Government is doing in support of community-led regeneration.

One of the key, things I tried to convey, was that failing place, is a problem that market will not solve it on its own. Even in the economic good times, growth did not deliver for some places and people.  To achieve regeneration, in the context of localism and less resources, we need to work differently.  

 Regeneration is needed when some or a combination of parts of the public, social or commercial network in any given place, are failing. As my colleague Sarah Longland’s outlines in a blog and as was stated in our written submission, regeneration in the future, is about re-connecting up this network in new ways. Local government, has a key interconnecting and stewardship role in this. 

The regeneration hokey-cokey is about local government being fleet of foot and nimble. In this it needs to gauge its involvement, carefully calibrating when to get involved or not, what to put in, what to shake about when it is in and how to get out.  

It possibly needs to put its whole self out! Regeneration can, in some instances, occur without any public intervention. Local government involvement is needed when the solutions are taking too long, or the other sectors need support in some way. So local government needs to look at its priorities, consider what other sectors are doing, and the likelihood of the market solving the problems, before it decides to get directly involved. 

It needs to put parts in! if the problems look severe enough then local government, needs to stop being 'out' and start putting things in. However, this intervention must be in proportion to the issue and the resources and capacity available. It could be that it merely acts to nudge behaviour of other sectors, or may act deeper and harness available resources and service activity to create a voracious concentration of forces.

It needs to shake it all about! How long local government hangs around and what it ‘shakes about’ is a decision which was often miscalculated in past regeneration activity.  Previously, fettered by central government, it was usually ‘shaking it about’ for a set period of involvement, say 5, 7 years.  Playing a managerialist role, feeding back outputs to Whitehall.  In this the ability to make decisions about tipping points and ability to retreat, were difficult to do. 

Do the hokey cokey and get out! Finally local government needs to gauge as soon at it is in, it’s plan for getting out again and which ‘bit’ it gets out.  Previously, this judgement call, usually came to late in the day and involved the often illusive aim of mainstreaming specially funded activity, back into central core budgets or ongoing practice.  The getting out, could be incremental, all at once, or a phased ‘in and out’ depending on what is required. 

This is not abstract, may local authorities are already doing this dance, being proactive about place stewardship and thinking differently about regeneration.  For instance Blackburn with Darwen are already considering its key priorities, when and where it needs to get involved, predicting how deep it can or needs to get involved, predicting how deep and how long it may need to stay around.  All of this framed within a recognition that it needs to act witha network of public, commercial and social actors.

This regeneration hokey cokey, is the new dance for Local government.  Take the floor!


Local government and social sector must be friends not foes

11 April, 2011 Posted by: -

Far too much debate around local government and big society has focussed on crude caricatures. This has distracted us from the fundamental questions around social and economic inclusion and masked the real issues facing local services and the needs of citizens. Its time to create new outcome focussed relationships. The social sector and Local Government need to be friends in this endeavour not foes.

The government inspired debate, reinforced by ministerial speeches have accused local authorities of unnecessary cutting, whereas, the voluntary and community sector (VCS) has been praised and lauded as the future of service delivery.  This has created some unease between the public and VCS sector.

Furthermore, nationally driven and at times overblown and chimeric claims for the big society, have also translated into some mistrust between these local bedfellows.

This is worrying, and local government, the VCS and advocates of the big society need to be mindful of this tension and avoid it. Some advocates of the big society will no doubt construe this as constructive disruption, and maybe even some in local government will say bring it on! However, no good will come of this tension, and I fear there will be only losers and these will be local service users, residents and communities.

Far too much debate around local public service reform and talk about big society has focussed on a crude caricatures, which has broadly portrayed local government as inefficient, self serving, lacking in innovation, slow and wasteful, whilst the VCS has been cast as creative, efficient, speedy and responsive.

This is baloney and dangerous, as it masks the real issues facing local service delivery and the needs of citizens in the future as regards ageing, increasing demand on services, how we pay for them and ongoing environmental change.

It also avoids pressing questions around local social and economic inclusion. These are the real issues we should be concerned about, and we need positive and creative relationships to overcome them. The powerful, paternal and at times overly grant dependent based relationship between local government and the VCS is changing.

This is mostly a good thing. However, as the power balance shifts, this is not a time to either criticise the VCS or for the VCS to start undermining the sovereignty and representative role of local government. However, it is the time to create commonalities and rally around new localist values, bespoke to place. 

CLES’s work on economic and place resilience, tells us that the stronger places have a good relationship between the public and social sectors. I have argued consistently about the need to maintain and develop a place stewardship role for local government. 

Part of this role is about an active and activist local state, working with the wider society of residents, community and voluntary groups. This involves a plural delivery of service, including a range of delivery options, including a greater role for the VCS in this.

However plurality is not an end in itself. For CLES, plural service delivery and the associated contracts and service relationships need to forged on the basis of delivering high levels of social, economic inclusion and environmental justice. Many advocates of the big society, and some in local government have lost sight of this.Local government must work with the VCS in ways which are not solely based on service competition, price and efficiencies.

They need to be forged on the basis of creative partnerships, networks and relationships, which have effective and progressive outcomes for service employees and citizens at their core.  Mistrust and acrimony are the enemies of this.

Local Government must ensure they retain a place stewardship role

15 March, 2011 Posted by: -

 ‘You know what, I am not sure I got into local politics to just manage contracts’.  This statement, uttered to me a few weeks ago by an experienced local (Conservative) councillor, goes to the nub of fears around the future of local government

Should local government and elected members just outsource all service contracts to the ‘big society’ and commercial deliverers of services and/or should it play a democratically accountable place stewardship and coordinating role?  I would argue that too much of the former, fetters the latter.  Some areas may be fast approaching this tipping point and we need a much deeper debate about the consequences.

The cuts have created a dynamic and head of steam which make outsourcing a strong option.  Firstly, the big society and commercial delivery are perceived as more efficient.  Secondly, it gets the costs isolated as part of a contract and reduces the liabilities.  These factors have created a dynamic where direct service delivery responsibility is moving away from Local government.

I am not suggesting that the use of the private and social sectors in service delivery is a bad thing.  Quite the reverse, some services have always been delivered by a blend of public, private and social sectors.  A plurality of service delivery is a good thing.   However, there is a key place stewardship role, which too much willy nilly and short term outsourcing will kill. 

This place stewardship role is about the qualities and values of public service.  It is the ability to ensure a sense of fairness, and equality of access to services.  It is also about governance and connecting up different services in creative ways.  And fundamentally, its about sovereignty and maintaining direct democratic accountability over a service. 

As a resident, in inner city Manchester, I quite like the fact that I can speak to my local councillor about a range of local services, knowing that she and local cabinet colleagues are accountable for them.  Even if I don’t like how the service is run, I can even make a vote for an alternative candidate and party.  I have a connection, I understand the connection, as does the councillor and all my fellow residents.  In contrast, how would I influence a service, if all the local council does is manage a contract, I can’t vote against the CEO or the board of a large commercial company?

Also, are we weakening the power of local government to act as key lynchpins and actors in times of stress?   All places are at the vagaries of unpredictable events and ongoing environmental, economic or social shocks.  When these shocks occur, the strategic place steward role of local government is to mobilise quickly, harness resources, relationships and reshape services and activity accordingly. 

Furthermore, what about opportunities?  A major investment opportunity or securing a major sporting or cultural event, is achieved through strategic capacity across a range of partners, drawn together by local government.  

Can these fundamental stewardship roles be achieved if all or the majority of our services are outsourced and part of legally binding contractual arrangements?  It could well be that outsourcing on a grand scale, weakens the stewardship and strategic role of local government.  In doing this we are making our places vulnerable to adverse change, and leaving our places weakened in attempts to realise fleeting moments of opportunity.

All of this is absent from present debate, and the localism bill is silent on them.  The future has to be about a strong local government which creates the conditions and ensures the health and wealth of local places, communities, businesses and residents.  It can’t do this alone, but it must retain the capacity to lead and steward place.

Local economies in peril?

9 March, 2011 Posted by: -

Good local economic policies are never enough on their own, we also need plans and strategies.  This is not a new problem, local economic strategy and planning has been limping for a long time.Some places lost their economic and industrial raison d’etre 30 years or more ago, and despite lots of regeneration and economic effort, are still trying to find a new economic destiny. Furthermore, with the advent of economic recession, and with ongoing threats of peak oil and climate change our planning and strategy is woefully inadequate.

Some recent local economic policies are welcome.  However, Local Enterprise Partnerships (LEPs) are not proven as a punchy economic planning vehicle and in many instances, are mired in capacity issues. The Regional Growth Fund is fine, but is dwarfed by the deep and rooted economic structural problems some localities face.  Recent consideration of a return to some form of 80’s enterprise zones, smacks of a lack of ideas and is old thinking for very different times.

Furthermore,even if these policies, were sufficient, we are also seeing a thinning of local economic knowledge and capacity, via the loss of personnel and resources.Local authority economic development departments and associated activity are reducing, as money is being diverted away from them, to protect frontline and statutory services.  This loss of capacity is also reducing the ability to make the vital networks and strategic links at various scales between economic, social, cultural services and policies.

How do we get a big (productive) society, if it is merely left to the understaffed LEP to forge the strategic connections between the social economy and large commercial investment? Or as a director of economic development said to me ‘where are the LEPs in matching large work programme contractors with a local understanding of demand?’

Let’s not be mistaken, there is an emerging crisis in local economic thinking, policy and strategy.  

Some may believe that local economic development is insignificant to the UK Plc economic policy as a whole, or unnecessary state meddling. Strategies and plans may also be perceived as old hat and part of a public sector bureaucracy which has got out of control.It is folly, dangerous and wrong to think this.  

To compete as a country, the constituent local parts play a vital role, and we need to do what every other country and successful locality does and strategically plan our local economies.  Even in the more economically vibrant parts of England, we need to maintain an edge and restlessly assist economic success in perpetuity, through forward thinking strategy and plans. Our international competitors are.

Of course, the absence of strategy and some scattergun policy may give some economic success and growth, but lessons from countless localities at home and abroad, tell us that it will tend to be more spatially uneven, make existing social and economic divides worse and will be transient and footloose, moving on, come the advent of cheaper labour or costs elsewhere. 

Sound economic strategies and plans and linked up development policy are not a predicated on large amounts of public resources.  For instance CLES’s work on economic resilience majors on creating new place based economic strategies which focus on the conditions for success, reducing the need for heavy interventions in the future.  This work highlights how place policy is economic policy. Who wants to invest, live or create wealth in a bad place?

Local and Central government needs to urgently start taking local economic development a lot more seriously and start thinking about new ways of delivering on it.  Disconnected policies and thin narrow strategies will not do the job.   

Hail Localism! But beware the unintended consequences

14 February, 2011 Posted by: -

It is now clear that the government’s radical reform agenda, is disrupting our old certainties.  In the localism bill, we see an intention to unleash local government and empower local neighbourhoods, residents and community and voluntary groups to play a greater role in services and managing assets.

I recently gave evidence to the localism bill committee.  My angle was that we should be disrupting the existing complex system and settlement between the centre and the local.  This will achieve serendipity, a windfall of new relations, more community ownership, and an unleashing of social capital.  However, I also warned of the importance of the centre and the potential of negative or even perverse outcomes.

In particular, an unfettered disruption may create more spatial differences, which will leave some localities under-served and some people and communities vulnerable.  The question here is not if these negative consequences of localism will occur- they will.  It’s whether they are outweighed by the positive windfalls and secondly whether the bill offers adequate protection to the very negative consequences, when they do occur.

On the first point, there is optimism from the government benches, who believe that there will be a flow of positives.  Some of this, is a reflection of experiences from their own constituencies, where they see active communities who are time rich, stress free and willing to take up the right to challenge, the right to buy, and get involved in planning their neighbourhood.  However, this is not the case in many other communities where worries over money or of making ends meet are the driving concern.  In these communities the negative consequences may outweigh the positives.

We could well end up with a localism, which rather than empowering, will just disempower and marginalise as services become fewer, variable and the slack is not taking up by an enthused big society but by big business or big voluntary sector detached from bespoke local concerns.  This scenario is very probable.

Localism must appreciate that England and its individual localities are made up of huge social and economic differences and cultures, such as variations in volunteering etc.

The government has a heady optimism over how time rich, stress free or interested people and communities are. This may be blinding them to these negative (and perhaps), unacceptable variations.

Secondly what types of safeguards is the bill interested in, as regards lessening some negative or perverse local effects?  Greg Clark, the minister of state, Department for Communities and Local Government in his summing up of our evidence, ably pointed out the dangers of a pure localism. He is right.  Pure localism, gives no safeguards to any negative consequences, bar the local ballot box.  However, Greg Clark, was not prescriptive about what these central safeguards should be, other than, his emphasis on ‘minority communities’.

The bill needs to offer some future protection, vested in the central state and the powers of the Secretary of state and parliament.  We need clarity about what areas these should cover and what differences would be unacceptable.  Minority communities for sure, but for me also some safeguards which ensure that localism does not perversely create even more social and economic inequality within locations and across England as a whole. This goes to the heart of this debate about negative consequences.

The Localism Bill, needs to reflect England as it is now and its deep economic and social inequalities and cultural variations.  Therefore, the bill must give due protection to those poorer and more deprived communities or just culturally different communities.

The Localism bill, in its desire to give power away is laudable and correct.  However, localism in action cannot make inequality any worse and the bill must create safeguards. Decentralising power is pointless unless we get better outcomes.  We must beware the potential negative consequences.

Localism needs to deliver on community cohesion

8 February, 2011 Posted by: -

In his recent speech at the Munich security conference, Prime Minister David Cameron criticised multiculturalism and called for a “shared sense of national identity” and efforts to promote “that feeling of belonging in our communities that is key to achieving true cohesion”.

However, we know there are fewer funds available for support activities relating to diversity policy and equalities issues.  In recent research by CLES, we found that cuts to Community Cohesion grants will jeopardise hard won progress on the very ‘big society’ issues such as local networks, connections and relationships, which Cameron hopes to promote.  In addition, these changes will potentially undermine future economic recovery.

In two separate pieces or research work, which have taken us to Copenhagen, Blackburn and Manchester, CLES has explored ethnic diversity policy, what its future should be and, in the UK context, the impact of cuts.  The work tells us a number of key things.

Firstly, it is abundantly clear that it is a false economy to not invest in policies that promote good relationships between communities.  Failure to invest and fund this kind of policy hinders the development of social capital and entrepreneurialism and employment skills, and hampering economic development more generally.

Secondly, it is no good just relying oneconomic success.  As proven from our work in Denmark, a focus on ethnic groups gaining employment and becoming active in the economy, does not on its own, tackle the wider issues of discrimination and lack of equality faced by certain ethnic groups. 

Thirdly, this is not just a localist agenda: national policy focus and help is still required.  In the UK, the days of nationally defined policy frameworks such as the Community Cohesion agenda and the Multiculturalist model that preceded it are gone. This undoubtedly presents an opportunity for local government to develop, creative and locally specific projects which foster good community relations and respect for ethnic diversity.  However, a lack of central steer and lack of local funds may prove problematic for the areas with growing ethnic populations, who do not have a long history of migration and ethnic diversity policy making or where population change is rapid or unexpected.

Fourthly, the notion and drive for a Big Society will falter even more, unless it addresses barriers to participation.  Our work shows that it is imperative that the government works to ensure equal access to participation in the Big Society and develops appropriate processes for monitoring diversity and equality.  Neither of these points have yet been adequately addressed as part of this emerging agenda.  As its stands, many groups face multiple barriers to accessing existing services, let alone having a ‘big society’ stake in delivering them.

Our work in this area makes the case thatcentral government must allocate sufficient funds to enable local government to develop policies that are effective in harnessing the opportunities of ethnic diversity and overcoming any potential challenges that can emerge from local population change.  Failure to do so, runs the real risk that the climate of public sector efficiencies will result in a rise in community tensions.  As such, it is crucial that local authorities retain capacity and that central government provides resources where necessary for activities that promote good community relations.

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