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Tony Travers: Javid and Hammond can 'reset' central/local relations

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With the autumn statement date now set for 23 November, lobbying about the future shape of the State can begin in earnest. 

We know that deficit reduction will be postponed. It has also become clear that any Brexit-induced reduction in economic growth may be less severe than initially predicted and also that low interest rates will cut the cost of servicing the national debt.

So Philip Hammond is in a slightly stronger position than it appeared two months ago. However, the financial plight of the NHS is building a powerful lobby for further additional resources. The press have reported that work and pensions secretary Damian Green has been arguing that there should be no further cuts to the welfare budget. With schools funding up for reform, it is likely more cash will be needed to protect those who lose money.

Sajid Javid and the chancellor have a chance to ‘reset’ the government’s relationship with councils

The chancellor’s room for manoeuvre will be significantly determined by the Office for Budget Responsibility’s forecasts of growth in the coming years. Pressure from business for additional investment in roads, housing and transport may well gain Mr Hammond’s support. Increasing housing supply, and thus a moderation of prices and rents, is likely to be one of the government’s priorities.

Where does this leave local government? As ever, nowhere near the front of the queue. However, NHS lobbyists have been clear that unless adult social care is properly funded, the consequences will turn up in hospitals and GPs’ surgeries. Since Theresa May took office, there have been no attacks on local government. Indeed, the PM is known not to like the rhetorical politicking favoured by some ministers during the Cameron years.

Communities secretary Sajid Javid and the chancellor together have a chance to ‘reset’ not only the government’s approach to taxation and economic policy, but also its relationship with councils. Given the prime minister’s stated desire for fairer and more evenly-spread economic benefits, local authorities will be key to the delivery of better living environments, economic planning and skill training.

2016 has been one of the most politically momentous for decades. As it comes to an end, there is an opportunity to reassure the electorate that public policy can more obviously improve Britain.

Tony Travers, director, LSE London

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