Introduction

The structure of government in the UK is widely regarded as unusually centralised, notwithstanding the devolution agenda of the last 25 years. This has happened just as nations, such as France, have moved in the opposite direction. Policymakers agree that the UK’s centralised decision-making and funding model has held back productivity improvements and restrained investment in regions outside London and the South East.

The English Devolution White Paper 'Power and Partnership: Foundations for Growth', published by the government in December 2024, is just one official document to point out that the centralised approach has contributed to unique regional disparities in economic and social outcomes compared to European standards. This has also been cited as the cause of poor overall economic growth at a national level since the global financial crisis in 2008.

In recent years the impact of centralised decision-making has been recognised by all of the mainstream political parties as a problem; as a result, devolution of powers now has bipartisan support. There has been significant progress on devolution in Scotland, Wales and Northern Ireland, starting under the Labour governments in power from 1997. English devolution was turbocharged under Conservative-led governments from 2010, with more powers being extended to the regional ”trailblazers” in Greater Manchester and the West Midlands, and new combined authorities being formed. The Labour government elected in 2024 has committed to accelerating the changes started by previous administrations.

To date, devolution has been something of a patchwork, with different powers being granted to different regions, changes happening at varying points in time and some major conurbations not being offered devolution at all. Perhaps as a result, the performance of the devolved authorities has been mixed. For example, house building in Greater Manchester and the West Midlands increased by more than the national average between 2009 and 2022. However, although gross value added (GVA) per person has increased in Greater Manchester by more than the national average over this period, that is not true in other combined authority areas, such as West Midlands and West Yorkshire.

One uniform policy success across the combined authority areas has been transport. This has resulted in the expansion of the Midlands metro system (West Midlands Metro), a fully integrated London-style transport system in Greater Manchester - the “Bee Network” - and the improvement of bus services and proposals to re-introduce light rail in West Yorkshire.

In the run up to the 2024 election, the Labour Party identified economic growth as a significant priority, alongside building more homes. Sub-regional devolution in England has become a key part of delivering this national mission, while also addressing regional inequalities and building on the success of combined authorities in delivering economic progress and new homes.

English Devolution White Paper (2024)

The English Devolution White Paper outlines the framework for progressing devolution in England. It proposes that local areas should be given more extensive powers and that these powers should be extended to more places.

The focus of the document is on three points:

• Local government reorganisation by converting remaining two-tier local council areas into unitary structures, ultimately aiming for national coverage of strategic authorities
• Increased powers for mayoral areas, including wider integrated funding settlements, a more extensive role in planning and delivering rail and highway infrastructure and services in their areas and a framework for bus franchising. Additionally, this should include further devolution of powers associated with skills, business support and clean energy.
• Mandating spatial development strategies (SDSs) across the whole of England via powers set out in the Planning and Infrastructure Bill.  

What do local government policy makers think?

Across our multidisciplinary business and, particularly through extensive city-region work, we have close relationships and connections with regional and local authorities across England. These established, long-term relationships give Mott MacDonald good insight into the changes leaders in local government believe are needed to drive better decision-making and faster economic growth. We have augmented this knowledge by undertaking a series of purposeful interviews with key stakeholders in local and combined authorities to explore how devolution should support housing-led growth and infrastructure investment.

Thinking from Mott MacDonald’s subject matter experts and the conversations with specialists on the ground quickly focused on the critical importance of delivering new and upgraded infrastructure to securing successful housing and place-based growth. Without improved infrastructure England will not be able, practically or politically, to build houses, improve communities and deliver economic growth. This insight may seem straightforward, but it has profound implications for the work of devolved authorities and the powers that they will need from English Devolution.

In light of the English Devolution White Paper, we have explored three core themes seen by local policymakers as essential to delivering strong, sustainable growth:

Theme 1 – Reinvigorating the approach to delivering strategic growth and associated infrastructure to ensure it is fully coordinated at a city-regional or regional level.

To maximise growth, investment in new and improved infrastructure should be planned and coordinated at city-region or regional level, as well as within sensible economic geographies.

Theme 2 – Simplifying and further devolving funding pots will enable more targeted and tailored outcomes for local communities.

Sub-national bodies need long-term funding certainty and flexibility to allow them to make effective investment decisions and stimulate the local buy-in and investment needed for delivery.

Theme 3 – Greater powers bring greater responsibilities –and should bring greater resources.

Higher funding for regional and local government will ensure they can deliver on the potential of the new powers, remits and expectations given to them through devolution.

For each of these themes we have highlighted the proposals that we anticipate will deliver positive change and unpacked the next level considerations needed to drive integrated housing and infrastructure investment in delivery of strong growth.