Graduate ‘brain drain’ – is regional economic growth the solution?

college graduates groupBy Heather Cameron

With the economic performance of cities and regions increasingly reliant on the skills of their workforce, the longstanding issue of graduate ‘brain drain’ to London and the south is something that needs to be addressed.

Although students attend many of the universities spread across the country, a significant number of graduates flock towards the capital at the end of their studies. According to a recent report from Centre for Cities, this deprives other cities of skilled workers and essentially damages the overall economy.

The evidence

A quarter of all new graduates in 2014 and 2015 were found to have moved to work in London within the six months of finishing their degree. And the highest achievers make up a significant proportion. While London accounts for around 19% of all jobs, of the graduates that moved city six months after graduation London employed 22% of all working new graduates, and 38% of those with a first or upper second class degree from a Russell Group university.

Although most cities experience an overall graduate gain, cities outside London don’t retain the majority of students that move to their city to study – the ‘bouncers’ that drive the brain drain overall, overshadowing any gain:

  • Manchester lost 67% of these students upon graduation;
  • Birmingham lost 76%; and
  • Southampton lost 86%.

Other figures show that 310,000 graduates have left the north in the past decade, contributing to a net average deficit of 7,500 highly qualified workers leaving annually, or 75,500 over a decade.

Northern regions have to some extent offset the effect of local brain drain by attracting enough highly qualified foreign workers to fill the gap. But with reductions in immigration, these regions could be left lacking.

Given the UK’s current position regarding the EU, concerns have also been raised over whether Britain faces a further brain drain of academics to Europe, following Brexit. A recent survey highlighted that 42% of academics said they are more likely to consider leaving Britain after the vote to leave.

Why?

While it may seem plausible to assume that higher salaries are the reason for this brain drain, it appears that the main pull for graduates is the availability of jobs and career progression, which London’s vast labour market offers.

However, as recent research from Homes for the North has identified, these are not the only reasons. It highlights the importance of additional non-work drivers of graduate location decisions, including the cost and quality of housing, quality of local amenities and the prospect of home ownership.

Of the graduates polled, 80% said the quality of housing was important, while more than 60% said the cost of housing was important. The quality of green spaces and local amenities was also deemed important by over 60% of graduates.

What can be done to redress the balance?

There have been numerous graduate retention initiatives at the local and regional level aimed at tackling the uneven distribution of graduates, such as graduate wage subsidies and local graduate job matching.  But it seems little has improved. The Centre for Cities research argues that these alone will not tackle the root cause of the graduate brain drain.

It suggests that cities themselves have a vital role to play in ensuring the local job market offers an appropriate number of graduate job opportunities that will allow them to both retain graduates and attract graduates from elsewhere. Policy should therefore broaden its focus to improve local economies by investing in transport, housing and enterprise, rather than focusing solely on graduate retention and attraction policies.

The chief executive of the Centre for Cities commented that the government’s new economic and industrial strategy should be used to strengthen existing devolution deals for city-regions such as Greater Manchester, extending their scope to grow.

Indeed, the industrial strategy green paper, published in January, clearly places emphasis on addressing the economic imbalances across the UK through a number of measures, such as working with local areas to close the skills gap, including new schemes to support the retention and attraction of graduates. However, the strategy has been criticised for providing little clarity on how regional rebalancing and sectoral deals will work in practice.

Final thoughts

While it appears clear that cities outside London need to improve their graduate offer with better job prospects, the evidence on graduate migration suggests it is more complex than this.

As has been argued, the provision of good quality affordable housing could play a role alongside high-skilled job creation and opportunities. With the cost of living in London so expensive, this would make sense, particularly as the average graduate salary in London is not that much higher than the average across other UK cities.


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Highlighting policy and practice: research briefings from The Knowledge Exchange

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So far this year, our team of Research Officers in The Knowledge Exchange have researched and written more than 30 policy and research briefings on a diverse range of subjects, from housing and planning to technology and training. Written in a clear and concise style, each briefing brings together examples of recently published evidence, alerts readers to new and continuing developments and signposts sources of further information. New briefings are available exclusively to members of our Information Service, and the choice of topics is driven by what our members are asking us about.

Today’s blog post offers a flavour of just some of the topics we’ve been covering during the year.

Housing

In many parts of the UK, people are struggling to buy or rent affordable housing. One consequence is a rise in homelessness. Our briefing – Delivering solutions to tackle homelessness – describes the complexities involved in defining homelessness, and the subsequent difficulties in measuring the scale of the problem. The causes of homelessness are no less complex, and the briefing lists some of the factors that lead to people finding themselves on the street, such as eviction, unemployment, health problems and relationship breakdowns. It also highlights approaches to tackling homelessness, such as social impact bonds and homeless health peer advocacy.

Planning

Closely related to housing is the role of planning in ensuring that individuals and families not only have adequate homes, but the infrastructure and services needed to support communities. One of the significant developments in this area has been the UK government’s policy on devolving more powers (including planning) to England’s cities and regions. Our briefing – Devolution of planning powers to city-regions – explains that each devolution deal agreed between the UK government and local authorities is tailored to the local area. In the West Midlands, for example, a directly-elected mayor will be given planning powers to drive housing delivery and improvements.

The briefing notes that, while there is widespread agreement that devolution of planning powers to local areas is a positive step, there is also concern that local areas won’t be able to deliver what they need to in terms of planning without control of expenditure, much of which is still retained by central government.

Technology

Our “Ideas in Practice” series of briefings presents case studies of projects and initiatives that have tackled a range of social issues, often resulting in reduced costs or improved efficiency. Our smart cities briefing on MK: Smart outlines a technology-led urban innovation project in Milton Keynes that aims to improve the town’s key infrastructure in areas such as transport, energy, and water. One of MK:Smart’s success stories is its Smart Parking initiative, which has encouraged drivers to use limited parking spaces more effectively, as well as providing the council with a better understanding of parking behaviour.

Another technology-focused briefing looks at the increasing development of “serious games” in the domains of planning, education, health and cultural heritage. Serious games in the policy field have borrowed elements from the video games sector, such as virtual reality, simulations and digital game-based learning. As well as improving skills and engagement among individuals, serious games have been used as a powerful way of introducing new concepts to the public, and providing people with an understanding of different points of view. The briefing showcases some examples of the application of serious games, including ‘B3— Design your Marketplace!’ which created an immersive and playful environment to encourage citizens to give their views on the design of a marketplace in Billstedt, a district of Hamburg.

Education, training and skills

A number of our briefings this year have focused on the all-important areas of education, training and skills. The Ideas in Practice briefing on science, technology, engineering and maths (STEM) education considers key trends and practical applications. Among the initiatives highlighted in the briefing is Third Space Learning, which connects primary schools in England and Wales with maths specialists via one-to-one online sessions.

In August, we published a briefing focusing on the impact of outdoor learning on educational attainment. It includes information on the implementation of the Forest School initiative in the UK, which places emphasis on children having contact with nature from an early age. The briefing highlights evidence that pupils with the highest connection to nature have been found to perform better in exams, and notes the positive impact on the attainment of those from deprived backgrounds.

Crime

Our briefing on urban gang crime highlights some of the ways that local authorities and organisations have sought to tackle the problem. One of the case studies focused on the exploitation of young women by gangs in Manchester. Delivered by women who have survived gang exploitation, it provides one-to-one support, allowing both mentors and victims to create lasting relationships and networks of support which help them as they transition from life within a gang. In 2013, the project won the Women in Housing award for best community/ training project for its work in rebuilding women’s lives.

Further information

This is just a taster of the variety of subjects addressed in The Knowledge Exchange’s policy and research briefings. A fuller list of briefings is provided here, and members of the Idox Information Service can keep up-to-date with newly-published briefings via our weekly Bulletin.

Reflections from the Scottish Planning and Environmental Law conference

spel 175 image

The theme of this year’s conference posed a question to speakers and delegates of the conference: is the current planning climate in Scotland presenting “new opportunities, or more of the same?”

Delegates came together in the COSLA building in Edinburgh to discuss all areas of planning and environmental law in Scotland. The gathering included a range of organisations and sectors, including lawyers and solicitors, planners, engineers, academics and civil servants.

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Image by Rebecca Jackson

The morning session focused on energy, infrastructure and economic development. Ross Martin (@SCDIChief), chief executive of the Scottish Council for Development and Industry kicked the day off with a discussion of place making in Scotland. He highlighted the economic benefit of good planning, noting that when it is done well planning has a core role in economic development strategies and can facilitate growth within an area.

This was followed by a discussion from Professor Becky Lunn from the University of Strathclyde who gave delegates some interesting food for thought in her discussion of the environmental, economic and moral consequences of Scotland’s energy choices.  A day after Ineos imported its first container of US shale gas to its Grangemouth refinery, Professor Lunn told delegates, that no energy solution is problem free, but “if we (Scotland) say no to the domestic production of gas and nuclear energy we are saying yes to something else”- the demand needs to be met regardless of whether the energy is produced in the UK or not. She questioned the moral arguments that it could be acceptable to import shale from elsewhere, while we are not content enough with the level of safety, the security of regulation and its wider environmental impact to do it ourselves (something which was picked up on by Ruth Davidson later that same day in FMQ’s). Professor Lunn advocated a strong public element to discussion, and a robust and well-informed debate around long term energy choices. She also warned against “crisis led” energy policy-making dictated by rhetoric of “fear and shortage”.

housing estate

 

Head of planning at Homes for Scotland, Tammy Adams (@TammyHFS) discussed the delivery of high quality homes in Scotland within the wider planning context. She highlighted the challenges and opportunities for house building, arguing that delivering new homes in Scotland should be “a golden thread” running through the Scottish planning system, and that an effort should be made to better align market realities and site strategy, but maintain flexibility of delivery.

The penultimate session of the morning was delivered by Sara Thiam, director of the Institution of Civil Engineers Scotland. She looked at the role of infrastructure and planning. Sara discussed the potential of devolution to city regions to grow the economy by allowing city regions to plan and build infrastructure which reflects their local social and economic needs. She also spoke about the need to be strategic about infrastructure choices, not just pushing increased finance for infrastructure, but targeting it strategically, investing in green infrastructure where possible, and thinking long-term about projects and desired outcomes.

The morning was brought to a close by event sponsors Terra Firma Chambers who provided some useful insights into  up-to-date case law, including notable cases that many delegates could draw on for their day to day decision making and planning submissions.

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Image by Rebecca Jackson

The afternoon session opened with a panel session which featured insights from four speakers: Greg Lloyd, Emeritus Professor of Urban Planning at Ulster University; Craig McLaren, RTPI Director of Scotland and Ireland; John McNairney, Chief Planner at the Scottish Government; and John Hamilton, CEO Winchburgh. The discussions focussed on the new opportunities presented in planning in Scotland, including the review of planning, building homes, creating more joined up planning and the planning process more generally. Discussions were wide ranging, generating a lot of interaction both within the panel and between the panel and the delegates. The discussions were wrapped up by a second case law update.

The final presentation of the day was delivered by Steve Rogers, Head of Planning and Regulatory Services at Dumfries and Galloway Council and Chair of Heads of Planning Scotland. He spoke about his experiences with smart resourcing and the importance of leadership in planning.

Overall it was a day full of insight and expertise, which provided everyone who attended with the opportunity to think critically about the state of planning in Scotland from a number of different positions. It posed questions to be considered, allowed delegates to reflect on their day to day practice and highlighted opportunities and potential barriers for planning in Scotland in the future.


An annual subscription to SPEL Journal is £145. For further details or a sample copy, please contact Christine Eccleson, SPEL Journal’s Advertising Manager, on 0141 574 1905 or email christine.eccleson@Idoxgroup.com

SPEL Journal is read by decision makers in Scottish planning authorities, planning law practices, planning consultancies, surveyors, civil engineers, environmental managers and developers across Scotland. It is also valued by many practitioners outside of Scotland who need to keep abreast of developments.

 

The digital world … why local government is still running to catch up

By Steven McGinty

In 2015, one third of local councils were still running Windows XP, months after a public sector-wide support agreement came to an end. By failing to update their systems, these local councils increased their vulnerability to cyber-attacks, potentially risking the loss of data.

Although many would argue that not installing a supported operating system is a minor risk, it does highlight a more fundamental issue with local government: whether it’s making simple upgrades or delving into advanced ‘smart city’ technologies, local government is struggling to keep pace with the digital world.

Why should local government invest in digital?

Local councils in England are facing a 6.7% cut in their funding by Whitehall between 2016-2020. It’s expected that the majority of the cuts will come in the first two years, easing off in the remaining two. Additional funding measures have been put in place for social care, including enabling local councils to raise £2 billion by increasing council tax and providing access to £1.5 billion from the Better Care Fund (BCF). However, Chair of the Local Government Association (LGA), Lord Porter, has emphasised that social care will not see the benefits of this funding for a decade and in the short term, services will still be under pressure.

So, with this challenging financial context, local government is looking to redesign services, to create efficiencies and improve the experience for citizens. Embracing digital could provide some solutions.

Where could digital be adopted?

According to the National Digital Report, local councils are wasting two million man hours per year by re-keying data they receive through online services or a customer relationship management (CRM) system. The research shows that 50% of local councils are re-keying more than half of the data they receive via e-forms, creating £14 million in waste. It’s estimated that 11% of local councils are re-keying all their data.

In addition, a report by independent consultancy Bluefin Solutions has found that if local councils improved their access to mobile technologies, they could save £10 million per year.  Chris Smith, Head of Public Sector at Bluefin Solutions, suggests that allowing council employees to access information via laptops and other mobile devices is an ‘untapped’ opportunity for council leaders. The report provides further detail, highlighting that local councils should allow staff to complete timesheets via mobile devices, engage with collaborative platforms, digitise data, and introduce a Bring Your Own Device (BYOD) policy.

These are just a couple of examples of where technology- enabled savings could be made in local government.

Sounds great! Why hasn’t local government implemented more digital solutions?

Limited infrastructure

Although there are a number of initiatives to improve broadband services across the UK, a lack of connectivity is still an issue, particularly in rural areas. For smart city projects, Wi-Fi infrastructure needs to be in place to support millions of sensors and connected devices. And in remote communities, local councils need basic broad infrastructure to ensure they can implement digital solutions such as cloud services, as well as encourage mobile working.

Red tape

Unlike the private sector, local councils often face challenges with red tape and providing a business case, especially when investing in unproven technologies. Interestingly, though,  the Local Digital Today 2014 report found that the need to provide a business case for digital projects has slightly declined (falling from 85.4% in 2013 to 78.3% in 2014), suggesting that maybe digital technologies are gradually becoming more acceptable in local government. However, for the majority of local councils providing a clear business case can act as a barrier to digital change.

Funding

In theory, providing technical solutions to local government services should provide long term efficiencies. Yet, in an era of constrained budgets, finding the initial capital for digital projects can be challenging. Leaders in councils trying to fund social care services and schools may not view digital as a priority. And with the legal obligation to set a balanced budget, under the Local Government Act, councils are unlikely to fund projects with debt. Seeking external investment can also be a challenge, as (unlike start-ups looking to develop new technologies) local councils are unable to work with private sector organisations such as venture capitalists.

Local councils have also received no digital funding from the recent Autumn Spending Review – with all £1.8 billion being allocated to central government departments. Martin Ferguson, Director of Policy and Research at Society of Information Technology Management (Socitm), argues that investing in digital health without investing in digital social care means that efficiencies and improved outcomes for citizens will not be achieved.

Politics

The public sector has been scarred by failed high profile IT projects, including the abandoned NHS patient record system, which cost the taxpayer nearly £10 billion. As a result, local council leaders have tended to be risk averse and avoid investment in major digital projects.

Additionally, public concern over privacy, an issue raised when national ID cards were considered, has also impacted enthusiasm for digital. Even exemplar digital nations such as Estonia are underpinned by departmental data sharing agreements, which the British public may not be comfortable with.

Research has also shown that a limited understanding of smart cities by the public, has led to a lack of support. Local councils have therefore been reluctant to invest in projects that have limited demand.

Is devolution the answer?

In the Policy Exchange’s Smart Devolution report, co-author Eddie Copeland suggests that devolution might provide the tools to encourage greater digital progress. In particular, he highlights the ability city authorities will have to pool together funding from separate pots, co-ordinate initiatives at a city-wide level, and exploit the benefits of data through a designated Office of Data Analytics.

This won’t entirely address why local government has struggled with digital change. Yet, it’s possible devolution will provide greater opportunities for local government to embrace the digital world. Either way, it will be interesting to see what role digital plays in devolution deals, and how this will impact the lives of citizens.


Follow us on Twitter to see what developments in policy and practice are interesting our research team. Further reading: if you liked this blog post, you might also want to read our other posts on digital

Devolution, for and against: a tale of many cities

Image: The Dickens Museum, by Peter Curbishley via Creative Commons

Image: The Dickens Museum, by Peter Curbishley via Creative Commons

By Rebecca Riley

In his classic quote, Dickens describes a time of great change, and the conditions which were forcing that change: industrial and technological revolution; growth in knowledge and education; oppressed conditions of the working class and lack of hope within a time of great progress. In France this led to revolution, in Britain it led to eras of philanthropy, growth in a new middle class, and extensive governmental and democratic reform within a broader struggle by the establishment to retain power.

Today, we are faced with similar conditions: huge technological change; growing inequality; uneven distribution of power and funds – but the demand for change is coming from the cities and local leadership, not from an oppressed working class. This is creating a resurgence in the call for greater devolution, which has gathered speed since the end of the 20th century. So what are some of the arguments for and against devolution, and what will be the impact?

The ‘for’ argument

Currently Britain has a patchwork of devolved powers, with devolved nations having greater control over local issues. Here local government already makes decisions on local issues and this ensures discussions and decisions are made at the appropriate spatial level. However, unlike other countries such as Canada, this is a combined self- and shared- rule, with central government still able to legislate in the devolved areas (in practice they don’t without the consent of the devolved government). This does, however, lead to one of the greatest arguments for further devolution, as England does not have a similar structure and there is no opportunity for any self-rule. In demographic terms, areas such as Manchester and Wales have similar populations, but Wales has much greater control over its own destiny.

This concentration of effort can streamline the decision making process as decisions are made by the people who know the issues and can implement the solutions. National government is freed up to discuss issues of national importance and the ‘bigger picture’. There is also the potential that decision making at a local level is more effective, because of the greater belief in a common goal by decision makers as they focus on the enhancement of their own local area.

Currently the devolved nations don’t have their own tax raising powers and are still funded via a block grant from central government. Greater powers over taxation could lead to greater competition and ensure money raised in an area is reinvested in that area. However, this could also continue to widen the gap between rich and poor areas.

The ‘against’ argument

One of the arguments against devolution is cost. Devolving decision making from a central system, which has been doing this effectively for a long time, would increase the time taken for decisions and the associated structure changes needed to implement them. And there is a possibility of constitutional instability. What happens if the city or regional government clashes with national government? How does this get resolved? Who do we appeal to? National government?

Current devolution structures are not all the same. Scotland has control over policing, Northern Ireland doesn’t. In Wales some powers are devolved to the assembly not the government, so structures, powers and legislation varies, and therefore the devolved governments are not all equal. This uneven devolved decision making can also lead to a postcode lottery. One of the starkest examples of this is university tuition fees, where a student in England looks at debts in excess of £27k for fees, while Scotland has not introduced them.

Many also see devolution as the start of the break-up of the United Kingdom which would lead to a weakening of the national government, and its position in world politics.

But what do the people want?

The recent Scottish referendum which asked “Should Scotland be an independent country?” returned a no vote with a 10% majority, on an unprecedented 84% turnout. Other referendums on devolution-related topics have fared less well on voter engagement: the Greater London Authority was established with a 72% majority on a 34% turnout; and the last limited devolution referendum in England was in the North East in 2004, where it was rejected, by nearly 80% of voters on a 47% turnout.

The Scottish question was a single issue campaign which people understood and engaged with, unlike the devolution debate in general. This has become enmashed in other policy areas such as health, education and planning, rather than being a single policy debate in its own right.  Generally, there is a lack of discussion with the electorate about what devolution could be trying to achieve:

  • A democratic voice for local areas and the structures needed to do that consistently and fairly;
  • Ensuring decision making is based on knowledge or the needs, requirements and opportunities of the local population;
  • Ability to create competitive local economies, that play to strengths and tackle micro-economic issues;
  • Streamlining government structures and preserving the whole country as an economic power;
  • The need to develop transparent decision making structures, which everyone can engage with;
  • A planning system which ensures strategic decisions are made which support local place development;
  • Ensure access to services, such as education, health and social care meet consistent, national standards but respond to local requirements;
  • Ensure a fair, place-based spending approach, which invests in places without widening the gap between them, and is balanced by social justice.

There are clear arguments for and against devolution, and whereas Dickens popularised political discussion in the nineteenth century by creating a narrative people related to (serialised in ‘cheap’ papers which the growing educated population and new middle classes could access) the majority of the electorate today is not engaged in these discussions. In the run up to the general election, there is a lack of populist narrative about devolution and, as a result, change could be implemented without full democratic participation and an understanding of the impacts.


The Idox Information Service can give you access to a wealth of further information on devolution, democracy and political engagement. To find out more on how to become a member, contact us.

Further Reading:

Manifesto for Local Economies

Devolution: the basics

Devo Met: charting a path ahead

The future of planning and place making

Getting to the heart of devolution in Manchester (new approaches to integrated health and care)

A healthy new direction or a costly gamble? (devolution of health and social care budget to Greater Manchester)

Governing in an ever looser union: how the four governments of the UK co-operate, negotiate and compete

The agenda: devolution (devolution to non-metropolitan areas)

The implications of devolution for England

Grey men dreaming of vibrant cities?

Image by Neil Howard under Creative Commons

Image of MediaCity, Manchester by Neil Howard under Creative Commons

By Morwen Johnson

They control combined budgets of over £10bn, deliver 24.4% of the combined economic output of England, Scotland and Wales, and are home to over 21 million people. What are they? The Core Cities of the UK – and as pre-election lobbying ramps up a gear they are at the forefront of the devolution debate.

Last week I attended the Core Cities Devolution Summit. This event, hosted in Glasgow, marked the launch of a modern charter for local freedom. It also gave those interested in the current cities agenda a chance to hear from the city leaders on the potential benefits of reform.

I won’t summarise the charter, or the main recommendations of a new report from ResPublica which argues for the fullest possible devolution of public spending and tax raising powers to the UK’s largest cities and city regions. Instead, here are a few reflections on the day.

Bespoke devolution

The hype over Manchester’s recent devolution agreement with the Treasury shouldn’t distract from the fact that devolution is not a one-size-fits-all model. The idea isn’t to try and mimic Manchester’s journey – what’s on the cards is an approach that takes account of local circumstances.

I’m not sure that the end result of this – potentially radically different priorities in revenue generation, service delivery and spending between neighbouring metropolitan areas – is being communicated in a transparent way. Ben Page from IpsosMori shared some interesting survey results which suggest that public opinion also lags behind the political agenda:

ipsos survey 1

ipsos survey 2Leadership not bureaucracy

Mention devolution and one of the immediate responses of naysayers is to complain it’s just yet another layer of governance – more costs, more staff, more vested interests. This was raised during Q&A and the panel responded by saying that what they are proposing doesn’t require massive reorganisation – it’s about effective leadership. The same pots of money are used but funds can be accessed in different ways for different purposes.

This was only half-convincing. Repeated reference to place-based decision-making (breaking down functional /organisational silos to ensure services are focused on outcomes and those residents with complex needs) didn’t really explain how you build the trust and political capacity that’s needed to roll out transformation across multiple agencies/workforces at the same speed and scale.

Equalities

Presenting a different perspective on the day was Professor Lesley Sawers, who highlighted the risks of unintended consequences from devolution in terms of social justice and inequalities. She argued that so far localism has led to an approach to investment that has not been particularly effective in tackling equalities issues.

Cities should be great agents of social reform but the rhetoric around growth has a tendency to focus on infrastructure and macroeconomics – ignoring social challenges such as skills, poverty and under-achievement. And it may seem an easy point to score, but running an event with only 3 female speakers out of 25, didn’t really send a great message to observers. Don’t even mention the lack of ethnic diversity on the platform.

What now?

The devolution agenda may be the ‘only show in town’ but whether the core cities can take advantage of this to benefit and engage their own populations remains to be seen.


The Idox Information Service has a wealth of research reports, articles and case studies on governance and city regions. Members receive regular briefings as well as access to our Ask a Researcher enquiry service.

Britain’s cities push for more powers

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Manchester Town Hall: (Photograph, James Carson)

On 9 February, leading politicians, decision makers and academics will meet in Glasgow to discuss how more powers can be devolved to the UK’s cities. The meeting is being organised by the Core Cities group, which advocates a bigger say for Britain’s major cities outside London.

The Glasgow gathering is the latest sign of a growing appetite for financial freedom for the UK’s cities and regions.  The movement picked up pace during the Scottish independence referendum campaign with the pledge by political party leaders at Westminster to give more powers to the Scottish Parliament.  The subsequent publication of the Smith Commission’s recommendations  prompted Sir Richard Leese, leader of Manchester City Council and chair of the Core Cities UK cabinet, to respond:

“What’s good enough for the Scottish Parliament should be good enough for big cities across the UK. Today’s commission report unveils significant fiscal devolution for Scotland and the power to retain more of the tax revenue it raises. This is something that Core Cities UK strongly advocates for cities on both sides of the border, giving us the power to make a difference on the ground and unlocking their full potential.”

But even before the Smith Commission had reported, devolution for cities was rising up the political agenda, and the major Westminster parties had already started setting out their proposals:

  • In November, the chancellor of the exchequer, George Osborne, unveiled a plan to give Manchester new powers over transport, planning, housing, police and skills. Similar packages are proposed for Leeds and Sheffield, part of the government’s commitment to build a ‘Northern Powerhouse’ as a counterbalance to the ‘London super-region’;
  • The Labour Party has promised that, if elected to government, it will pass control of business rates to the major cities, and that the House of Lords will be replaced by a senate of elected regional and city representatives;
  • The Liberal Democrats have called for devolution on demand to be offered to any part of England with a population in excess of one million.

Politics is one factor driving the demand for more city devolution; another is the economic situation. As the Centre For Cities recently observed:

“From a public finance perspective, there is an increasing realisation that future reductions in public sector expenditure will be impossible to deliver without changing the way public services are designed and delivered, and this requires more to be done at the local level.”

For many, the moves to cut the purse strings held by Whitehall and Westminster are long overdue.  The City Growth Commission noted in October that the UK has the most centralised system of public finance of any major OECD country, with sub-national taxation accounting for only 1.7% of Gross Domestic Product (GDP), compared to 5% in France and 16% in Sweden.

The Commission argued that more powers for the cities would build on the momentum of the government’s City Deals by creating stronger, more inclusive and sustainable growth in the UK, and suggested that London, Manchester and West Yorkshire are already equipped to take on the risks and benefits of fiscal and funding devolution.  While some, including the Prime Minister, welcomed the report, others, such as Stephen Brady, leader of Hull city council felt short changed:

“I’m really, really disappointed that Hull once again has been overlooked in favour of the bigger cities. We’re like the forgotten city, despite being strategically so important. We’ve won the City of Culture 2017 bid. What else can we do to prove that we want to be given the chance to run things ourselves?”

His response is a reminder that establishing a comprehensive devolution settlement that covers all of Britain will prove challenging.

Ultimately, the real prize of city devolution could be a fairer society. A report from the International Monetary Fund in April 2014 found that decentralising government expenditure and revenue can help achieve a more equal distribution of income. But the authors stressed that this would require several conditions to be fulfilled, including comprehensive decentralisation on both the expenditure and revenue sides.

During its Glasgow meeting in February, the Core Cities group promises to unveil a ‘Charter for Local Freedom’ setting out the powers  it wants central government to devolve down to cities. And with cities set to play a key role in shaping the outcome of the general election, it’s clear that this is one issue that will continue to build. As Alexandra Jones from the Centre for Cities observes:

“The debates about devolution and the city regions have not always had political momentum; there’s no shortage of that now.”


Further reading

We’ll be attending the Core Cities Devolution Summit on 9 February – follow @idoxinfoservice for live tweets and this blog for follow-up commentary.

Devo-City: a short guide to Britain’s devolving city regions in words and data

Tales of the cities

Economic growth through devolution: towards a plan for cities and counties across England

Charter for devolution

Abstracts and access to subscription journal articles are only available to members of the Idox Information Service.