North East Devolution and Levelling Up

More Power For Councils Even Without Mayors, Say MPs

More powers, including new tax-raising powers, should be devolved to local councils without the need to form combined authorities or accept elected mayors, according an all-party group of MPs. 

English devolution is key to delivering on the government’s ambitions to ‘level up’ the country and recover from the Covid-19 pandemic, they say in a report, and need not necessarily be on the lines of the current mayoral combined authority model. 

‘Whilst there may be advantages to reorganisation and the formation of combined authorities where there is agreement to do this in local areas, it must not be a compulsory precursor to councils taking on new powers’, says the report from the All-Party Parliamentary Group on Devolution.

‘Councils are the best leaders of their places as demonstrated most recently by their successful role in the emergency response to COVID-19. If we are to rebuild and renew the country after COVID-19, there must be a new emphasis on devolution and a programme of change in Whitehall as this is the way to level-up communities and support central government in overcoming barriers’, says the report. 

It adds: ‘‘The government should provide opportunities to move away from the traditional drivers of departmental spending and inefficient and expensive competitive bidding processes towards a degree of fiscal decentralisation in line with some of the world’s most productive economies. This should include consideration of new tax setting powers for local government, as the current local government tax base is already too restricted and has been further impacted by COVID-19. Fiscal devolution is not a replacement for central government funding and redistribution through central grants and public spending must continue’. 

The report says: ‘Given the scale of the economic and social challenges ahead, the need to make swift progress and to recognise that metro mayors are unlikely to be appropriate for every community, the government needs to widen its approach and consider new models. The forthcoming [Devolution and Recovery] White Paper should bring forward a new approach… 

‘The White Paper should make clear that powers may be devolved to any existing unit of local government without the requirement to undergo structural change. Devolution from Whitehall to councils should be by default and at the heart of the White Paper. Such a policy is not a barrier to councils coming together into new combined authorities or other partnerships to pursue shared objectives or address common challenges’.