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Last Updated: Thursday, 30 March 2006, 15:00 GMT 16:00 UK
Devolution call on council review
Sir Michael Lyons

The man reviewing council tax is to argue the case for giving local councils more power so they can do their jobs properly.

Sir Michael Lyons will use a report next week to try to encourage public debate on the role of local government.

Answering BBC News website users' questions, he said the UK had more centralised decision making and funding than most other developed nations.

There was much confusion about what was funded through council tax, he said.

MPs in charge?

Sir Michael is due to report to ministers in December about reforming council tax and possible changes to the role of local government.

He was asked during a BBC News 24 Have Your Say whether MPs should be put in charge of local services and whether the UK political system was suited to decentralised government.

The former council chief executive said he was about to publish a further paper to add to the public debate.

It would argue "there are potential benefits to be achieved by a greater degree of devolution and freeing up local government to do the job which, where it does it well, is highly regarded by local communities".

Sir Michael said the idea of handing control to MPs was one of the more "creative suggestions" and he was unsure what MPs would make of it.

"The big issue is: do we want decisions made locally by people we have elected to make decisions?

"If we do, let's make that system work for us rather than making alternative arrangements."

Unrealistic expectations?

Only about a quarter of what councils spend is raised locally through council tax and charges for services, including housing rents.

Sir Michael is examining calls for councils to be able to raise more money themselves rather than rely on government grants.

He told News 24 there was a danger people had unrealistic expectations as they thought their council tax paid for more than it really did.

People should move away from the idea that they could continue to demand more from public services without wanting to pay through taxes.

Sir Michael said he had so far not ruled out any options for reforming council tax.

"You could do away with council tax and you could replace that with additional national taxation whether on income tax, a sales tax, or on VAT," he said.

But that would break the link between local taxes and local services, he said.

Revaluation worries

There have been fears that revaluing homes for council tax could see houses with views over open fields paying more.

Sir Michael said such factors affected the value of homes and if there was to be a property tax it had to be based on the value of people's properties.

The government has postponed revaluation until after the next general election.

Home prices from 1991 are currently used to determine council tax bills.


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