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Call for reorganisation under industrial strategy draws critics

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Leading figures in local government have reacted sceptically to a thinktank’s call for the creation of strategic authorities on very similar boundaries to those of the 1974 upper tier reorganisation.

Localis said England should be reorganised into 47 new strategic authorities in order to deliver the government’s industrial strategy. These are based almost entirely on the shire and metropolitan counties created in 1974 - but in some cases radically changed since then - rather than the 39 local enterprise partnerhips or any other permutation of boundaries.

Strategic bodies are identified by Localis as mayoral combined authorities, county councils which draw up agreements with districts, and elected assemblies chaired by a member who commands a majority.

These 47 bodies would exercise devolved powers aimed in particular at reviving the economies of smaller towns whose voters formed the bulk of the ‘leave’ vote in last year’s referendum on European Union membership.

District Councils’ Network chair Neil Clarke (Con) called the idea “fundamentally flawed”, while Simon Edwards, director of the County Councils Network, welcomed the report’s “emphasis on counties as major strategic authorities”.

The Local Government Association warned the government against imposing new structures.

Greg Clark

Greg Clark

Greg Clark

Business secretary Greg Clark said Localis’ report, The Making of an Industrial Strategy: Taking Back Control Locally, published on Wednesday, was an “important contribution” to creating a “strong industrial strategy”.

Writing in the foreword to the report Mr Clark said place would be “an important feature of the industrial strategy” and added: “Local civic and business leaders will be central to ensuring the government’s vision of a country sharing in the prosperity of growth. This means we need everyone to work together in the national interest.”

Localis said the 47 bodies’ devolved powers should include a greater influence over tax-setting and raising, planning, local transport, business incentives and labour market rules because “England has no governance structure with the strength and capacity to help deliver the government’s national industrial strategy”.

It also calls for fiscal pilot projects in which local leaders could trial a variety of revenue-raising powers, such as powers to set VAT locally and take a local top slice of corporation tax.

There is also a proposal to allow areas of high growth to petition government to use land from neighbouring authorities to meet their own demands for housing and economic development.

Neil Clarke

Neil Clarke

Neil Clarke

Cllr Clarke (Con) said: “Proposals setting out top-down approaches to geographical areas based on out-dated ceremonial boundaries are fundamentally flawed.

“When it comes to devolution, we remain clear that one size does not fit all. It must be down to local areas to determine governance arrangements which reflect what local people and businesses want.”

Mr Edwards said: “Devolving power and resources to counties at scale – rather than a heavy emphasis on the major cities and bureaucratic governance – will help rebalance the country and deliver on the government’s aims of its industrial strategy and higher regional productivity.”

Mark Hawthorne (Con), chair of the LGA’s people and places board, said: “It is important that we build on existing locally-led economic strategies and partnerships, and not create unnecessary uncertainty or confusion through the creation of new institutions or structures.

“The government should work more flexibly with local areas to agree deals, recognise that not all deals need to follow the same governance framework and commit the resources necessary to get those deals over the line.”

Birmingham City Council leader John Clancy (Lab) said a successful industrial strategy needed radical devolution of powers and funding and thought Localis’ report “shows how that can be achieved”.

Localis chief executive Liam Booth-Smith said: “We need to expand economic policy out from big cities to small town England. Our report is a roadmap for turning a national industrial strategy into local economic renewal.”

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