‘Super cabinet is nothing but a new talking shop’

Jun 4 2008 by Bill Gleeson, Liverpool Daily Post

THE proposal for a super cabinet populated by a group of local politicians amounts to the creation of yet another talking shop when what the region really needs is action.

The super cabinet is to be made up of senior representatives from the region’s six local authorities. The new body is meant to foster greater co-operation between the region’s local authorities and foreshadow the creation of a city region layer of sub-regional government.

As a nation, we are already over-governed. Brussels, Whitehall, the North West Development Agency, the North West Regional Assembly and each local authority already spends copiously on often wasteful schemes.

My principal objection is cost. Each layer of government, from Brussels down, comes with its own budget and administration. The promoters of the new cabinet claim sub-regional government would be good for the economy, but how can flabby, costly government be good for the economy? Yet, if our region has more layers of government than rival places, the cost of doing business in our region will rise, making the Liverpool City Region less competitive.

One of the justifications for the scheme is that it would improve co-operation between the area’s local authorities, which, it is fair to say, have a reputation for quarrelling. But wouldn’t it be far better if the local authorities just grew up and chose to get on with each other using the current arrangements?

What is more, the idea of another layer of government has been effectively rejected, when voters in effect turned down regional devolution a few years ago.

City regions are just another way of trying to implement an idea that the population doesn’t want.

A better suggestion to improve local, sub-regional and regional government would be to conduct a thorough review of the costs of each layer together with an examination of which bits are wasteful duplication or are unnecessary and, therefore, could, quite painlessly, be scrapped, resulting in a lower burden on taxpayers. That is more like the sort of thinking local business wants to hear, but what chance any bureaucrat is going to set the wheels in motion on that one?

CITY investors were pleasantly surprised by the rise in profits at United Utilities. The water company’s figures were slightly ahead of expectations.

The cause was the higher water bills we are all paying. Mine was £450 this year. It doesn’t seem so long ago the figure was nearer £200.

Water regulator Ofwat has allowed bills to rise to fund investment in sewage treatment, reducing leaks and other infrastructure improvements that has helped improve the quality of our water supply, reduce waste and clean up the region’s rivers and shorelines at an annual cost of £800m.

Which is all good stuff.

But was some of this extra revenue really meant to filter down to the bottom line and leak out of the system by way of dividend to shareholders?

United Utilities used to be a diverse business, offering a range of services, including electricity and telecommunications, but a series of disposals has turned it back into largely a water company.

Water companies are not the same as other types of enterprise, not even other utilities. There is no competition in the water market. Consumers are stuck with their local supplier.

What is more, this was not a one-off boost to profit. United Utilities anticipates the current year will also see a good set of profit figures.Ofwat has loosened its grip on price regulation too much.