Where's Derek Hatton when you need him?

Whilst the headlines are all about the spending review, there seems to be one effect of the cuts no-one is mentioning.

I refer to the coalition's attitude towards local government. In an apparent sop to the public, council tax has been frozen. "Fair enough", some might say, "I mean, no-one wants to pay more council tax, right?" True enough, but scratch beneath the surface of this policy, and we begin to see a disturbing consequence.

I'm no fan of the council tax, from a left-wing perspective it is unjust, since the rich will never pay more than about 4 times as much as the poor - in sheer quantitative terms, that is - as a percentage of their incomes they will pay far less. A pensioner whose income necessarily drops when they retire will continue to pay the same amount. From a right-wing (or at least pragmatic) perspective, it just doesn't make sense, much of the market economy is buoyed up by the house price inflation, a tax on the value of property is necessarily an impediment to economic growth. I agree with the principal of a local income tax.

But instead of introducing such a tax, (as the Lib-Dems loudly promised to do) the coalition have frozen it. On top of this, they have cut back central government funding to local councils. Result? Many locally provided services will have to go.

Now all this has been covered by the media, but there's another side to this. A decline in local services is not the worst aspect of this policy, this is the culmination of a trend which stretches right back to the end of the Second World War, and crosses the political divide. I am referring to the quiet process of centralisation.

Thatcher of course, was most famous for her assault upon local authorities, and instituted a policy quite similar to the present one - rate-capping. Elected authorities could no-longer be trusted to charge the "correct" level of taxation, so she imposed limits. This was defied by a number of Labour Councils for a short while, something we are unlikely to see in response to the present government. More's the pity, some might say: "come back Militant! All is forgiven!"

I'm joking of course, Militant were an absurd bunch and Hatton was the most absurd amongst them. They were prepared to bankrupt a city as a cheap political stunt, as Kinnock rightly said they were "play[ing] politics with peoples jobs, with people's livelihoods" They were also hypocrites, Militant, and its modern successor - the Socialist Party of England and Wales - would not grant the same level of autonomy to any council were they to gain power, and I should know - I was once an inmate of that particular asylum. But they were right on the issue they fought, even if their actions weren't, an elected body should have the right to raise however much revenue it feels it needs, and if the voters don't like it, they can kick them out.

But it's unfair just to blame Thatcher for this. It was Attlee who started the trend of rolling back the powers of local government. He denied them the right to build hospitals. Wilson was one of the worst offenders, completely redrawing the UK's internal map, without so much as a local referendum. Blair never tried to turn the clock back either.

There's more to it than just the formal powers local authorities have though. Council tax accounts for just a quarter of local government revenue. The remainder comes from Westminster. This ensures a system of patronage, when most of your money comes from the state, it pays not to step out of line. It's no wonder people feel turned off from local politics.

Furthermore, why is it that the most unpopular tax is the one that gets collected by local councils? It would seem they are expected to take the flack for an unwanted burden, and the trend continues. By forcing councils to make cutbacks rather than doing so themselves, the coalition hopes to foist the worst of the blame onto them.

So far as I can see, there has been no serious debate in this country about where the centre of power should lie. All but 4% of revenue is collected by the chancellor of the Exchequer, and few people question this. Some might point to devolution as a counterexample, but most of the debate on devolution has revolved around identity assertion rather than a systematic programme of federalisation. England has not gained an autonomy corresponding to that given to Wales and Scotland, which are themselves fairly large political entities. The fact that a few of the diktats placed upon local authorities now come from Edinburgh or Cardiff does not represent a dramatic shift in the power relations of this country.

The coalition have just placed the final nail in the coffin for local government. An institution which has the potential to provide a relevant and participatory democracy for ordinary people has, over the past half-century or more, been turned into a farce and a scapegoat. It is time to sit up and take notice.