Osborne: Tories will learn from councils

The Tories today pledged to "reduce the Whitehall headcount" in a bid to cut costs and make local government powerful again

Shadow chancellor George Osborne said a Conservative government would have much to learn from the way Tory councils are run.

David Cameron's ministerial team should harness the "unique opportunity" of most councils in England now being controlled by the Tories, he said.

In a speech to the Conservative Councillors' Seminar in central London today, Mr Osborne said: "While we develop our policies for improving public services in an age of austerity, local councils have got on with doing it.

"When it comes to rooting out waste and cutting costs, or improving services through innovative new policies, Conservative councils are showing us that it can be done.

"In short, Conservative Whitehall will have much to learn from Conservative town halls."

Tory councils were already using new approaches to information and transparency, and reducing unnecessary costs through shared services, he said.

Mr Osborne told councillors the Tories would "reinvent" the role of government.

"So yes we will reduce the costs of central government," he said.

"And yes we will reduce the Whitehall headcount. But this is not just a cost-cutting exercise.

"It is about changing the role of central government - and making local government powerful again."

Labour's instinct was to reach for the "top-down target" - and it had created a "large national bureaucracy of civil servants, inspectors and second-guessers".

Mr Osborne's remarks were the latest in a week of stepped-up rhetoric on belt-tightening from the Tory top team.

Yesterday shadow health secretary Andrew Lansley warned NHS managers that health spending was "by no means a blank cheque".

He said the Tories would only guarantee "small increases" in spending on the NHS and could not match Labour's investment.

In a speech to NHS chiefs in Birmingham, Mr Lansley said: "Our commitment will still mean a significantly reduced rate of expenditure, and it's by no means a blank cheque.

"Even with small increases, NHS services everywhere will have to tighten their belts just to meet demand."

He added: "A real-terms increase in expenditure has to go hand in hand with real savings, which can be ploughed back into front-line services to meet the needs of an ageing population and drag up our health care results."

On Tuesday, Mr Cameron pledged to "cut the cost of politics" by reducing the number of MPs and ministerial cars, and ending subsidised alcohol and food in Parliament.

Communities Secretary John Denham hit out at Mr Osborne's speech.

"George Osborne is right to say that Conservative councils demonstrate what a Tory government would be like," he said.

"They show that, despite Cameron's claims to have changed the Conservative Party, around the country Tory politicians pursue the same right-wing agenda which they always have done.

"Whether it's their plans to use taxpayers' money to subsidise private schools in Bromley, to wholesale privatisation of every local service in Essex, or to charge more for less in 'budget airline style' Barnet."

He added: "Of course it's important local councils deliver value for money for taxpayers.

"But what Osborne says about Tory councils is nothing special in this respect. It's Labour that has led the way in making sure local government is more efficient.

"With Labour, the whole of local government has delivered £3.4 billion of savings between 2004-2007."