No.10 North is starting to take shape. Andy Burnham is reported to be appointing the people who will run it, which means the design choices are being made now. The one that matters more than any other is whether the new body controls the public money that is allocated to places. If not, the risk is that No.10 North is a relocated office with a coordinating role and no lever, which is the situation that defeated delivery units before.
Controlling the money does not mean taking it from the Treasury. The Integrated Settlement gives seven mayoral authorities across England a single multi-year pot in place of dozens of competitive grants; the National Audit Office reported this month that it is a real improvement on what came before. But it reaches only about 40% of England, and it sits inside outcome targets that the centre still determines and oversees. No.10 North’s job should be the layer above: to define the strategy those settlements serve, and to agree the conditions for success and the desired outcomes with mayors and combined authorities, rather than setting them from the centre – alongside the Treasury.
Some argue the answer is to go further and take the economic growth function away from the Treasury. Paul Collier, writing in the New Statesman, makes that case: demote the Treasury to a budget ministry and build a separate economics ministry alongside it. He is correct about the problem. The Treasury runs everything on annualised budgets, reclaims money not spent by the end of the financial year, and appraises projects one at a time, so our public sector is unable to plan for the long term. It’s also arguably infantilising and an unnecessary constraint on those closest to the issues and communities that need the focus a No.10 North would bring.
Collier is also right that moving staff out of London, as the Treasury’s Darlington campus did, potentially shifts people without shifting power. Where he is wrong is the remedy. A new economics ministry would still have to allocate money and say ‘no’, so the hard part does not go away. Such an institution would also arguably take years to stand up and it still would not own strategy for place. Two centres of power arguing over the same money is exactly the risk No.10 North should be built to avoid.
The rest of the operating model follows from getting that lever right. No.10 North needs one clear role: to coordinate how central government works with mayors, combined authorities and councils, and to align and cohere departments behind a clear vision for place. It is not a second No.10 for press and crisis, and it should not be an agency delivering services itself. The Cabinet Office has arguably lost focus by taking on too much, and No.10 North should not repeat that error.
Caroline Simpson, the chief executive of Greater Manchester’s combined authority, is reported to be taking charge of No.10 North as Burnham’s deputy chief of staff. On the surface that is a strong choice, because she has run a large devolved authority and a £2bn fund that lends and invests in regeneration and recycles the money as projects repay, which is closer to controlling money for places than anything Whitehall does at the moment. But the role is political and reports to the prime minister. A body led from inside the prime minister’s own office, by an appointee whose post is political even if she herself is not, is closer to a second No.10 than to the standing institution the task needs.
No.10 North should also be the single route in for mayors, who currently have to haggle across several departments for money and powers. The first rule should be capacity before responsibility. Handing powers to a council that lacks the staff, data and systems to use them shifts risk elsewhere without moving the means to manage it. Greater Manchester took most of a decade to build what it has, and the National Audit Office warned this month that expectations on mayoral authorities are already growing faster than their capability and capacity to meet them.
Finally, No.10 North has to be hard to kill. Units at the centre come and go, usually because their powers and remit waxed and waned under successive political leadership. Its remit and its role in funding should be set out in law, so the next prime minister cannot quietly sideline or close it down. A body meant to shape where growth happens over a decade cannot depend on one person staying in office, and a political delivery unit tends to diminish or even vanish with the premiership that created it.
The whole design comes down to money and authority. Giving No.10 North both asks the Treasury to share powers it has always jealously guarded and asks a prime minister to build a strong centre, that can act as a counterbalance. Neither is the tradition of British government. For the people now being asked to build this, that is the problem to solve first, because the early choices on funding, appointments and reporting lines will set the pattern long before the first decisions are made.
Patrick Diamond is professor of public policy at Queen Mary University of London and a former head of policy planning in No.10. Vijay K. Luthra is a public service transformation specialist and former civil servant, local government councillor, school governor and NHS NED