The politics of pounds and pence

More powers for the cities of the Northern Powerhouse were announced this week, as George Osborne continued pushing out his devolution agenda across the North of England. On closer inspection, it becomes clear that this was an adroitly political budget from a nimbly political Chancellor.

Locally grabbing the headlines was the devolution of criminal justice powers to Greater Manchester, which will see local leaders given powers over youth offending, prison services and where prisons are to be built. This coincided with the revelation that a new “resettlement jail” could be built in Greater Manchester, the first to developed in the area since the 1990s.

In the Liverpool city region, powers over transport, business rates, and apprenticeship grants for employers are all being handed over. Joe Anderson, Mayor of Liverpool City Council, commented that he was, “pleased there is the potential for additional new powers and responsibilities that will be negotiated to help us take our city region forward by growing our economy and protecting and delivering better services.”

If we are to look beyond the figures though, it appears that George Osborne has delivered quite a political coup in the North of England with these announcements, as well as in North Wales, which was name-checked for a Growth Deal in the near future.  With key elections in the next few months across Northern Powerhouse cities such as Manchester, Liverpool, and Sheffield, Mr Osborne has given the leaders of such councils significant victories to take to their electors.

In Liverpool for example, Joe Anderson – who is facing re-election for City Mayor and likely to be a candidate for the metro mayor position – will be able to show Liverpool that he can bring in investment when required. He will now be able to spend 100% of business rates collected as he sees fit, and control which local companies can take advantage of grants to employ apprentices. In Greater Manchester, leaders such as Cllr Sir Richard Leese (Manchester) and Cllr Sue Derbyshire (Stockport) will be able to work to suppress crime rates locally, with powers over probation and tackling youth offending.

These gifts will help to cement Mr Osborne’s image as a pragmatic Chancellor who will work with local authority leaders of all stripes. It is worth remembering that the Conservatives still have relatively little presence among civic leaders in the North. It is no secret that the Chancellor has designs on becoming Prime Minister when David Cameron stands down; having cross-party support for his policies will go some way towards showing Conservative Party members that he can win them another term, and perhaps even win in more naturally Labour areas, such as Merseyside and Greater Manchester.

Finally, with some huge cuts about to be felt by local councils, particularly in the North, these new measures will help in keeping the silence of agitated council leaders, who may be less inclined to attack the Conservative Chancellor after being given powers that could ultimately help see them through to re-election. It may turn out, though, that memories at the ballot box are shorter than Number 11 would like…