Abolishing 201 local councils will benefit economy, thinktank says

Abolishing 201 local councils in England and giving the rest London-style powers could benefit the economy by £31 billion over five years, a report has found.

ResPublica’s report said the reform could result in huge improvements for businesses, housebuilding and public services in the counties of England.

Most counties use the ‘two-tier’ system of local government, meaning that each individual area has two separate councils - a county council and a smaller district council. Each one is responsible for both economic growth and public services.

Cities have largely abandoned this system is favour of single ‘unitary’ local councils responsible for all plans and public services. ResPublica’s report Devo 2.0: The Case for Counties argues that counties should now adopt single councils too.

The report highlights the vast economic disparity between different parts of England, with workers in Surrey producing around 55 per cent more output per hour than their counterparts in Cornwall, meaning it takes workers in Surrey three days to produce the same value that it takes workers in Cornwall five days.

Adopting the proposed reforms could enable additional growth of £31 billion over five years. This is a result of savings from single local councils of £2.9 billion, and efficiencies of £11.7 billion gained from devolving powers, being reinvested in local growth.

The report says that with uncertain economic conditions after Brexit, it is vital that counties are in the strongest position to weather the storm.

Phillip Blond, director of ResPublica, said: “The needless confusion that frustrates the ambitions of business and government alike in our county
areas must end now. With Brexit on the horizon and our city-regions already benefitting from devolution, we can’t afford the waste and complication that the current system creates. Single councils at the county scale are the future and we call on the government to move rapidly to encourage them.”

Jane Scott, County Councils Network Reform spokesperson, said: “All elected councillors and local MPs, would agree that the move to unitary for Wiltshire has been a huge success.

“In 2017 the need for change has never been greater, with the real risk of counties being left behind.

“ResPublica’s report highlights that streamlining counties will contribute billions to the national economy and will be good for business; but the real winners are local residents who will benefit from improved public services, less bureaucracy, and access to more housing and facilities that meet local need and demand.”

Chris Richards, head of business environment policy at EEF, the manufacturers’ organisation, said: “Today's ResPublica Devo 2.0 report is another hammer blow to the columns holding up the outdated two-tier local government system in England. Its central recommendation -that district councils should be abolished and functions merged into larger unitary councils -will be well received by England's manufacturers.

“Today's report echoes EEF’s Manufacturing Local Growth report in identifying the benefits from moving to larger unitary councils including allowing businesses to benefit from a reduction in the number of voices and competing visions for their local area, speeding up decision making and better supporting growth through devolution deals.”

Tom Follett, policy manager for cities and devolution at ResPublica, said: “Central government finds itself struggling to deal with the complexity of the demands placed upon it, hemmed in by limited resources and national difficulties of unprecedented scale. Local government offers an alternative, but is being called on to take up a role which is unsuited to its current structure and design.”

“Adopting these reforms is a matter of urgency. Local government in the counties, as it currently stands, is simply unable to rebalance the economy, or provide the homes we need.”