DEVOLUTION

How local government reform might play out and how to prepare

After publication of the English Devolution White Paper brought sweeping reforms, Laura Hughes predicts how the Government will bring a carrot-or-stick approach.

(c) PredragLasica / Shutterstock.com

(c) PredragLasica / Shutterstock.com

In more than 20 years of working with local government, the proposals set out in this week's English Devolution White Paper carry as much significance as anything I've witnessed. 

Currently, half of the country is not covered by a strategic authority, and 25% is still under two-tier local government arrangements. 

Plans to create strategic authorities across the country and unitarise two tiers of local government, where these sit underneath, are ambitious and far-reaching.

Opportunities and challenges in local government reorganisation

Supporters will point to how a two-tier system of a strategic authority – the Government's terminology describing all types of existing combined authorities – sitting above a unitary authority in every area will remove complexity and duplication in a system that has become a complicated patchwork of arrangements.

If the public and businesses have a better understanding of how local government works, they are more likely to engage with it.

Strategic authorities also give every region a seat at the table nationally and elected mayors will enjoy enhanced devolved powers.

While these powers broadly cover the same topics as devolved to current strategic authorities, the scope is broadened in some of these areas and mayors will work closer with government agencies. 

Legislation will largely standardise these powers and related funding agreements. However, the door is left open for more bespoke arrangements where required for ‘technical reasons' (the example given is around operation of trams). There is also a process for adding to – but not removing – these powers via proposals from mayors and local pilots. 

This is important because in driving large-scale efficiency, Whitehall mustn't forget the true essence of devolution is to provide regions with freedom to deliver for their areas in a way tailored to each locality's specific set of opportunities and challenges.

Likewise, compelling arguments are made in the paper for unitarising local government below strategic authorities, including greater simplicity, cost savings and delivering services in a more streamlined way. The Government also argues that district and borough councils haven't received the required funding to make meaningful positive change in their local areas.

Dissenters to reform, however, point out that consolidating tiers of local government won't automatically streamline local decision-making. Work is required to deliver efficiencies. 

There are also understandable concerns about depriving people of genuinely localised decision-making by creating structures where councils are based up to 50 miles away from pockets of their populations. 

Overall, our view is these proposed reforms offer the possibility of positive change for local and regional government. By arming a smaller number of unitary authorities and overarching strategic authorities with greater scale, funding and power, local government should have a greater voice, agency and autonomy.

How will this all pan out?

The intention is to introduce an English Devolution Bill by the end of Parliament's first session in July 2025, by which time it will hope to have progressed the first tranche of proposals for new two-tier areas, and to be proceeding at pace with establishing new strategic authorities.

Unitarisation and new strategic authorities are likely to be implemented first where there's little opposition to reform and where local authorities are agreed on a way forward. They will therefore be happy to take Whitehall's ‘carrot' approach, which may feature various incentives for early adopters.

In other areas, government must determine whether to use existing geographies to create strategic and unitary authorities, or alter boundaries.

The biggest battles may be fought in forming unitary authorities, which should generally serve more than 500,000 people. This requirement means dividing existing counties won't necessarily create new unitaries neatly; splitting broader geographies may be required.

In addition, the white paper indicates that changes to unitary arrangements may be made where existing unitaries are failing due to size or other issues. We suspect the Government may seek to exert pressure on those that have filed section 114 notices, or are on the cusp of doing so, to identify different arrangements.

For other areas without a consensus on the path forward, the Government has armed itself with the ‘stick' approach with a warning it'll pass the necessary legislation to force reorganisation. 

Some of these may fall into line for a second wave, once Whitehall has dealt with the low-hanging fruit, but whether Labour has the stomach to fight areas with the largest opposition as another General Election draws nearer remains to be seen. 

If some three-tier systems were allowed to continue their existence in the medium term, we could find ourselves in a situation that's at least as complex, if not more, than now. 

But with the Government having laid down the gauntlet for its devolution plans, a period of self-reflection for existing local authorities is the best immediate-term strategy. 

They must recognise what change may look like in their area and how improvement could be delivered through reorganisation. 

Engaging with other councils in their potential unitary or strategic authority – or a neighbouring one they may wish to join – as well as being proactive with government early doors, would give them the best chance of shaping their own future, rather than having it handed down to them from Westminster.  

 

Laura Hughes is head of public law at UK and Ireland law firm Browne Jacobson, and has worked on devolution deals including the East Midlands Combined County Authority 

 

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