Just how good a deal is DevoManc? David Walker expresses scepticism.
Here are two ways of framing DevoManc. The first is (somewhat breathless) localist enthusiasm. A principal city-region is being offered new power to shape spending and services in health and social care, infrastructure and transport. As important as substance is the theatre: a group of Labour authorities in dialogue with a Tory chancellor, looking forward, talking practical schemes. Having engaged with Manchester, Whitehall will have to make concessions to local leadership elsewhere in England.
The second is (suspicious) realism. On the evidence of his coalition performance and the 2015 Tory manifesto, George Osborne wants to fracture and perhaps destroy what remains of the post-1945 welfare state. By killing the Labour Party as an England-wide political formation, end the prospects of social democracy. Financial reality is the £19m cut in Wigan’s revenue grant and the £56m of cuts Salford has to make by 2017. Osborne is devolving the axe and, he hopes, shifting responsibility for reducing eligibility for social care and (in time) lengthening NHS waits to Labour politicians.
Putting it as bluntly as that makes Richard Leese, Jim McMahon and the rest seem dupes. Osborne is setting up Tony Lloyd and his elected successor as the man to pillory as and when it suits partisan purposes: the Daily Mail will aid and abet as needed.
To localism’s advance guard the deal is all about growth and urban modernisation and so it could be, up to a point. But contrast that attractive prospect with the service set of Greater Manchester’s districts, which is focused on the poor, children and the increasingly infirm old. Nothing has altered that will diminish the differentially higher need of GM’s population for assistance or – that dirty word in the Cameron lexicon – for welfare. Where in Osborne’s proffered agreement is there any commitment to recognising existing need in the conurbation in the revenue support arrangements – which the former communities secretary Eric Pickles adjusted to secure a greater flow of grant to the suburbs and the south?
During the election campaign, to demonstrate their commitment to ‘aspiration’, the Tories promised residents of social landlords a discounted right to buy. Councils are to be compelled to sell their own high value property that falls vacant and pass the proceeds to RSLs in order to build. It doesn’t sound like a shiny example of localism, not least because it would necessarily involve detailed central control of disposals and purchases.
So here’s an acid test for DevoManc. The Tories could demonstrate their faith in the city by exempting GM authorities from the edict, allowing them to make their own decisions about housing and asset disposal. Such a move would prove the Cameron government is prepared to enfranchise local decision-making.
It is not going to happen. Nor is the emancipation of GM districts from the souped up policy of transferring schools into the ownership of academy chains or the establishment of free schools. Manchester to get its head over nursery entitlement – no way; central edicts about the use of the private sector in pre-school provision are not going to be lifted for Stockport or Oldham, either.
As for health, NHS England is gearing up to take direct action to shrink the number of provider trusts and, possibly, the number of commissioning groups. In another, not necessarily connected neck of the woods, the intervention powers held by the regulators Monitor and the Care Quality Commission are being strengthened.
What does the Manchester concordat say about CQC inspection of healthcare providers that might notionally fall under the umbrella of GM’s bid to shape health? Are Manchester trusts going to be spared Monitor poring over the minutiae of their spending?
No need for heavy irony. Ultimately there is only one test of whether central government is genuine – revenue. Osborne is not against the Treasury making concessions on tax, at least in Scotland, Wales and Northern Ireland. Increased local income tax, if it happened, would serve useful political purposes, by demonstrating that non-Tory governments impose fiscal burdens.
But inside England the Treasury shows no sign of making room for local revenue raising, apart from public transport, where market pressures apply. Genuine DevoManc ought to involve stabilising then growing the conurbation’s revenue base, and that implies a lot more than some share of expanding business rate income.
According to the OECD, Cameron government plans will see the state as a proportion of GDP fall to US levels, around 36% by 2020. The local state pro rata. That means Greater Manchester’s revenue budgets and hence the affordability of its investment programme must shrink. Osborne’s localism is a one-way street.
