New city-region powers must be matched by city-region-wide leadership and accountability.
Today marked the announcement of the second Devolution Deal for a major UK city-region in a month, as Sheffield joined Greater Manchester in the vanguard of the Government’s latest attempt to put more power in the hands of local leaders. But observers have immediately pointed out that the scope and ambition of the Sheffield agreement is substantially lower than that of the Manchester Deal, and that critically, there is no mention of a directly elected Mayor for the Sheffield city-region.
These two issues are inextricably intertwined. We have learned in the weeks following the announcement of the Manchester deal that the acceptance of a directly elected city-region leader was a non-negotiable issue for the Chancellor and the Treasury. Their position has been clear from the outset that for substantial new strategic planning and economic development powers to be transferred to the city-region level, the existing combined authority arrangements would need to be strengthened by a directly elected Mayor.
This presented a significant hurdle for local leaders to clear in order to secure a deal, given the suspicion that many hold for such a model, and for local government reorganisation in general. Nevertheless, through intense negotiation, an agreement was reached in Greater Manchester that means that the city region – and its new Mayor – will benefit from new powers over skills, business support and welfare issues, as well as increased certainty and discretion on transport investment for the area.
These arrangements may not feature major elements of fiscal devolution, but they do represent a significant step forward over previous attempts to decentralise power and funding out of Westminster.
The same cannot be said of the current deal in place for the Sheffield city-region. Although featuring a number of encouraging commitments to explore new working arrangements between local leaders and National Government, the city-region is not being handed new powers or direct control over substantial revenue streams or the critical drivers of growth on anything like the same scale as Greater Manchester. There is, for example, no Sheffield equivalent of the reformed ‘Earnback’ infrastructure investment arrangements, nor devolved transport budgets, nor the housing investment fund that Greater Manchester stands to benefit from.
The primary reason for this appears to be that an agreement could not be reached locally over the establishment of a city-region-wide Mayor akin to the London or new Greater Manchester models. Indeed, when assessing the potential for further devolution, the document states that “Sheffield City Region will consider different options for improving local governance and accountability. In response to any further agreements on local governance, Government will consider what further powers and funding could be devolved to Sheffield City Region over time”.
The message from Government to Sheffield and other cities therefore remains clear – if you want a substantially improved ‘city-region deal’ in the future, then you need to strengthen local governance. Many have, and will continue to, protest at this position, and cite that decentralisation should be about local choice, not national imposition. But such an argument fundamentally misses the point that the current structure and accountability of local government – even in areas where combined authorities have been established – is not fit for purpose in a world where significant new powers are transferred to the city-region level.
Without such arrangements, local leaders elected from their individual wards, to their individual councils, will not have the legitimacy or mandate to take strategic decisions on behalf of the whole city-region, and a real risk will remain that plans for the area will be reduced to those of the lowest common denominator, which can most easily gain support across the board.
It is understandable that – just as it was in Manchester – reaching local agreement on this kind of reform is an intense and difficult process. But directly elected city-region leadership – ideally in the shape of a single city-region Mayor – will be fundamental to providing the kind of legitimacy and decision-making needed to wield the kind of powers that have been on offer from Government, as well as allowing local policy-makers to work effectively across councils and with the private sector to plan strategically for growth in the years ahead.
Even though it means that the Sheffield deal announced today has fallen short of expectations, the Government is right to stick to its guns on city-region Mayors. While appreciating that for many places, this won’t be achieved overnight, over the long term the opportunities presented by the recent cross-party commitment to devolve to city-regions can only be seized with the right leadership in place.
Director of Communications and Development
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