The University of Manchester and Centre for Local Economic Strategies (CLES) play host to the Making Devolution Work conference next week. To mark the event CLES’s Chief Executive Neil McInroy writes the first of a series of blogs around the conference, examining what devolution could mean for the region and country.
The UK is massively centralised. The recent devolution momentum follows a century long history of effort which has tried to deal with regional imbalances and an emasculated local government. Can this devolution dislodge a settled economic geography which is unbalanced and increasingly divergent? If so we need to grab it.
I recently spoke at a public meeting in Central Manchester, which focussed on Devolution to Greater Manchester- the so called ‘Devo Manc’. In this meeting, some were calling for outright rejection, seeing the proposals as anti-democratic. As someone said ‘it’s a poisoned chalice, a Treasury carve up, passing the buck on austerity’. A few days later I spoke at a conference in the north of England. One of the speakers spoke exuberantly about devolution. They saw this as a potential ‘revolution’ in how our local places are governed, a massive boost for economic and social growth in the north.
After years of pain and false dawns, I understand both positions. On the one hand (as in Scotland), many are frustrated by Whitehall, Parliament, and ‘the establishment’. There is a desire to get a devolution which offers an antidote to austerity, poverty and inequality. They want a democracy which is open, involves citizens, civil society and is more relevant to the issues of the day. The legitimacy of any devolution will falter if these aspirations are not accommodated. On the other hand, after 100 years of talk and very little movement, I also understand the need to take advantage of any opportunity, acting quickly. However, this devolution is imperfect, We must recognise the challenges.
I think we need to grab this opportunity, but grapple with making it better. We must be alert to this being yet another false dawn. Whitehall has form. Past efforts have just kept local government in its servile place and at best has just slowed the pace of a growing economic gap. Whitehall is a master at smothering promise under the yoke of deals, process and micro-managerialism. The possibility of a financial meltdown in local government remains and there are no plans to increase the level of local fiscal autonomy via real tax raising powers.
Most significant is how local economic plans, which underpin devolution, remain shoehorned into an economic model which complies with the Treasury version of the English economic state and the role of local economies in it. Driving the devolution in English cities are a set of free market ideas, centred around a ‘new spatial economics’.
This theory has abandoned a sense that we must actively deal with social inequality through strong regional policy and redistribution. Opposed to a redistributive place based approach, it focusses on forms of economic growth which accrue through the density of human activity. These ‘agglomeration’ ideas, place a singular focus on the human networks of policymakers, companies, consumers as the essential elements to the innovative stimulation of economic growth. That is why there has been so much focus on devolution to the larger cities and already successful areas where the potential for even greater economic growth can be readily realised.
There is too little consideration as to the quality and how ‘good’ that growth will be, and how opportunity and wealth is to be distributed. Poorer people and places are seen as benefiting either through trickle down in wealth through jobs or a ‘trickle outwards’ of wealth toward any outlying (and poorer) areas of cities and neighbouring towns. For agglomeration the focus is not on deep rooted spatial inequalities. Quite the reverse, they see place ‘losers’ as the inevitable price to pay for the higher order importance of winning on opportunities, economic growth and global competitiveness.
This downgrading of the social outcomes and geographic fairness to devolution, is out of kilter with the economic and social values of many. The agglomeration approach is too often sold as an indisputable truth, as opposed to a political choice. Its successes seen as a panacea, as opposed to a particularity. Its failings seen as a problem of restrictive planning and interference in the market. Efforts which lessen the rough edges of this approach may not be voracious enough.
As an antidote, it’s is evident that we need a progressive devolution which grapples with what we have and seeks to transform what is on offer.
We must get a devolution which actively coordinates regional imbalances, and not just leave them to the market.
We need a new constitutional conversation and settlement, rather than an asymmetric pattern of winners and losers
We need fiscal devolution to local government but framed by national redistribution.
We need a decentralisation of public administration and employment. We need a programme of Whitehall decentralisation,
We need a decentralisation of the financial system.
We need local economic and social models which delivers a socially virtuous ‘double dividend’.
Some of the above is either not on offer, or limply so. But we should see devolution as a interative process, not a fixed deal. We need to grab and grapple with this opportunity. Maybe the devolution ‘genie is out of the bottle’. Maybe it can be transformed. We should maybe see this as just a start of a progressive moment, which will eventually work for all.