PINSTRIPE

There is a common view that the funding of local authorities is not as it should be and there is much debate on what changes ought to be made.

The commission chaired by Sir Peter Burt some years ago proposed the admirably simple system of a 1% levy on the value of your house each year. A terrified Labour administration kicked that into touch on the basis it might lose them some votes.

In retrospect this was a high class problem for them. The SNP administration is now consulting on the issue again. Many variants on the theme of more local taxation are now being put forward for consideration, including the unwise proposal for a local income tax which, when added to looming higher Scottish national income tax rates, would destroy our tax base.

The issue with all this is that it starts from the right analysis of the problem - local authorities do not have enough money and are overly subservient to central Government and then proposes the wrong solution - more tax.

My own dealings with local authorities, far from uncovering useless jobsworths doing as little as they can, almost invariably reveal dedicated individuals who believe in public service but are so demoralised by understaffing, poor pay, inadequate support and stupid rules that they cannot do the job they want to do and which local citizens deserve.

The answer comes in two parts. First, set the local authorities free to charge for premium services. Would you like your bins collected weekly rather than only each fortnight? - no problem the price is £x.

Do you need a routine planning permission for an uncontroversial extension to your house but want the work to be able to start in time to finish it by Christmas - but you cannot because the planning department is so overloaded it would take you weeks to get an answer - well, what would you pay for a premium service which gave the answer (the same answer - not a different answer) in seven days?

The second part of the answer is competition.

For certain services, bin collection would be one, there could be two teams within each local authority and you, yes you - the customer, can decide each year which one you want to use. Sounds crazy? 40 years ago we all had BT phones - no different.

For some services local authorities should be allowed to compete in other local authority areas. In order to do this we need to turn local people into the procurers of services - why can’t your local community council award a contract every few years to its choice of local authority to fix its community’s roads and street lights or sweep its streets?

Does anybody mind whether it is Renfrewshire or Inverclyde which mends a pothole - I doubt it - all a local community wants is that it gets done. The ability to choose at the most local level who provides services for you would not only empower local communities but, through greater competition, create efficiencies. Local authorities which grasped the opportunity to provide efficient services which people were willing to pay for would gain extra funding and a positive spiral would develop.

The connection between the council tax payer and local authorities would be made much more real - and actually matter. Other than in setting the framework within which the system would operate, the interfering hand of central Government would be removed and local people and service providers could agree what they want.

Soon Argyll & Bute would rule the world.

Pinstripe is a senior member of Scotland's financial services community