George Osborne: Tory councils are leading the way in delivering value for money

Localism is about more than having the right policies. It's about understanding that not all good ideas are dreamt up in a policy unit in Whitehall. It means realising that many of the best and most cutting-edge policies actually come from local government. And when it comes to public spending, I believe that local government offers at least three clear lessons for a future Conservative government.

First, innovation works. Conservative councils don't just cut costs. They improve services. And they do it by using new ways to deliver them. So, for example, the conventional approach is to provide a range of different services in different departments. But this ignores the fact that many vulnerable families will need to use multiple services simultaneously. So, by joining up individual services, as Westminster council has done, we can provide better care to the most vulnerable families, we can reduce the hassle they face, and we can also reduce costs. The lesson is that when it comes to service delivery, it is vital to allow local councils and local public service professionals to use their own creativity to find the best solutions.

Second, transparency and openness are powerful tools in the fight against waste. Publishing spending programmes online is a great example of how new technology can be harnessed to improve accountability. Everyone can see exactly how their money is being spent. We have tried to get legislation passed through Parliament that would force the Government to be more transparent about public spending, but Labour killed it off. I pledge that, if we win the next election, all items of public spending over £25,000 will be published online. I know it may create awkward stories for ministers from time to time. But that is exactly the point.

As David Cameron argued earlier this week, when people don't know how their money is spent, it is much easier for a spendaholic culture to set in. When we open up the books to the public, there is a clear imperative on politicians and civil servants to ensure that only those projects that can be justified to the public will go ahead.

Third, it is not only possible to cut costs while improving services – Conservative councils are doing it right here, right now.

Taken from a speech given yesterday to a Conservative Councillors' seminar by the Shadow Chancellor