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Editorial: Levelling down: Gove's plan to trap councils in permanent insolvency

MICHAEL GOVE’S plan to let councils plug budget shortfalls by selling assets will mire local government deeper in permanent insolvency.

The Levelling-up Secretary was, in a previous incarnation at the Department for Education, the genius who scrapped the “wasteful and bureaucratic” Building Schools for the Future scheme, cutting off access to funds for essential renovations, forcing some schools to cancel already commissioned repairs and sowing the seeds of the crumbling schools crisis that shocked the country last autumn.

Gove blandly admitted then that axing Building Schools for the Future had been a mistake. He has not learned much, since his solution to a Tory-created crisis of local government is again the degradation of our national infrastructure.

That it is a “sticking plaster solution” is obvious. Selling assets to fund ordinary spending is a time-limited exercise.

Nor is it even a new solution. Councils have sold off £15 billion in assets since 2010 as they seek to raise funds to deliver services — many of which they are legally obliged to provide — while staggering under cuts to central government grants of over 40 per cent. 

Since David Cameron and George Osborne launched their “austerity” assault on public spending councils have sold off or closed over 1,000 swimming pools and 800 libraries. Half of magistrates’ courts, hundreds of playing fields and over 1,000 public toilets have gone too, a recent article by FT architecture critic Edwin Heathcote reported.

“Levelling up” was supposed to regenerate regional centres. A co-author of the Tories 2019 manifesto, Rachel Wolf, told their 2021 party conference that the project needed to restore civic pride through smartening up town centres, cleaning graffiti, even funding hanging baskets because these “short-term wins” sent a message to the community that a public space was cared for.

The reality is that municipal neglect is a direct legacy of her party’s policies. Councils, which have very few legal means to raise their own funds, are forced to prioritise their statutory responsibilities over everything else. 

Besides incentivising outsourcing functions from social care to refuse collection to the cheapest providers, with all the knock-on damage done to workers’ pay and conditions, this has driven the collapse of municipal services. 

It is the poorest who suffer when a library closes, removing a free learning resource. It is the poorest whose mental and physical health suffers when the only available swimming pools are in expensive private gyms. It is the poorest and the disabled — heavily overlapping categories given we have also had 14 years of relentless attacks on disability benefits — who have suffered most from the withdrawal of public toilet facilities, forcing people to spend money in a cafe or pub just to use the loo.

Worse, the collapse of services is self-reinforcing. The Tories’ mantra that “Britain” pays too much tax (hint: the tax burden is not fairly distributed) gathers force when people can’t see what their taxes pay for, since nothing works and departmental and council budgets are conveyor belts for shovelling more money at the rich. 

Local government is in crisis. The declaration of bankruptcy by Europe’s largest authority, Birmingham, was a wake-up call: the cuts are killing councils.

Tweaking the rules to make it easier for them to sell assets does not offer more flexibility, since these sales will be forced to meet statutory responsibilities. When the assets run out, the next stage will be to claim those statutory responsibilities are no longer ones this country can afford: further restricting access to essential services to those who can pay.

Arresting Britain’s sharp descent to that dystopian future means raising the profile of council funding and organising co-ordinated campaigning around it, as we must do for the NHS and other services. That means demanding funding restoration, but also opening a wider conversation about local democracy, how it’s funded and what it’s for.

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