All political parties talk about localism, but can this really become a reality without Local Government being trusted to raise it’s own finances and being released from the vagaries of the annual Revenue Support Grant settlement. David Cameron has admitted that the Conservative Party was guilty of centralising more power than any other Party in the 90s and that he now realises the need to devolve more responsibility to Town Halls. One possible solution to the total restructuring of Local Government Funding could be the return of the National Non Domestic Rate paid by local businesses to Councils, whom then pass it on to Government.
The current process was again thought up by the Conservatives in the early 1990’s as it jostled with the poll tax policy. This was a genuine attempt to restructure an outdated system of local tax collection and although the poll tax failed the NNDR changes went through.
As a District Council Leader and small business owner it is becoming increasingly obvious how detached the business community is from the decision making processes within Local Government. This is mainly due to the fact that their rates go out of the Borough and therefore it is always local residents, not business that have the loudest voice when it comes to dividing up limited resources. However, without SME’s, retail outlets,. Hotels, Pubs etc our town centres and job market would die.
By allowing Town Halls to retain the NNDR it collects, local politicians can rebuild it’s relationship with local industry and directly target business related issues and projects to help stimulate and maintain local economies. In 2007 the LGA carried out significant research into this subject and has concluded that there is a possible way forward. Perhaps if we are serious about a New Localism we need to address the thorny issue of funding first – I suggest that the return of the NNDR could be the best way forward to stimulate the debate and move true localism forward?