Some people think Britain’s greatest challenge is the impending Brexit. They are wrong. Britain’s greatest challenge is the impending collapse in its local public services. I recently travelled to cities in France, Belgium, the Netherlands and Germany. The contrast to Britain was stark. Of course surface impressions can be deceptive, but I was struck by the absence of piles of litter, potholed streets, screaming police cars, tacky ads on roundabouts and graffiti. There were also fewer desperate people pleading for money. I felt I was briefly in a civilised continent. The difference is that in continental Europe, these matters are at the discretion of local people, the mayor and electors. As they get richer, they reasonably expect, vote for and pay locally for better services. In Britain they are not allowed to do this. So they get worse.

Over the “austerity” decade since 2010, British government has stripped localities of a great chunk of their centrally supplied resources. What is left is spent on statutory services such as social care, schools and roads. Local government has become an instrument of the centre. Money has steadily dried up for discretionary activities, such as youth clubs, old people’s homes, children’s agencies, drug treatment centres, homeless shelters, libraries, cleaner streets and public gardens. Successive chancellors have treated impoverished councils’ pleas with contempt and cavalier disregard.

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This week, Nottinghamshire’s failings over child sexual abuse were presented as those of local leadership, as was the case with other debacles in Rotherham and Northamptonshire. So they certainly were, and the failures should not be underestimated. But there is another dimension. Central support for councils will have fallen by nearly 60% between 2010 and 2019-20. The relentlessness of austerity has sapped local democracy of all sense of responsibility.

One indication of this is the hierarchy that exists between the services for which Westminster has responsibility, and those few over which councils still have some discretion. The former cater for the haves, the latter for the have-nots.

Last week it was revealed that 38% of places at Britain’s universities are now offered “unconditionally”. With most student fees never repaid, this is simply an unaudited state donation to a privileged group of private institutions – in reality an electoral bribe to under-21 voters. Meanwhile education’s outcasts, further education colleges, have been butchered, losing a third of their staff since 2011. Their only crime is to be essentially local in character. As are the more than 200 secondary schools that are so squeezed they’re having to cut the school week. A quarter of parents in England and Wales are now paying for private tuition, 41% in London. This should be unheard of.

Facebook Twitter Pinterest Off-duty police officers march in protest at funding cuts, May 2012. Photograph: Eddie Keogh/Reuters

Care of elderly people is the pride of any prospering community. Effective lobbying by the NHS means our hospital system is relatively well-financed, though costs rise year by year. But the domestic care of old people, much of which falls under the purview of local authorities, is sliding towards catastrophe. Four hundred care homes have closed in five years. The sector’s £1bn deficit will rise a further £700m as a result of this year’s round of cuts. Norfolk alone is slashing £9m from its adult services budget. This will inevitably overcrowd NHS hospital wards, but Whitehall will not mind. Hospitals are its empire and the Treasury always bails them out. Care homes can go bankrupt.

Likewise, the nation’s defence plans are a stranger to budgetary discipline. Eager ministers sounding the alarm over “security threats” are furnished with glamorous kit and headline interventions galore. The defence of the public goods of local communities is far too mundane a goal to attract such largesse. Instead of ships, these places can only point to overcrowded prisons. Security threats at local level amount to a vicious circle of broken families, school exclusions, drug addiction, gang membership, county lines and knife fights.

Forget about Boris Johnson’s 20,000 more police as the true frontline of defending local communities. The strategy should be focused on the intensive counselling of vulnerable teenagers through out-of-hours schooling, youth clubs and prison rehabilitation. Yet these local services are closing in droves: 81 London youth clubs have shut their doors in the past eight years. Camden’s spending on them has fallen from £3.2m in 2011 to £2.4m, Westminster’s from £1.5m to almost nothing. Our civic defences are in headlong retreat.

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These kinds of services cannot be “nationalised”. They respond to local concerns, local pride and local resources. Centralising, standardising and cutting merely demoralise staff and weaken leadership. Small wonder “good people” no longer want to serve.

Yet Glasgow’s recent breakthrough in street crime was a telltale sign of what can happen when a devolved government is freed from Whitehall. It renews and succeeds. The failings noted in Rotherham, Northampton and Nottingham were those of people deprived, year after year, of room to innovate and improve. Theirs was just a grim round of cut, cut and cut. For 30 years, no British government has reversed Margaret Thatcher’s local capping of property tax. When central resources were rising it did not matter. Now a centralising state, described by the LSE’s Tony Travers as “without precedent in modern times”, is crippling the welfare state at the frontline. Revenues from local taxes have halved since capping. If people want better services locally, in a democracy they should be allowed to vote for them. A liberty enjoyed by citizens across Europe is denied to Britons.

There is only one obstacle. It is the political arrogance of a Westminster culture that cannot bear power residing anywhere but in its own hands. MPs accuse Brussels of power-grabbing. They are fine ones to talk.

• Simon Jenkins is a Guardian columnist