Does Rachel Reeve’s announcement mark the UK’s liberation day?

Chancellor Rachel Reeves has set out plans for a significant shift in the UK’s economic model, placing fiscal devolution at the centre of the government’s growth agenda.

In a major speech on Tuesday (17th March), she confirmed proposals to give regional leaders greater control over funding, including the potential to retain a share of nationally raised taxes, and regionally raised equivalents like business rates, alongside new long-term investment funds for cities and regions.

The move is designed to rebalance the economy by shifting power away from Westminster, enabling local areas to shape their own growth strategies, with regions incentivised to drive economic performance and reinvest the benefits locally.

While full details will follow in the Autumn Budget, the announcement signals a clear intent to accelerate devolution and place regional economies at the heart of the UK’s future growth model.

This raises important questions around delivery, capability and the role of local leadership in driving long-term, inclusive growth.

Here’s the reaction from some of our board members…

Nigel Wilcock, Executive Director, iED
“This could be the UK’s Liberation Day.  Providing regions with the power to invest capital for the long term, while also rewarding growth through the retention of tax receipts, creates the conditions for the growth agenda to be seized at the level where economic opportunity is best understood. This has the potential to accelerate what have, to date, been relatively small steps towards devolution and fiscal reform.”

“Of course, outcomes will vary between regions, with some progressing more quickly than others. But the IED has long supported devolution, and with it comes diversity rather than uniformity.  Over time, this direction of travel could unlock new drivers of growth and help release the potential and opportunity that has long been shackled in regions across the UK.”

Rebekah Formosa, Board Director, iED
“Reeves’ announcement signals a meaningful shift toward a more locally driven economic model, with fiscal powers intended to give regions greater control over how growth is funded and delivered. By moving toward more stable and predictable funding streams, the proposals could enable longer-term investment in skills, infrastructure and productivity, while reducing reliance on short-term, centrally allocated pots.  In the near term, the greatest gains are likely to be felt in areas with established governance structures, particularly combined authorities and mayoral regions. Targeted investment, including £2.3bn in city funds for the North and West Midlands, is designed to strengthen local strategies and unlock further private sector investment.”

“However, the success of these reforms will depend on how they are implemented in practice. Questions remain around capacity, accountability and the fair distribution of resources, particularly for areas with weaker tax bases. Ensuring all regions are equipped to benefit will be essential if the reforms are to deliver genuinely balanced and inclusive growth.”