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‘Taking back control’: a good start, but more needed to drive growth in local economies
The King’s Speech has presented a raft of bills which Ministers want to pass in the next parliamentary session, leading Sir Keir Starmer to promise ‘national renewal’ for the country.
From a local government perspective, an English Devolution Bill will streamline the process to transfer more powers to elected mayors in combined council areas. A Planning and Infrastructure Bill will ease the process for approving critical infrastructure, and overhaul roles on the compulsory purchase of land. The Skills England Bill, meanwhile, will set up a new arms-length body of the same name to boost and regionalise training, bringing together businesses, unions and mayoral combined authorities.
Generally, we are pleased that the new Government recognises that the country remains too centralised, with the economic potential of too many regions and communities ignored. Our call in the IED’s pre-election manifesto Grow Local, Grow National was for greater devolution, underpinned by multi-year funding settlements rather than annual spending reviews, and we are pleased that this (together with our call for an end to competitive bidding) is recognised.
When taken together, the Government is clearly looking to create the conditions for growth. From seeking to boost housing delivery, implement planning reform, and develop a stable macro-economic environment which is key to investment, the combined impact of all the proposed bills is aimed at driving growth in local economies. That said, there are aspects of the planned legislative programmes that have the potential to deliver the most benefit.
Measures to reform planning and also boost housing growth will be key. It is important that the Government goes beyond these measures to look at the cost of scheme delivery – for many areas of the country, marginal viability housing markets and commercial floorspace markets remain a huge challenge, so speeding up planning alone could have limited impact in these areas. We look forward to further measures and understanding how Government will enable a more activist investment role, for example, through Homes England, in this space.
We would, however, welcome further discussion on what will succeed the Levelling Up Fund and UK Shared Prosperity Fund. What is required is significant, multi-year, devolved intervention funding to make help make residential and commercial pipelines happen on the ground. Currently, this is an unanswered question.
The measures around skills and labour market reform are also promising. A sustained strategy on post-16 education and training, and with it local labour market progression routes, including on lifelong learning for adult retraining, is long overdue. We can be reasonably optimistic about some of these changes, whilst recognising the wider devolution agenda and absolute levels of funding for 16+ need careful examination.
In our manifesto we called for skills development, workforce assessment and the development of clear pathways into work to be a key element of the economic strategy, so we welcome the early signals around the new Skills England.
Key challenges for local and combined authorities remain, of course. In particular, there is a need to bring levels of devolution across the country including in newer combined authority areas to a more even level. But those with advanced trailblazer deals also need to be able to go further – for example on 16+ skills funding, and on their relationship with Homes England for affordable and social housing investment.
Transport and infrastructure remains a key challenge. We note the announcements about the Railways Bill and High Speed Rail Bill, but a sustained investment in regional infrastructure planning will be key to driving regional growth and we must plan for and invest in that in partnership. Local government remains key to delivery of the national mission for growth, as we outlined in Grow Local, Grow National.
Underpinning these bills is a strong statement of partnership, and we have also heard the commitment to re-introduce a new industrial strategy and end short-term economic policy making with the establishment of an Industrial Strategy Council. This follows our call in our manifesto for the introduction of a national economic/industrial strategy, and we look forward to bringing the voice of experience and practitioners to this work with Government.
However, the mission of sustainable economic growth, and deepening devolution settlements across England with statutory Local Growth Plans, requires even greater commitment to economic development practitioners working for local and regional communities. Councils alongside specialists in the private sector could deliver so much more if they were given statutory powers, with their unique understanding of local economies, to better ensure policies are adapted to local conditions and make the most of the strengths of local places.
So far there is no statutory economic development duty – but we remain willing to discuss this with the Government and how enacting it in local authorities could support the growth mission and the work of the Industrial Strategy Council.
Tom Stannard is Chair of the Institute of Economic Development.