The English Devolution White Paper: Cautiously radical?

Posted on: 17 December 2024 by Tom Arnold in Blog

The eagerly-awaited English Devolution White Paper (EDWP) is a curious mixture of continuity, radical reform and a degree of caution. It is simultaneously more ambitious than had been anticipated (on local government reorganisation, for example) and conservative (there is not even a hint of discussion about fiscal devolution). Five key themes emerge from the paper.

1. Establishing a uniform, ‘strategic’ mid-tier of government in England. The white paper continues the direction of travel established by the previous Conservative government – that every part of England should have a larger-than-local government, and that these governments should ideally be led by a mayor. Similarly, Labour’s proposals lean on evidence (from the OECD, for example) that decentralisation increases productivity. The EDWP is more categorical on the government’s desire to ‘complete the map’ of devolution, however. Its “strong preference” is the establishment of strategic authorities with populations of at least 1.5 million. If local authorities are not able to agree on a geography for establishing a strategic authority, the EDWP indicates government will make this decision for them. The ‘carrot’, in the form of enhanced powers for mayoral combined authorities, remains – but the ‘stick’ is wielded a little more visibly than in the 2022 Levelling Up The UK white paper.

2. Simplifying decision-making and funding. Combined authorities are currently required to gain unanimous approval from all constituent local authorities for major decisions such as approving budgets. This can lead to stalemate, particularly in combined authority areas where more than one political party is represented. The white paper proposes a move to simple majority voting to speed up decision-making, and mayors will also receive ‘call in’ powers over some planning decisions, allowing them to override decisions made by local authorities, in line with the powers currently held by the Mayor of London. Funding will also be simplified, with ‘established’ Mayoral Combined Authorities (Greater Manchester, Liverpool City Region, North East, South Yorkshire, West Midlands and West Yorkshire) receiving integrated settlements allowing them to move funding between policy areas and ultimately decide how budgets are spent. Non-mayoral strategic authorities will receive ‘consolidated’ funding determined through the Comprehensive Spending Review currently underway. The era of the ‘begging bowl’, with local governments forced to compete for funding, may be over. 

3. Aligning political, economic and service delivery geographies. The patchwork of different geographies for delivery of public services in England has long baffled casual observers and frustrated policymakers seeking to align economic, social and political objectives. The EDWP is clear that service geographies should be simplified and, wherever possible, reflect travel-to-work patterns and local labour markets . More mayors will take on police and crime commissioner roles and responsibility for fire and rescue. All strategic authorities, including those without mayors, will produce a Spatial Development Strategy – representing the return of strategic regional planning across England for the first time since 2010. Mayors will also have a statutory role in delivering local rail services and be involved in delivering ‘Local Power Plans’ developed by Great British Energy, while Homes England (the public body that funds new affordable housing) will move to a “more regional and place-based operating model”, more aligned with the activities of strategic authorities.

4. Ending two-tier local government. Will Lord Redcliffe-Maud finally have his day? In 1969, his report on local government recommended abolition of the myriad of counties, boroughs and districts, proposing in their place the establishment of metropolitan counties and unitary authorities. The plan was only partially implemented, but over the last 15 years gradual unitarisation has significantly reduced the number of English county councils. Cheshire County Council and its six district councils were abolished in 2009 for example, replaced with two unitary authorities, with Cumbria following a similar path last year. The white paper aims to finish the job, proposing “a programme of local government reorganisation for two-tier areas” aimed at streamlining local politics. Meanwhile, multi-year funding settlements will allow greater certainty for local authorities, but will not end the local government funding crisis unless the amount received by councils can cover spending on statutory services such as social care.

5. Fiscal devolution is off the table for now. Radical as much of this restructuring appears, it will be implemented in the context of continuing fiscal restraint and, crucially, with few new money-raising levers for either strategic authorities or local councils to pull. Proposals for fiscal devolution are limited to the introduction of a Mayoral Community Infrastructure Levy enabling extra spending on major infrastructure projects, similar to the fund that helped successive London mayors partly pay for the Elizabeth Line. While combined authorities may experiment with small levy-raising initiatives such as tourist taxes, they will continue to be reliant on central government largesse until significant powers are devolved over taxes on incomes, sales and businesses. Council tax reform and associated efforts to introduce land value taxes remain off the table, despite the efforts of a handful of new MPs. Without genuine fiscal devolution, England will remain, as the introduction to the white paper puts it, “one of the most centralised countries in the developed world”.

Risk and reward

The English Devolution White Paper is undoubtedly ambitious – in its scope, in its objective to develop a permanent strategic regional tier of government in England, and in its clarity about the ‘ideal’ structure and geography for local government. Yet this ambition comes with risks attached. English local government units are already large by international standards, and these proposals have potential to move power further away from communities. Furthermore, there is little evidence that reducing the number of councils makes local government more efficient.

The new powers for Mayoral Combined (or ‘Strategic’ in the new terminology) Authorities are couched primarily in terms of their role in boosting growth and improving productivity, objectives which are potentially in tension with aspirations for democratic renewal. Despite the countless references to ‘partnerships’ between mayors and government, the long-standing uncertainty about how far Westminster is willing to allow sub-national government to diverge from national policy remains. With a Labour government in power, and the party dominating the mayoralities (holding all but one of the current 12), these local leaders appear central to delivering the government’s missions. Will this relationship hold once Labour’s grip on regional bodies loosens? How relaxed will government be if a Mayoral Combined Authority decides to develop alternative policies, on net zero or transport, for example? A test may come as early as next May, when voters in Greater Lincolnshire will elect their first mayor – with Reform hoping to secure their first win at this level.

Despite these concerns, it is welcome that government has sought to build on the devolution of the last decade by continuing to empower mayors and combined authorities. With levels of trust in Westminster government at an all time low, and evidence that confidence in the mayoral model is growing, building these institutions may represent England’s most hopeful route for political renewal.