Thursday, 23 September 2010

The State PLC

In an interesting development, Eric Pickles is proposing that instead of cutting services, local authorities should compete with small businesses directly. Let me repeat that. Local authorities should compete with local businesses for your trade.

He gave some examples. Councils should:

  • Utilise their council-run MOT test centres for checking the safety and roadworthiness of their own vehicles to offer an MOT service to the public and generate income.
  • Offer insurers, who require an annual tree inspection of trees within a policyholder’s premises, a tree inspection service carried out by members of their arboriculture team using their expertise and equipment.
  • Using powers in the Highways Act 1980 relating to the maintenance of highways and dropped kerbs, offer a service to residents who wish to create a driveway from the roadway through to the edge of their property.
Although local authorities have a wide power to charge for discretionary services under section 93 of the Local Government Act 2003 (LGA 2003), it should be remembered that this power supplements, rather than replaces, charging powers contained in other legislation and cannot be applied to services that a local authority has a duty to provide. Nor does it apply where there is already an existing power or prohibition to charge.

Under section 95 of the LGA 2003, relevant authorities in England and Wales have the power to engage in entrepreneurial commercial trading with private bodies and persons. However, the following restrictions in relation to the exercise of section 95 must not be forgotten:

  • The trading must be function-related.
  • The power cannot be used to authorise commercial trading in relation to a function that a local authority is under a statutory duty to provide.
  • The trading power cannot be used if an alternative commercial trading power already exists.

Call me old fashioned, but when I need a plumber, I call a plumber. I don't expect to find the local authority offering plumbing services in competition to local plumbers anymore than I expect to find them running supermarkets, selling petrol or arranging travel breaks to Tuscany.

It is not the civic duty of publicly funded local authorities to offer services that compete with local businesses. The Town Clerk changing his name to CEO is one thing. The State replacing private businesses and becoming the one stop shop for all your needs is another. It's called communism and always ends in tears.

with thanks to Christian Lister

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