North East Devolution and Levelling Up

New devolution deals on way for North East

The North East appears today to be on the verge of participating in what the government called ‘the largest devolution of power from Whitehall to local leaders across England in modern times’ – if they decide to accept the offer.

The Department for Levelling Up, Housing and Communities announced negotiations for an expanded mayoral combined authority (MCA) deal for the North East and an invitation to Durham to do a county deal.

The expanded North East deal will presumably combine the North of Tyne and North East combined authorities, minus County Durham which will have its own deal.

This would at last resolve the division created along the line of the river in 2016, when the south of Tyne councils of Gateshead, South Tyneside, Sunderland and Durham rejected a government devolution offer and the three councils to the north – Northumberland, North Tyneside and Newcastle – broke away and signed their own deal.

That split divided the Tyneside economy and has been holding back the entire region ever since.

The DLUHC also announced a new MCA today for York and North Yorkshire, while Durham is one of nine areas invited to do county deals, along with Cornwall, Derbyshire & Derby, Devon, Plymouth and Torbay, Hull & East Yorkshire, Leicestershire, Norfolk, Nottinghamshire & Nottingham, and Suffolk.

There will also be negotiations for ‘trailblazer’ devolution deals with the West Midlands and Greater Manchester to extend their existing powers – with these deals acting as blueprints for other MCAs to follow.

‘By 2030’, said the DLUHC, ‘every part of England that wishes to have a “London-style” devolution deal will have one’.

A new devolution framework will set out a clear menu of options for places in England that wish to unlock the benefits of devolution, said the DLUHC, whether that is moving towards a London-style transport system to connect people to opportunity, improving local skills provision, or being able to act more flexibly and innovatively to respond to local need.

The £2.6 billion UK Shared Prosperity Fund will be decentralised to local leaders as far as possible, said the Department, with investments set to regenerate communities, boost people’s skills, and support local businesses.

There is a commitment to ‘vastly simplify the local growth funding landscape to allow local leaders to drive tangible, visible change in their communities’.

The government sees today’s White Paper as the starting gun for a decade-long project to level up Britain, with radical new policies across the board.

It announced 12 ‘national missions’, all quantifiable and to be achieved by 2030. These include:

  • local public transport systems becoming much closer to London standards;
  • the large majority of the country gaining access to 5G broadband; and
  • illiteracy and innumeracy in primary school leavers to be effectively eliminated – focusing the government’s education efforts on the most disadvantaged parts of the country (as reported here yesterday).

Among other measures, domestic public investment in research & development will increase by at least 40% across the North, Midlands, South West, Scotland, Wales, and Northern Ireland.

Missions also include hundreds of thousands more people completing high quality skills training every year (as reported here yesterday), gross disparities in healthy life expectancy narrowed, the number of poor quality rented homes halved, the most run down town centres and communities across the country rejuvenated, and a significant decrease in serious crime in the most blighted areas.

For the first time, all homes in the private rented sector will have to meet a minimum standard – the Decent Homes Standard – and ‘no fault’ evictions will be abolished.

The government will commit to building more genuinely affordable social housing and a new Social Housing Regulation Bill will deliver on the commitments the government made following the Grenfell tragedy in 2017.

There is a commitment to significantly increasing cultural spending outside the capital, with 100% of the Arts Council England funding uplift agreed at the latest Spending Review to be spent outside London.

A £230m investment in grassroots football will be delivered, with funding this year to deliver 850 pitches in England and funding to Scotland, Wales and Northern Ireland.

The Dormant Assets Scheme will provide £44m to support charities, social enterprises, and vulnerable individuals and there will be a consultation on the best causes for a further £880m later this year, which will include a community wealth fund, youth and social investment.

Sixty-eight more local authorities to be supported by the High Streets Task Force to transform their town centres.

The government will give local authorities the power to require landlords of empty shops to fill them if they have been left vacant for too long.

The Safer Streets Fund will provide £50m every year to give Police and Crime Commissioners, local authorities, and certain civil society organisations in England and Wales the resources they need to tackle crime and anti-social behaviour.

To ensure those who transgress repair the damage they cause, £93m will be invested in scaling up the amount of unpaid work that offenders do to around eight million hours per year – 1.75 million hours higher than any time since records began in 2015. Police officers will also gain the power to deal with noise nuisance.

Building on investment from the ten-year Drugs Strategy, the government will work intensively with the local authorities of 10-20 areas most affected by prolific neighbourhood crime.

The government will legislate to give itself the duty to publish an annual report updating the public on the progress of its missions.

Levelling Up Secretary Michael Gove said: ‘[N]ot everyone shares equally in the UK’s success. For decades, too many communities have been overlooked and undervalued. As some areas have flourished, others have been left in a cycle of decline. The UK has been like a jet firing on only one engine.

‘Levelling Up and this White Paper is about ending this historic injustice and calling time on the postcode lottery. This will not be an easy task, and it won’t happen overnight, but our 12 new national levelling up missions will drive real change in towns and cities across the UK, so that where you live will no longer determine how far you can go.’

Prime Minister Boris Johnson said:From day one, the defining mission of this government has been to level up this country, to break the link between geography and destiny so that no matter where you live you have access to the same opportunities.

‘The challenges we face have been embedded over generations and cannot be dug out overnight, but this White Paper is the next crucial step. It is a vision for the future that will see public spending on R&D increased in every part of the country; transport connectivity improving; faster broadband in every community; life expectancies rising; violent crime falling; schools improving; and private sector investment being unleashed.

‘It is the most comprehensive, ambitious plan of its kind that this country has ever seen and it will ensure that the government continues to rise to the challenge and deliver for the people of the UK.’

Stephen Phipson, Chief Executive of Make UK, said:Manufacturers will enthusiastically embrace this strategy which is a vital building block in spreading growth to all parts of the UK. The sector has a significant presence in exactly the areas which need levelling up and is playing a vital role in delivering high value skills. While there is substantially more to be done, this focus on skills and innovation, together with an emphasis on infrastructure and place, is the right starting point and one that industry will back.’

COMMENT

Today’s announcement, so long awaited, does not disappoint in terms of ambition, scope or detail. The big question that will now be contested is whether the resources necessary to deliver are adequate, as no extra funding on top of that already known about following the Autumn Budget and three-year Spending Review has been announced or can be expected before the next general election in 2024.

Labour’s Shadow Levelling Up Secretary was quick to focus on the issue of resources when she criticised the White Paper. She accused the Tories of making hollow promises and said the White Paper ‘has left communities up and down the country completely short-changed once again’.

Writing in ChronicleLive, she said the government needed to deliver on jobs; thriving high streets; transport, digital infrastructure and affordable housing for towns and villages; power; and safety.

According to the all-party Treasury Select Committee, the Chancellor’s fiscal rules for controlling debt are ‘reasonable in the context of the pandemic and its effects’ while the UK’s tax burden is set to rise to ‘levels not seen during peace time’. So in the absence of ‘new money’ beyond what has been known about since the Autumn Spending Review, or unexpectedly healthy economic growth, levelling up will have to be delivered through departmental budgets such as those of the DLUHC and the Department for Education (DfE).

DfE funding, however, is set to rise by only 2.2% a year to 2024-25, compared with an overall departmental spending increase of 3.3%, and DLUHC spending power will be flat or falling after taking account of the extra for social care. Meanwhile, the UK Shared Prosperity Fund will amount to only 60% of the EU regional funding which it will replace from April.

As the Treasury Committee says: ‘Austerity is over, but not undone, for most departments’.

Meanwhile, in the short term, there is still no indication of government funding to avert a North East public transport crisis following the withdrawal of its Covid-specific support at the end of March, with a real and imminent prospect of bus service cuts.  

Separately, the North East Joint Transport Committee has been hoping for £804m for a bus service improvement plan, but without a region-wide devolution deal it will miss out again. Today’ announcement says: ‘The government will fund ambitious plans for bus improvements in areas where this can make the most impact, including the mayoral city-regions, Stoke-on-Trent, Derbyshire and Warrington’.

These funding issues make today’s announcement far from perfect. But the Chancellor’s fiscal rules are, as the Treasury Committee says, reasonable and North East councillors should not allow frustration over funding, or opposition to the idea of a mayor, deter them from correcting the disastrous error they made in 2016 when they rejected the deal on offer then.

That decision has split the Tyneside economy, cost the region hundreds of millions of pounds, particularly for transport, denied the North East a place among the mayors who are becoming increasingly important in English local government and set back regional development by more than five years.

The government’s levelling-up missions are intended to be achieved by 2030. That is a sensible timespan. The North East and other economically lagging parts of the country will not catch up overnight, even if the civic improvements that the government no doubts hopes will be visible by the time of the next general election, due in 2024, do indeed appear.

Now is the time for council leaders in the North East to set aside their parochial differences, accept a directly elected mayor like Andy Burnham in Greater Manchester and Ben Houchen in Tees Valley, do a deal, take advantage of the new powers apparently on the way for places with devolution and set the North East on the road to development and the economic parity with the rest of the UK for which it has been vainly striving for decades.