Opening the 'people's purse'

BBC News local government correspondent John Andrew looks at how it might work in practice.

The move was announced by Hazel Blears, the newly-appointed Secretary for Communities and Local Government, who said it would be piloted in 10 areas, including Sunderland, Bradford, Birmingham and Southampton.

Some councils have already been devolving budgets to neighbourhood groups, but usually it's involved only small pots of money.

What the government's piloting now is much bigger - in the case of Sunderland, for instance, some £23 million over two years.

Brazil example

Strange though it may seem, the idea of "participatory budgeting" originated in the slums of Brazil, where allowing some of the world's poorest people in the world a say in how public money was spent gave them a stake in their future.

Here ministers are still deciding on what to call the English version -"people's purse" or "community kitty" are early contenders. But how would it work in practice?

What it won't involve is giving a large stash of cash to a group of local people and asking them to get on and spend it how they like.

The pattern established in areas like Bradford and Sunderland is to appoint panels of local people who broadly represent the make-up of their populations and then for this panel to consult other people on how the budget is used.

This, I'm told, might involve community-led debates, neighbourhood votes and public meetings.There'd also be training for local people on how budgets work and priorities set.

Because of the potentially large sums of money involved, the process would have to be overseen by a council community development officer and the accounts properly audited.

So what might the money be spent on?

Ministers say it could be used to employ more police or community safety wardens in areas where anti-social behaviour is a problem.

Or it might be used for environmental improvements - new green spaces or play areas.

Ms Blears said it can often produce surprising outcomes.

"There was one project in Bradford where it was young people deciding how money was spent and everyone thought they'd go for a skateboard park.

"Actually, they decided to vote for quite a large part of the pot to go to services for older people."

Kitty in five years

But the Local Government Association, who represent thousands of councillors, are distinctly cool about the idea.

Its new chairman Sir Simon Milton said research suggested there was no great public appetite to take budget decisions and that the role was best left to elected ward councillors who were accountable and could be voted out, unlike an appointed panel.

Ministers, though, believe devolution shouldn't just be from Whitehall to town hall and that councils have to hand some of their powers down too.

The aim is for every neighbourhood to have a community kittty within five years.

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