Housing
- Housing Delivery: Mayors and Strategic Authorities will play a central role in housing delivery. Grant funding for regeneration and housing will be integrated into the budgets of Established Mayoral Strategic Authorities starting in 2026/27.
- Affordable Housing: The government aims for full devolution of affordable housing funds. Interim measures include Mayors directing future affordable housing programmes, determining tenure mix, and identifying priority sites.
- Strategic Planning: Local Authorities must prepare Spatial Development Strategies (SDS) to address housing needs. Housing targets will align with the Standard Method outlined in national policy.
Finance
- Funding Reform: A Recovery Grant worth £600 million will target areas with greater deprivation and service needs. Councils will receive multi-year funding settlements to improve financial planning.
- Business Rates Redistribution: Business rates growth will periodically be redistributed to ensure fairness across regions.
- Core Spending Power: Total core spending power for Local Authorities will increase by 3.2% in real terms, combining council tax, retained business rates, and new grants.
Council Tax
- Mayoral Combined Authorities (MCAs) can introduce mayoral precepts on council tax to fund additional local priorities, although current limitations on its use (e.g., bus services) may be lifted. Councils will be supported to plan and raise local income more efficiently.
Business Rates
- Enhanced business rate retention allows Local Authorities in certain areas to retain more locally raised business rates. Reforms are planned to standardize retention models and ensure consistent support for Strategic Authorities.
- Retained business rates growth will focus on funding local growth priorities.
Welfare Benefits and Social Security
- The paper highlights local innovation in welfare, such as pilots targeting long-term sickness and employment support. Examples include South Yorkshire’s Working Win pilot, which helps residents with health issues find or retain jobs.
- Family Help and Children’s Social Care Prevention Grants will nearly double funding for preventative services to over £500 million.
The English Devolution White Paper proposes significant changes to local governance in England, aiming to decentralize power from Westminster to regional authorities. Several sources have already identified several advantages and potential risks:
Advantages:
Enhanced Local Decision-Making: Empowering local leaders allows for policies tailored to regional needs, potentially leading to more effective governance and improved public services. (https://www.gov.uk/government/news/devolution-by-default-to-create-new-era-of-local-power)
Streamlined Governance Structures: Transitioning to single-tier authorities with populations around 500,000 aims to increase efficiency, capacity, and financial resilience, facilitating more effective infrastructure development and service delivery. (https://www.ft.com/content/ca925c34-bf2b-49ac-96ce-075e7b006829)
Improved Financial Planning: Multi-year funding settlements are intended to end the “cap-in-hand” approach to local authority funding, providing councils with greater financial stability and the ability to plan long-term investments. (https://www.thirdsector.co.uk/government-lays-plans-multi-year-funding-settlements-english-devolution-white-paper/policy-and-politics/article/1900243)
Greater Accountability: Directly elected mayors with expanded powers can offer clear leadership and accountability, enhancing democratic engagement and responsiveness to local issues. (https://www.gov.uk/government/news/devolution-by-default-to-create-new-era-of-local-power)
Risks:
Perceived Remoteness: Larger unitary authorities may feel distant to residents, potentially weakening local engagement and the sense of community representation. (https://www.ft.com/content/ca925c34-bf2b-49ac-96ce-075e7b006829)
Disruption from Reorganization: The process of merging councils and restructuring local government could lead to administrative upheaval, diverting focus and resources from service delivery during the transition period. (https://www.placenorthwest.co.uk/bold-devolution-white-paper-is-not-without-risks/)
Complexity in Implementation: Determining appropriate geographical boundaries for new authorities that reflect economic and social realities is challenging and may result in mismatched regions, complicating governance. (https://www.centreforcities.org/reader/economy-first/risks-for-the-english-devolution-white-paper/)
Potential Loss of Local Identity: Amalgamating smaller councils into larger entities might dilute local identities and reduce the effectiveness of addressing hyper-local issues. (https://www.thetimes.co.uk/article/england-loses-shape-in-this-regional-rejig-2fjbm6sgm)
It is my view that the reorganisation of local government, first initiated under Labour’s John Prescott and later reimagined by the Conservatives’ George Osborne, was always inevitable. However, this lengthy journey might have progressed more swiftly had other events—such as the financial crisis, the prolonged focus on Brexit, and the COVID-19 pandemic—not disrupted the past decade of governance. These events diverted attention, resources, and political capital away from structural reform, delaying the progress of local government reorganisation.
In recent times there has been some adjustment and consolidation of mayoral and police commissioner roles, significant changes to regional responsibilities have been limited. Instead, efforts have focused on refining existing structures, clarifying key roles, and enhancing the delivery of economic development, external investment, and infrastructure within regions.
The real driving force behind this paper is the proven success of regional government in the UK—most notably in Manchester, the West Midlands, and, more recently, in West Yorkshire and Teesside. These areas have demonstrated that devolved powers at a regional level can be highly effective in driving economic growth and development. Despite receiving mixed press, London has also shown that regional governance can make a significant contribution to economic prosperity. This success is further reflected in the devolved administrations of Wales and Scotland.
That said, it is important to recognise that regional government, as an overlay model, has been relatively straightforward to implement because it involves drawing power and services down from national government. In contrast, the process of drawing power up from local government—through the creation of unitary authorities—has been far messier and more challenging. Even merging two councils can yield both notable success stories and examples of significant difficulty. Nevertheless, the trend towards shared services and combined authorities has gained momentum, particularly in response to the financial pressures facing councils. In many instances, these “marriages of convenience” have quietly succeeded, avoiding the dramatic media headlines often associated with such reforms.
The challenge with any merger—whether in the private or public sector—is that there are always winners and losers. What appears promising on paper can falter without sufficient investment in strategic planning, effective communication, and a robust system of arbitration as roles and responsibilities evolve.
Whether one supports or opposes regional government and council mergers, the reality is that reorganisation has been occurring in an unfocused and meandering way—and it will continue to do so as economic and political circumstances evolve. This White Paper offers an opportunity to reorganise local government in a structured and pragmatic manner, and it is one we should seize.
I do not dismiss the concerns of sceptics; many of their points are valid. However, the time for objections has passed. What is now required is a constructive approach: identifying risks and proposing measures to mitigate them.
Interesting times lie ahead.