Local Government Association (LGA) chairman Sir Merrick Cockell warned that the current system of central control was "bust" and called for local councillors to be given sweeping new powers over raising and spending funds in their areas.
He called for the merger of six Whitehall departments into an "England Office" to support activities carried out at local level. And he urged the Government to scrap the "outdated" Barnett formula, which determines the way central funds are shared out between the nations of the United Kingdom and has left English authorities facing deeper cuts than their counterparts in Scotland or Wales.
Speaking at the LGA's annual conference in Manchester, Sir Merrick launched the Rewiring Public Services manifesto of 10 demands, agreed across party lines, to "transform the way that local government is structured, funded, how that money is distributed and how central government will need to respond".
English local authorities are "the hardest hit part of the public sector" and residents face the reduction or closure of services such as culture, leisure facilities, school support and road maintenance, he said.
"The current model we have... set in the context of an over-centralised national state will not see us through for very much longer," said Sir Merrick, the Conservative leader of Kensington and Chelsea council in London. "In many ways, it is already bust."
Sir Merrick called for "equity and fairness throughout the United Kingdom", pointing out that England receives an average of £8,500 per person for public services, compared to £10,000 in Scotland. The Barnett formula - which dates back to the 1970s - should be scrapped and replaced with a "new needs-based funding model", he said.
Decisions on the distribution of cash should be taken out of ministers' hands and multi-year settlements should be made according to an agreement across English local government.
Every council area should have its own Treasury, able to allocate money based on local priorities and to decide whether specific taxes are appropriate in particular areas.
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