Forum Brief: Local government powers

The Federation of Small Businesses has warned that private sector jobs will be lost unless politicians and civil servants address the threat posed to small businesses by new local authority powers to charge and trade outlined in the Local Government Bill.

The FSB is demanding that each council undertakes a full investigation into the impact on local firms before they go into business themselves.

Forum Response: Federation of Small Businesses

John Walker, policy chairman of the FSB, said: "Local authorities only need to cover their costs and so will undercut businesses which offer similar services but also face the commercial realities of covering their overheads and making a profit. These new charges will be devastating for small businesses threatening jobs and livelihoods and wiping out potential markets for start ups."Small businesses have a strong voice in Westminster, with a minister for small firms, a Small Business Council, and the largest all party group in parliament. All three promote the interests of small firms in the corridors of power and now need to make their voices heard on this vital issue."Forum Response: Local Government Association

A spokesman for the Local Government Association told ePolitix.com: "This new power is not in any way a threat to anyone. There is no question of councils setting themselves in competition with business.

"These proposals are necessary to relax constraints on councils that currently prevent them providing existing public services in a way that is most appropriate and flexible for local needs and consistent with the principles of best value.

"The more councils are freed up to meet local needs with flexible mechanisms of delivering public services, the better it will be for local communities.

"This in turn will boost the job creating ability of local business."