Tuesday, January 26, 2010

How Localism Could Save Us Billions

It is possible to strengthen local democracy, save billions of pounds of public money, and still invest in front line services. Our local councils, police, schools and hospitals are all burdened by a costly regime of box ticking, form filling and inspections that has been imposed by this government.

Southampton City Council has just had its annual audit at a cost of £334,000. It is a useful report (and is broadly complimentary) but largely tells us what we already know and certainly doesn't represent value for money. That is only part of the cost though, as considerable resources in terms of staff time are spent preparing for these over zealous audits. The annual audit is just one example of a whole myriad of disproportionate and costly inspections imposed by government on councils up and down the country.

Huge amounts of time and money is spent by local authorities and other public bodies bidding for pots of government funding. Only a few are ever successful on each occasion, and money is wasted by those that do not succeed. Probably the best example is the debacle over college funding. Locally our colleges in Southampton and Hampshire spent millions bidding and preparing for promised rebuilds. In the end not a penny came to Hampshire. Across the country an estimated £200m was wasted on this alone.

Finally we have the large number of unelected, quasi-autonomous non governmental organisations or ‘quangos’. These extra layers of bureaucracy with their big budgets, shuffle bits of paper, produce endless reports, distort local priorities and have little or no accountability. Decisions should be taken by our schools, hospitals and elected local councils, not by faceless bureaucrats.

This regime of inspections, quangos and ring fenced pots of money with expensive bidding processes, costs the taxpayer billions of pounds every year. Surely now, when the public finances are tight, it is time to admit that Labour's top down, centrist approach has failed, and instead better to adopt a localist approach which empowers public services and saves us all a great deal of money.


Anonymous said...

You aren't seriosuly suggesting the council shouldn't be audited annually?! Every organisation above a certain size is regularly audited, including charities - It is hardly a disporportionate cost imposed solely on councils. Audits are essential to preventing improper accounting and preventing and detecting fraud and embezzlement.

Jeremy Moulton said...

Not at all. However we do not get value for money currently. We need a risk based approach and the cost needs to come down considerably.

Ben Frost said...

Central government does not audit every large organisation every year, private companies audit themselves under the pressure of market forces. In the case of public bodies the best pressure we can currently apply is transparency legally enforced through the Freedom of Information Act and used by the press and public to keep a eye on what's going on.