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Cities colaborate to devolve

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On 1 October the Core Cites, London’s mayor and the London boroughs came together to launch a campaign seeking devolution

On 1 October the Core Cites, London’s mayor and the London boroughs came together to launch a campaign seeking devolution of the property taxes identified by the London Finance Commission to all nine cities in the alliance.

This initiative reflects arguments for self-funding local government that become more commonplace and more urgent as funding cuts bite.

The LGA’s Rewiring Public Services made the wider case that fiscal autonomy throughout England delivers service integration, so addressing the challenge of austerity. Yearly cuts and a failure to reform mean the inevitable alternative will be service failures.

In London, the forecast spending gap by 2020 has increased to 31%, or £3.1bn, following the summer funding consultation. Yet as Tony Travers’ London Finance Commission showed, 95% of taxes raised in London go to the Treasury, while New York raises 69% of its funds, Berlin 75%, Paris 83% and Tokyo 92%. In tough times, at least these other cities have the freedom to shape their destiny.

Threats to public services mean that as we approach Scotland’s independence referendum in 2014, the absence of a devolution settlement for England will appear ever more unreasonable.

Yet while the intellectual argument is strong, engaging hearts depends on explaining the case in specific places with which people identify. The Cities campaign seeks devolution of property taxes and freedom to invest within tested prudential framework rules.

Goals will vary from city to city. The Core Cities believe that freedom could unlock another £1.3bn of growth for UK GDP.

In London chancellor George Osborne has responded positively to the joint proposals of the mayor and London borough leaders for a formal dialogue on devolution for growth. This allows us to make the case for new approaches to infrastructure development, housing and welfare-to-work programmes, among others.

We need to show that Londoners can get a better deal and live in a better city when London has freedom to tailor funding and services to
its specific needs.

The intellectual case is already clear to those without vested interest. Now we need to build the public understanding that wins hearts as well as minds.

Dick Sorabji, corporate director policy and public affairs, London Councils

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