Property taxation should be devolved to councils as part of a major shift towards financial independence, former local government minister Bob Neill has said.
Speaking at a fringe event at the Conservative party conference in Birmingham, Mr Neill said he wanted to see councils raising 50% of their revenue locally.
“You could [make] a rapid start by devolving property tax,” he said. “I don’t want that to involve tax going up; I want it to involve tax going down.”
He said: “Local government should be concentrating on property tax as a sensible means of devolution because that’s readily done.
“Stamp duty land tax is a very obvious thing to be thinking about localising. If we do that, then you start to build up a significant income stream, which will lead to the growth of municipal bonds so local authorities can go to the market on the basis of their income streams.”
Mr Neill, who remains the Conservatives’ vice-chair for local government, said neither regional government nor an English parliament was “the answer” to the question of how to devolve power in England, adding that the establishment of the Welsh assembly “sucked power out” of local government and “emasculated” councils.
“Proper financial devolution to top-tier authorities in England is the place to start,” he said. “City deals are fine, but they’re not the answer. [We] need a system that gives alike powers to the big strategic counties.”
At the same event, Conservative MP John Redwood said some politicians would be nervous about devolving power to councils. “We need to recognise that the quality of local government around England is very variable,” he said, adding that some would argue there were “many councils that fall well short”.
He said opponents of devolution would ask, “why trust Rotherham with more power when they let their public down so badly over such a crucial service [on child sexual exploitation]?”
Mr Neill acknowledged the risk but said: “If we trust local government and accept that there will be the odd failure where we have to pick up the mess, what you do is unleash financial dynamism … Now’s the time to grasp the moment.”