Society of Local Authority Chief Executives (SOLACE) Conference 2008

The Rt Hon Hazel Blears MP

Secretary of State

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Society of Local Authority Chief Executives (SOLACE) Conference 2008

Draft text of the speech - may differ from the delivered version.

It's a pleasure to be in Belfast.

Today, I've visited a city transformed. I've seen the new buildings in Victoria Square and here in Laganside. I've met people coming together in a spirit of reconciliation, and above all looking forward to the future.

I know the city council has played a huge role in all these changes, attracting investment, bringing private and public sector together, and working hard to keep local people informed, involved and engaged.

"the crucial role that local authorities will have in overcoming the economic challenges over the coming months."

So though I am Communities Secretary for England - and what I have to say is addressed first and foremost to English local authorities - it's apt to be doing it in a place that is a symbol of renewal and a testament to what local leadership can achieve.

It is also - as ever - a pleasure to speak to SOLACE.

I know your discussions over these three days have covered big issues - from policing, to housing, to social capital.

Of course there has been one issue that have overshadowed them all. The international financial crisis.

And that's what I want to focus on today: the crucial role that local authorities will have in overcoming the economic challenges over the coming months.

Helping people stay in their homes and jobs.

"There are no easy solutions. But equally, there is no call for despondency."

Helping local businesess stay afloat.

And managing the stresses, strains and anxieties that can arise when resources get scarcer.

There are no easy solutions. But equally, there is no call for despondency.

Local authorities are starting from a position of strength.

Don't let anyone tell you we live in a broken society when you see what local authorities across the country are doing to make their neighbourhoods safer, cleaner and greener.

Look at towns and cities like my own constituency in Salford, on their knees in the early 90s, unrecognisable today - with new buildings, new jobs, a new sense of purpose.

Look at places like Waltham Forest - from zero stars to four stars in six years.

Or look at how authorities are finding the most effective solutions to the biggest and most complex changes we face as a society: Wandsworth tackling childhood obesity, Lambeth tackling guns and gangs.

All this progress is the result of long-term investment, long-term leadership, and hard work.

Over the past year, local authorities have gone further still. Using new discretion and room to manoeuvre not only to deliver better services, but also to build trust with local residents.

North Somerset are appointing joint team leaders for young people across the council, the primary care trust and connexions, to make sure that services join up and deliver the kind of rounded support young people need

Nottingham have an "information bus" which tells residents how they are doing against the priorities in the Local Area Agreement, and that transparency can only increase confidence in the town hall.

Alongside this, the signing first multi-area agreements in May marked a decisive moment for local authorities, a sign of their maturity and confidence.

By focussing on issues such as housing, training and transport, groups of authorities from country, town and coast are giving themselves the opportunity to unlock the sub-regional economy.

So my first point is - the past year has been another year of hard work for local government, proving your ability to lead, and rewarded by practical change for the people you serve.

But we all know how much the economic picture has changed in a year.

Twelve months ago, Northern Rock's future was hanging in the balance. Oil prices were volatile. Food prices were on the rise.

But few people could have predicted, even then, the kind of swings in stock prices, the turmoil in the banks, or uncertainty in markets that we see today.

In fact, it seems at the moment that every day is a fresh dip on the rollercoaster.

It is a stark reminder of what living in a global economy means.

Let us be clear - the current turbulence is a global phenomenon with global causes. At a national level we are pulling out all the stops, working together with partners in the US and Europe, to create long-term stability.

Yesterday the Government took decisive steps.

A comprehensive package to boost confidence in British banks, restore liquidity, and maintain lending for the medium term.

"we shall use the full power of Government to blunt the worst effects of the crisis."

A concerted 0.5 per cent cut in interest rates matched by the US Federal Reserve and the European Central Bank.

The National Economic Council - whose first meetings I attended in Number 10 this week - will continue to work tirelessly to put together a responsible, coherent and effective response to unprecedented challenges. It will be supported by the Regional Economic Council, who will make sure that no region is left high and dry.

I am determined that we shall use the full power of Government to blunt the worst effects of the crisis. We will fight the mass unemployment and house repossessions which characterised previous economic down-turns. Nothing has a greater impact on social cohesion than people losing their jobs and homes. It tears the heart out of a community. It is the death of hope for a family. It blights the chances for young people. And this Government will not allow our communities to pay the price of a global financial crisis.

As Secretary of State I am acutely aware of my own Department's responsibilities. I have asked senior officials to look at spending plans in the new context, and to offer up some tough choices for me to make. Every penny we spend must be measured against the simple test: does this help hard-working families through the tough times ahead? If not, then we must think again.

But the fact we have a strong national response does not mean that the local response does not matter. On the contrary.

More people will come to their council for practical help: housing, jobs, benefits.

You will come under heavy scrutiny and you will have to deal with serious demands.

"Every penny we spend must be measured against the simple test: does this help hard-working families through the tough times ahead?"

I come here today with a promise and a challenge.

Local autonomy and local leadership is part of the solution.

Look at the Work Foundation "Ideopolis" report. It highlighted that places prosper more when they knew what makes them unique and find a way to exploit it.

Whether that's Brighton or Watford finding a role to complement London in their regional economy, or Salford building a new image and a new industry around the iconic Lowry Centre.

Or take Sheffield's economic masterplan, looking in the round at education, housing and business incentives, with the ambition of bringing the city's income up to the national average.

These examples show that the economic duty, proposed in the sub-national review, will not be a shock for the vast majority of councils. Rather it will give confidence and clarity to all about what they can and should be doing.

Where local authorities are devising their own LAA indicators outside of the national set, more than a quarter are about the local economy - by far the biggest theme.

It's encouraging to see local leaders thinking about these issues creatively.

In fact with the local economy, as with so many issues, local authorities can do that best when they have the space to prioritise, to innovate, and lead.

So I promise to keep on fighting your corner: to listen to you: to find ways to give you the room for manoeuvre you need.

And where you come across barriers to helping your area prosper I am ready to work with you.

In return, my challenge is this.

Use your flexibility and discretion to the maximum.

Show the kind of leadership that has underpinned the debate about the new localism for all these years.

And work with us to deliver for the people to whom we are all, ultimately, accountable.

The people who work hard, who do their bit, but who are having to make some pretty tough decisions of their own and are anxious and frustrated.

I want to make three points about where we go from here.

First, this is the time to assert your role as local leaders.

The whole of the framework set out in the 2006 White Paper is based on the premise that local authorities are about much more than delivering a set of discrete services to a statutory minimum.

It envisaged councils' role as thinking about the overall wellbeing of the place they were responsible for, considering what really mattered to local residents whether the council were directly responsible for it or not, and bringing together all of the local services that go to make a great place to live. Not just streetcleaning but policing. Not just benefits but hospitals.

That's why we have the Comprehensive Area Assessment on the way, measuring not individual services but what it really feels like to live in a particular place.

So if ever there was a moment for you to assert your leadership of your local strategic partnership, this is it.

When budgets are tight there is no excuse for excessive bureaucracy or uncoordinated services that don't get the absolute maximum of value from taxpayers' money.

It's local authorities who can see better ways of doing things. Local authorities with the clout and the legitimacy - as elected bodies - to bring together services where they can work more effectively.

Take childhood obesity. Who is affected? And who can make a difference? It's about schools. About playgrounds, parks and leisure centres. It's about GPs. It's about young people and their parents.

It's vital to have the conversation with everyone in the room and work out what they can do differently not just to sort out the problem but to stop it happening in the first place. Local authorities are the people who need to make that conversation happen.

Of course, you know this. But it bears repeating.

My second point is this. Economic turbulence is not a reason to give up on empowerment.

In July we published the White Paper Communities in Control. Over the summer I've been listening to the reactions.

It's been encouraging to hear so many councils running with agenda as their own.

We've seen scores volunteering to lead the way with techniques such as asset transfer and participatory budgeting.

But I've also heard an alarming argument creeping into debate here and there.

The idea that - in tough times - empowerment is a fluffy extra that should be the first thing to go out of the window.

I think that's misguided, for two major reasons.

First, in tough times government and the public sector at all levels come under a lot of scrutiny.

There's a danger - especially when tough choices are called for - that you get a gap developing between the public at large and those exercising power.

But giving people a say helps them understand the trade-offs and constraints that public bodies are operating in.

It helps people to "own" what's going on, to feel that they're involved, rather than being powerless in the face of events.

And transparency can actually help maintain trust in vital civic institutions at a time when it's needed most.

The second hard-headed reason you need empowerment now is financial.

There can be an initial cost in making empowerment happen, in getting it into the way of thinking about designing and delivering services.

But it's equally obvious that getting the public involved can help deliver better services at better value.

There's an increasingly thick folder of evidence about it but I'm particularly struck by the case of individual budgets for social care: better outcomes at lower cost. It goes to show that people aren't naïve with handling public money. They can make some pretty shrewd choices.

And this links to my third point.

There's no point beating about the bush: budgets are going to be tight.

The income from business rates is likely to be less than you had expected. We have already seen local authority projects involving private sector partners, such as affordable housing, start to flag.

And I know LGA and others have expressed concerns about the implications of what's happening with Icelandic banks. In general, I would not expect local authorities to face serious financial difficulties as a result of the failure of any one institution, provided they are following prudent financial policies. The Government has taken action by freezing the UK assets of Landsbanki to help ensure that creditors of Icesave are treated fairly if Landsbanki goes into administration. If any authorities do face critical financial difficulties there are well established procedures for providing expertise and advice. We will be working closely with the LGA to protect individuals, communities and local services.

And I welcome how hard you work to make sure the first reaction to tight budgets is not to do less, but to find ways of doing things differently.

Leadership will help you do things differently.

Empowerment will help you do thing differently

And both can help you and your partners think differently about meeting these challenges.

Now is the time for innovation and creativity, now is the time to really understand what your communities need, be they householders, home owners, or small and medium local businesses.

This understanding, combined with a thoughtful overview of your place and the contribution of different partners will allow you to design and deliver services that are flexible and responsive, even more capable of doing what people need right first time

And of course the more we get right first time, the more we respond clearly and directly to the needs of local people and local businesses, the greater the resilience we build in our local community, the more empowered and capable they are themselves.

And more often than not the cheaper it is to deliver our services as less effort is wasted on the wrong or unnecessary things, as well as increasingly, finding ways to head off problems before they occur.

I know the local government sector has the expertise and ingenuity to meet this challenge, and that the work of the Regional Improvement and Efficiency Partnerships - learning from this experience, helping us all think through how to deliver to suit our local circumstances, sharing this learning more widely, and driving innovation - is going to gain a new significance.

No-one should be under any illusion that the coming months are going to be easy or comfortable.

But as you probably know I'm the most optimistic member of cabinet.

And I think we do have grounds for optimism today. Not just because we're in a decent long-term position, nationally, to come through this difficult period.

But also because we have in you the right local leaders to put people first and make a difference.

I wish you every success.