Subsidy Control Regime - Enforcement
Oct 8 2021
Part four in our four-part seriesRead More
We are waking to a very different future for politics, finance and governance in the UK.
The immediate response of the markets and the political parties will play out in the days and weeks ahead. But what will this mean for local authorities in the short and long term?
There is speculation on the exact route which will be followed to implement the referendum decision and how long this will take. The next few months will inevitably focus on the leadership of the country and the Conservative Party. In terms of legal implications, the message at the moment is "Business as usual - until told otherwise".
Many areas of local government activity and regulation are rooted in policy and legal foundations flowing from UK membership of the EU. These include procurement, state aid, employment and immigration rules. Until changes are made, local authorities will need to continue adhering to all relevant legal requirements whether they flow directly or indirectly from a EU source.
There is no immediate legal impact because (taking procurement / trade issues and employment as examples)
More immediately, the fall-out from the Brexit vote could have other impacts on local government. George Osborne proposed an emergency budget in the event of a Leave Vote - if this now happens, and follows the previous approach to austerity, local government can expect to bear the brunt of further measures.
If there are further changes in national political leadership, this could have a more profound effect on current policy direction. The devolution agenda has been driven to a large extent personally by George Osborne as Chancellor - would this survive a change in his role? The inevitable political vacuum while the leadership election is contested may halt policy developments and new legislation in any event.
Any downturn in the economy whilst all this plays out will itself impact local authorities. The downside of greater financial autonomy is that the connection between the council and its local economy is closer and more immediate – great in successful times but of real concern in difficult economic times.
Local government officers, many of whom will have had little sleep last night working to deliver a smooth referendum, will have much to reflect on in the days ahead.