Sarah Southerton contrasts the positions of two neighbouring councils to examine how the past is affecting service provision for local people.

The London boroughs of Westminster and Lambeth are separated only by the River Thames.

In Audit Commission assessments, both councils have seen their ratings remain constant, yet their relative positions in performance league tables could not be more different.

Westminster City Council had a council tax in 2004/05 at an average £605 per year for a Band D property, while the services provided remained highly rated. In 2002, the council was awarded excellent ratings in areas such as social care, housing, use of resources and general ability, while receiving good ratings in education, the environment, leisure services and the payment of benefits. Those ratings remained constant in the latest review conducted in 2003.

"I am delighted that we have retained our ‘excellent’ rating from the government inspectors," said the council’s leader, councillor Simon Milton. "I know how hard everybody at Westminster has worked to build on last year’s result and improve our performance still further. The renewed ‘excellent’ rating is a tribute to the efforts of all our staff and councillors."

The council has set itself an ambition to remain excellent in absolute terms, not just in relation to other authorities in the country.

Milton pledged the council would also continue to seek improvements in performance. "We will do this by driving forward our civic renewal programme and delivering order, opportunity and low taxes to Westminster," he said.

As a result of Westminster’s record, the council was awarded beacon status in 2002. "Beacon council awards are an important tool in recognising excellence," said Milton in April. "But in any of these award schemes we must take care not to believe too much of our own PR. We must be mindful of the innate scepticism that many people feel about local government in general. And that winning awards or becoming a beacon council does not mean that you never make mistakes or that there is no room for further improvement."

Westminster City Council has not completely escaped controversy. The authority has made headlines for the "homes for votes" scandal of the 1980s, a row that was still making headlines this April. In 2001, the House of Lords found former council leader Dame Shirley Porter guilty of selling council houses to possible Conservative voters in marginal wards, and ordered her and her deputy, David Weeks, to pay a £27 million surcharge. It has now been agreed, following negotiations with council leaders, that Dame Shirley will pay £12.3 million.

On the opposite bank of the Thames lies Lambeth, controlled jointly by the Liberal Democrats and Tories.

Its householders saw an average council tax bill rise of more than a fifth in 2003 and, despite the increase, still achieved poor Audit Commission ratings for the second year in a row.

In 2003, 26 councils received improved performance ratings, while nine saw their rating slip. Lambeth, like Westminster, saw its position remain constant, but it was at the worse performing end of the scale.

Like Westminster, education in Lambeth was rated as "good" both in 2002 and 2003, but on social care, housing and its use of resources, the authority was rated as "weak", and "poor" in the areas of the environment, leisure services, benefits and general ability.

So is the case so cut and dried? Is it simply that Westminster is a good council, while Lambeth performs badly? One obvious area to examine for answers is the issue of finance.

Amid national rows over local council tax levels, rates in Westminster rose this year to £605 for a Band D property. Across the river in Lambeth, the Band D charges went up from £995 to £1,050.

For the 2004/05 year, Westminster will receive the minimum increase of four per cent in its grant support from central government. Without the minimum increase the council says it would have lost £26 million because of a smaller population count resulting from the 2001 Census.

However, Lambeth councillors have had to cope with some entrenched financial problems. The joint Liberal Democrat and Conservative administration, elected in May 2002, inherited a £28 million deficit which has been turned into a surplus. Debts, which stood at £875 million in March 2002, have been reduced by £150 million with plans for a further £100 million cut.

And in the current financial year, Lambeth said it had received the smallest increase in central government grant in inner London. "Government funding makes up three quarters of Lambeth’s spending. But after money has been given to schools, government funding has actually increased by less than inflation," said the council.

So while both councils have expressed dissatisfaction with their funding arrangements, they have delivered different levels of service standards with the cash they have received. Lambeth’s financial difficulties have also resulted in a significantly higher council tax charge to residents. That could point to Westminster history of political and finacial stability, when compared to the troubles of Lambeth, as a significant factor in its performance.