THE collapse of local government in parts of New York and Chicago is well known and documented. And the warning bells heralding a similar collapse in some areas of London have been rung by the Audit Commission in a report which spotlights the parallels between these loony Left boroughs and their American counterparts.
Yet as recently as seven years ago in Waltham Forest, Ealing, Hammersmith and Wandsworth, the average rates bill was around £3 per week. Last May the Left took control of the first three. Together they have managed a staggering increase of 300 per cent between them compared with 1978/9. hopefully to be rate-capped next year like Lambeth, Islington, Southwark and other big Labour spenders.
Wandsworth's increase over these nine years is a mere 82 per cent compared with inflation of 103 per cent; most rate-payers in that borough will find that their average weekly rates bill goes up from £3.19 in 1978 to £5.80.
The Left blames the enormous increases elsewhere on the need for "jobs and services" and wrongly blames the Thatcher Government for the ratepayers woes.
Inefficiency
Paradoxically the Audit Commission, an independent body, came to the opposite view. The commission maintains that policies of high rate spending, high staffing, low charges, poor management and political interference in the running of services actually aggravates the cycle of deprivation in inner cities.
Singling out eight hard Left boroughs in London--called Group A--the Commission characterises them as having high staff levels, high expenditure, high cost per unit of output and high inefficiency.
In Wandsworth the figures speak for themselves. There it costs £264 a week to keep a child in a council home. The comparative figure for Group
A is £438. In Wandsworth, the cost of managing each council house is £155 a year. In Group A, it is £201. In Wandsworth the council employs 12 non manual workers per 1000 residents. In Group A, 19.
The 5000 marchers in Waltham Forest were telling the Left bluntly--and it is a message which will be taken on to the streets in other boroughs as ratepayers accepting five, six or seven per cent wage increases gasp at their rocketing rate demands --that they want the application of sound business common sense management applied to local government services.
The rot set in when hard Left councils began meddling
How the average weekly domestic rates bill has changed. The scale ranges from £2.78 in Southwark (1978) to £13.50 In Waltham Forest (1987). |
in day to day management combining that with a predilection for directing their energies to areas outside their control like South Africa, nuclear disarmament, gays and police monitoring.
The fact is that adherence, to political dogma which flies in the face of common sense and residents' wishes denies these Labour boroughs quality services and environmental improvements at huge financial strain.
The confidence generated by a steady, well-run council with low rates appears to have yet another beneficial effect: it attracts private investors-- they injected £36m in Wandsworth in 1985, creating many new jobs. That may go some way to explain why the per centage of unemployment in Lambeth, Southwark and Islington (at December 1986) was about 70 per cent higher than that of Wandsworth.
Wandsworth regularly monitors and reviews its services. This frequently means testing, by competitive tendering, with the rewards of better, measurable services--and £25m saved over the five year contracts.
Furthermore the generation of capital receipts, primarily by sales of council houses, largely to tenants and those waiting on rent lists, has boosted Wandsworth's capital re-investment while meeting home ownership desires of 10,000 new owners.
The effect of the capital re-investment in Wandsworth's housing, roads, parks, sports halls, swimming pools, libraries and so on, has been dramatic over recent years. Some 75 per cent of the council's housing stock has either been repaired and renovated to modern standards. or is in contract for this work.
This success is more obvious when one compares Wandsworth's capital spending per council dwelling of £786 for 1985/86 with Lambeth (£118) or Southwark (£369).
Clamouring
Furthermore, this use of capital receipts does not have the same effect on the rates as borrowing, or worse still, the deficit financing arrangements which have found favour with many Labour boroughs, to the tune of £5 billion currently.
London's Labour boroughs are sinking deeper into financial crisis. They are not alone. Manchester, Bristol, Sheffield, Edinburgh and others are in the team, with Ealing. Hammersmith, and Waltham Forest clamouring to join.
The Audit Commission has warned that many of the hard-Left boroughs have been relying on " deficit financing " --or, to put it more simply, have been living on credit.
The day of reckoning is not too far off and the impact then could make the Waltham Forest rate rise look modest. Wandsworth, by contrast, has shown that the low rate. high investment--high service level philosophy can provide the answers for the inner cities.
One can only hope, with an election looming, the nation takes note before it votes.