On the level? Is devolution a useful tool in ‘levelling up’

On the level? Is devolution a useful tool in ‘levelling up’

After prime minister Boris Johnson spoke of ‘catch up ketchup’ in his detail-light ‘levelling up’ speech in Coventry, Localis head of research Joe Fyans asks if devolution and local leadership can provide the special sauce required.

To decry the ‘levelling up’ agenda for a lack of policy substance feels somewhat redundant at this point.

In their analyses of the speech, a good many commentators, publications and even (reportedly) Conservative MPs have already expressed their view that the shoe still fits well.

It is certainly true that the prime minister’s address did not provide much in terms of practical detail.

However, those of us with professional, political or ideological obligations to keep a close eye on the state of devolution in England found more than mere rhetorical flourish to observe.

As was reported in PF yesterday, it appears that as and when a ‘levelling up’ white paper materialises, devolution deals will be back on the table.

It is worth bearing in mind that the prime minister was talking in the patch of one of his personal favourite devolution deal recipients at the time, which should alleviate the despair of localists who have long felt that ‘levelling up’ is a uniquely centralising exercise.

Admittedly, Johnson last year described devolution to Scotland as a ‘disaster’ – so he may be somewhat flexible on the issue.

But there is now a clear signal that the white paper will include pathways to devolution deals for areas who want them, and without the mandatory unitarisation which caused the original economic recovery and English devolution white paper to dissolve like so much wet tissue.

In the year since that white paper fell through, concerns have mounted that devolution under this government would be entirely partisan.

Indeed, the speech yesterday barely acknowledged the severe need for ‘levelling up’ in parts of the capital, governed as it is by the government’s nemesis Sadiq Khan.

More encouraging for advocates of getting party politics out of devolution (starting admittedly from a low base) was Boris Johnson’s apparent nod to Andy Burnham, as he bemoaned the plight of local leaders bold enough to go visit foreign property conferences to seek investment, even in the face of a pillorying from the local press.

It would seem then, that after a winding tour around the houses, the devolution agenda has ended up back where it was about a decade ago: “You can have some powers, but you have to negotiate them with us one-by-one and we’ll need you to be making the right noises about our agenda”.

Is devolution even the answer to the question posed by ‘levelling up’?

For the sake of argument let’s make that question “how do we close the regional gap in income?”.

Even that, however, would be seen by some as crediting the agenda with too much specificity ­– or is the whole ‘place’ argument a hiding to nothing?

The key localist argument is one of both efficiency and democracy.

If the idea is to boost regional growth by funding capital projects at a smaller-scale in places across the country, it would be better for that spending to be directed by those with deep knowledge and long-standing experience of an area and its economy, particularly if they are democratically elected and locally accountable.

Paradoxically, the argument against devolution is also one of both efficiency and democracy.

The government has a mandate to deliver a ‘levelling up’ agenda of some form or another and is directly accountable to the public for how it goes about it.

Strong oversight is therefore required over how it is carried out, rather than a bonanza of potentially conflicting and overlapping growth projects popping up all over the country on the ministerial dime.

The devolution deal policy, as pioneered in the coalition years in the model of Greater Manchester, represents something of a compromise between these two arguments.

It has been well established that in a legal and constitutional sense, combined authority deals don’t provide much in the way of devolution at all and can be better understood as essentially funding vehicles, or instruments of policy delivery, where Whitehall lays very clear tracks for the authority to follow.

Despite this, however, and as the various fracas during the pandemic showed, they do provide an office around which a capable mayor can rally the public as well as constituent local authorities and partners.

Through this framework, the shape of ‘levelling up’, such as it is, can be seen as essentially a decentralised policy rather than a devolved responsibility.

Will ‘levelling up’ deliver regional growth, closing the wealth gap?

This is where the wooliness of the agenda once again becomes an obstacle to cogent analysis.

As we argued in our Plan for Local Growth, there is good evidence that long-term policy interventions that raise productivity can be well conducted in precisely the kind of top-down, decentralised manner prescribed by the ‘devo deal’ model.

However, when it comes to issues of liveability, quality of life and indeed as referenced by the prime minister yesterday, life expectancy, far greater and quicker gains could be achieved another way – through funding those hyperlocal community groups, those ‘little platoons’ which form the bedrock of our social infrastructure and, of course, local government itself.

According to Dominic Cummings’ Substack rant in response to the speech: “’Levelling up’ is not ‘so powerful’. It’s a vapid SW1 slogan like ‘Global Britain’ that objectively does not work & shows the opposite of ‘strategy’”.

Being optimistic to the point of derangement, I intend to wait for the publication of the white paper before making a judgement on whether this whole ‘levelling up’ caper has been a colossal waste of time and hot air, or if in fact the tide has finally turned on regional inequality in England.

Yesterday’s speech in Coventry gave us a hint at the form of ‘levelling up’, if not quite the function.

It is up to the prime minister’s ‘levelling up’ adviser Neil O’Brien MP, and the forthcoming white paper’ to fill in the blanks.

Joe Fyans is head of research, Localis

This article first appeared on 16 July 2021 in Public Finance