The government is hoping to turbo-charge its growth agenda by ‘the biggest transfer of power out of Westminster to England’s regions this century.’ This ‘devolution revolution’, using mayoral devolution as its blueprint, is laid out in the government’s white paper, which explains how the Mayors’ use of ‘their mandate … to tackle the obstacles to growth that need a regional approach’ should be rolled out to ‘devolution deserts.’
The government is convinced that devolution will help to resolve one of the main sources of tension between central and local government, namely Labour’s undertaking to deliver 1.5m new homes by the end of its term, a key component of its growth agenda. Of immediate local interest is the government’s invitation to eligible two-tier areas (county council / district councils) to apply to become a unitary authority. Warwickshire’s application to be part of this first tranche was unsuccessful this time. Those that are successful will be required to develop a Spatial Development Strategy, demonstrating how it will work within the newly merged strategic authority to unlock growth in the county including how and where these houses will be built.
Taking a page from the Mayoral playbook
The government believes that devolution can overcome ‘political horse trading’ which, in many parts of the country, has acted as a brake on creating ‘a unified transport strategy, getting houses built, or putting in the necessary infrastructure to boost economic growth.’ Although the current mayoral strategic authorities (with Birmingham and Manchester, and Liverpool being the most high-profile) are being held up as examples of how to overcome blocking tactics, they are not immune to local challenges and opposition.
Indeed, the High Court has given permission to a local campaign group, 'Save Greater Manchester's Green Belt' to challenge Mayor Andy Burnham’s 'Places for Everyone' development plan 2024, agreed by nine Greater Manchester authorities. The plan sets out how the boroughs should develop up until 2039, with bold ambitions to improve employment opportunities, build the right homes in the right places, rejuvenate green spaces and reshape town centres. The permitted ground of challenge alleges procedural unfairness in the way that green belt additions were reduced from 49 sites to 19 in the plan. While the plan seeks to build upon the devolution successes achieved in the region thus far, legal challenges such as this highlight that local plans (or parts) created under a mayoral system can ultimately be quashed. We will await the outcome of the substantive hearing.
The challenge for local planning
Although devolution in the form of unitary authorities is supposed to work because ‘they have skin in the game and are accountable to their citizens’, as we pointed out in a recent article in Property Week, many councils are struggling financially - with some already bankrupt - and have already failed to implement local plans that have been around for almost a decade. Expecting underfunded and understaffed planning departments to get to grips with implementing a Spatial Growth Strategy designed to be delivered across different authorities, which may not be politically aligned, is optimistic at best.
In a local example, a joint statement by four out of five district councils in Warwickshire expressed their concerns with becoming a unitary authority, citing the ‘haste’ with which the council is pursuing this course of action. According to a BBC report, Warwickshire has been earmarked by the government to provide 20% more housing per year than it has currently delivered. By September 2024, only Rugby District Council had approved more planning applications (78%) against the national benchmark of 72%; Warwick District had approved 70%; and Stratford-on-Avon District, 66%. Angela Rayner has committed to ‘knocking heads’ together in areas where local authorities cannot agree on mergers – which rather suggests that local decision making may take a back seat if it goes against central government objectives. So, the question remains: how will devolution overcome blocking tactics of local interests, lack of financial resources, and a dysfunctional, underfunded planning system?
Will devolution unblock the housing pipeline?
There are certainly no guarantees. The Institute of Fiscal Studies (IFS) warns that devolution will not solve the problems caused by the current opaque funding allocation system, originally introduced by the last Labour government. Counterintuitively, those areas with the highest need have received the least funding with population growth not being factored into the arithmetic. Attempts to reform funding have been kicked into the long grass, so local authority funding remains arbitrary and short-term. Devolution may be the route to efficiency savings and a more streamlined service delivery, however, according to the IFS, if funding is not properly allocated, councils won’t be able to take on the responsibilities asked of them.
This devolution agenda has both supporters and detractors. The latter believe that devolution will actually result in decisions being made further away from the communities which they affect, while others welcome the move to a more strategic way of working which harks back to the days of regional planning. On the plus side, many applaud the cost savings likely to arise from the pooling of resources and the resulting savings for local authorities which are becoming increasingly financially pressed. Nonetheless, it is unlikely that devolved powers alone will counter the political manoeuvring by local councillors responding to local sensibilities around more housing, and particularly housing allocated in green or grey belt land.
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