Progress in local devolution: The picture so far Presentation to LGIU Policy seminar Name David Marlow Third Life Economics Date 7 th April 2016

Progress in local growth and devolution???  Four topics to discuss in an hour....  An overview of the local growth and devolution ‘story’ in the 2010s  Purposes and forms of devolution  Models and frameworks for local growth  The dilemmas of ‘deals’  BUT FIRST – an icebreaker:-  What does ‘good’ strategic economic leadership of place look like? The where, what, who, and why?

Local Growth and Devolution under the coalition...  Three distinct periods:-  – the ‘big society’ period – multiple goals, minimal powers and resources  – the ‘no stones unturned’ period – LEPs, SEPs and ‘deals  – the pre- election promises period – EVEL, CAs and PSR

The 2015 local growth landscape...  New partnerships – LEPs, LTBs, LNPs etc., and local authorities  New policies – NPPF and planning reforms (CIL, NHB etc), EZs, etc.,  New funding instruments – RGF, GPF, LGRR, TIF, LGF, ESIF etc.,...  New sub-regional instruments – CAs; city deals, wave one, two; local growth deals;  New local instruments – whole place budgets, early intervention and prevention  Renationalised E&I functions  BUT  “Let’s party like it’s ”  Local growth – need to be in it for the long haul  Too many deals....too little devolution (especially fiscally)  Intermediate tiers and tears....  Crises of the state – EU, UK, England, sub-regional and local

Local growth and devolution  The rise of Powerhouses and Engines...  The C&LGDA2016 enabling legislative framework  Nine Mayoral CA agreements + Cornwall + ?Leeds CR?  ‘Fiscal revolution’ pilots and promises...

What might be on offer to Mayoral CAs?  Mayoral CA agreements typically include  A 30 year investment pot (£15m - £36.5mpa) + IB status for ESIF  An education, training, skills and employment package  A transport package  A housing, land and planning package  A business, innovation, trade and investment package  A commitment to health and care integration development  Perhaps...a nationally-significant pet project or two...  Most recently, criminal justice reforms  Anticipate mayoral elections in 2017, with typically considerable powers (but some restrictions)  Still need to go through local and statutory authorisation procedures which are considerable

What are the caveats?  A private haggle...  Democratic renewal  Roles of partners  The devil is still in the detail...  Money, powers and influence  The overall system – especially those outside deals  Intermediate tier and local BUT not national reforms  Outside GM, little time or effort to build the partnership and test its resilience  No real clarity of purpose or geographies  Unlikely to be either politically, institutionally or financially sustainable

Discussion points...  Reasons to be cheerful....  Reasons to be pessimistic... ....about local growth and devolution  How do we lead, plan and manage change?

What is devolution really for?  Clarify purpose(s)  Decentralisation road map(s) and transparent process(es)  Build capacity, capabilities and commitment (including from partners and communities)  Some sort of independent Commission/Mediator ? Should form (and geography) follow function? Unlocking local growth Rebalancing the economy Efficiency savings and PSR Addressing societal challenges Democratic renewal

What forms can it take?  Devolved Administrations  The London model  Mayoral CAs  Non-mayoral CAs  Joint Committees or other LA-based arrangements  Non-statutory models (including LEPs)  Mix and match hybrids

Discussion points...  If the purposes of devolution were:-  Unlocking local growth  Rebalancing the national economy...what forms and geographies would be most ‘fit for purpose’ in your areas?  Might you have different forms and geographies for those two different purposes?

Models and frameworks for local growth...  Universal societal challenges  Fundamentals of place shaping  The productivity puzzle  Approaches to local growth planning and management

Challenges of ‘big picture’ change....  Demographics and social innovation  Science and technological innovation  Globalism, recession and public sector austerity  Localism and complexity...

Some fundamentals of place-shaping  Physical investment-led  Enterprise, innovation, and creativity-led  Community regeneration-led  Positioning and branding approaches  Integration with LCD and sustainable communities

Raising productivity...  The ‘five drivers’....  Investment  Innovation  Skills  Entrepreneurship  Competitiveness  BoE ‘productivity puzzle’  Capital deepening  Technical efficiency  Capacity utilisation  Agglomeration  Metro-connectivity

Some of the strategic local growth ‘tensions’  Striking a balance between:-  Investing in success and tackling underperformance  Specialisation and agglomeration or diversity and polycentricity  Strengthening ‘anchors’ and supporting radical disruptive change  Inward investment and indigenous capabilities  Not strictly trade-offs – but:-  how do we find the ‘win-wins’  How do we avoid increasing inequalities? Strengthening national anchors The global ‘gazelle’ Leveraging local assets and capabilities Disruptive indigenous innovation

Five local growth planning frameworks...

In practice, much of the devo and local growth practice to date has ‘followed the money...’! Pros: - Local-centre conduit for direct negotiation - Helps build relationships – local and central/local - Encouragement and promotion of Innovation - Project and programme integration - Catalyst for local governance reform? Cons: - Asymmetric information - Centre as supporter and appraiser - Negotiating power resides centrally - Lack of transparency - Uneven outcomes of political haggles - Slippage from announcement to implementation - Limited evaluation Pros and cons of deals...

Discussion points – strategic alternatives or strengthening the local side of the playing field?  Constitutional  Strategic  Operational

Where next?  The Osborne project unravels very rapidly...  Local leadership teams are seen to ‘fail to deliver’ on the deals...  This is the beginning of a very positive period of disruptive innovation... ...leading to better leadership and management of growth in the long term

Thank you