Devolution: Impact on Economic Growth

Devolution to strong local leaders who understand the economic opportunities and challenges in their patch has clear economic benefits: it can drive higher productivity, boost local economies and put more money in people’s pockets. For example, Greater Manchester, which is further along in its devolution journey, has one of the UK’s fastest growing local economies.

I am pleased to see that the Government are pressing ahead with their commitment to implement new strategic authorities. May I press the Minister to consider how those new strategic authorities can grow their local economies by providing support for things like community businesses and social enterprises in town centres, helping to regenerate and renovate the neglected high streets we see across the country?

My hon. Friend is completely right to highlight that. There is a huge opportunity for strategic authorities to support community businesses, co-operatives and social enterprises to help regenerate and revitalise our town centres and build community wealth. We are already seeing that across the country: we see it in Liverpool city region, where significant investment is going into community businesses. We are keen to build on this opportunity and to unlock it across the country.

Devolution is starting off well in North Yorkshire, but North Yorkshire council is really concerned about the upcoming local government settlement, which will obviously be challenging for all councils. May I urge the Secretary of State in his new role to look carefully at the most rural county in England and the particular challenges that it has in delivering services?

We are looking closely at every area. We know that local government is going through the process of reorganisation at the same time as we are doing devolution. We are doing that at pace, but we are doing it in strong collaboration, working closely with individual areas.

We welcome devolution in London, but the ability of local councils like mine in Wandsworth to tackle growth could be undermined by the changes proposed in the fair funding review. In Wandsworth, 26% of residents and 33% of children live in poverty after housing costs. Will the Minister consider making adjustments to the proposed funding formula to properly account for housing and children’s services and ensure that no council is worse off as a result of the review?

We have consulted on the fair funding review. My colleague the Minister for Local Government and Homelessness is looking at proposals at the moment, and we will report back in due course.

Devolution can have huge benefits for local people. Using £20 million of funding from the last Government, Stockton-on-Tees borough council has brought forward proposals to change Yarm High Street, but the council has completely failed to properly consult and work with local residents and businesses in developing the proposals, so what could be an opportunity has become a nightmare. Does the Minister agree that such changes should be done with local residents and businesses, and not forced upon them?

One hundred per cent. Devolution offers the opportunity to put communities in the driving seat and give them genuine power. For example, this Government’s Pride in Place programme puts communities right at the centre, because we think that is how to ensure that communities come together to drive the change that they want to see in their area. We encourage all councils to work closely with their local communities to make that change happen.