Media coverage has been bordering on feverish over the resignation of Claire Kober, Labour leader of Haringey Council in north London. Kober had backed a development vehicle opposed locally by Labour MPs and members, the Liberal Democrats and the Greens, as well as much of the community.

But after Labour’s ruling National Executive Committee made a unanimous request to suspend the project, 71 of the party’s 123 council leaders chose to attack this as “dangerous and alarming”, “uncomradely and disrespectful” and “an affront to the basic principles of democracy”. Why should this be, when the vision Jeremy Corbyn brought to Labour’s local government conference was so positive about the role councils could play under a transformative government?

Corbyn was, after all, a councillor (in Haringey as it happens) and represented council workers as a trade unionist. The 2017 general election manifesto promised devolution of powers, new forms of local taxation and powers to intervene in the local economy, shape town centres and build council houses. It was a far friendlier message than that brought to the conference 20 years ago by newly elected prime minister Tony Blair, who demanded big changes and “tough choices” on spending. If councils failed to modernise, “their powers could be given to businesses and voluntary organisations”, he said. Too many were apparently “mediocre” and their policies incoherent.

A leading Labour local government figure of the time tells me that Blair, in all his years in office, met with the NEC representatives of the Local Government Association just four times and remained contemptuous and disrespectful towards the sector throughout his leadership. So why are Labour local government heads less enthusiastic now about a leader who values them? The answer lies in the settlement Blair made with council leaders, not unlike that between a feudal king and his nobility. He created strong council chiefs who, with the co-operation of the party’s regional offices, were able to ensure troublesome critics could be barred from selection, leaving leaders free to run their towns and cities as they chose. In return, they would provide their overlord with a loyal ground force, who could be relied upon to operate the local party machine and deliver the outcomes No 10 desired.

Councillors sign contracts, enforced by the leader’s whip, covering campaign activity, community and party engagement, surgeries, meeting attendance and specific responsibilities. If they behave themselves, they will be readmitted to the panel of candidates before the next election and perhaps promoted. If not, the whip will give them an unsatisfactory report. Agreements between council leaders and regional officers ensure applications for the panel, and appeals against exclusion, have the desired results. Sometimes a councillor’s “performance” is affected by caring responsibilities or disability.

In 2013 in Haringey, Kober achieved her desired outcome because Luke Akehurst, secretary of Labour First – a network describing itself as the voice of “moderate party members”– and at that time a councillor in Hackney, chaired all the interviews for the panel with carefully chosen colleagues and excluded some applicants from the left.

In 2017, the left won control of the Haringey Local Campaign Forum – which oversees the selection process – so other methods were sought to shut out their applicants. As well as taking the step of having two separate assessment panels, Kober produced a dossier in her selection interview against other candidates. Of course, because of rules around negative campaigning, this wasn’t considered.

The Haringey Development Vehicle is the result of an ideology that views market forces as best-placed to solve society’s woes – in this case, sloshing libraries, schools, small businesses and thousands of homes into a £2bn private fund, then knocking most of them down. The scheme made no promise of any social housing. It feels like, in London at least, we’re witnessing a sea-change moment in attitudes to these monolithic, outsourced schemes designed to extract profit rather than serve local residents. In Southwark, the Labour council has called a halt to the controversial redevelopment of Elephant and Castle, while London mayor Sadiq Khan has said that City Hall funding for estate regeneration will be dependent upon balloting of local residents.

With local elections coming up, it is important to minimise any disruption. That is precisely why the NEC decided to intervene in Haringey. And while the committee had already discussed the disastrous collapse of Carillion – which may have pushed some people into stronger opposition to the proposals – it did not ask Haringey to change its view. The NEC merely said that if mediation proves unproductive, it “strongly advises that the process to agree the [development vehicle] is paused” (my emphasis), “and that contractual arrangements are not signed prior to May’s local elections, after which they should be reviewed”.

Labour’s selections process must be improved. Manipulated for political advantage by strong leaders with great powers of patronage, it disempowers the communities we’re meant to represent. If our party is to elect councillors who are true community organisers and will enact radical change on the ground, we have to make our council leaders more responsive, both to their fellow councillors and to party members.

Jon Lansman is the founder of Momentum and a newly elected member of Labour’s National Executive Committee

This article was updated on 09 February to remove a reference to an exclusion from a selection panel.