Introduction

The preceding chapters of this book have detailed how business concerns have been promoted up the social policy agenda since the late 1970s. New opportunities have been presented to businesses and business people wanting to become more closely involved in a range of welfare services. Even where business has been reluctant to take up these opportunities, central government has gone out of its way to encourage greater private sector involvement in social policy. Service providers, meanwhile, have been forced to incorporate business people into their management structures and have regard to business preferences in their decision making. Nonetheless, business involvement in welfare services has been patchy. This chapter looks at the extent of business involvement in local provision, taking the city of Bristol as a case study.

Local government, business and social policy

Chapter Five detailed how local government has been systematically undermined by central government since the 1980s through a number of mechanisms which served to strengthen business interests locally and weaken elected officials (Valler et al, 2000, p 411). To begin with, central government exerted increasing controls over taxation and spending levels. This was partly in response to lobbying by organised business for lower levels of corporate taxation and spending at the local level, and was partly due to the Conservative government’s desire to control overall levels of public expenditure. This resulted in the introduction of the 1984 Rates Act, which forced local authorities to consult with businesses about the setting of local taxation and the provision of local services.

This act also introduced rate capping, whereby central government placed a ‘cap’ on the amount of local taxation that could be levied by councils. The most important change came with the 1988 Local Government Finance Act, which introduced the Community Charge (Poll Tax) and the Uniform Business Rate (UBR). The Poll Tax imposed a flat rate tax on most adults in order to pay for local services. The UBR shifted the responsibility for the setting and collection of business rates to central government in response to the business criticism that, in setting business rates, local authorities often paid very little attention to business interests, which represented a tiny minority of the local electorate.