Friday Analysis: Localism makes a comeback

November 18, 2011

The Localism Act, which gives local communities more say about planning and development, was given Royal Assent on Tuesday. But is it good news for Bath and the West region?

According to the Chartered Institute of Public Finance and Accountancy (CIPFA), it is an encouraging shift of power from central government to communities.

For example, the Act allows for community groups to buy local assets such as pubs, shops and libraries – and to run local services. CIPFA stresses that any group using public resources and operating public services needs to have adequate infrastructure and processes in place, including governance, financial management and HR in order to maintain standards of control and accountability.

CIPFA's assistant director of local government, says it represents “the largest transfer of power back to councils and local communities in a generation. But with this upheaval comes uncertainty and local authorities will need to work closely with their communities to ensure they are working effectively. “We will wait and see whether council tax referenda have a positive impact on local democracy. But for community groups to deliver services, they need proper support coupled with strong governance and financial management systems and processes from the outset.”

Jo Davis, senior director at property agents GVA, welcomes the Act. She said: “This is a significant move towards a clearer, more democratic and more effective planning system. The ultimate consequence is that many more decisions about housing provision and delivery can be taken locally.

“We have long advocated the merits of a city regional approach to economic growth, placing cities at the heart of the economic agenda, in which strong civic leadership is critical to our places reaching their full economic potential.

“Rebalancing the disparities in regional growth across the UK, starts with leadership and in clearing the way for locally elected mayors. The Localism Act will give Bath a 'voice' and the ability to generate resources to deliver local priorities will break free from the functional silos that public policy and finance tends to operate within."

She adds that the local government finance settlement was substantial in 2011/12, (£19billion). If a small proportion of this was made available to forge a new creative relationship with the private sector across a platform of locally determined economic development and regeneration projects in the region, such as the Temple Meads Enterprise Zone in Bristol and Bath's Western Riverside Enterprise Area, then the prospects for growth would look much brighter.

This, she says, is the real potential of the Localism Act.

“However, there are still matters which need addressing. In terms of planning there is a need for transitional arrangements to be agreed pending the adoption of the National Planning Policy Framework. The Localism Act has probably introduced the most significant changes to the planning system since 1947 and as the NPPF moves forward there remains uncertainty around further planning reform and also uncertainty on how the framework will assist in the delivery of the potential outlined above. Uncertainty always restricts investor and developer confidence and clarity of the Government’s intentions around planning reform is urgently required if the sound principles of the localism act are not to be undermined by an unhelpful planning system.

“We look forward to local authorities responding positively to the enhanced powers and freedoms which they have been granted.” 


Among changes introduced by the Act are the abolition of Regional Spatial Strategies and the introduction of neighbourhood plans led by communities and business groups in non-governmental neighbourhood forums.


The Act will:

- Introduce a new general power of competence, giving councils unprecedented freedom to work together to improve services and drive down costs. In fact, councils are now free to do anything – provided they do not break the law.

- It gives councils greater control over business rates. They will have the power to offer business rate discounts which could help attract firms, investment and jobs. The Act also cancels unfair back-dated business rates which threatened to cripple key businesses. It stops plans to impose a business rate supplement on firms if a simple majority of those affected do not give their consent and simplifies the process for claiming small business rate relief.

It introduces new planning enforcement rules, giving councils the ability to take action against people who deliberately conceal unauthorised development

It also increases powers for councils to remove illegal advertisements and graffiti and prevent fly-posting, and gives planning authorities stronger powers to tackle abuses of the planning system

Other measures include enabling councils to return to the committee system of governance, if they wish, regardless of their size. Centrally set rules interfering in how councils set up their own affairs are being scrapped

- It reforms homelessness legislation to enable councils to provide good quality private rented homes where appropriate, freeing up social homes for people in need on the waiting list.

- Allows councils to keep the rent they collect and use it locally to maintain social homes through the abolition of the housing revenue account.

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