The following Statement was made in the House of Commons on Monday 16 December.
“With permission, I would like to make a Statement on the publication of the Government’s English devolution White Paper.
This Government were elected on the promise of change, and we are determined to transform our economy and our country through a decade of reform and national renewal that reverses the chaos and decline that we inherited. We will rebuild Britain from the ground up, so that it works for working people, through a mission-led plan for change that unlocks growth and raises living standards in every region. We will deliver new homes, jobs and opportunities for all by matching investment with reform to improve local services, and to maximise the impact of every penny we spend.
The British people deserve an economy that works for the whole country, and to have control over the things that matter to them. That is why we are moving power out of Westminster and putting it back into the hands of those who know their area best. The White Paper that we have published today sets out the means through which we want to achieve that, backed up by our landmark English devolution Bill, which will finally redress the imbalance of power between this place and communities up and down the country.
This change cannot be delivered soon enough, because for all the promises of levelling up, after 14 years, our nations remain economically divided, with living standards in many parts of the country stagnating. We have an economy that hoards potential and a politics that hoards power. As a former councillor and council leader, I have seen the immediate and tangible difference that local leadership can make. However, I also recognise the frustration that local leaders face in delivering the change that their areas need. In fact, it mirrors the frustration that local people feel when they cannot effect change in their neighbourhood or on their high street. That hits at the heart of what it means to live a decent life. Pride of place and security are rights too often denied in the places that need them the most. This Government are determined to end the top-down approach to decision-making in this country, and to replace it with a principle of partnership.
The last Labour Government began the process of change by creating the London Mayor, the Scottish Parliament, the Welsh Senedd and the Northern Ireland Assembly. I saw the transformational impact of empowered local leadership in Greater Manchester when in 2014, a decade ago, I was one of the local council leaders who worked in co-operation to agree the first English devolution agreement outside London—an agreement that created the combined authority, which has delivered genuine change under the leadership of an elected mayor, working hand in glove with local leaders.
Crucially, none of the now 12-strong mayors would claim that they act alone. Whether they are attracting investment in clean carbon and renewable energy, growing digital and creative industries, bringing buses back under public control, or tackling violence against women and girls, all would point to solid local partnerships and the importance of local government in delivering change, but the truth in England is that the process of devolution remains unfinished. Today, we are introducing to the House the measures to finally get the job done.
At its core, this White Paper sets out how the Government will strengthen and widen the mayoral model of devolution across England, shifting power, decision-making and money away from Westminster in a completely new way of governing and driving growth. We are empowering more mayors by introducing integrated funding settlements, and by giving them a statutory role in the rail network, and greater control over strategic planning, housing funding and skills training, so that they can deliver change that local people can see and benefit from. Ultimately, our goal is mayoral devolution that means that powers can be used to shape local labour markets, integrated transport systems, clusters of businesses, and housing development. That is the sort of strategic decision-making that is not possible over a smaller geographic area. By creating strategic authorities—a new tier of local government—we will give our cities and regions a bigger voice in getting the resources and support that they need.
The Government will shortly set out their devolution priority programme for areas that stand ready to progress devolution on an accelerated timescale, and a plan for inaugural mayoral elections to take place in May 2026. Each of those areas will have an elected mayor sitting on the Council of the Nations and Regions. We will work with those areas that are already in discussions with the Government to confirm their position. To those areas that are ready to move at pace, we say: come forward now. Be part of this movement. Be part of this moment.
We understand that devolution is a journey, and that some areas will need time to decide what course to follow. We want to walk alongside all areas—areas defined locally, not from those at the centre with a map—as they take the first step to realising the potential of devolution, for instance through a foundation agreement to unlock new powers. Our ambition is clear; we will legislate for a new power of ministerial directive that allows the Government to create strategic authorities where absolutely necessary, if local agreement has not been possible, to achieve full coverage of devolution across England. We will deliver a new constitutional settlement for England that makes devolution the default setting, with an ambitious devolution framework secured in law, guaranteeing powers for each level of devolution. All that will be underpinned by improvements to accountability, including an outcomes framework for integrated settlements, so that the system remains fit for purpose as we devolve more powers and funding.
None of this reform can be achieved without strong local government. Councils are the bedrock of our state. They are critical to driving growth and delivering local public services that people can rely on, but they have been neglected for too long. That is why we are establishing a proper partnership with local leaders through multiyear funding settlements, and moving away from farcical bidding wars for limited ring-fenced funding pots. We will give councils the respect and powers that they deserve and need to deliver the missions and the plan for change, so that change is keenly felt in every community. We said that we would reset the relationship between central and local government, and we meant it. We will give councils the certainty and stability that they need to plan ahead and prioritise their budgets, and to tackle local issues through public sector reform and prevention, rather than through more expensive crisis management, for which taxpayers are paying more and more, often for worsening outcomes. We have to tackle that head-on.
It is important that councils be the right size and shape to serve the people they represent, with simpler structures that people can better understand. Through our bold programme of unitarisation, as announced by my right honourable friend the Chancellor of the Exchequer in the Budget, we will ensure that local government reorganisation and devolution can be delivered in tandem as soon as possible. We look forward to areas coming forward with their own proposals. This Statement gives the clear direction that local governments have been asked for, and my door is always open for discussions with colleagues about how that will look and feel in their area. Although I recognise that this will be a challenging process for some, for many there is growing agreement that the time has come for change.
I am under no illusion about the scale of the task that we face in delivering more power into the hands of local leaders, but we are committed to resetting the relationship with local and regional government, and to working with local leaders to deliver the change that the country voted for; that is what the electorate will judge this Government on. Placed alongside the work that we are progressing on fixing the broken audit system, rebuilding the standards regime, and bringing forward plans for community power, this plan shows that the Government are determined to get our house in order and ensure a top-to-bottom redistribution of power in England, as we reset our economy, restore local government, and rebuild our country from the ground up, so that it works, finally, for working people. That is what it means to take back control, and that is what we will deliver. I commend this Statement to the House”.
My Lords, this White Paper will take away powers from local communities and risks making local government less responsive to the needs of local taxpayers. As my honourable friend in the other place rightly said:
“This is not bottom-up local leadership, but top-down templates for local government”.—[Official Report, Commons, 16/12/24; col. 38.]
In government, we supported joint working between local councils, which included some unitary restructuring as well as district mergers, but Conservative Ministers were clear that any unitary restructuring had to be locally led and have local support. It was not a condition of devolution deals.
If I may, I would like to raise some of the most pressing concerns of my noble friends on these Benches. Unitary restructuring does not necessarily result in better value for money for local residents, and alignment of council taxes across different councils has generally been upwards. Creating an additional mayoral tier above local authorities also risks wasting any savings achieved through unitarisation.
This has been proven in Labour-run mayoral regions, where we have seen eye-watering mayoral precepts imposed on residents. Ken Livingstone and Sadiq Khan massively hiked their council tax precepts in London, now topping £471 per band D household in London under Sadiq Khan. Only Conservative mayors such as Boris Johnson have cut council tax precepts; Andy Street and Ben Houchen—now my noble friend Lord Houchen—charged nothing at all. Can the Minister give the House an assurance that the Government’s plans to change the structure of local government will deliver better services without imposing significantly higher council tax on local residents?
We expect Labour to invite proposals from councils for local government restructuring. The first wave of this restructuring would then result in county council elections in May 2025 in those chosen areas being cancelled. Does the Minister agree that no council should be bullied or blackmailed into local government restructuring?
“We will deliver a new constitutional settlement for England”.
That is a very ambitious claim. What we have in the White Paper is a great disappointment by comparison. There is a deep confusion between what is “local” and what is “regional”, which are used interchangeably and loosely throughout the White Paper. We are promised “regional Mayors” who will, we are told, also be “vital local leaders”. They will take part in the Council of the Nations and Regions alongside Scottish, Welsh and Northern Ireland Ministers; they will also sit on a separate Mayoral Council with the Deputy Prime Minister. There is no link with Parliament here, I note, nor any link to Gordon Brown’s proposal to reform the Lords as a second Chamber to give us a role in representing the nations and regions in UK-wide debates. This looks to the Liberal Democrats like a plan designed in the Treasury both to save money, by shrinking local democratic institutions, and to convert elected mayors into agents of central government, spending funds that they hope to obtain by negotiations with the Treasury—the integrated settlements—without taking into account the importance of embedding democratic government in local and regional networks.
Chapter 4.1 of the White Paper begins:
“England is made up of thousands of communities—towns, cities and villages”.
It then proposes to squeeze those thousands of local communities into somewhere between 30 and 40 combined authorities, with fewer than 100 unitary authorities beneath them, each containing between 500,000 and 1 million people. That is not a unitary system; it is a new two-tier system in which strategic decisions will be taken by the upper mayoral tier—in effect, by one elected person. Local democracy rests on the relationship between voters in their communities and the councillors who represent them. It is the bedrock of democratic politics and of political parties, which draw their campaigners, their members and, often, their recruits into national politics from these local activities. But here is a proposal to cut further the number of elections and elected councillors and to remove them to a much greater distance from those they try to represent, with 15,000 voters or more in each ward.
My Lords, I thank all noble Lords who attended the drop-in session on the White Paper yesterday.
The English devolution White Paper sets out what I will not apologise for being an ambitious new framework for English devolution, moving power out of Westminster and back to those who know their areas best as part of our plan for change. We want to see all of England access this devolved power by forming strategic authorities that can make the key decisions to drive economic growth, with a clear preference for mayors. We will do this with areas and will launch a devolution priority programme for those that want to be on the fast track to mayoral devolution. We will legislate for a ministerial directive for areas that are not able to agree, so that no part of England misses out on that programme.
We have created a new devolution framework to be put into statute through the English devolution Bill, which will give areas a range of new powers across planning, infrastructure, transport, skills, business and energy, with consistent voting arrangements to allow effective decision-making.
We will also clearly set out the criteria by which all mayoral strategic authorities will be able to access further powers, including integrated settlements, to allow greater flexibility of funding by becoming established mayoral strategic authorities. This framework will grow over time, including through suggestions from strategic authorities to be discussed at the Mayoral Council.
We recognise that devolving power requires us to fix the foundations of local government so that we can empower communities at all levels. We will give communities a new community right to buy for valued community assets.
12:49 pm
20 of 41 shown
The Government’s true attitude to devolution is clear from their approach to housing delivery. Their introduction of the concept of grey-belt land explicitly removes the green-belt requirement to safeguard the countryside from encroachment. When their assisting in urban regeneration by encouraging the recycling of derelict and other urban land is considered alongside the imposition of mandatory housing targets, it is increasingly clear that the Government intend to concrete over as much of the countryside as they can, while cutting building targets in cities.
Despite these changes to the planning rules and the Government’s intention to deliver 1.5 million homes, the Government have cut new housing needs targets in areas where new homes are needed—minus 11% in London, minus 38% in Birmingham and minus 55% in Coventry—while increasing the targets in areas where the housing need is clearly less acute: it is 106% in the New Forest, 199% in North Yorkshire and 487% in Westmorland and Furness. These mandatory targets are just one example of the Government’s centralisation of control over local authorities and reduction of the power of local leaders, who know their communities’ needs best. Can the Minister tell this House why a Labour Government have cut housing targets in Labour-run London, Birmingham and Coventry while imposing higher housing needs assessments on the Conservative-run councils in the New Forest and North Yorkshire, as well as in the Liberal Democrat-controlled Westmorland and Furness?
This announcement could have been so much more. It could have been a chance to rethink from scratch the duties, responsibilities and funding of local government, and to ensure that its form follows its function. Before I sit down, I have a few final questions. Can the Minister reassure this House that local authorities will be fully consulted and given time to consider the Government’s plans fully before making any decisions about their future? Can she confirm whether local authorities will have genuine choice on restructuring? Most importantly, will local residents themselves be consulted directly before any decisions on restructuring are taken forward?
In order to ensure electoral equality across the country, will His Majesty’s Government also look at the representation per capita in London and in some of the other metropolitan councils? That is really important to ensure that every person in this country gets equal representation.
Finally, I understand that local councils have been asked to submit their expressions of interest by 10 January. Can the Minister confirm that councils will then have more time—the time that they need—to consider their further steps?
England’s voters tell pollsters that they deeply mistrust Westminster politics and trust their local representatives more. This measure risks deepening public mistrust of democracy further and weakening political parties; it asks voters to identify with one elected mayor overseeing some millions of people and quite possibly elected on little over a quarter of the votes cast. I remind the Minister that, in July’s election, five parties won more than 10% of the national vote in England. First past the post risks producing some remarkably unrepresentative mayors elected on perhaps 27% or 28% of the vote.
We will need to strengthen the really local tier—the town and parish councils—to compensate for this shift of power upward. I could not find any discussion of parish and town councils in the White Paper. Did I miss some passing references? No other democratic state in Europe, North America or Australasia has such a thin framework of local and regional government. England will remain the most highly centralised state in the democratic world.
Chapter 4 declares:
“There is clearly an appetite for reorganisation in parts of England”.
We are given no evidence of such an appetite among the public. We have had multiple reorganisations in the past 50 years. Now we are going to have another one, which will cost additional money—as all reorganisations do—and disrupt services during the transition. Has the Treasury budgeted for the costs of transition? It then goes on to propose that there should be new rules on remote attendance and proxy voting for councillors at meetings. This is not surprising, given the size of some of our new councils. In the new North Yorkshire Council, it takes some councillors 90 minutes or more to drive to council meetings, so remote attendance and proxy voting are necessary. That is not local government or local democracy, however.
Lastly, in chapter 5 we are told:
“Established Mayoral Strategic Authorities will be held to account for the outcomes associated with their Integrated Settlement”
by “reporting to central government”. That is mayors acting as agents of central government, not responding to local and regional issues. The Government seem to want to rush through this reorganisation without waiting for local consultation or the agreement of other parties. This is not the best way to deliver a long-lasting constitutional settlement for England at a time when trust in our local democracy is lower than it has been for a very long time.
As councils are the foundation of our state, we will fix their foundations through fairer funding and multiyear financial settlements to give councils the certainty they need. We will also end the destructive “Whitehall knows best” mindset that micromanages their decisions and replace it with the principle of constitutional autonomy and partnership—so devolution by default.
It is important that councils are the right size and shape to serve the people they represent, with simpler structures that people can understand. That is why we will facilitate a bold programme of local government reorganisation for two-tier areas and for smaller, failing, unitary councils. We will invite proposals for reorganisation from all these areas and phase delivery—a point made by the noble Baroness and the noble Lord—taking into account where reorganisation can unlock devolution, where areas are keen to move quickly, or where it can help address wider failings. We will work closely with areas to deliver an ambitious first wave of reorganisation in Parliament.
Before I answer the specific questions, I would like to say that I am not going to take any lessons from the party opposite about the management of councils. When we came into power, many councils were going bust and issuing Section 114 notices, with a growing queue behind them of councils struggling with their finances. The lack of fiscal discipline in the audit regime left a backlog of 1,000 audits and £100 million that the previous Government could not account for. How has that helped democracy and local accountability? There was also a deepening crisis in adult social care. Parents were having to take their own councils to court to get the special needs provision their children were entitled to. There was a homelessness emergency that has seen the utter scandal of 150,000 children living in temporary accommodation, and councils having to use up to 40% of their net revenue budget to fund it. I am taking no lessons about the stewardship of public finances or efficiency of local service delivery.
I turn to the specific questions. It is not taking away local powers to give a range of new powers from Westminster to local areas so that decisions can be taken locally. I have already outlined what some of those areas will be. Making sure that decisions on health, transport, skills, workforce and so on can be taken at a local level is an increase in local powers, not a reduction.
The noble Baroness asked about the mayoral tier and whether that would waste money. Of course, she spoke about Labour-run mayoral precepts. I suppose if your principle is to deliver worse services with more cost, we could look at the previous Government’s management of funding. In a Statement later today, I will make a number of announcements about local government funding, making sure that local government is funded properly to deliver the services it is charged with delivering.
The noble Baroness also said that no councils should be bullied or blackmailed into doing this. This programme has been driven by local government; the demands have come from local government ever since we started the devolution programme. It is local councils that will work together with partners in their areas to pull together the programmes. This is a locally driven programme.
The noble Baroness made some points about the green belt and the grey belt. I am afraid that the assumption she made is just wrong. There is a specific proposal to protect those areas of green belt that are nationally protected areas or have sites of special scientific interest. There is a specific proposal about brownfield first. A sequential approach to the use of land is set out in the National Planning Policy Framework.
The noble Baroness raised the new calculation on housing targets. When the previous Government withdrew the requirement for mandatory housing targets, we immediately saw a reduction in supply. We have made a new calculation based on affordability and housing need. Everywhere needs to contribute to the delivery of housing. It is really important that that happens. The new assessments are fairer from that point of view.
The noble Baroness asked about time to consider the proposals. The letter that went out—the noble Lord, Lord Jamieson, has asked some questions about this letter too—clearly set out the programme. Councils and areas that want to go faster can submit proposals, but there will be more time, for those who feel they need it, to take the time they need.
On consultation with residents, it will be a legal requirement to have a consultation and the department will undertake that consultation through MHCLG resources.
Turning to the noble Lord’s questions, I am not apologising for the ambition of this plan. I think it is an ambitious plan. It is certainly not a plan from the Treasury; it has come from local government. But it is true to say that it is the problems in local government funding that mean we have to consider more efficient and effective ways of delivering service.
I understand the noble Lord’s points about local representation. When surveyed, only 23% of people felt they could have any influence over decision-making in their local areas. That is not good enough. We need to improve that rate. Whatever the system is now, it is not giving people a feeling that they can influence decisions in their area.
When you look at some of the activity of our mayors, they can use their mandate for change to make difficult decisions and drive growth in their areas, as Oliver Coppard has done in taking the Supertram back into public ownership in South Yorkshire. Mayors provide coherent leadership for their place. We have seen this already, with mayors such as Tracy Brabin leading trade missions to drive growth in their region. We want every part of England to take its place on the Council of the Nations and Regions and to have strong, effective partnerships with councils and other partners to deliver the missions we have set out to transform the country.
There is some wording about town and parish councils in the White Paper. If the noble Lord wants to contribute more on that topic, we would be pleased to hear that. I have been talking to the National Association of Local Councils and its officers about how we use them in this new system, and how the parish and town councils respond. There will be a vital role for them. There will be a vital role for front-line councillors as conveners of their neighbourhood areas in order to drive this programme forward. Mayors will certainly not be agents of central government. I know some of them quite well and it is a long stretch to describe them as such. They work very hard for their local areas and deliver really well.
I thank noble Lords for their comments today. As the former Secretary of State for Wales, Ron Davies, said about devolution to another of the United Kingdom’s countries, devolution is
“a process, not an event”.
We have a way to go yet. This devolution offer is the floor, not the ceiling, of the Government’s ambition. We want to continue to deepen devolution across England, developing policy with regions, including through the Mayoral Council. The White Paper is very explicit about engaging with the sector, seeking proposals from areas for devolution and local government reorganisation in their area, and engaging with mayors and councils on policies for the English devolution Bill, which we intend to lay in this Session. We welcome your Lordships’ input on how, but the aim is clear: a devolution revolution that helps us rebuild the country, deliver growth and change the politics of our country.