Devolution white paper delivers changes that support needs of local policymakers

Radical changes to the structure of local government have been the main focus of media coverage following the publication of the English devolution white paper before Christmas. However, while the move away from the two-tier system is the biggest change in 50 years, the document is considerably more expansive in its focus than just the headline-grabbing announcements.

The rest of the white paper is probably better described as an evolution in devolved powers, rather than a real revolution compared to the structural change – but it is very much welcomed. While the other changes may not be as dramatic, what it does set out is a statement of intent for the future role of sub-national government with a greater strategic role for mayors supported by greater funding flexibility and certainty.

Nonetheless, the role of mayoral strategic authorities, which were previously combined authorities, remains focused on local economic growth over wider public service delivery and there is considerable detail still to be worked through before the English devolution bill is put through parliament.

What we can see in the white paper is that it does meet a need within local government though, and those needs are ones we at Mott MacDonald have heard first hand in recent months. Through a series of interviews with key players in local and combined authorities, we have looked at facets of infrastructure that will be crucial to successful housing and place-based growth.

Through these conversations we have considered how this might be applied by and for the growing set of strategic authorities under devolution to ensure that housing delivery goes hand in hand with investment in infrastructure.

During the process we have heard several consistent messages and, positively, the proposals put forward in the white paper broadly align with the results of our research. Those messages can be broken down into three core themes that local policy makers see as essential to delivering strong, sustainable growth.

Infrastructure planning

The first centres around the need for strategic growth – and associated infrastructure that supports it – to be planned and coordinated at city-region or regional level, as well as within sensible economic geographies.

The removal of regional development agencies and the 2011 Localism Act have driven most spatial and development planning to a very local level. At the same time, much significant strategic infrastructure planning continues to be undertaken by national bodies on a sectoral basis, rather than being place-based.

The white paper addresses the ineffective coordination between the housing and growth plans of local planning authorities and the infrastructure planning that results from these changes. Under the proposals, strategic authorities will have a stronger role in the planning and delivery of key economic infrastructure, such as the rail and highways networks.

The roll-out of spatial development strategies across England – based on the London Plan model – is also a step in the right direction. Backed up by the proposed new mayoral development management powers, there is the potential to plan and deliver housing, employment and infrastructure at scale to support growth while also delivering better outcomes for people and place.

Funding certainty

The second common theme was that sub-national bodies need long-term funding certainty and flexibility to enable effective and locally prioritised deployment of resources.

Our research suggests that the white paper’s plan to move to more extensive – in scope and geography – place-based funding would be warmly welcomed. It would give greater flexibility to support more innovative funding and financing models at a sub-national level.

Combined and local authorities have generally been forced in recent years to bid for short-term funding pots for growth rather than think strategically about their long-term funding requirements. Different pots often have different timeframes, magnifying complexity.

Some critical enabling funding – such as for affordable housing – has remained largely centralised, even in those areas where devolution is most progressed.

The white paper’s commitment to single-pot, multi-year “integrated settlements” appears to recognise these challenges. Greater stability and certainty should lead to more effective delivery of the housing, infrastructure and wider measures needed for local growth.

The new funding power offered to mayors – again largely based on the London model – through a mayoral community infrastructure levy could help to support local growth, although its potential will be greatest in places where land values are highest.

Resourcing

The final theme that came through our research was that with greater powers comes greater responsibility, resulting in a need for greater resources.

The challenge around this will come as no surprise, with many local authorities having been adversely affected by austerity over the past 15 years and not in a position to take on significant new responsibilities. The white paper does recognise this challenge and makes commitments to support capacity building with funding and wider assistance planned.

It is clear that the direction of travel set out in the white paper answers a need in local government, but it is currently just a framework and there is a lot more detailed thinking required.

Challenges ahead

To me, citing the London Overground in the white paper as a successful example of rail devolution is an example of the challenges that are still to be addressed. The London Overground is a largely isolated system and that type of environment does not really exist in many other cities.

As an example, services running between Greater Manchester and West Yorkshire cross boundaries, but the two areas have different devolved powers and may also have different goals.

The document does not acknowledge that one of the fundamental challenges that has held rail devolution back in other places in the UK is addressing how competing demands from local, regional and national services on the same rail infrastructure can be accommodated. Investment in new rail infrastructure must be delivered alongside local custodianship, if devolution is to have the transformational effect needed.

The linkages between funding devolution, infrastructure investment and housing growth are explicit in the white paper. However, moves to devolve affordable housing funding seem limited in the short term and more could be done to offer funding and financing support to enable brownfield development.

It is local policymakers who will determine whether devolution is a success on the ground

Honest reflection is required around organisational capacity and skills, which can vary significantly from place to place, particularly for specialist areas. For example, the Better Buses Bill will pass significant new public transport operations responsibilities to strategic authorities. Enabling funding and broader ongoing support from national government is likely to be necessary to support local government upskilling if devolution is to be a success.

These are not the only hurdles, but they – and others – can be overcome, particularly if industry and other stakeholders support local and national government to progress the technical detail needed to translate the white paper’s framework into a blueprint that can unlock place-based growth and wider reform.

Ultimately it is local policymakers who will determine whether devolution is a success on the ground. Our research suggests that the white paper is well aligned with the issues that matter to those policymakers, placing it in a good position to achieve its aims.