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MCL-17(2011)13

Council of Europe Conference

of Ministers responsible

for Local and Regional Government

17th Session, Kyiv, 3 - 4 November 2011

Draft Kyiv Declaration


DRAFT

KYIV DECLARATION

(1)      We, the European Ministers responsible for Local and Regional Government, have come together at the 17th Session of our Conference on 3 and 4 November 2011 in Kyiv in order to take forward our longstanding co-operation.

(2)      In particular we have addressed, and adopted specific Declarations, on important issues of common interest, namely 

a.       the further impact of the economic crisis on local government and the policy responses to it;

b.       human rights at local level;

c.       the role of government in overcoming obstacles to transfrontier cooperation;

d.       the outlook for the future of pan-European work on local and regional democracy, on the basis of the Chaves report.

         

(3)      We note that important decisions on the future work of the Council of Europe will be taken by the Committee of Ministers at the end of November 2011. We accordingly request the successive Chairs of the Committee of Ministers, namely Ukraine and the United Kingdom, to bring the full Kyiv Declaration to the attention of the Committee of Ministers as a matter of urgency, and we thank them for their co-operation.


DECLARATION 1

ON THE FURTHER IMPACT OF THE ECONOMIC CRISIS ON LOCAL GOVERNMENT AND THE POLICY RESPONSES TO IT

We the Ministers responsible for local and regional government of the member States of the Council of Europe

declare:

 

(1)      Since our last session in Utrecht (November 2009) and further to our Declaration adopted on that occasion and thanks to the partnership between the CDLR and the Open Society Foundations (OSF), which contributed significant resources, and the input from the Council of European Municipalities and Regions (CEMR), work has been undertaken to monitor the impact of the financial and economic downturn on local and regional government and, in the light of the guidelines we adopted in Utrecht, of the policy responses.

(2)      We highlight further that under the auspices of our colleagues Minister Manuel Chaves and Secretary of State Gaspar Zarrias of Spain, two stocktaking conferences were held in Strasbourg in September 2010 and June 2011 respectively. We thank our Spanish colleagues for the efforts they have made in organising these successful events and the Open Society Foundations (OSF) for its contribution enabling the holding of these conferences.

(3)      At our session here in Kyiv we have been presented with a thorough report, prepared by the CDLR in cooperation with the OSF and with contributions from the Council of European Municipalities and Regions (CEMR), entitled “Local government in critical times: Policies for crisis, recovery and sustainable future” which sets out the main findings and conclusions to be drawn from all the material collected from member States and observers and enables us to have a continent-wide and in depth comparative view both of the development of sub-national budgets in members States and of the policy responses that have been adopted since our last Session.

 


(4)      We subscribe to the main conclusions of this report namely that we can acclaim the resilience of local and regional government in dealing with the crisis and that in order to live with the uncertainty of the future we need to adhere to robust strategies which can withstand fluctuating economic fortunes and which are in line with the European Charter of Local Self-Government. In particular we adhere to three main strategies:

(5)      In order to effectively implement these strategies and having reviewed the guidelines we adopted in Utrecht, we have, drawing on the experience we have gained and drawn together in the report presented at this Session, agreed on a more developed set of guidelines for our actions at domestic level that will henceforth be known as the “Kyiv guidelines” and which appear in the Appendix to our Declaration.

We therefore decide:

1.       to recommend to the Committee of Ministers that it, in order to assist member States and their local and regional authorities toweather the economic downturn and address long-term challenges, include in the Council of Europe programme on local and regional democracy and governance the work of analysing the impact of changing economic fortunes on local budgets and of monitoring and developing policy responses (stabilising local revenue bases, improving efficiency and transparency of local expenditure, regulating and overcoming indebtedness, sustaining the level of local public services, especially to the most vulnerable, setting up innovative partnerships to promote local economic recovery)on the basis of the Kyiv guidelines and in full compliance with the European Charter of Local Self-Government and the Committee of Ministers’ acquis;

2.       to commit ourselves to draw inspiration from the “Kyiv guidelines”, to use them and to contribute actively to the work to be undertaken as set out under paragraph 1 above by engaging our senior officials competent in these matters;

3.       to actively disseminate and draw the attention of all relevant stakeholders in our respective countries to the Report “Local government in critical times: Policies for crisis, recovery and sustainable future” and the “Kyiv guidelines”;

4.       to thank the Committee of Ministers for the timely adoption of its Recommendation to member States on the funding by higher-level authorities of new competences for local authorities (CM/Rec(2011)11) and to disseminate and make use of it.

 


DECLARATION 2

ON HUMAN RIGHTS AT LOCAL LEVEL

We, the European Ministers responsible for Local and Regional Government, meeting in Kyiv on the occasion of the 17th session of our Council of Europe Conference,

(i) noting the responsibility of local and regional authorities to, within their fields of competence, comply with the international human rights commitments of member states;

(ii) noting with interest the Recommendation 280 (2010) by the Congress concerning Role of local and regional authorities in the implementation of human rights;

(iii) noting the Committee of Ministers’ reply to the Congress in response to Recommendation 280 where the Committee expressed interest and support for some measures recommended by the Congress;

(iv) also noting that the Committee of Ministers in its reply to Recommendation 280 noted that the Congress does not intend to monitor, or on its monitoring visits to assess, the implementation of human rights by local and regional authorities and that it will not duplicate the activities of Council of Europe monitoring bodies,

decide

1.         to recommend the Committee of Ministers as part of its programme on local and regional democracy and governance to elaborate proposals for strengthening awareness raising of the human rights dimension of local and regional governance in dialogue with the Congress. In doing so it is essential to identify concrete action and practical instruments that could support local and regional authorities in their responsibility to uphold human rights, bearing in mind the importance of not duplicating other activities of the Council of Europe, taking account of differences in legal systems and local authority functions in different Member States,and focusing on measures that can provide an added value specifically in relation to the role of local and regional authorities;

2.  to recommend to the Committee of Ministers to adopt the Recommendation and Declaration on the Principles of good democratic governance at local level, prepared by the CDLR.


DECLARATION 3

ON THE ROLE OF GOVERNMENT IN OVERCOMING OBSTACLES TO TRANSFRONTIER COOPERATION

We, the European Ministers responsible for Local and Regional Government, meeting in Kyiv on the occasion of the 17th session of our Council of Europe Conference,

i.        considering that the aim of the Council of Europe is to achieve greater unity among its members,

ii.       drawing attention to the important role that transfrontier co-operation between territorial communities and authorities can play in achieving the goal of a Europe without dividing lines,

iii.       wishing to follow up the examination of the state of cross-border co-operation which we conducted at the 16th session of our Conference, in Utrecht, and wishing to make further progress in removing the obstacles to cross-border co-operation,

iv.      having regard to the results of the consultations conducted by the European Committee on Local and Regional Democracy about the obstacles to cross-border co-operation and the means of overcoming them,

v.       willing to contribute further to the identification and implementation of appropriate solutions, in conformity with the political priorities of the Council of Europe and taking account of the powers and responsibilities of the Committee of Ministers,

Declare:

1.       Cross-border and interterritorial co-operation between territorial communities and authorities helps to make border regions areas of dialogue, co-operation, social progress and economic dynamism.

2.       It has been greatly facilitated and assisted by states' action, Council of Europe conventions and European Union legal instruments and programmes, both within the Union and at its external borders.


3.       While the movement of persons and goods and the production of services are increasing in cross-border areas which are now highly active, cross-border co-operation has also gradually expanded into most spheres of economic and social life: regional development, infrastructure and transport, population and labour catchment areas, health and the environment, spatial planning, education and culture, security; numerous public and private partners have become involved in it - states, regions, universities, chambers of commerce, businesses, civil society – far more than just local communities and authorities.

4.       Thanks to this co-operation, public policies are put into practice across wider areas or encompass larger populations, enriching and rationalising the supply of public services, facilitating territorial integration and promoting more effectively economic and social development; the ensuing benefits for society as a whole justify the continuation of particular support for these activities from the public authorities, despite current budgetary constraints.

5.       For those territories which have often been handicapped by their position at their country's borders, cross-border co-operation has become an opportunity and a necessity, particularly in times of economic crisis, and efforts should be redoubled to remove or reduce, as far as possible, the obstacles which prevent or curb it.

6.       These obstacles vary in nature and intensity.  They may be a result of the legislative and administrative systems of the states concerned, of the "asymmetric" powers of territorial communities or authorities, of languages and cultures.  It would be unrealistic to hope to remove them all; this is why it is states' responsibility to offer the various players, and territorial communities in particular, tools and procedures enabling them to manage these situations in the most successful way, so as to make compatible and bring about dialogue between different systems.

7.       The solution to other difficulties should be sought through simplification of procedures and adjustments to the institutions called upon to work together on cross-border co-operation projects.  Thus, for example, it might prove useful to designate within central government a "special task mediator” for cross-border co-operation, or to designate within border territories a "contact person" for cross-border issues.

8.       Cross-border co-operation needs not only to be freed from the obstacles which curb it, but also to be actively promoted.  Bodies set up for this purpose can help in this respect, bringing together all the players in this co-operation and encouraging or coordinating their action.  The legal framework enabling such bodies to be set up will have to be revised or reinforced, through ratification if necessary of the relevant Council of Europe conventions[1].


9.       Thirty years after the adoption of the Madrid Outline Convention, states' role in enabling, facilitating and even encouraging cross-border co-operation remains crucial.   Aware of our responsibility as political decision-makers,

We accordingly decide:

I.        to examine the possibility of ratification of those Council of Europe conventions relating to cross-border co-operation between local communities and authorities to which our states are not yet parties,

II.       to review, with the help of the relevant recommendations of the Committee of Ministers of the Council of Europe[2], the procedures, regulations and administrative practices whose existence or methods application curb or hinder cross-border co-operation,

III.      to give thought to designating, according to need, a central government "special task mediator" for cross-border co-operation, tasked with making the action of the different ministries and players concerned more dynamic, or a border zone "contact person" for cross-border co-operation, whom territorial authorities and communities could contact when promoting and setting up cross-border co-operation;

IV.      to recommend the Committee of Ministers to include in the Council of Europe programme on local and regional democracy and governance the work of

a)       exchanging information about the state of ratification of the aforementioned Council of Europe conventions;

b)       drawing up a list of those fields in which cross-border co-operation is most active, and identifying the main obstacles encountered therein, so as to give particular attention to this subject when amendments of legislation or regulations are planned;

c)       sharing the results of the experience of certain member states which have designated a cross-border "special task mediator";

d)       creating a "knowledge community" on good practices in cross-border co-operation.


DECLARATION 4

ON THE OUTLOOK FOR THE FUTURE OF PAN-EUROPEAN WORK ON LOCAL AND REGIONAL DEMOCRACY

We European Ministers responsible for Local and Regional Government, meeting in Kyiv on 3 and 4 November 2011 for the 17th session of our Council of Europe Conference

(i)       Aware that the Council of Europe, in the framework of which our cooperation has taken place in the course of four decades, is undergoing radical transformations in order to enhance its effectiveness as an organisation that promotes human rights, democracy and  the rule of law;

(ii)      Believing that our cooperation has contributed to the strengthening of democracy across European nations and welcoming the opportunity we have had for achieving this through the Council of Europe;

(iii)     Believing we have contributed towards the success of the Council of Europe in the pursuit of its statutory aim to achieve greater unity between its member States for the purpose of safeguarding and realising the ideals and principles which are their common heritage and facilitating their economic and social progress;

(iv)     Believing that, given our responsibility for local and regional government within our respective member States, we need to be fully engaged with the promotion, protection and development of democracy and good governance across Europe and can also contribute to efforts to support local and regional democracy in the wider neighbourhood;

(v)      Recognising therefore that it is essential for us to effectively engage in the activities which the Council of Europe undertakes to strengthen democracy and governance at local and regional level and to provide the high-level input the Committee of Ministers expects from our Conference, as emphasised in the letter of 3 October 2011 from the Chair of the Committee of Ministers, Minister Gryshchenko to Minister Virkkunen of Finland;

(vi)     Having reviewed the implementation so far of the Utrecht Agenda adopted at the 16th session of our Conference and endorsed by the Committee of Ministers;

(vii)    Considering that the renewed emphasis on democracy, including local and regional democracy, in the Council of Europe and simultaneous reduction of available resources require more than ever that innovative approaches to the Council of Europe’s work be pursued;


(viii)    Convinced that the Council of Europe must ensure the greatest possible impact of and value for taxpayer’s money in its work;

(ix)     Convinced equally that these impacts must be those member States want to see and be of value to us and the governments of which we are members;

(x)      Confident that our colleague Foreign Ministers in the Committee of Ministers share these beliefs;

(xi)     thanking our colleague and former colleagues, Ms Mari Kiviniemi, Mr Tapani Tölli and Ms Henna Virkkunen, successive Ministers of Public Administration and Local Government of Finland for developing and putting forward to the Committee of Ministers on our behalf a proposal for a partnership with our Conference aiming to enhance the effectiveness of the work of the Council of Europe in the field of local and regional democracy;

(xii)    thanking our colleague Mr Manuel Chaves, Vice-President of Government and Minister of Territorial Policy and Public Administration of Spain for conducting the reviews we agreed upon at our 16th session in Utrecht (November 2009) and for presenting us with his report at this session of our Conference;

(xiii)    noting with satisfaction the implementation so far of our Utrecht Agenda by the Council of Europe and noting with interest the measures taken in our member States;

decide:

1.             to commit ourselves to taking continued and new initiatives in the future in our member states to strengthen good governance, capacity building and citizens democratic  participation at local level, following up the progress review reports on the Outlook to the future presented in Kyiv, and to report to the Committee of Ministers on the result; 

2        to recommend to the Committee of Ministers, building on the “agenda in common” foundations laid in the Chaves Report, to reconfigure fundamentally its overall approach to the work of the Council of Europe in field of local and regional democracy and governance, bringing together the roles of all actors involved: Ministers, Parliamentary Assembly, Congress, Conference of INGO’s, Centre of Expertise, in order to achieve unity of purpose and greater impact;

3.       to request the successive chairmanships of the Committee of Ministers to take this approach forward expeditiously;


4.       to entrust our colleague(s) … (and….) with ensuring the continuity of our work and to liaise with our colleagues of Foreign Affairs to ensure optimal exchange of information and synergies with the Committee of Ministers;

and, having regard to Resolution (2011)7, look forward to our conference being convened at the request of the Committee of Ministers and/or the Secretary General of the Council of Europe, especially in the light of the wish for continuity expressed in the aforementioned letter of the Chair of the Committee of Ministers.


APPENDIX


DRAFT KYIV GUIDELINES

1.       The survey of members carried out in preparation of the 16th Session of the Council of Europe Conference of Ministers responsible for local and regional government in Utrecht (The Netherlands) in November 2009 identified main possible policy responses for which more detailed guidelines were adopted in the so-called Utrecht guidelines. In the light of experience gained since 2009, the guidelines have been further developed into those set out below. It is to be stressed that the feasibility and desirability of individual guidelines may vary from country to country and thus are to be seen a range of policy options and not a prescriptive set of measures.

2.       The economic crisis has generated a widespread recognition of the need for radical improvements in governance and in the management of public expenditure. Even when the worst of the crisis is over and whilst the means to be deployed will differ over time and vary from place to place, there will be a constant need for increasing efficiency across the whole of the public sector, and hence for greater collaboration between all the stakeholders, central government, local and regional authorities as well as their associations. The aim should be to remove duplication and to drive down costs arising from a lack of co-ordination, integration and flexibility in the delivery of public services, not only to meet the demands of the current fiscal situation, but also to be better placed to address longer term social, economic, demographic and environmental changes the challenges of which will no doubt outlast the crisis. These challenges also place emphasis on the value of partnership with private and social enterprise and the voluntary sector.

3.       Above all, the Council of Europe is concerned to protect and enforce the values of local democracy enshrined in the Charter of Local Self Governments and also of social responsibility, embodied in the European Social Charter. Exchanging and sharing information and experience at local, regional, national and international level, as well as the identification of good practices this enables, will be key to achieving success at the earliest possible time.


I.         Council of Europe standards

4.       Any policy response by central government to the impact of economic downturn on local government must be fully compatible with its obligations under the European Charter of Local Self-Government (CETS 122), which recognises that questions as to the financial resources for local authorities are to be determined within a Party’s national economic policy.

5.       The two recommendations of the Committee of Ministers in the field of local finance: Rec(2004)1 on financial and budgetary management at local and regional levels and Rec(2005)1 on the financial resources of local and regional authorities, offer a powerful and coherent set of guidelines aimed at ensuring a sound local finance system, many of which are ever the more useful in the context of the economic downturn.

II.       Possible policy responses identified so far

6.       The main options identified so far are:

1.       Stabilising local revenue bases

2.       Improving accountability and efficiency

3.       Combating social deprivation

4.       Partnership in delivering public services

5.       Enhancing local flexibility and discretion

6.       Promoting Economic Recovery

1. Stabilising Local Revenue Bases

 

Tax assignments

7.       Local budgets are heavily encumbered by regular operating costs. This is particularly the case where they include teachers’ salaries, social assistance or medical services, but most pay for basic essential services like road maintenance, waste management, care for the elderly, and water supply. They need relatively stable revenues to sustain these responsibilities.

8.       Governments and local authority associations might wish to consider changes in those local revenue bases which depend excessively on shares of highly volatile taxes such as those on corporate profits and property transactions. Overall, the ratio of own revenue to transfers does not seem to make much difference to the stability of the local budgets in crisis. What is important is to ensure a broad and diverse basis of own revenues, avoiding over-reliance on a single volatile tax.


9.       Alternatively, consideration should be given to transfer mechanisms with automatic stabilizers incorporated, such as those used in Northern Europe to finance the social services. Where volatile taxes are already assigned to local governments and legal changes are difficult to make, local governments might consider to introduce “buffer” mechanisms, which would neutralize revenue fluctuations.

10.     Personal income is the only tax base which is both technically susceptible to variation by local decision and capable of funding a large proportion of the costs of major services, such as education and social and health care. Revenue from local budget shares of personal income taxation has inevitably suffered from reductions in employment, hours, salaries etc, but less dramatically than that of corporate income. It remains the most effective alternative to over-dependence on transfers and should be protected or may be introduced where it does not exist.

11.     Taxation of property ownership or occupation has proved remarkably resilient. This is because in most European states liabilities do not vary according to annual changes in property values; municipalities also have used freedom to increase rates or intensify administration to compensate for decline of other sources. Conferring such opportunity on local governments who do not have it would contribute to financial resilience.

12.     The property tax based on effective market values has no tradition in Europe (with exceptions, such as Denmark and Sweden), and where it is applied, e.g. in the United States, its drawbacks have come to the fore during the recent crisis. Stability is enhanced where property taxes are based on statutory values and are revised from time to time, but not annually. In the interest of stability, such revisions should reflect long term market developments, rather than short term fluctuations.

13.     Regular changes to property tax liabilities will be needed between periodic revaluations to reflect increases in the municipal costs which they fund, but they should not be subject to the severe fluctuations which sometimes influence property market values because of the potential damage to either municipal budgets when these are depressed or to taxpayers’ pockets when they surge. Indexing the base to an appropriate price index is one possible solution. Regular increases in tax rates set by local councils is another; as practised by British and Polish local councils, for example, annual increases just above the rate of inflation have secured substantial revenue increases over time without serious political opposition.


Discretion to set local tax rates and charges

14.     On balance policy responses to the crisis have reduced the freedom of local governments to determine their local tax levels though there are exceptions. This appears to weaken compliance with the European Charter of Local Self Government

15.     It must be recognised, however, that local councils’ sense of accountability to their business taxpayers may be weaker than to their residents. Restrictions on rate setting powers to prevent discrimination against non-voters may well be justified. Curbs on excessive local PIT rates may also be justified where they have a proven impact on labour supply and fiscal sustainability.

16.     Some countries employ caps on local tax rates or surcharges such as on the personal income tax. This is counterproductive especially if all, or almost all, municipalities have reached the rate ceiling. In this case the local taxpayer knows that he/she is protected against higher taxes and loses interest in controlling a possibly spendthrift local budget policy. Caps on local tax rates simply endanger accountability and leave scope for pressure on national governments to come to the rescue of unbalanced local budgets.

Intergovernmental transfers

17.     Local budgets cannot be indefinitely shielded from national revenue losses and budget deficit.  However, immediate and arbitrary cuts are damaging to local public services if conducted during the fiscal year. Such harm can be minimised where local governments are given notice in advance of finalizing their budgets  Cuts, where unavoidable, should be distributed by objective formulae to ensure their equity and political neutrality.

Debt

18.     Reviving capital investment will be important to recovery, which means restoring operational surplus sufficient to fund it directly or redeem debt. But growing indebtedness calls for improvements in the regulatory regime for both borrowing and insolvency. This applies also to the often murky financial relationships between municipal budgets and those of their utility companies.


19.     In some member countries, unsustainable local government debt has emerged as a problem. In these instances actions must be taken to correct any fundamental imbalance between responsibilities and resources. Municipal budget autonomy needs to be exercised within clear policies over prudential and macroeconomic limits to borrowing and processes of public scrutiny. Clear rules and procedures are also needed to govern cases of municipal insolvency.

20.     The Maastricht criteria induced a number of countries to introduce an intergovernmental mechanism for restricting public sector borrowing under headings such as “internal stability pact” or “debt brake”. The Council of Europe Committee of Ministers issued Recommendations in 2004 and 2005, whilst NALAS has just published as very comprehensive analysis on borrowing procedures in South East Europe. These deserve constant bearing in mind.

2. Improving accountability and efficiency

21.     Making the most of more limited resources will remain a priority for the foreseeable future.Much of the reduction in revenue has been absorbed simply by deferring capital investment. Reports, however, reveal many attempts to improve the efficiency and effectiveness of local budgets. These deserve dissemination and replication.

Of particular significance are:


22.     In a number of countries wholesale territorial reorganisations have been carried out or are in progress to achieve scale economies or more uniform service quality. These may well be beneficial but have initial political and financial costs which limit their immediate gains. Increasing inter-municipal co-operation offers quicker returns. Territorial re-organisation will nonetheless be something that many States will wish to consider as a medium to long-term reform.

                                                                      

23.     Obstacles to efficiency remain which governments, associations and individual local authorities are urged to address. These include:

3. Combating social deprivation

24.     The recession has inevitably increased social distress reflected in rising unemployment, lower household incomes, increased costs such as heating, utility charges and food, evictions. Budget cuts, national and local, threaten benefits and some programmes such as early childhood development important to the human rights of poor and minority households.  In some cases support to programmes most significant for such vulnerable groups is being cut disproportionately because the services concerned are not mandatory and are provided by non-governmental organisations whose employee severance costs do not fall on local budgets.

25.     Local governments’ social expenditures have risen substantially and are destined for sustained growth because of long term increases in the population of elderly people   requiring medical and social care.


26.     Measures are recommended to mitigate these burdens. These include:

 

27.     National and local governments should also review their benefit procedures to ensure that the poor are not hindered from access by legal and bureaucratic obstacles.

4. Partnership in delivering public services

28.     Local government faces long-term challenges, which will outlast the crisis. The autonomy promoted by the European Charter should give the freedom to innovate in meeting these and some security over resources. But these challenges require a style and habit of partnership with other key actors such as other levels of government, the private sector, universities and other members of the research and training communities, social enterprises and other non-governmental organisations

29.     The crisis has slowed down the spread of partnerships involving the private sector in carrying out the initial investment in a public service facility. These remain widespread in cases such as waste disposal where construction and operation can be combined in a single management and where costs can be recouped directly from beneficiaries. Efficiency can suffer, by contrast, where responsibility for operation becomes fragmented between commercial investors and public service professionals; costs can also escalate substantially when loaded with the higher interest rates attached to private sector borrowing.


30.     By contrast, the crisis has increased interest in partnership with the voluntary sector and social enterprise in running community level services. Care of the elderly is an increasingly important field for such partnership. Giving social enterprises freedom to provide both residential and domiciliary care services and providing beneficiaries with cash benefits rather than services in-kind, provides an arena for choice and competition which can enhance quality of life. Family and voluntary carers, in practice mostly women, can also be supported and encouraged by measures like compensation for pension losses, arrangements for career breaks, re-entry on the labour market, respite care and even petrol allowances. Involvement of the private or voluntary sector in provision of public services must be in line with public policy and have regard to the requirements of efficiency and value for money and, above all, the needs of those which services are intended to address.

 

31.     Partnership will also be vital in keeping local economies ahead of the game. Partnership with other local actors will be crucial in identifying contemporary opportunities, promoting technological research and innovation, providing education to improve the local skill base and providing the planning and infrastructural framework (including information and communication technology).

5. Enhancing local flexibility and discretion

32.     The impact of the crisis on compliance with the Charter of Local Self Government has been mixed. The Report “Local government in critical times: Policies for crisis, recovery and sustainable future” gives examples of both increases and losses of local tax autonomy.  Examples have been given of national governments intervening in detailed local budget decisions, while there are fears that EU attempts to impose common economic government within the Eurozone will curtail the ability of local government to determine their spending levels. On the other hand some conditionality and control have been relaxed by national governments to avoid responsibility for detailed cuts in services.

33.     The need to preserve and possibly enhance local discretion over local taxes and charges has already been highlighted. It will also be important to

 


6. Promoting Economic Recovery

                                  

34.     With GDP almost static and unemployment still rising in much of Europe, helping to engineer recovery must be a priority for local government.

35.     Its first contribution should be to revive its former levels of infrastructural investment which have been the biggest casualty of budget squeeze. This primarily means restoring the operational surplus which funded investment directly, serviced loans, repaid bonds and provided pre-finance and counterpart support for EU structural funds.

36.     Its second major role is to work with banks, private enterprise and the local research and training community to identify and exploit opportunities for economic growth in the 21st century. Vocational training and broadband networks are key components. So are planning framework and development control procedures which create a favourable business environment and increase the competitiveness of local economies.

37.     Finally local governments are key actors in responding to climate change and rising energy prices. Making municipal assets more energy efficient, increasing the use of renewable energy,  reforming transportation, increasing the capacity of stormwater drainage are all key tasks for local government, requiring partnerships with utility and transport companies,  “green” technology companies  and any other suitable actors with capabilities and commitment



[1] Madrid Outline Convention and its Additional Protocol, Protocol No. 2 and Protocol No. 3.

[2] Recommendations Rec(2005)2 on good practices in and reducing obstacles to transfrontier and interterritorial co-operation between territorial communities or authorities and Rec(2005)3 on teaching neighbouring languages in border regions.