John Ruddy says it’s time to look again, not just at how local councils are funded but how they are structured, and to create a new system fit for the 21st century, incorporating regional strategy and local delivery.


It is now 25 years since the then Secretary of State for Scotland, Ian Lang, announced his plans to reorganise Scottish Local Government into 28 unitary councils. Despite some minor changes these are the councils we have had since 1995. They were formed, not as the best way to deliver local services, nor in order to provide more responsive governance closer to the people. They were designed, at least in some areas, simply to maintain the Tory position in local government.

Previous schemes for local government in Scotland have lasted between 20 and 28 years, so it would seem apt to consider what structure is needed now for the 21st Century, looking at the challenges and opportunities of the modern day, rather than the gerrymandered solution of the last gasp of the Tory Government of the 90s.

What the experience of the last 25 years has shown us is that one size does not fit all.

Clackmannanshire Council – with a population of 53,000 – is responsible for delivering the exact same services as Glasgow City Council which serves 600,000. There are challenges facing some councils which can only be met by working with others – yet by the nature of such “partnership working” these have little to no democratic oversight.

We also now have a number of “City Deals” in progress and proposed across Scotland. These involve large sums of money committed by both Scottish and UK Government to delivering growth in various regions across Scotland. But again, there is little democratic oversight into their delivery. And they show that many projects can only work when considered across existing administrative boundaries.

But while local government is expected to do more and more, so the funding it is receiving from the Scottish Government is being cut. According to research carried out by the Scottish Parliamentary Information Centre, councils in Scotland have received cuts 4 times bigger than the cuts to the Scottish Government block grant. How we fund our local services needs to be looked at as well – including the proportion that is funded centrally and what is raised locally.

Traditionally, central government funding has been both to ensure a fair allocation of resources between richer and poorer areas and to deliver central government priorities, for example free social care. The percentage of their funding made up by council tax – almost the only income over which local authorities have control – is under 18% of the total. Nearly a quarter comes via non-domestic rates, allocated by the Scottish Government (a council doesn’t necessarily receive all the business rates that are raised within its area) and general revenue funding – a block grant – from the Scottish Government makes up nearly 60%.

As we decide on a way to change local government funding, we should also look at its structure., and what functions would sit best at which level. And that is why I believe a return to two tier local government should be Labour policy.

Large regions – many centred on the areas of the city region deals – would do the strategic planning and large scale projects which cross local boundaries – transport (including bus regulation and operation), education (including FE and HE) and enterprise (plotting the growth of the local economy). The local level councils would be much smaller, making services more responsive to local residents, and able to focus on delivering a service which matches the needs and wants of the local people. Some of these could be equivalent to the old district councils, while others would need to be new areas based on how our communities look now in the 21st century.

So we would have local services, delivered by and for local people, with regional bodies tackling the issues which need a big horizon, and economies of scale that can be delivered only by a larger body – but with democratic oversight, unlike now.

As Donald Dewar is reputed to have said, devolution is a process, not an event. It’s time for Scottish Labour to show that devolution doesn’t just end at Holyrood.