Deep dive devolution deals end begging bowl culture

Businesses in the West Midlands and Greater Manchester Mayoral Authority areas are today celebrating the award of deeper devolution deals with government that edges Mayors towards fiscal devolution and a single post funding arrangement in the style of a government department.

As expected, a full devolution of powers of skills budgets, and innovation districts and 

In a message that seemed to point to the end of the road for Local Enterprise Partnerships, Chancellor Jeremy Hunt announced trailblazer “deeper devolution deals” for the West Midlands and Greater Manchester along the lines of a departmental settlement, positioning local authorities as the drivers of economic strategy. 

He also signalled a move towards fiscal devolution with a promise of local authorities retaining 100% of business rates.

The innovation clusters in Glasgow, Greater Manchester and West Midlands will get £100 million of investment across 26 R&D projects. The Innovation Accelerators programme is a new approach to supporting these city regions to become major, globally competitive centres for research and innovation and will support levelling up. The projects will attract private investment to develop the technologies of tomorrow, creating new jobs, and boosting regional economic growth. 

Hunt also announced further details on 12 high-growth Investment Zones clustered around research Institutions such as universities and focused on driving growth in one of the UK’s key sectors: Technology, Creative industries, Life Sciences, Advanced Manufacturing and the Green sector.

As well as for tax reliefs, funding can be used to improve skills, provide specialist business support, improve the planning system, or for local infrastructure.

Hunt said: “True levelling up must be about local wealth creation and local decision-making to unblock obstacles to regeneration. 

“From unleashing opportunity through new Investment Zones, to a new approach to accelerating R&D in city regions, we are delivering on our key priority to supercharge growth across the country”.

Andy Burnham said: “This is the seventh devolution deal Greater Manchester has agreed with the government and it is by some way the deepest. This Deal takes devolution in the city-region further and faster than ever before, giving us more ability to improve the lives of people who live and work here.

“I have always been a passionate believer in the power of devolution, and I’ve been in the privileged position of being able to exercise those powers and make a positive difference to people’s lives.

“We’ve worked hard to secure this Deal and have achieved a significant breakthrough by gaining greater control over post-16 technical education, setting us firmly on the path to become the UK’s first technical education city-region; new levers and responsibilities to achieve fully integrated public transport including rail through the Bee Network by 2030; new responsibilities over housing that will allow us to crack down on rogue landlords and control over £150m brownfield funding; and a single block grant that will allow us to go further and faster in growing our economy, reducing inequalities and providing opportunities for all.

“With more power comes the need for great accountability and I welcome the strengthened arrangements announced in the Deal.

“While we didn’t get everything we wanted from the Deal, we will continue to engage with government on those areas in the future. For now, our focus will be on getting ready to take on the new powers and be held to account on the decisions we will be making on behalf of the people of Greater Manchester. Today is a new era for English devolution.”

West Midlands Mayor Andy Street welcomed an end to begging bowl culture. “We’re deepening devolution by building on previous deals and further empowering local leadership with the financial autonomy and decision-making authority that they are best placed to deploy.

“No one in Whitehall can understand the West Midlands better than local leaders, and so there is no doubt in my mind that we should be empowered to shape our future – which is exactly what this new deal will allow us to do.

“I recently called for an end to the ‘begging bowl culture’ which confined us to regularly submitting bids for various pots of money in competition with other regions. I’m pleased to see that this new devolution deal goes some way to addressing that – giving us guaranteed devolved funding to spend how we choose, akin to what Government departments have currently, and doing away with Whitehall micromanagement.”

Jessica Bowles, Director of Strategic Partnerships and Impact at Bruntwood said the recommitment to Investment Zones welcomed the commitment to Investment Zones, noting the role of universities. “We believe this clustering with universities is key, as their strengths can be used to support regeneration and provide tailored responses to local issues ensuring they have the greatest impact and catalyse change. By doing this, people can come together, generate ideas, build on key strengths and create more productive clusters, and ultimately contribute to the wider levelling up agenda,” she said.

Commenting on any changes to devolution she said: “For a number of years now, there has been a need and appetite for a more radical devolution of decision-making power to places. 

“We know that power and accountability for local decisions on investment have a far greater impact for the future of places. The Chancellor’s commitment to increasing fiscal responsibility to the Mayor’s of the West Midlands and Greater Manchester is a big step in establishing the principle of local decision-making and providing these areas with the opportunity to make changes that are most relevant to their needs. This is something we believe will be crucial in stimulating growth in the long-term, and we hope it will be the start of even greater collaboration between local authorities and central government moving forward. 

“At the same time, we believe that the Government should focus on investing in things only the Government can invest in, such as improvements to national infrastructure. So, this transfer of power – and hopefully more in the future – will allow this to happen more often.”

Speaking at MIPIM as part of the Liverpool City Region Delegation, following today’s Spring 2023 Budget, Colin Sinclair, chief executive of Knowledge Quarter Liverpool (KQ Liverpool), welcomed the ‘enhanced’ tax credit announced by the Chancellor today will mean 27% back for every £1 spent by qualifying SMEs – those in high intensive research and development companies such as biotechnology.

At MIPIM, during the launch of Hemisphere on Paddington Village, Sinclair said: “This is welcome news for the City Region and the Knowledge Quarter Liverpool Innovation District (KQ Liverpool). We very much hope that the new investment zones will be pivotal to raising aspirations, accelerating R&D and driving inclusive growth, creating skilled jobs for the people of the City, the Region and beyond. “In KQ Liverpool, and at nearby Daresbury, Liverpool City Region has world-leading clusters in health and life sciences, (including infection prevention and treatment, civic data and mental health), materials chemistry and advanced manufacturing technologies. The funding and powers that investment zones could bring would give the opportunity to better leverage these existing strengths to supercharge economic growth across the City Region.”

Hunt also announced a £1m “Manchester prize” for research into Artificial Intelligence, named after the world’s first programmable computer, Baby, built at the University of Manchester by Alan Turing.