Background

The Sustainable Communities Act received Royal Assent in 2007, having been sponsored as a private Members Bill by the Conservative MP Nick Hurd. The government came to support the Bill as part of their devolution agenda. It also received a wide coalition of support from third sector organisations under the ‘Unlock Democracy’ banner.

The Act is a response to concerns at the closure of local services (ie, post offices, local shops etc.) and the lack of control people feel they have over decisions (ie, fall in voter turn out). The Act aims to give local communities more power over the decisions that affect the environmental, economic or social sustainability of their area.

Operation of the Act

The main provisions of the Act are:

• to change guidance turning community strategies into sustainable community strategies
• to require central government to publish how much it spends in each area and on what (through local spending reports)
• to set out a process for local people to submit ideas to government on making their local area more sustainable. This could, based on the information in local spending reports, include a request to transfer functions plus funding to councils.

The Act requires government to produce local spending reports detailing the expenditure of all government departments in each local area. Bodies whose expenditure may be included in the reports are local authorities, government departments and any other bodies exercising public functions. However the Secretary of State will be able to produce different reports for different areas.

It is hoped that the local spending reports will help inform local authorities’ consultations with local people, strengthen local democracy and enhance the operation of LAAs. However the guidance for the Act acknowledges that not all public expenditure will be able to be mapped within the local spending reports. CLG plan to publish a consultation on the production of local spending reports in December 2008 with the first arrangements for the reports to be taken by April 2009.

Under the Act, the Secretary of State will also invite local authorities’ to submit proposals which they believe would contribute to the sustainability of their area. The process for generating these ideas is as follows:

• local communities come up with ideas to improve local sustainability · the council brings together a community panel of local representatives to 'try to reach agreement' on which proposals to take forward (ie, much more than merely to consult). The community panel must be a balanced selection of individuals or groups that would be interested in the proposals
• the council may put forward the agreed local ideas to the Local Government Association (LGA) (called the ‘selector’)
• the LGA shortlists the proposals and sends them on to government
• the Secretary of State tries to reach agreement with the LGA on which proposals to implement
• the Secretary of State must also publish an ‘action plan’ setting out the action they propose to take to implement any proposal

The government’s guidance emphasises that proposals need to be specific about what roles or functions central government needs to change as well as making a good case if they involve additional public expenditure. The government will also take a cost-benefit approach when considering proposals. This will take into account the impact on people or groups outside those presenting the proposal, as well as the costs of making individual changes in specific areas rather than a uniform approach.

The Secretary of State formally invited local authorities to submit their first proposals in October. The deadline for proposals to be sent to the LGA is 31 July 2009. The timescale for when decisions will made or when the invitation will be repeated has not yet been finalised. The statutory guidance for this part of the Act was published alongside the Creating strong, prosperous and safe communities guidance in July 2008.

Potential of the Act

The New Local Government Network has recently published a report examining the potential of the Act and its possible applications. The report argued that local authorities’ should use the Act to achieve new powers and freedoms. The NLGN argues that local authorities could use the Act to propose that:

• council leaders become responsible for local public transport in their area
• councils keep local increases in tax revenues to finance regeneration, capital investment and infrastructure improvements
• local branches of national public services working with the Local Strategic Partnership (LSP) should adapt local management procedures without waiting for prior approval from regional or national offices
• partners who do not contribute appropriately to the LAA should be at risk of having their functions and funding transferred to partners who will contribute