Just over a year ago, the Levelling Up White Paper promised a Devo pathway to end the almost feudalistic culture of ambitious local leaders taking a begging bowl to their Lordships sitting in Westminster and Whitehall to ask for more cash.
The promise of levelling up looks like it might really come true for the two Andies, Burnham and Street, who were the BIG winners in Hunt’s Budget. It looks like they have secured a trailblazing £1 billion cash prize for their city regions, Greater Manchester and the West Midlands.
Jeremy Hunt’s first ever Budget statement, was all about keeping markets and business leaders calm, but perhaps it was also about triggering a quiet devolution revolution?
Metro Mayors will have more money, more control over that money, and more powers on skills, transport and housing. This is a big step in the right direction: a single funding pot for the trailblazer city regions, giving Mayors autonomy over their finances.
With new money comes new scrutiny and accountability. In the future, could we see a new dynamic emerging with Metro Mayors and portfolio holders being held to account by the MPs in their region and Whitehall?
More powers and fiscal devolution will have a BIG impact. Take transport as an example. For Greater Manchester, it will mean the ‘Bee Network’, Burnham’s promise of a fully integrated system of buses, trams and now trains, will be fulfilled. And Andy Street in the West Midlands will be able to expand his own tram network. If they fail they will be held accountable but it is more likely that they will succeed now they have the powers and money to get on with it. This may well prove to be a game changer for levelling up. Where Greater Manchester and The West Midlands have blazed a trail we can expect more to follow. Could this be the key to unlocking growth in England’s towns, cities and regions?
The building blocks for growth
These are very similar to the Investment Zones that helped sink the Kamikwasi Budget last year; but this time, there’s a limited number, rather than the open-ended free-for-all that the sugar-high Truss government announced. Local areas will be able to choose how they spend £80m from the government, and these deregulated zones aim to forge links with universities and businesses, based on the so-called Medici principles lauded in the Levelling Up white paper.
This, with Whitehall’s new Department for Science, Innovation and Technology, suggests maybe this is a government that takes seriously R&D, STEM, and the high-skilled industries in which Britain can really excel. But, unless the country stops dragging its heels when it comes to building transport and housing, this won’t really come to anything.
See the prize, see it through
The main issue with Investment Zones is whether the government actually sees this through, rather than constantly fiddling with the messy patchwork of institutions and agencies. Labour too should resist the temptation to meddle unnecessarily with regional policy before it has a chance to work. Make good policy, make the case for it, and stick to it, to give business the stability it needs.
Labour should instead turn its attention to the big holes in this Budget. On transport, last week’s decision to delay HS2 is a classic example of Whitehall and Westminster’s short-termism. It’s going to cost more and slow down growth and net zero ambitions. Meanwhile, Hunt said zilch about one of the most obvious things Britain must do to reverse its relative decline and get the North moving: Northern Powerhouse Rail. But that was to be expected. Labour must make building this vital infrastructure a key priority of its manifesto. Whilst the government’s movements on childcare are to be welcomed, the other side of care is still lacking. If Hunt wants to sort out Britain’s workforce woes, he’ll also have to get social care done.
This is perfect territory for Labour to fight the next election on, but there’s still time for the Conservatives to bring in a real plan. Meanwhile, Burnham has been trying to make it in America, embarking on the “most ambitious mission” by a British city-region to boost trade. That’s the real prize that proper devolution can seize: where UK cities are globally competitive to attract business, trade and investment, not fighting each other for pennies from Whitehall. And whilst there’s still time for this Budget to unravel, on the devolution front, Hunt should be given credit for quietly taking a radical step in the right direction.
