Public Sector Focus

Cities and local government devolution bill

Adam Hewitt reports on the government’s plans to reform local government and devolve further powers to combined authorities and city-regions.

As PSE was going to press, the Cities and Local Government Devolution Bill was getting its second reading in the House of Lords. 

The Bill – previously referred to as the English Devolution Bill and the City Devolution Bill – was unveiled in the Queen’s Speech and published soon after. 

The appointment of Greg Clark MP as the new communities secretary, replacing Eric Pickles MP, has widely been seen as a positive for the devolution agenda, with his previous roles looking after the cities portfolio and growth deals having given him time to make his enthusiasm clear. 

Clark has previously said that he is “convinced that the cities programme is of direct relevance to the work of the Treasury” and that “economic policy must also recognise the importance of place”. 

The new Bill fulfils a number of requests from the Local Government Association (LGA) in its recent ‘English devolution: Local solutions for a successful nation’ document. Though the Bill does widen the scope of potential powers that combined authorities (with a mayor) can exercise, it does not give them “full discretion over their composition and functions” as urged by the LGA. 

The Bill, and much of the government’s offer to date, has come with the quid pro quo of elected mayors, though again the LGA says “there is no evidence that good governance can be delivered only by a single model”. The Sheffield City Region deal came without a mayor, but also without devolution on the same scale as Manchester. 

The LGA has long backed the basic principle of devolution, though, arguing: “Over the past year, three independent commissions, made up of renowned business leaders, economists and other experts have taken a hard, dispassionate look at what needs to be done to ensure that Britain’s economy stays globally competitive and public services are sustainable. All three came to the resounding conclusion that devolution is the most effective way to create jobs, build homes, strengthen healthy communities and protect the vulnerable in all parts of the country.” 

The Bill removed the statutory limitation on the functions that can be exercised by a combined authority, which have previously been limited to economic development, regeneration, and transport. Future deals could also include employment support and skills provision, housing and strategic planning, public assets, policing and public safety, as well as health and social care. The Greater Manchester ‘Devo Manc’ agreement has already pioneered action in a number of these areas. 

The Bill also allows elected mayors to take over the functions of a police and crime commissioner for an area, and – with council agreement – to “streamline” governance arrangements. Mayors will be required to appoint a deputy (one of the combined authority leaders) and can have up to one political adviser. 

Ed Cox of IPPR North calls it the “legislation necessary to make the northern powerhouse fly”. He added: “In demanding directly elected metro mayors, the chancellor has set a high bar for powerhouse cities to draw down similar powers to Greater Manchester and it remains to be seen how far such cities are prepared to go politically to help him achieve his agenda.” 

The Bill could face some political opposition, including from those who think new mayors should be able to borrow from the markets – rather than be dependent on the Treasury. Labour’s Clive Betts MP, who chaired the Communities & Local Government Committee during the last Parliament, is among them. 

He told the Independent on Sunday: “Giving mayors more [financial] resources means they will have more choice over how it’s spent – in this form, it’s completely with the Treasury on how much is spent.” 

Ben Harrison, director of partnerships at Centre for Cities, said the Bill’s provisions are “deliberately generic” to enable bespoke deals to be thrashed out between combined authority areas and the government. He also noted the Bill’s provision that, if one body in a combined authority wanted to block the introduction of a mayor for the area, Clark could remove that non-consenting body from the arrangement. 

Robert Hazell of The Constitution Unit at the Department of Political Science at University College London said “the rhetoric may be larger than the reality” because the devolution consists “mainly of unbundling small funding packages into larger ones, with no new money”. 

The existing combined authorities are: Greater Manchester; Sheffield City Region; North East; Liverpool City Region; and West Yorkshire. Many more are set to come into being soon, with the most advanced including Derbyshire, Nottinghamshire, Tees Valley and ‘Greater Birmingham’ (see page 68). The idea seems to have proved less popular in more rural areas, and amongst unitary authorities that ‘broke away’ from a county or former county (including Telford and Medway).

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