Devolution – the future for British cities?

The United Kingdom's near-death experience seems to have changed it. As a relieved David Cameron welcomed the news on 19 September, he pledged to find "a decisive answer" to the UK's constitutional quagmire, reopening questions about English devolution that seemed to have been closed by the referendum in the North East a decade ago.

The case for some form of regional devolution is clear. The UK is one of the most centralised developed economies, with political and financial power controlled tightly from the capital. It's surely no coincidence that regional cities are lagging behind. Seven of the eight largest cities outside London have a GDP per capita less than the national average. In federalised Germany, by comparison, the eight largest cities outside Berlin all have a GDP per capita that exceeds the national average. By this measure, Manchester's economy is less than half as strong as Munich's, and three-quarters as strong as Marseille's.

While the prime ministerial zeal to "empower our great cities," as he put it, may have been burnished by Scotland's itchy feet, studies into how best to set about the task have long been underway. In the days before the referendum, the think-tank ResPublica's report Devo Max – Devo Manc set out ambitious proposals to have all public spending in Greater Manchester, amounting to more than £22 billion annually, controlled locally. Just today, the City Growth Commission has published its final report, concluding that the surest way to "boost UK growth over the long term and put our economy on a more sustainable, inclusive footing" is to provide our metropolitan areas with greater political and economic power. Sir Richard Leese, long-time Leader of Manchester City Council, has made clear he thinks it's time for "a new relationship between national and local."

What could this mean for property professionals? Some of the effects would almost certainly be counterintuitive. Development control is already one of the more successfully localised government functions: for city regions truly to be empowered to determine and execute their own growth strategies, authority over planning may well have to reside with the region. This is the approach the City Growth Commission recommends, allowing cities to coordinate their housing and transport development in the way that Greater London can now.

This greater flexibility for planners might loosen some of the restrictions imposed by having to work within the confines of local planning authorities, allowing city regions to respond more dynamically to changing demand. This flexibility could help planning work better for cities and their inhabitants, with Green Belt areas that have ceased to serve their intended purpose declassified, and replaced with greenfield areas elsewhere that need protection. It might also be easier for metropolitan regions to make progress with vital regional infrastructure projects if they pay from their own funding, and do not have to convince Whitehall, in competition with every other bypass and link road, that they are the most deserving.

Much, it is clear, remains up for grabs. What should be evident is that we are reaching the critical stage of a national conversation about how our regional cities can realise their full potential. Political parties are drawing up their manifestos for the General Election, which will shape the next Government's legislative programme. In the coming years, any proposals for city-based devolution will likely be subject to extensive public consultation. The voices of regional politicians and businesses must shape any new political settlement. Now is the time to decide what works for your business and sector, and to make sure that message is heard.

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