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Let’s play a game of “guess the devolution deal”. The package in question includes a commitment of £30m funding per year for 30 years; greater powers over local transport, buses and trains; new powers over skills and training; and, more control over strategic planning. Which city-region am I describing?
The truth is, you’d be forgiven for listing any of the city-regions that have agreed deals to date, and that has led some to say that these deals are essentially all the same, and as a result, that they will fail to meet the needs of individual places. But a closer consideration of the devolution process, and the deals themselves, reveals such an analysis to be fundamentally flawed. Here’s why.
First, the overarching similarities in the deals agreed to date reflect the difficulties of devolving power from such centralised institutions, and the need to secure and consolidate any progress made. Gaining agreement within central government to devolve funding, functions and responsibilities to a local level requires ministers to spend political capital – whether through deploying resources to navigate the technical issues with doing so, or striking political deals with those within the centre who may not be in favour of the devolution, or who may stand to lose out. Given devolution is but one issue on even Greg Clark MP’s agenda, there is inevitably a limit to the amount of times this can be achieved within the framework of agreeing deals with different places, within a given period of time. That means if progress is made in securing the devolution of, for example, powers over local skills for the North East, there is an imperative to “bank” that progress in a series of deals with others.
These dynamics can be observed when we look back over the last six years, where, in hindsight, we have seen repeated “devolution cycles”. First, the intention to devolve is announced, and an invitation for new ideas is issued. Second, proposals are submitted. Third, a minority of proposals are accepted, and then rolled out more broadly to other places. Give it 12 months, and it’s time to begin again with a further round of incremental change.
Second, it isn’t just about the centralised British state, or the political reality of deal making. The reason that elements of the current city-region devolution deals look so similar is because they are fundamentally important to driving economic growth across city-regions. Over the course of the last ten years, the research we do here at the Centre has made clear that issues like transport, housing, skills and business investment are key drivers of local economic growth, and for even longer than that local leaders, academic experts and commentators have campaigned for control over these drivers to be devolved.
In particular, there has been a strong appetite for places to be able to leverage stable, long term funding for infrastructure, to shape strategic economic plans at the city-region level, and target investment where it can generate the biggest local returns. That is why upon agreeing such an arrangement with central departments for Greater Manchester, other cities and the Government more generally have been keen to roll the model out more widely. And although some will argue (with some justification) that in the broader context of cuts to local government funding the sums involved are too small, the importance of establishing this kind of mechanism across UK city-regions should be recognised and celebrated.
Third, exactly how devolved funding and powers are used in practice will be determined by places themselves. Awarding city-regions similar powers does not mean they will choose to implement them in the same way – their application will be tailored to the needs of their local circumstances. In Merseyside, the new infrastructure and planning powers will mean more progress can be made on developing the new deep water port in Liverpool; in the West Midlands, it will support the extension of metro connections across the area.
In a noteworthy contribution to the second committee stage debate of the Cities Bill this week, Labour MP Graham Allen – a long-term devolution advocate – remarked that “devolution, by definition, will create difference. It will create best practice.” He is of course quite right. Devolving power to a local level means different decisions being taken with that authority, and different policies being implemented. And MPs on all sides of the House of Commons have praised the Government for adopting an enabling approach in its Cities and Local Government Devolution Bill, which allows for a flexible approach to devolution to be taken.
With the passage of time, some places will no doubt be keen to go further, faster on devolution, and no doubt the deals of 2015 will be deepened, expanded and added to accordingly.
And finally, despite headline similarities, the deals do differ from one another in important ways. Most notably, the Greater Manchester Devolution deal is significantly bigger in its scope given the inclusion of Health and Social Care as well as blue light services. And below the top lines of the deals announced so far, there are other, important distinctions. The West Midlands deal announced this week, for example, includes commitments for a £4.4 billion HS2 Growth Strategy to ensure maximum economic benefit from HS2 investment, while the North East deal features a commitment to drive the commercial rollout of ultrafast broadband across the combined authority – an important priority for the region given the mix of urban and rural areas.
All of which means that while for the casual observer it might be difficult to distinguish between the devolution deals agreed to date, their significance must not be underestimated. In part, their similarity is a function of the means through which the Government has chosen to deliver devolution. But just as importantly, the deals look similar because they cover the issues that can really make a difference to a local economy. And most critically of all, it will be for local leaders to prioritise how best to use the new funding and powers on offer.
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