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Rob Whiteman: Whatever the Brexit deal, councils must aim for these five outcomes

Rob Whiteman
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Calling the snap general election back in April seemed at the time to make perfect sense for Theresa May.

The polls showed public opinion was in her favour, Labour appeared far from presenting a viable challenge and the campaign would surely focus on little other than Brexit, the talking points for which, the government thought, had all been well-rehearsed.

But with the release of the manifestos, attention quickly shifted to other domestic issues, such as the affordability of social care, education funding and, following the atrocities in Manchester and later London, issues of national security.

A reasonable conclusion to take from this is that we should never forget politics is rarely about one issue. It feels like the public is growing savvier and less tolerant of watered down, soundbite politics.

Brexit is anything but an isolated issue. The outcomes of these negotiations will affect all areas of the UK and we will need to strike a deal that works across the public and private sector and meet the needs of our European partners.

There have been clear signs the public does not want another referendum, but neither has it endorsed any one party on its Brexit stance. Far from strengthening the prime minister’s mandate for a ‘Brexit means Brexit’ kind of Brexit, the election result means the government will now likely need to compromise and, with worsening public finances, have to pay much closer attention to the potential economic consequences of no deal.

However the final deal looks, exiting the EU will have a measurable impact on how the UK public services operate, and not in a uniform way.

Local government is a good example of such differing needs. What is of central importance to one council may not be a crucial concern for another. Sufficient housing to provide a large workforce might top the list of concerns for one chief executive, while another might be struggling to support local industry due to infrastructure needs. The chances seem pretty slim of the prime minister pulling off deals that work for everyone everywhere, so it seems unlikely the Brexit deal will be sensitive to all localities.

Nevertheless, there will be common needs shared by most councils. Social care is the obvious example that springs to mind and given this is one area that relies heavily on low-wage EU migrant labour, any loss of capacity will affect the sustainability of services. Securing the rights of EU workers, therefore, should be a priority for the sector.

Beyond Brexit, the public mood has changed and there is a growing sense that austerity has run its course. Already the government has effectively relaxed its spending target, along with the rhetoric of clearing the deficit, which is unlikely before 2025. Pressured by a resurgent Corbyn-led Labour Party, combined with a set of demands from the DUP and a very precariously positioned prime minister, the Conservative Party will likely halt the benefit cuts programme and maintain the triple lock on state pensions. All of this amounts to spending a lot more money.

What this all means for local government remains to be seen. Whitehall will have plenty of preoccupations over the coming years and there is concern this may dampen devolution momentum. But with the introduction of the new metro-mayors and the implementation of 100% business rates retention, this could have the opposite effect. The Chartered Institute for Public Finance & Accountancy’s response to this is that councils should work to ensure:

  1. Strong and transparent financial management, with spending decisions based on independent evidence-based assessments
  2. Innovative thinking towards being more commercial, but with due consideration of the new skills and expertise this requires and good awareness of the level of risk this introduces
  3. Deliverable affordable housing and innovative financial solutions that support economic growth; and materially more council housing if that’s the quickest way to change present supply-and-demand imbalances and force improvements to the private rented sector
  4. Continue working with the government to drive greater fiscal devolution away from Westminster to enhance systems thinking across highly rationed resources
  5. Powers to mayors and combined authorities to develop new 14-19 skills strategies to tackle post-Brexit workforce shortages that schools alone cannot fill

It feels futile to offer any predictions for the timing of the next election, how the UK will look post-Brexit or who our next prime minister will be. But I can say with certainty that we have dropped from the top to bottom for G7 growth in a year, and inflation has jumped 0.2% this quarter. It’s going to get bumpy, and we all need to be leaders.

Rob Whiteman, chief executive, Cipfa

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