Annual Policy Review 2015


Localism

Localism


1AchievedAchieved

  • Promises of a more substantial devolution settlement in 2015
  • Creation of Greater Manchester Combined Authority with a budget of £1 billion


1More-to-doMore to do

  • Significant steps to encourage housebuilding
  • Finding a sustainable devolutions settlement
  • Balanced economic growth across the
    country


1UnexpectedThe unexpected

  • The huge impact of Scottish devolution on the localism debate


LegacyLegacy

  • Hugely increased power outside Westminster
  • Increased strength of Scottish national identity as a political force

 


 

 

Localism in firmly back on the agenda. This year saw all the main parties commit to a greater form of regional and local devolution following a promise of greater powers for Scotland and an unbalanced economic recovery.

The 2010 Coalition Programme for Government proclaimed a radical vision for localism. It promised reforms which would “end the era of top-down government” by devolving a range of powers to local councils, neighbourhoods, communities and individuals. However, while this has had some degree of success, we have not seen the radical devolution promised. Whitehall has held on to a lot of spending powers, while directly elected mayors and Police and Crime Commissioners have had a lukewarm response at best.

This year, we have seen the debate shift. The Scottish referendum debate unleashed an unexpectedly powerful wave of Scottish nationalism. In addition, the Opposition have increased the volume on their concerns about a geographically unbalanced economy. The combination of these two factors has placed localism firmly back on the agenda.

Starting with the latter, these concerns are understandable. Unemployment in the North East has risen to 9.9% and remains high in the North West at 6%,with economic performance lagging well-behind the South- East and London. This is hardly a new problem – between 1992 and 2007 London’s economic growth was double that of the North – but as the City regroups and the economy pulls out of recovery mode, the gap is widening once again.

George Osborne’s solution is to transform the North of England into an economic ‘powerhouse’ with investment of up to £15 billion. In particular, he backed a report by local authorities in Manchester, Liverpool, Leeds, Sheffield and Newcastle, which proposes a series of transport improvements to complement the new High Speed railway line linking the cities.

Meanwhile, Nick Clegg has launched the northern Futures project, calling for the views of members of the public, civic leaders and businesses on how to create a ‘Northern hub’. The Deputy Prime Minister has hinted at a more substantial devolution, implying that for him Coalition reforms have not gone far enough. He has particularly noted that powers enjoyed by the Department for Work and Pensions need to be “radically devolved”.

Finally, the particular economic, infrastructure and housing needs of London have seen unlikely bedfellows such as Boris Johnson and Diane Abbott call for greater autonomy for boroughs.

The hastily promised ‘devo-max’ settlement, pledged by the frantic party leaders to sway indecisive voters in the referendum, has added urgency to the debate. The Prime Minister promised legislation on the issue by Burns Night, an eye-wateringly tight timeline considering the weight of the constitutional questions involved.

The first stage of this, the Smith Commission, has recommended devolving tax powers, VAT receipts and certain areas of welfare to Scotland. However, the attention on localism elsewhere means this immediately led to calls from local government for a comparable package of measures to be rolled out at the same time for the regions.

For Labour, the answer to the so-called ‘English question’ is greater devolution. Ed Miliband has pledged to pass an English Devolution Act, giving local authorities the power to manage funding for transport, housing and further education as well as a more substantial role in commissioning health and social care – a substantial transfer of powers from what currently exists.

As leader of Manchester City Council Sir Richard Leese puts it, “the genie is now out of the bottle”. Whether it is Ed Miliband’s English Devolution Act or George Osborne’s Northern Powerhouse, leaders have an increasing understanding of the importance of localism to voters. The question which no one knows the answer to is how much the United Kingdom in 2020 will resemble that of 2015.