As the party conference season fades from recent memory, and it is left to the wonks to turn announcements into workable policies, Chancellor George Osborne’s proposals for business rate devolution have left the biggest impression on local government. While it sounds pretty dull to the uninitiated, this announcement represents the biggest change to the way councils are funded in 25 years, with profound implications for local leadership, and for comms.
In short, Osborne is proposing to phase out the support grants that councils get from central Government, and in return allow them to keep 100 per cent of what they raise from business rates. He has also made it clear that for cities and regions to take full advantage of these new freedoms he expects them to adopt the directly elected mayoral model, of which he has long been an advocate.
I am, in general, a fan of elected mayors. My own authority of Hackney is often cited as an exemplar of where the model works well. But that has not been the case everywhere. A system that places so much trust and power in an elected individual will stand or fall on the quality of the candidates for the job, and as we move closer to a system of all-powerful US-style city leaders, that issue will become even more fundamental.
Running cities, boroughs and regions is a tough job that needs executive skills and serious talent. An elected mayor is not just a figurehead; he or she needs technocratic competence, as well as charisma. But in an era where Jeremy Corbyn and Nigel Farage are appealing to a public appetite for apparently unspun authenticity, there is a danger that Osborne’s enthusiasm for the model could give rise to a generation of ‘maverick mayor’ figures. Obviously, competence and maverick appeal are not mutually exclusive, as Ken Livingstone and Boris Johnson have shown in London, but it is a rare combination, and there is a risk that if the people elected are not up to the job then the consequences could be catastrophic.
Change on this scale could be a huge opportunity for local government. Both the sector and the business community have greeted the announcement with a ‘devil’s in the detail’ caution, but one thing is certain. If local areas are going to stand or fall on their ability to grow their local economies by attracting new business, the power and necessity of place branding will become undeniable. Local areas will be competing, with a new fervour, to attract employment and investment.
Economic development will become key, not just to local prosperity but to councils’ ability to deliver services, especially in more deprived areas that have traditionally relied more heavily on grant funding. In Osborne’s new world, the areas that succeed will be ones with a clear sense of their own identity, a great story to tell and an inspirational leader to tell it. For councils, that means having the strategic capacity to develop that story, and for many, that work needs to begin now.
Polly Cziok is head of comms and consultation at the London Borough of Hackney