Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
In a little over three weeks, residents across 10 metro regions in England will vote for their local mayor. First elected outside London in 2017, metro mayors have become a rare success story in Britain’s otherwise lacklustre and inconsistent approach to regional growth. Most mayors are now more recognisable than local authority leaders and MPs, according a survey by the Centre for Cities. Those living in mayoralties also support greater decision-making powers for their mayors. Some leaders have already begun overseeing economic improvements too; from developing tram networks and bus systems, to addressing skill shortages.
England needs wider and deeper devolution. Policymaking is most effective when it is in sync with local needs. But for decades, English regions have lacked the autonomy or funding to strengthen their local economies in the country’s highly centralised political structure. Successive governments have also left behind a hotchpotch of institutions. This has contributed to weak productivity growth in second-tier cities — including former industrial powerhouses, such as Liverpool, Manchester and Birmingham — especially compared with those in other advanced nations. England relies heavily on its capital for economic growth but, with greater powers, second cities can become significant propellers for regional growth.
England should build on the successes of metro mayors by extending the model to more areas. Several primary urban areas — including Leicester, Stoke and cities on the south coast — remain without devolution deals, says the Institute for Government. Mayors should also gradually obtain further powers: additional control over transport, skills and planning would vastly help the development of coherent local industrial strategies. Transferring policing powers from individual commissioners also makes sense where boundaries align. Finally, devolved areas need predictable long-term funding, including via greater tax retention and revenue-raising powers. This has the added benefit of giving mayors a stronger stake in the success of their local areas.
It is encouraging that both the Conservative and Labour parties see metro mayors as a core part of their devolution plans. But how the rollout proceeds also matters. While regions such as Greater Manchester under Andy Burnham and the West Midlands under Andy Street are widely considered success cases, Tees Valley mayor Ben Houchen has come under pressure after an independent panel found insufficient guardrails to ensure taxpayers’ value for money on a steelworks redevelopment project. Taking stock of the lessons so far is crucial.
First, devolution needs to be an incremental process. Many local areas have been gutted by years of austerity and not all regions have the institutional capacity to take on additional responsibilities, including fiscal powers, immediately. Staggered devolution can have advantages. For instance, the IfG recommends that the next government could pilot tax revenue sharing models in more capable regions as a first step towards greater fiscal devolution.
Second, a focus on getting more devolution deals over the line must not overlook the importance of first nurturing collaboration and commitment from the local authorities that are part of it. Third, while elections provide a layer of accountability, it is important that accounts and policies are also scrutinised by an audit body.
Central government will still play a vital role in developing the overarching national strategies and infrastructure. It also needs to navigate the difficult trade-offs over how much power and tax revenue to transfer. Metro mayors will not be suitable for all geographies, and there will be good leaders — as well as bad ones. But the experiment is working. Time to double down on it.
