International ideas made local
Cherilyn Mawby, External Affairs Assistant, NLGN, 9 August, 2017

OECD’s recent ‘Government at a Glance’, published last month, presented an insightful array of data on and challenges for governments across the world. Most notably, the report declared a record low for citizen trust in central government. British citizens’ faith in their government sank to 41 per cent. This evaporation of trust internationally has also been noted by the Edelman Trust Barometer.

At NLGN, however, our interest was captured by some other findings.

The OECD reported that, in 2014, most countries employed more staff at the sub-central level than the central level of government, indicating greater decentralisation of responsibilities and public services to regional and local governments.

The findings offer some interesting insight into the role of local government across the world, the extent of decentralisation and how the U.K. compares.

Distribution of General Government Employment across Levels of Government, 2014

As the graph above indicates, many countries, like Japan (JAP) and Sweden (SWE), have far more decentralised capacity with greater responsibility and competences at the local government level. Other countries, however, such as Turkey (TUR) and Ireland (IRL) who employee around 90% of government staff at the central level, have not reached these same levels of decentralisation. Data was not available for the U.K.

These differences determine, in part, the distribution of government expenditure across levels of government also:

Distribution of General Government Expenditure across Levels of Government, 2015 and 2016

As one would expect, greater expenditure at the local government level is partly positively correlated with a greater distribution of government employment at the level of local government and, therefore, greater decentralisation. For example: Japan experiences a greater proportion of expenditure at the local government level (almost doubling central government expenditure) in comparison to Ireland, who experiences much greater expenditure at the level of central government. These results can be compared to the OECD average also, which show the U.K. (GBR) as more centralised in expenditure than most countries despite the past few years of devolution policy.

Change in the Distribution of General Government Expenditures
across Levels of Government, 2007 to 2015

The above graph would suggest that expenditure at the local government level in the U.K. has in fact decreased by around 3 per cent from 2007 to 2015 whilst central government expenditure has increased by the same proportion. So the years of austerity have seen a retrenchment of local government, but conversely, expanded activity from central government. The OECD average has seen similar reductions to local government expenditure, but not at the same rate as the U.K. nor with the same level of augmentation in central government expenditure.

This data highlights the sheer range of roles and impact of local governments across the world. These differences are characterised primarily by their unique histories – political and societal – and by their contemporary conditions.

With trends towards decreasing trust in national governments across the world, there may well be opportunities for local governments to play increasingly active governance roles. To tackle the trust deficit, new models of governance that are no longer simply a top-down notion of ‘for the people’, but instead increasingly find ways to work ‘with the people’ (Edelman, Slide 50).

How far this will manifest itself in UK Government policy remains to be seen. Some hints in this new Parliament could be promising: business secretary Greg Clark recently suggested that councils could be given a more formal role in delivering economic growth as part of the government’s industrial strategy. He also hoped to establish consensus on “the pivotal place of local government within it” and make “in effect a commitment that is almost constitutional in establishing the importance [of local government] and reflecting what has already been done”.

Yet judging by how the UK compares internationally, there is a long way to go before it reaches the capacity and levels of resource expenditure of many of our advanced international counterparts.

Our new International Blog Series will explore further the role of local government internationally. We will explore this topic across continents, in developed and less-developed countries – examining their differences and similarities to contribute to our everlasting dialogue on how to achieve greater innovation and improvement in English local government.