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Cigarettes and alcohol? What about efficiencies and MAAs?

April 23, 2009

Humans are adept at hiding from inconvenient truths, but I sense a change in the national mood. Sustained economic growth has meant that post-budget gloom in recent times has been caused mostly by excise duty on cigarettes and alcohol. Today the headlines are about tax rises, unemployment, and the Chancellor’s two-pronged gamble on future – a bet on a rapid recovery and severe cuts to public spending. Concern about the staples of unhealthy living has gone up in smoke.

In the wider noise about our collective misery, HM Treasury quietly released the final report of its Operational Efficiency Programme. With public sector spending on the slide, coverage so far has centred on the efficiencies required of local government. However, Sir Michael Bichard’s contribution to it recommends stronger local partnerships, reduced ring fencing and greater local flexibility.

On the Guardian’s Joe Public Blog, Peter Hetherington draws our attention to one of the more cheering aspect of yesterday’s budget – the creation of two statutory city regions in Manchester and Leeds. These initiatives will deliver exactly what Sir Michael Bichard calls for. MAAs like these have potential to be powerful recovery engines, but they won’t work everywhere.

Despite the tools provided to local councils yesterday – although just how useful is money directed at jumpstarting housing developments and green social housing is still open to question – a further inconvenient truth for this recession is that smaller cities and towns will find it difficult to get back from the economic brink. Our own on-the-day budget statement states that local government is best placed to help deliver recovery in communities, but this won’t happen unless new alliances of local authorities covering smaller urban areas are allowed to flourish and for them to be able to draw funding down urgently from central government and bodies such as the HCA to get local infrastructure projects in place. This issue and the future challenges local government faces will be debated with the Local Government Minister, John Healey MP, at our July national policy conference.

Our full budget briefing for members is available here.

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