Greg Clark, the new minister for decentralisation, has said that reforming how councils are funded is “central to meaningful decentralisation”.
Talking to LGC, Mr Clark refused to be drawn on the timescale and terms of reference of the review of local government finance confirmed in the coalition agreement between the Conservatives and Liberal Democrats.
However, he confirmed that centrally controlled funding was one of the main drivers of over-centralisation.
“If people only get their money for behaving in a certain way, that’s completely incompatible with meaningful decentralisation,” he said.
Mr Clark also indicated the new government would not adopt a heavy-handed approach to driving efficiency savings.
“Part of our approach is to respect the sovereignty of councils,” he said. “The assumption that councils can only work together if forced to do so is an unfortunate myth.”