Can local heroes convince a nation?

As the Labour Party gathers at its local government conference this weekend it could hardly be in better municipal shape. It controls councils in all parts of the country, including 27 out of 36 metropolitan districts and 22 out of 32 London borou ghs. In Britain as a whole, the party has more than 9,100 councillors out of 24,000, many of them in the most powerful authorities.

While Tony Blair may be concerned that nationally his party has been little more than a pressure group in recent years, in local government it has been gathering power in town and (often for the first time) county halls. Success in local government has acted as partial compensation for four general election defeats and the morale-sapping Thatcher revolution. Even in the depths of the Michael Foot leadership years, Labour was casting the Tories out of districts and counties. The effects of this lengthy predominance on the Labour Party's overall image are difficult to judge. On the positive side, being in control of most of the highest-spending authorities has allowed Labour councillors to deploy their huge spending power to mitigate the impact of government policy. Welfare state provision such as education, social services and council housing distributes benefits in such a way that money is spent on the poor even if they make no contribution through local or national taxes. Thus spending on, say, the under-fives or children for whom English is not the first language can be a powerful redistributive instrument. And a commitment to such redistribution has been, even in their darkest days, a useful binding factor for all Labour councillors.

Labour's success in local government has also allowed the party to keep its election-fighting machinery in operation. Councillors and other activists close to town halls are important in maintaining any political party's fighting strength. Indeed, there is much anecdotal evidence that the Conservatives, whose position in local government has been in steep decline since 1979, have lost their campaigning edge as their activists have been thrown out of office.

Another advantage for Labour has been the opportunity to keep reminding the electorate that its representatives were capable of running effective public services. Despite the dire problems in a minority of councils during the 1980s, Labour administrations in places as diverse as York, Glasgow, Kirklees and Lewisham have been good by any standards.

But the enormous strength of Labour in local government has also had a downside. The most obvious failure is the enduring public perception of incompetence and irresponsibility arising from the difficulties the national party had with Liverpool, Lambeth and a number of other inner-city authorities during the mid-Eighties period of rate capping and "creative accountancy".Neil Kinnock and his Shadow Cabinet colleagues were in no doubt that the epithet "loony left" lost the party votes at local and generalelections. Yet Labour's municipal strength during the Eighties meant that even the worst performing councils tended to get re-elected, ensuring the Conservatives and their media allies a continuous supply of ammunition against the national party. Eventually, however, loss of control in some councils and political reconstruction in others has removed much of Mr Blair's problem.

Labour may also have been implicated in the public mind on many occasions when "urban stress" stories have hit the press. Because the party controls so many inner-city areas, which have the greatest social problems, it is statistically inevitable that more battered children, more abandoned elderly people and more drug-related crime will turn up in Labour areas. Rightly or wrongly, the prominence given to such stories shows the generally Labour-controlled council in a bad light.

In fact Mrs Thatcher has saved Tony Blair a great deal of agony in his quest to modernise Labour. Her legislation to curtail what she saw as the excesses of local government has moderated the behaviour of virtually all Labour's erstwhile problem councils. Even the most radical of council leaders have come to see the benefits of good old-fashioned civic pride. Keeping the streets clean and parents happy now takes precedence over ideological crusades. On balance, therefore, the advantages of maintaining morale, keeping the party's local machinery in working order and showing that Labour can run services effectively must have outweighed disadvantages such as the periodic embarrassments thrown up in some inner cities.

There may, however, be a further, long-term danger. With the increasing Conservative longevity in national office and Labour consolidating its lead in local government, Mr Blair's party risks being seen as a safe bet to provide a high level of equitable local services, while the same electorate continues voting for Mr Major's "low-tax" national government. Paddy Ashdown already suffers from this problem, classically in Richmond-upon-Thames, which consistently returns two Conservative MPs but a strongly Liberal Democrat council. Labour may soon find that it too faces this phenomenon; the signs are already in evidence in such places as Reading (two Conservative MPs and a Labour council). What may develop in such areas is a habit of voting Conservative ingeneral elections and Labour or Liberal Democrat locally. Such cross-voting is common in the US.

If he is to break that habit, Tony Blair has to be sure that he can stay true to what the electorate likes about his party in local government while not unnerving voters about the national tax bill for redistribution and improved state services.

The writer is director of a research centre at the London School of Economics.