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Local employment initiatives are key to national recovery

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This month has been a big one for local government.

Legislation outlined in the Budget regarding planning, pensions, devolution, childcare and housing reform, and the Local Government Association conference in Harrogate, showed where local government is going.

So let’s assess.

For councils that have already seen their funding cut by about 40%, the chancellor’s plans to cut Britain’s deficit at the same pace as in the past parliament will still make tough reading.

Local government would have already anticipated another large cut in funding over the next few years, and planned accordingly. But the £12bn in welfare cuts is likely to have a knock-on effect on our services.

Westminster is a great place to live, work and visit but it also has issues that are a microcosm of the wider UK. We have some of the highest land values in the country, and wealthiest businesses and residents, yet we also have the fourth and sixth highest areas for deprivation in the country.

There will be no automatic housing benefit for 18- to 21-year-olds and child tax credits will be restricted to two children by 2017. Working age benefits will freeze for four years, with benefits capped at £20,000 (£23,000 in London) when previously it was £26,000. The change in rents for the housing revenue account will also hinder our ability to build houses and regenerate our estates.

We must redouble our focus on growth. Getting the hardest-to-reach people into work has to be the priority over the next parliament and we can only truly achieve that through devolution, as the statistics tell us.

We have at least 10,000 long-term unemployed people, yet last year alone, through locally funded programmes and partnerships, Westminster supported more than 600 of the hardest-to-reach of our residents into work. We want to do more.

We have seen huge successes in Manchester and Cornwall, while Liverpool, Sheffield and Leeds continue discussions about taking charge of budgets for fire, health and social care, children’s services and employment.

While it is critical that these places can secure their own devolution deals, the government must not neglect the south because we are deemed to be successful already. This isn’t true in every ward in London; it isn’t even true in every ward in the eight square miles of Westminster, where poverty is just a five-minute drive from the glitzy West End.

Improving productivity in the south is critical for the UK as a whole. Devolution in the south will lead to greater gross value added across the country.

The facts are simple. The 430,000 unemployed people in London are costing the taxpayer £4bn and the economy approximately £6bn in lost economic output a year, while the 30,000 skill shortage vacancies in the capital are making London £3bn poorer a year and denting confidence in the capital’s economy.

The government must recognise that our local programmes consistently outperform national provision for unemployed residents with the most complex needs. For example, the flagship ‘working capital’ programme that will shortly be rolled out across central London, and which is funded by the London growth deal, will have a target success rate of 30% for work programme leavers, which is considerably higher than the performance measures achieved by the work programme itself.

Councils are in a unique position to unlock extra resources to deliver more intensive, specialist employment support, enabling effective collaboration across local public services to support our communities into work. This has proved difficult through nationally contracted employment programmes.

By maximising the impact of local networks we can boost levels of engagement among residents with complex needs and forge deep connections to local employers. It is up to local authorities to instil a sense of place and pride in people, and make sure big businesses and tourism benefit residents.

If this challenge is not met, a significant minority of citizens will remain locked out of the benefits of work, while often also facing a wider range of complex and unmet needs. The resulting high costs and high demands will continue to fall on overstretched public services and increase the benefits bill; all over a period of further planned reductions in public spending.

While it has been another tough few weeks for the sector, we also have more clarity and know we have to stay on our path of growth and reform. We must hold firm and provide the leadership necessary to transform our places and support our communities.

Charlie Parker, chief executive, Westminster City Council


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