Centre for Cities Responds to Budget 2015

The Centre for Cities welcomes the Chancellor’s continued focus on growing the UK’s city economies – including within Scotland and Wales – and the role that city-level investment in the fundamentals of housing, transport, infrastructure and innovation can play in building a more sustainable national recovery. Ultimately, this was a Budget that reflected the progress made on urban policy and city devolution across the political spectrum over the past year. But it also made clear that there remains much to be done before policy-making matches the rhetoric of change.

Housing was a particular disappointment: given the significance of the threat the chronic ongoing under-supply of housing poses to the economies of some of our best-performing cities, this Budget is most notable for what wasn’t said on the subject. There were ultimately no announcements that would suggest the UK can get anywhere near the kind of scale of house building we need to see to improve affordability – and indeed, the Help to Buy ISA could increase demand further, and without a complementary increase in supply, it is unlikely to provide any kind of reprieve to the housing crisis for young and old alike.

There are also questions as to just how ‘widespread’ the Chancellor’s plans for devolution will truly prove in the short-term. While another tranche of further City Deals were promised, his announcement that Greater Manchester, together with Cambridge, will be able to retain 100 per cent of their additional growth in local business rates, represents another reward for the city-region that has proven itself most capable of making tough decisions and working in partnership across boundaries for the broader economic good. But this means that the gap between Greater Manchester and the powers available to other UK cities to decisively shape their economic future continues to grow. Even London was unable to secure any steps towards the kind of fiscal devolution that would enable the capital to tackle its housing and infrastructure shortfall, and help achieve the future growth the Chancellor claims he would like to see.

What we need from the next Government is a fundamental commitment to shift power away from the centre and support cities across the country to fulfil their potential. That means moving beyond awarding ad hoc pots of funding for specific projects, to giving more cities strategic control of local revenue streams, and the powers and responsibilities needed to drive prosperity. For their part, more cities throughout the country should look to step up and emulate the pragmatic and strategic example set by Greater Manchester – in order to get the powers needed to drive positive change in their communities.