Today, in Leeds, there was a protest against the council (Labour/Green ran) plans for cuts. What councils should do in response to the cuts is something I haven’t really discussed. It’s a complex issue, with the left fighting amongst itself (as always) on what to do.
The government preaches about local democracy, whilst placing the councils in an awful position as their grants are slashed, with the government cutting the council’s budget by 28% over the next four years. The government complain that Labour councils are making ideological cuts, but frankly even Tory councillors are complaining about the extent of the cuts. This situation is even more infuriating when Cameron pulls off special favours for his council, preventing the closure of a library.
Setting an illegal budget does have the potential to undermine the central government’s control over councils. Specifically, such a move would make it clear that it’s not the council who are choosing to enact the cuts; undermining any legitimacy they may appear to be receiving from the council. The source of the cuts needs to be emphasised. In Leeds, Liberal Democrats are using the cutting of the Crisis Service, an insensitive decision by the council, as a political scoring opportunity. This angers me given given their own position regarding the cuts. However, this is not to say that councils have no responsibility, but just because the Liberal Democrats are in opposition in the council doesn’t make them any less responsible.
The 1980s was a different context (see Bright Green Scotland for a good analysis of this), but for measures such as illegal budgets to work there needs to be a considerable number of councils setting illegal budgets. This would be aided by a clearer, much more focused strategy and campaign in order to raise public awareness of the need for resistance. Also central to the fight back is a continuation of opposition against the central government, given they are the source of the cuts. The Bright Green Scotland article, referred to, also refers to the need for a coordinated strategy, as without a larger political movement councils can become isolated and intimated by the central government.
However, it may prove harder than the 1980s, given the Labour party’s distance from the left. Let’s not forget that under a Labour government, cuts would be beginning now, as Labour set out to halve the deficit in a parliament, through cuts Darling said would be worse than Thatcher. However, councillors from all parties are raising objections, so there is potential.
Other alternatives are slim. The council have no ability to raise council tax, for instance. Before someone says this would have been regressive, the council could have used it in a progressive way of only increasing it for the richest in the city/town. Furthermore, councils’ ability to borrow through Tax Increment Financing is restricted, despite claims contra to this; consider the apparent unreliability of the borrowing potential:
It has been fiercely resisted by the Treasury in the past, largely on the basis that the projected development income in the form of higher business rates cannot be guaranteed, and should therefore be marked against government borrowing.
Given the market, relying upon such income may prove difficult; especially given the severity of the cuts – offsetting loses through this would be difficult. Also, such borrowing is focused upon private sector investment, which is unreliable and driven by profit, not equality. It also has a hint of PFI to it. The Tax Increment Financing is about using projected future gains through taxes to fund investments, rather than a concentration on maintaining current services. Therefore, the effects this will have in the short-term is limited, especially when attempting to stop cuts to the front line, such as the cut to the Crisis Centre. This is not to undermine its potential for investing in areas, particularly deprived ones. However, there are concerns this can result in gentrification.
There are measures that the councils can take, the borrowing option provides some potential, whilst limited. However, illegal budgets seems to be the only really powerful alternative. It seems that the movement towards outlining the alternatives for councils needs to become better coordinated and more unified; councillors need to know they have the public’s backing. Whilst we should not take responsibility away from the councillors, we have to consider the effects the central government’s actions are having and how they should not be forgotten within local election campaigns as two-faced LibDems try to rewrite reality.