Merseyside follows Manchester, sort of

By Daniel Kenealy

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In October a UK government minister remarked that Merseyside was ‘not ready’ for a city-region devolution deal of the type that was announced for Greater Manchester in November 2014. Last week the six local authorities that came together to form the Liverpool City Region Combined Authority in 2014 – Liverpool, Wirral, Knowsley, Halton, Sefton, St. Helens – managed to reach agreement on a bid for a devolution deal.

Just getting agreement across the six local authorities is a political achievement. As we know, George Osborne’s quid pro quo is that, in exchange for a range of new powers, city-regions have to agree to move to a directly elected ‘Metro Mayor’. Greater Manchester agreed to that, and people there will elect their first Mayor in May 2017 (the Police and Crime Commissioner Tony Lloyd is currently serving in an interim capacity). This was one of the major stumbling blocks for Merseyside, with some of the local authorities particularly unkeen on the Metro Mayor model.

Ultimately, however, Greater Manchester have found a ‘fudge’ for this. Whilst the region will have a Metro Mayor it remains unclear just how dominant the office holder will be vis-a-vis the leaders of the local authorities that comprise Greater Manchester. Conducting research on ‘Devo Manc’ over the course of this year has revealed a range of possibilities. For some of the local authority leaders the new Mayor will be little more than a glorified Chair of the city-region’s Combined Authority. For campaign groups who question ‘Devo Manc’ on democratic grounds, they fear a strong executive Mayor, insulated from day-to-day scrutiny, and with a strong bureaucratic base encompassing a range of existing institutions including the Police and Crime Commissioner, Transport for Greater Manchester, and so forth.

The Liverpool Combined Authority is currently chaired by the leader of Wirral Council. There are concerns, amonst the local authorities on the periphery of the city-region that a Metro Mayor might lead to dominance of the region by the interests of Liverpool. A similar core/periphery concern is present up the M62 motorway in Greater Manchester. But decision-making structures can be designed to curb the powers of the Metro Mayor. Indeed the local authority leaders will form some sort of ‘executive cabinet’, working with the Mayor and in some cases having the power to block mayoral decisions.

In Merseyside it was St. Helens council that was most reluctant but, last week, the Labour group agreed to a revised bid by the city-region. The original bid, submitted to the Treasury in early September was unfocused and read more like a list of things that might be done, as opposed to a focus set of asks with a clear rationale for how those asks could boost growth and improve public service delivery across Merseyside. A more focused deal has now been signed with Greg Clark, the Secretary of State for Communities and Local Government, and Jim O’Neill, recently ennobled and now Commercial Secretary to the Treasury with specific responsibility for these city-region deals.

What is Merseyside going to get? A similar package of powers to that announced elsewhere, and less than that given to Greater Manchester. For example, on Merseyside it seems that the Police and Crime Commissioner role will remain, whereas in Mancs it will be folded into the Mayor’s responsibilities. Similarly, Greater Manchester is alone in seeing the devolution of the entire health and social care spend for the region (worth some £6 billion). The leader of the Green party group on Liverpool City Council has already said that the Merseyside deal is second class compared to Manchester’s. But, as we have seen with ‘Devo Manc’, these deals can evolve quickly. The ‘Devo Manc’ deal of November 2014 has already been supplemented twice, in February and July 2015.

Merseyside will receive new powers over local transport budgets, franchised bus services, increased responsibility over employment support and skills provision, and control over investment worth £30 million per year for the next three decades (a total fund of £900 million) designed to boost growth around the River Mersey and its port, and to capitalise on the delivery of HS2. There are also commitments in the deal to support the International Business Festival and the museums and galleries across the region.

The broader picture here is one of a quiet revolution in the way that England will be governed. Broadly speaking the Chancellor has asked local authorities to work together, across larger spatial areas, and accept a Metro Mayor to deliver clear, executive leadership. In exchange these cities and city-regions will receive a package of powers that are, broadly, similar and cover transport, adult skills, housing, spatial planning, and investment funds over a 30-year period.

Greater Manchester went first, given a long tradition of cooperating across the conurbation that dates back to the abolition of the Metropolitan County Councils by Mrs Thatcher in 1987. Since then the Sheffield City Region, the North East and Tees Valley, and the West Midlands have followed. Merseyside now joins them. Many other groups of local authorities have submitted bids to the Treasury, and we may find out more about additional deals at the Spending Review this coming Wednesday.

This is a far cry from the municipal socialism that often animated the politics of such cities in the 1980s. In its place is the idea of entrepreneurial cities, making their due contribution to the Gross Value Added of the UK as a whole. But, as more and more local authorities come together to bid for these powers, the more it begins to look like a restructuring of the way that England is governed. Coupled with the Chancellor’s commitment to move, by the end of the current parliament, away from the system of funding local government by grant towards the full retention of local business rates (with some redistribution to equalise funds), we are witnessing a quite revolution.

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Daniel Kenealy is a Lecturer in Public Policy at the University of Edinburgh and has been researching ‘Devo Manc’ and the other city-region devolution deals since December 2014.

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