Sir Paul Christopher Jenkins is exactly the sort of man you would want to help navigate the labyrinthine complexity of English devolution. As the UK government’s principal legal official adviser from 2006 to 2014, he has managed many thorny transformations within Whitehall. And in chairing Browne Jacobson’s recent roundtable discussion on austerity and devolution, he simplified a subject characterised by confusion.
One year ago, he noted, there was a considerable amount of scepticism about whether devolution was going to occur at all in England. Today, there is only acceptance. The question now is how it will unfold.
That, in effect, is the billion dollar question. Or the £6bn question in the case of Manchester – the heart of George Osborne’s so-called northern powerhouse – which became the first combined authority to go full “devo” in 2014. Since then, the multi-authority has taken control of regional spending on skills, transport, housing, economic development, and a £6bn social care and health budget.
While other local authority devolution measures will follow suit – albeit likely on a smaller scale – Manchester is leading the way in England, and is a clear potential test bed for success. (Wales and Scotland may also provide some learnings – but as their devolution was driven by separate legislation, it’s harder to draw comparison.)
A lack of clarity from central government
For Browne Jacobson, the public sector lawyers who convened the roundtable discussion, English devolution is now in a period of transition – and this applies as much to local authorities, as it does to government departments.
“If devolution is to happen at scale, it is essential that there’s sufficient buy-in across Whitehall,” says Richard Barlow, head of public sector at Browne Jacobson. “Right now, there are still doubts about the manner in which agreements are being reached – and the differing agendas of parts of central government.”
Browne Jacobson’s latest report notes that there will inevitably be tensions between local and national priorities. Devolution will affect central government departments in many different ways: not only their future sizes but also roles required.
“Greater transparency and clarity of what is ‘on and off the table’ [from central government] would help deliver deals, and allow frameworks for governance, scrutiny and operations to develop,” conclude its authors.
Another significant reason for the current lack of clarity around devolution is that there simply is no standard model for devolution – meaning it is highly likely to unfold in a non-uniform way.
The Cities and Local Government Devolution Act 2016 provides a starting point, but it leaves many questions unanswered on major issues, such as accountability of local authorities, finance and funding, and how public sector bodies can share services effectively. The government’s resistance to any substantial fiscal devolution – seemingly a red line for the Treasury – creates another potential fault-line in the structure.
“The Act is a first paving stone towards creating the capacity required to devolve further,” says Barlow, “[but] you couldn’t regard it as comprehensive.”
The problem with combined authorities
Nowhere are the grey areas more apparent than on the question of combined authorities. The 2016 Act appears to have been written on the provision that local authorities would enter into devolution arrangements as single tier authorities. In reality, devo deals are on offer to dual tier counties in addition to unitary authorities.
In the race not to “miss out” on devolution opportunities, many local authorities have scrambled to create larger multi-authority procurement and delivery vehicles. At a time when local authorities are facing a period of unprecedented austerity, these could deliver vital cost efficiencies.
And yet for every Greater Manchester – which brought together 10 local authorities under a single city-region – there are less successful stories emerging. For example, a number of local authorities in the North Midlands – facing pressure to agree devolution deals in time for the last budget – dropped out at the last moment.
To date, says Barlow at Browne Jacobson, the main driver for successful multi-authority agreements appears to be regional identity, such as with Manchester, Sheffield and Cornwall. Where this “geographical togetherness” is less compelling, it seems to be harder for local authorities to make the case for devolution.
“The reality is that each local authority has to decide how they take forward their own arrangements locally,” he explains. “It comes down to the strength of their local enterprise partnerships and the political connections they can broker across regions and areas.”
Conflicts of interest
And yet, even where local authorities can successfully overcome these hurdles to create combined authorities, this immediately presents a potential challenge.
If members wear two hats – representing their local authority and wider region – they will sometimes need to make decisions that cannot be in both parties’ interests.
This conflict of interest points to a wider, additional risk around the joining up of local authorities – that, far from simplifying the English local government landscape, they could in fact create an additional layer of bureaucracy: the exact opposite of what devolution is designed to achieve.
The goal of Browne Jacobson’s roundtable was to bring together people from central and local government, and a range of related stakeholders, to discuss and unpick these challenging issues. And even if there are many obstacles ahead, Barlow sounds a cautious note of optimism.
“We are quietly positive about devolution,” he says. “It will need very careful crafting but if local authorities have a range of powers and responsibilities in place, they will be in a position to find innovative and cost-saving solutions.”
You can download the full Browne Jacobson round table report on English devolution here.
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