Posted by Andy Pike, 04 November 2015

A devolution ‘deal’ has finally been agreed for the North East. Delayed by disagreements and negotiations between HM Treasury, Whitehall departments and the local authorities involved about exactly what would be released from the centre, where the LEP would sit and to whom it would be accountable, and how a commission on health and social care would work. Such haggling is characteristic of the deal-making integral to Government’s ad hoc and piecemeal approach to decentralisation in England. Deals have been positive in providing a channel for local-central dialogue, innovation and strategy-making, and governance reform. More problematic are the uneven information and power between the negotiating parties, the lack of transparency, the limited capacity locally and in Whitehall departments coping with expenditure cuts, and the limited evaluation of progress to date.

Doing decentralisation this way has been complicated by Government’s lack of clarity in specifying exactly what decentralisation is for: local economic growth? Rebalancing? Savings and public service reform? Addressing societal challenges like ageing and climate change? All of the above? International analysis on the impacts of decentralisation is mixed. There is however evidence that giving local actors more say over certain elements of territorial development – such as business support, EU funding, housing, investment, skills and training, and transport – are helpful. For the North East, then, such things are a welcome step in the right direction. Less clear are the resources involved and whether they are new and additional money from the centre or the local delegation of the risks of new borrowing and taxes. Requiring elected mayors as part of the deals – an oddity in the context of ‘localism’ and their recent democratic rejection in 2011 – sits on shakier ground. International evidence on mayoral success is highly selective and fails to nail whether they are catalytic or merely contributory factors in territorial development. Even if the more positive story of mayoral influence is accepted, it is not entirely clear how they will do their job in a city-regional context with potential local authority veto within the combined authority.

Assessing whether or not such deals are good, bad or indifferent is difficult. In such an opaque process, who knows exactly what was on or off the table? Is what the North East has agreed the best package it could have got? The deal is smaller and narrower in scale and scope than those agreed with Greater Manchester and Sheffield city-region. Perhaps this is what central government desires. Orchestrating a race amongst local actors to put together propositions for deals in a short timescale has certainly put them on the back foot and kept the centre firmly in control. Again, a curious approach to localism. Giving some ground on decentralisation in a still highly centralised governance system enables claims of reform and modernisation. The current deals have the look of delegated responsibility with a bit of greater leeway on powers and flexibilities but they are some way short of substantive devolution with appropriate levels of resource.