The Rocky Road to Decentralisation

Posted by Peter O’Brien, 28 October 2014

After twelve months in the making, the RSA City Growth Commission, chaired by the former Goldman Sachs Chief Economist, Jim O’Neill, has published its final report. The Commission was tasked with examining the current and potential future contributions of cities and city regions in the UK to macro-economic growth. The Commission has seized the moment, and provided a valuable contribution. Recent events have led to devolution being more visible to the public than at any point during the last decade.

The final report has a strong Mancunian flavour to it – and this is not simply due to the birthplace of the Commission Chair. In his foreword, O’Neill suggests that ‘some devolution is a necessary but not sufficient condition for stronger national growth’. This begs two questions. First what sort of devolutionary change is the Commission proposing? And second, what other interventions and policies are needed to build balanced and sustainable economic growth and prosperity within and across different parts of the UK? The remit of the Commission means that it has turned the majority of its attention to the first question rather than the latter.

The Commission seeks to outline how cities and city regions could boost total UK output by £79 billion per annum if they were to ‘reach their growth potential’. O’Neill has been consistent that the Commission would only recommend supply side interventions, thus the strong focus on devolved powers relating to infrastructure, skills, planning, housing, digital connectivity, science and innovation and migration. This means that particular questions and subsequent answers were never on the table from the outset. The Commission also leans heavily towards cities and city regions needing to establish appropriate governance arrangements, and using evidence, intelligence and data in a more systematic fashion. In attempting to tackle the long-standing conundrum of sub-national governance in England, the substantive evidence for Metro Mayors, in terms of what they offer in terms of accountability, and direct links to growth, public service delivery, and the catalyst for citizen and community engagement, is inconclusive. It is no coincidence that Metro Mayors tend to be the preferred model for many who favour greater managerial urbanism.

Although firmly buying into the narrative of agglomeration, the Commission does flirt with the subject of small cities, which is sensible because of the preponderance of such places in UK. But it avoids some of the tricky questions about unintended consequences and negative externalities of urban growth. However, the Commission does, at least, recognise that a mix of people and place-based interventions form the foundations of successful local development strategies.

Initially, the Commission identified fifteen cities and city regions for scrutiny during the course of its review. This was understandable given the time constraints the Commission faced. However, by being perceived to employ a ‘league table-type’ methodology, the Commission has received criticism from some quarters. In reaching its conclusion that only two city regions are ready for devolution (e.g. Greater Manchester and West Yorkshire), there are echoes of where we were seven years ago when Manchester and Leeds were chosen by the then Labour Government as statutory city regions. In their favour, both city regions can point towards years of intra-city regional working, they have scale, local capacity and have produced and implemented evidence-based strategies and investment plans.

During the launch, in London, of the Commission’s final report, Lord Heseltine linked further devolution in England, Scotland, Wales and Northern Ireland to ‘English Votes for English laws’. He also suggested that significant machinery of government changes would be required in parallel with greater devolution from the centre. Jim O’Neill reminded the audience that the Commission had considered cities and city regions across all parts of the UK, but the final report, at times, does not take sufficient account of the variegated devolved landscapes in which Glasgow, Cardiff and Belfast are located and operate within. Sir Richard Leese, Leader of Manchester City Council, said that fiscal devolution should be separated from further policy and resource devolution, and that whilst some tax powers were needed at the local level, there was a risk that Whitehall grouped further devolved powers with substantive fiscal autonomy and placed both firmly into the ‘too hard to do box’.

But has the City Growth Commission’s work, and other similar studies, captured the mood of the Scottish Independence Referendum, if indeed such an atmosphere exists in the rest of the UK? The Scottish Referendum ignited interest in renewed civic engagement and demands for a different relationship between political institutions, economic decision-makers and citizens, and a yearning for new solutions to some big economic, social and environmental challenges. City region devolution, in its current guise, feels as though it is being driven by structuralism, the tweaking of politics per se and the implementation of existing economic orthodoxies, albeit at new spatial levels. Perhaps O’Neill is right, ‘some devolution is a necessary, but not sufficient condition…’

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