Can more devolution revive fortunes of north-east England?

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Northern leaders and businesses are hoping that the Autumn Statement on Wednesday will mark a long-awaited step forward for English devolution.

Plans for two new mayoralties have been drawn up for either side of the Humber estuary in Yorkshire and North Lincolnshire, according to people familiar with the plans, as well as a more limited devolution deal for Lancashire.

Proponents of devolution argue that stronger local decision-making will help to rebalance England’s London-centric economy and raise productivity across the country. Since 2014, nine mayoral devolution deals have been agreed for areas outside the capital. 

Business leaders in places without devolution have been increasingly keen to see their own deals agreed due to fears that they were losing out to the lobbying power of mayors in other parts of the north.

“Places with a deal and a mayor are getting benefits from devolution,” said Akash Paun, programme director for devolution at the Institute for Government think-tank, referring to areas such as Teesside and Greater Manchester. As a result, other areas may perceive a “risk of getting left behind”.

In the Humber, local authorities on either side of the river have historically struggled to decide on a devolution model. Local business leaders said they were concerned the lack of agreement would stunt the area’s green industry cluster at the expense of rivals such as the Tees Valley.

In recent years, the area’s Conservative mayor, Lord Ben Houchen, has successfully lobbied the government for green investment, winning funding to regenerate post-industrial sites into a new energy cluster.

Richard Gwilliam, chair of the Humber Energy Board, which comprises businesses either side of the estuary, said the area had been particularly disappointed to lose out on carbon capture storage funding from central government in March.

“When it came down to big funding opportunities earlier in the year, it was noticeable to us that the successful areas — in Teesside and the north west — all benefited from having mayoral authorities and devolution deals,” he said.

The Humber had an international reputation as a leader in decarbonisation, he said, but “disappointingly it hasn’t really resonated as effectively as we’d have wanted it to in Westminster”. Devolution was therefore “critical” to realising the area’s potential, he added.

Local leaders are hopeful that chancellor Jeremy Hunt will unveil two “level three” devolution deals for the region, using a framework created in the government’s 2022 levelling up white paper designed to raise the economic prospects of left-behind areas.

Under the plans, each side of the river would gain a mayoralty, with elected figureheads overseeing pooled funding and some powers over housing regeneration, transport and skills. One mayoralty would cover Hull and East Riding to the north, while the other would operate across the new footprint of Greater Lincolnshire.

Anne Handley, Conservative leader of East Riding council, made devolution a priority after taking over the authority’s leadership in May. Since then, she has collaborated closely with Mike Ross, Liberal Democrat leader of Hull council, on plans for securing greater powers.

Anne Handley
East Riding council leader Anne Handley: ‘It’s about getting the best deal you can for our region’ © Les Stubbs/East Riding of Yorkshire Council.

“At the end of the day, it’s about getting the best deal you can for our region,” she said of working across party lines. “Not getting left behind, not getting the crumbs from the table — actually being at the table.”

Handley added that she was hopeful of a deal in the Autumn Statement, and that a new pan-Humber body was potentially in the pipeline to ensure the two mayors co-ordinated across the wider local economy. 

Jo Barnes, director at Yorkshire Energy Park and a board member of Humber freeport, said that without devolution there was a “danger” the area would fall behind.

“Should we hear something positive on Wednesday, and the devolution deal goes through, I think it will be a major step forward,” she said, pointing to the benefits of strengthened local decision-making and funding. 

“If we get this, it will give us the momentum we need to push on and push forward as an economy — and then we get the trickle-down benefits for the community.”

In Lancashire, north-west England, local politicians have similarly struggled to agree on devolution arrangements across a large economic geography comprising many large towns with strong individual identities.

But the county council and business leaders are expectant of a “level two” deal, a more limited set of powers outlined in the government’s devolution framework. 

Such an arrangement would not include a mayor but would transfer some powers and funding, including for aspects of transport and adult education, to a new combined authority of councils. 

Miranda Barker, chief executive of the East Lancashire chamber of commerce, said local businesses of all sizes were supportive, having found political arguments over devolution “quite frustrating” to date. 

“We know we are going to argue, but why not do what Greater Manchester did — put on a combined front and get the investment,” she said. “And then you can still argue about what you do with it.” 

Source: Financial Times


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