Why is a devolution framework needed to ‘level up’, and what should it look like?

The UK is one of the most regionally divided countries in the developed world. Over-centralisation, ingrained in a culture that assumes that ‘Whitehall knows best’, is the root cause of this. This means that the opportunity to live a good life is not felt equally across the country, and is becoming unattainable for too many in regions like the North. The pandemic has latched onto these divides and exacerbated them further.

That’s why ‘levelling up’ is an urgent task. After much delay, a white paper, setting out the government proposals and strategies, is now expected in January. This offers a unique opportunity to shift the dial and rebalance our economy, by taking power away from Whitehall and shifting it to our Town Halls. Its aim should be to ensure no place or community is left behind, giving every town and city across the country the power to drive their own prosperous future.

In this blog, we discuss why a clear framework, with devolution at its heart, is essential to get the levelling up recipe right – and what is needed to achieve this.

Why devolution matters

For the government to prove that it is serious about levelling up the country, its first step should be letting go of power – rather than hoarding it in Whitehall.

Despite its limits, devolution in England has brought benefits to the areas that have access to it. In the North, 9.7 million people now have a metro mayor. That’s three in every five northerners. Overall, the six northern mayoral combined authorities govern populations and economies bigger than Scotland and Wales put together, and they plan to invest £4.4 billion in local priorities, such as job creation and building healthier environments, in 2021/22.

This locally rooted leadership is important because it means decisions over investment and services are moulded by local people’s priorities. Local leaders are closer to communities: they have direct insight on, and can be more responsive to, local needs and challenges; and they also understand the potential that makes each place unique. Through this, they can harness the power of place: enhancing not just local economies, but also local pride and identity. Our research has also highlighted how local control generally provides fairer investment decisions, more equal life outcomes across areas like health and education, and could help to restore trust in democracy.

But to reap the rewards of devolution, all places should have access to it. This is the main problem with the current ‘deals’ approach: it is generating winners and losers, thus creating new divides instead of addressing existing ones. To date, most devolution deals have involved metropolitan areas. Some places, away from city regions, that have also experienced industrial decline and urgently need to boost their local economies have been excluded. This applies too to most rural and coastal areas. Crucially, the competitive nature of existing devolution deals pitches areas against one another – making them race for increasingly small and centrally controlled pots of money. This has exposed disparities in terms of institutional capacity across local authorities: not all places have a history of cooperation, or indeed the resources, especially after over a decade of austerity, to enter good bids.

While rhetoric about empowering local places has been high, in practice central government has not yet specified the ‘rules of engagement’. New priorities for devolution and levelling up are announced by press release or through leaks – rather than through a clear agenda – as we have seen recently with suggestions that Whitehall could introduce governors for county deals; or impose unitaries and abolish district councils.

Without a clear roadmap, devolution has been muddled up with top-down local government reform – taking power further away from local places. This does little in the way of addressing our growing regional divides, overcentralisation and the democratic deficit that stems from them. Devolution can and should be about bringing politics closer to the people. While local leaders in the North have grasped this potential, Whitehall is still missing in action.

Why do we need a clear devolution framework? And what should it include?

Devolution by stealth does not benefit all people and places. It helps promote local growth in some areas, but it leaves others behind. As such, it hampers, rather than provide a strong foundation, for levelling up. A clear framework is essential to address this and should be at the heart of the upcoming white paper.

Such a framework must be bold, and should:

• Commit to let go of power: through an irreversible transfer of power and funding, outlining clearly what’s available to all places – in the long term, and not just in view of the next general election.
• Be co-produced: devolution, and with it levelling up, should be done with local places and not to them. To achieve this, central government should work with local leaders to develop and roll out a devolution framework that can make the agenda work for all – rather than imposing strategies from the top down.
• Re-set central-local relations: replacing competition with cooperation and trust – between and across all levels of government – prompting a culture shift in the governance of our country. This would also mean opening up to experimentation and collaboration at the subnational level – fostering a place-based devolution ethos that recognises, and harnesses, the economic, social, institutional diversity of areas across the country.

To make this happen, the framework should be based on two key pillars: flexibility and subsidiarity.

Why flexibility?

Once there is clarity over principles, power and resources, each local area should be able to access devolution to a degree commensurate with their initial capacity, at their own pace and in an incremental way. There are several reasons why this flexibility is needed:

• Local and subnational governance structures in England are complex. This is often seen as problematic for the devolution agenda. But centrally imposed reforms to streamline local government into larger units curb local democracy, accountability and power. Releasing the potential of all places requires embracing their diversity.
• Devolution should be place-based. ‘Off-the-shelf’ fixes or models – such as the imposition of unitaries and/or mayoral style leadership; or the introduction of quangos to ‘police’ devo deals – restrain, rather than unbridle, the opportunities of localities across the country. Policy experimentation is necessary to ensure local areas can make devolution ‘their own’, releasing people from what is holding them back from the life they want and helping to set them up for success.
• City-region functional economic geographies, so far privileged by central government as the ‘best scale’ for devo deals, work for some areas, but not everywhere. To be effective, devolution should map onto our diverse local economies, identities and sense of belonging. Local places should be able to make devolution work around the geography that makes sense for them – not just for Whitehall.
• Finally, not all places and levels of government have the same degree of institutional capacity and legacy, or experience of cross-institutional cooperation – collaboration is a skill that needs to be developed and nurtured based on local specificities, and not simply ‘assumed’.

Why subsidiarity?

Subsidiarity means powers to make decisions on key political, economic and social issues should sit closest to the people that will be affected by them. Only those decisions which cannot be taken locally or are more effective delivered at higher levels shouldn’t be devolved. But so far, devolution has been hindered by the lack of a true commitment to this principle.

Beyond rhetoric and warm words, seven years after the inception of a devolution programme for England too much power is still held in Westminster. As a result, subsidiarity is often called upon within the debate on levelling up, but it is poorly understood and is not pursued in its truest sense. This needs to change radically if we are to address our widening regional inequalities and unleash the full potential of devolution.

Subsidiarity is also a democratic principle—and one which looks increasingly relevant to address UK’s democratic problems heading into 2022. Polarisation, apathy, and distrust are too prevalent in our democracy. In our society, many do not feel they have control over the things that impact their lives and the places where they live. From work and wages to high streets and public transport, many have lost trust and confidence in our political system to materially improve their lives.

Bringing power closer to local communities could help address this. It could lift people’s hopes and ambitions for what better lives look like by giving them a real say over their destinies, and the power to remould services and funding to focus on local goals. At the same time, it would furnish them with the tools needed to deliver real change.

A framework that is bold, flexible and commits to full subsidiarity would allow to broaden and deepen of devolution – giving local leaders and communities the levers necessary to turn the levelling up rhetoric into reality.

Arianna Giovannini is Interim Director of IPPR North, she tweets @AriannaGi. Marcus Johns is a Research Fellow at IPPR North, he tweets @MarcusIPPR.