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18.12.16

PAC: Devolution not a ‘miracle cure’ for central government

The government must make clear what it is trying to achieve through devolution to taxpayers and service users, the Public Accounts Committee (PAC) has said in a new report.

The PAC’s new report, ‘Devolution in England: governance, financial accountability and following the taxpayer pound’, has highlighted the continued failure of central government to define its objectives for devolution in England.

The report also raises concerns about transparency and accountability in devolution spending, bringing attention to the ‘opaque’ nature of LEPs, which are now negotiating local growth deals backed by a £12bn growth fund, and warning against a new ‘local centralism’.

Meg Hillier MP, chair of the PAC, said: “Devolution in England has significant implications for the lives of millions of people, yet even at this late stage, and despite concerns raised by us and others in Parliament, the government still has serious questions to answer.

“Generalisations about the potential benefits of devolution just don’t cut it with taxpayers worried about real-world issues.”

The report stresses that taxpayers must be able to understand who is spending their money, to what end and where responsibility lies if things go wrong, suggesting that documents regarding devolution spending should be made publicly available by central and local government.

The DCLG must also be able to more clearly demonstrate the link between devolution and economic growth, with the government currently placing more emphasis on devolution itself rather than other relevant factors like housing, education and skills, the report said.

Perhaps most strikingly, the report stresses that the devolution of services does not absolve central government of its responsibility to ensure that devolved areas receive adequate funding to sustain them.

The risk of leaving devolved authorities to fend for themselves is a particularly relevant concern for health and social care given that local authority budgets are already being heavily stretched in the beleaguered sector.

However, the PAC said that local bodies must take equal responsibility for their spending and be able to ensure value for money when they are delivering services.

“Devolution is not a miracle cure and central government cannot expect to wash its hands of problems to which it has no solutions,” Hillier said.

“[Central government’s] obligations to local citizens do not end with the signing of devolution deals; it can and should be doing more. We again call for it to properly acknowledge its responsibilities and respond meaningfully to our concerns.”

The government’s cities and local growth unit has now already negotiated and implemented 12 bespoke devolution deals in England, although three of them have since broken down.

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