Mark Sandford analyses the government’s recent ‘trailblazer devolution deals’ with Greater Manchester and West Midlands, suggesting that they contain the makings of a new way of governing within England.
The government published ‘trailblazer devolution deals’ with Greater Manchester and the West Midlands on 15 March 2023. The two deals include a number of incremental, but significant, indications of the future of English devolution policy. They are twice the length of most previous deals, but they promise only modest increases in powers for the two areas. Are the deals therefore of little value to these localities, and does this reflect the challenges faced by the government’s ‘levelling up’ agenda?
Here I suggest that there are three reasons to think that the trailblazer deals could be of long-term significance. They make a number of proposals for co-designing policy; they offer the two areas a route in to central policy-making; and they propose a step-change in financial flexibility in the form of the ‘single settlement’. These changes indicate that both centre and localities are starting to think differently about the distribution of power in the UK.
What will the deals change?
The deals include only a modest number of additional powers and budgets. Both areas will gain strategic control over the Affordable Housing Programme, currently managed by the arm’s-length body Homes England, in the medium term (though closer control is on offer to Greater Manchester than the West Midlands). Both areas will establish a joint governance board for post-16 technical education, co-design future employment support programmes, and take part in the governance of local rail services.
However, the deals include a large number of proposals for co-design of policy, with central government agencies and the mayoralty working jointly. These are proposed in areas such as employment support, careers provision, public land, and tourism. In some of these, the deals state that the combined authority is to be regarded as the lead agency in policy-making for the area.
Co-design can be viewed at first glance as an alternative to devolution of power, a way of maintaining central control. However, it can also serve to build trust between the different levels of government, while circumventing head-on disputes about whether devolution is ‘real’. There is some evidence that co-design is popular within the local tier for precisely this purpose. It is also possible that this type of approach can, in practice, facilitate more local influence over policy than fully devolving responsibilities.
Then, at many points the deals commit to inviting Greater Manchester and the West Midlands into the government’s policy-making process: for instance around productivity, innovation and investment. This may accustom civil servants and public bodies to work with local leaderships, building trust and confidence.
This approach is workable as a pilot with two authorities, providing a gateway to greater influence. However, it would not be scalable if large numbers of mayoralties sought similar access. And it is possible that these arrangements are lower priority for Greater Manchester and West Midlands than the ‘hard powers’ gained over skills and transport. Much depends upon the extent to which both sides actively pursue these commitments.
The single settlement
The most significant change proposed by the trailblazer deals is the idea of a ‘single settlement’ for Greater Manchester and for the West Midlands. This would in effect be a single allocation of funding to each authority, replacing separate allocations for transport, skills, housing and so on. This would be introduced at the next Spending Review in 2025.
The deals anticipate that the single settlement would cover funding for local growth and place, local transport, housing and regeneration, adult skills, and retrofit of buildings. The devolved institutions would receive funding allocations in respect of those matters but would be free to move money between them. Government would hold them to account against a small number of high-level indicators within a new accountability framework, which has yet to be developed.
A ‘single settlement’ for a local area in England would be a major step away from the historical approach to budgeting by the UK state. It could well provide more flexibility and capacity for decision-making than any moves towards fiscal devolution. Fiscal devolution is complex and could hold as much risk as reward for localities. It is no surprise that it is absent from the trailblazer deals, apart from a commitment to keep current business rates arrangements in place for a further ten years.
An idea whose time has come?
More widely, there are signs that the metro-mayors are becoming accepted as a permanent part of the political landscape in England. This is evident from a number of features of the trailblazer deals.
First, they include an unprecedented level of attention to scrutiny and governance. A new English Devolution Accountability Framework (EDAF) has been published, and a scrutiny protocol for all combined authorities is anticipated in summer 2023. Previous devolution deals have treated governance in a far more perfunctory manner. This suggests a growing belief within the government that good governance within combined authorities is core to effective delivery.
Second, the devolution deals include some halting steps toward regulatory powers. These include considering legislating around zebra crossings in side streets; pavement parking; and energy efficiency standards. Regulatory powers are a normal part of local government, but they have been absent to date from devolution to local government in England. These developments point to an acceptance of combined authorities as general-purpose governing bodies, not merely local delivery partners for key government projects.
Third, there is a degree of convergence between the trajectory of the English devolution agenda and that of the Greater London Authority (GLA). New powers over affordable housing and rail in the trailblazer deals are already devolved in London. The EDAF mentions the GLA on a number of occasions.
Up till now, the GLA has been a silent guest within the English devolution agenda. It has quietly taken on a few powers offered to Greater Manchester, such as the Work and Health programme and the Adult Education Budget. On the other hand, some new powers in the trailblazer deals have not yet been offered to London: for instance, retrofit funding, 16-19 technical education, or careers provision. It remains to be seen whether London will demand or receive these.
The trailblazer deals enable the sketching out of the makings of a new way of governing within England. Of course, it is possible that little may come of many of the joint working commitments and lower-key proposals within the trailblazer deals. These attract little political cachet alongside providing new funding for training courses, or opening new railway stations. But the range of proposals in the deals show that both centre and locality are invested in trialling different ways of working together, to a degree that has not been evident so far.
By Mark Sandford, Senior Researcher, House of Commons