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Hand councils power and save ‘up to £100bn’

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Devolving power to councils and slashing bureaucracy and regulations could save up to £100bn, according to a Local Government Association report, which proposes a radical shake up of public services.

The ambitious plans require ministers to de-ring fencing a raft of funding streams and hand localities control over spending on range of issues including local transport, primary health care, policing and probation, and support into employment for the long-term unemployed.

Councils or groups of councils should be responsible to local voters and to Parliament for spending on frontline services under a new system of “placed-based budgeting”, the LGA argued.

The LGA said it was a “once-in-a-generation programme of change to strip out the plethora of funding streams, accountability regimes, ring-fenced budgets, quangos and funding bodies, which cost billions of pounds”.

Addressing the LGA’s annual conference in Bournemouth, chairman Dame Margaret Eaton (Con) is scheduled to say: “If we simply cut departments and organisations as they are currently configured, we will do nothing to cut waste and instead hurt the frontline more than we need to.

“Far too many costly agencies spend money running themselves and talking to each other, rather than doing things people want.  Far too much time at the frontline is spent accounting to bureaucrats, rather than being accountable to people who actually use services.”

To read the report, Place-based budgets - The future governance of local public services, see attached file.

Proposals in the report include:

  • Put councils at the heart of local economic development, allowing councils in each region to either replace the Regional Development Agencies (RDA) with local enterprise partnerships  or retain existing regional arrangements, and abolish the boards of Primary Care Trusts and Strategic Health Authorities
  • Devolve RDA, Homes and Communities Agency and Skills Funding Agency budgets to place-based budgets
  • Devolve the budgets and commissioning of employment support and Job Centre Plus functions
  • Transfer responsibility for many trunk roads (excluding motorways) from the Highways Agency to local government
  • Create local accountability for offender management
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