Further freedoms to control public spending locally were awarded around criminal justice in Greater Manchester and transport in Liverpool.
Mayor Joe Anderson, chairman of the Liverpool City Region Combined Authority, said: “I’m pleased the Chancellor has today announced further opportunities for devolution. It is, as I have always said, a continuous process and follows on from last November’s deal. I have always said that deals have to work in our collective regional interest so I am 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.”
Osborne said the updated devolution deal “builds upon Liverpool’s mayoral deal on 17 November 2015, and gives Liverpool additional new powers over transport, pilots the approach to 100% business rate retention across the city region, and commits the city region and government to work together on children’s services, health, housing and justice.”
Anderson added: “We’ve been in talks with [Osborne’s] officials for some time, making the case that decisions made locally usually work best. So I’m particularly pleased we will be helping pilot the proposal for keeping 100% of business rates. By playing a constructive role in this review, we will help ensure the needs of other local authorities with similar social and economic challenges to our own are ironed out and the design of the final policy is fair and equitable.
“I also welcome the developments in skills policy, with the City Region taking on responsibility for the Apprenticeship Grant for Employers, allowing us to shape the grant support to fit local needs here in the City Region. Matching supply of skills with actual demand has to be the right approach.”
Commenting on the other additional powers, Mayor Anderson said: “The other changes announced today, particularly the Government’s commitment to work with the City Region to explore Clean Air Zones, are welcome and could contribute towards achieving Air Quality Plan objectives at local and national level A series of traffic powers similar to those held by the Mayor of London would also be practical, common sense measures to help address issues arising from road congestion.
“Meanwhile, ongoing discussions continue with our health partners around integrating health and social care to focus on preventing acute stresses on the NHS and reviewing how children’s services across the City Region can collaborate on issues like adoption, which we believe will help all the authorities in the City Region work together to address issues in common.”
For Greater Manchester, there was praise as the Chancellor called the city region “a trailblazer for devolution in England.”
He went on to say “government will work with Greater Manchester on the devolution of powers over criminal justice services, as well as supporting the establishment of a Life Chances Investment Fund. The radical devolution of justice responsibilities will enable Greater Manchester to offer seamless interventions for offenders as they transition between prisons and the community, and to join up public services to tackle the causes of crime and prevent reoffending.”
There was also a stretching of the Northern Powerhouse devolution agenda across the border into North Wales. Osborne said: “This Budget opens the door to a growth deal for North Wales to help strengthen its economy and to make the most of its connection to the Northern Powerhouse. This government will look to the next Welsh Government to devolve powers down and invest into the region as part of any future deal.”
Next year, over half of the population of the Northern Powerhouse, the Chancellor said, would be able to vote for a directly elected metro mayor under the terms of the devolution deals set out to date.
The Chancellor thanked influential Manchester economist, now Tory peer, Lord Jim O’Neill, for his “superhuman efforts” in rolling out devolution.
Existing deals in Greater Manchester, Sheffield City Region, the North East, Tees Valley, Liverpool City Region and the West Midlands, will be followed by “new mayoral devolution deals with English counties and southern cities too, reaching agreements with the West of England, East Anglia and Greater Lincolnshire.”
Amy Hopkinson, head of the Manchester office of public affairs and political engagement consultancy, Remarkable, said: “We welcome the Chancellor’s continuing commitment to let cities and regions decide how money is spent, and the emphasis on new elected mayors and on infrastructure funding underlines his personal investment in the Northern Powerhouse. If the concept is to continue to be worthwhile, the next year must see delivery on the rhetoric, ready for the first city-region elected mayors in 2017.”
Alexandra Jones, chief executive of Centre for Cities, said: “The new deal for the West of England represents a welcome commitment from the Government to extending its devolution agenda, and will be particularly important to improving the UK’s poor productivity. But the Government also needs to hold up its end of the deal on devolution and resist the temptation to shift the goalposts as local government prepares to take on more responsibilities.
“In particular, the new plans to permanently raise the threshold for small business rate relief will impact on local government revenue in the short-term, and will reduce the annual funding available for local government by at least £1bn when business rates are devolved in 2020.
“It’s good to see a commitment from the Government to compensate local authorities for this, but it will be important to retain incentives for places to grow local tax revenue, rather than distributing money from a national fund. Local leaders have had to overcome significant challenges to agree devolution deals in the first place – now the Government must keep to its end of the bargain, and ensure local areas can deliver the services expected of them and benefit from the decisions they make.”