Prime minister Andy Burnham has warned that the centre of government must shrink as part of a new wave of devolution that will give greater powers for housing, transport and skills to regional mayors.
A seven-page policy statement published today sets out plans to “shift power, funding and accountability from Whitehall to local leaders” through a new “framework for governing”. It unpacks a range of measures for increasing the power that rests in local areas, with the intention of boosting economic growth.
The document, credited to the PM and cabinet, states the plans – to be enacted over the remainder of the current parliament – will have “implications for the role and shape of central government, the civil service and arm’s length bodies”.
Rewiring the State says: “Central government must become smaller and more strategic, releasing savings and enabling resources to be transferred to local areas alongside policy responsibilities. Where powers and functions are transferred, we will not duplicate them.”
The document says that Burnham and his new cabinet have also agreed to adopt an operating principle of “devolving by default”. It means that where policies or services are being designed or altered, secretaries of state will need to justify holding them at central government level.
A similar devolution approach will be taken with arm’s-length bodies, where consideration will be given to whether an individual organisation’s responsibilities and funding should be transferred to local leaders or to departments.
The policy paper also pledges to “reduce the number of duplicative policy, communications and strategy teams in arm’s length bodies” that do not report to accountable local leaders or ministers.
According to Rewiring the State, the changes will “mean a smaller and more strategic civil service, focussed on the challenges that can best be dealt with at a national level”.
It says this represents an “opportunity for the civil service to adapt and learn through greater interchange with regional and local government”. The document says the government will build new career paths between central government and the wider public sector to aid joint working.
The document states that both Burnham and cabinet secretary Dame Antonia Romeo have agreed that Rewiring the State will “form a major part” of the end goal for the civil service’s future operating model, which is currently the subject of a review.
Tax and funding changes
The civil service plans form just one part of today’s unpacking of former Greater Manchester mayor Burnham’s devolution programme.
Earlier, Burnham set out proposals for regional mayors and strategic authorities to keep a share of income tax and business rates revenues in a new wave of English devolution.
The tax plans are part of measures designed to give local leaders greater control over housing, transport, skills, employment support and public services – and to move towards a funding system that rewards local growth.
Burnham’s proposals expand on themes set out in his speech at Manchester’s People’s History Museum last month, in which he said it was “time for Whitehall to accept that growth cannot be ordered from the top down”.
No.10 said that regional mayors would be given more control over large local transport schemes “by removing and streamlining Whitehall”. Mayors will also get stronger planning and regeneration powers, and more devolved funding to allow them to build more homes and unlock stalled development sites.
No.10 said that where power is devolved, “Whitehall resource will follow”, giving devolved leaders the resources they need to drive change closer to home.
Today’s announcement does not give a sense of the proportion of tax that mayors will gain control of or the new PM’s expectations for the future size of the civil service. But it does give an indication of the first steps and a timeframe for further details.
No.10 said that mayors will “begin retaining a greater share of locally generated revenues” from spring next year, starting with business rates. It said further details on that and on income tax retention for mayors would be set out in a roadmap at the Budget. A date has yet to be set for the Budget, but it is expected to take place in November.
Rewiring the State says the way regional government is funded will be overhauled, starting by replacing grants from central government with a share of local income tax for every mayor beginning in 2028.
Burnham said his devolution plans are part of the pledge he made to take power out of Westminster and carry it “into every postcode in the country” in his first speech as prime minister.
“Under our plans, more of the taxes raised in a community will stay in that community,” he said. “Soon, every local leader will have the power and resources to improve public transport, build homes and create jobs.
“I know what it’s like to be ignored by politicians in Westminster. I’m not going to make that same mistake now I’m PM. The whole of government will now pull together behind the people and places that desperately need our support. This is how we’ll bring back hope and bring power home to you.”
Burnham’s newly-established No.10 North operation will drive work on the devolution agenda, alongside mayors, other local leaders and partner organisations.