Local government leaders must “move out of their comfort zone” and put together a “persuasive agenda” for devolution, the leading economist Jim O’Neill has said.
In an interview with LGC to mark the launch of the RSA City Growth Commission’s final report, Mr O’Neill, who led the commission, voiced frustration with the approach taken by some.
Recalling a recent meeting with council leaders, he said: “They had a bitch about having no powers but didn’t come out with a credible or persuasive agenda for getting more.”
Mr O’Neill, a former Goldman Sachs Asset Management chair, urged politicians to capitalise on the momentum building up behind greater devolution in the wake of the Scottish independence referendum.
“I would encourage local authority leaders to move out of their comfort zone,” he said.
The commission’s report argued for the metropolitan authorities with the “most robust” governance structures to be offered more powers, including the flexibility to borrow on the open market. These organisations should enjoy much longer finance settlements, stretching up to 10 years, so they could plan more effectively.
They should also be able to pool budgets at a city-region level and to raise and retain their own business rates and council tax revenue.
During the interview, to be published in full in a future edition of LGC and on
LGCplus.com, Mr O’Neill dismissed concerns that more local control over finances could result in poorer parts of England losing out.
“It’s up to people to raise their game,” he said. “You can’t argue for more devolution and when you are given it, not do something with it.”
The report recommended that the process for devolving power and responsibility from Whitehall to UK cities, which it dubbed “devo met”, should run in parallel with that for Scotland.
It recommended the establishment by January of an independent devolution commission to evaluate applications for “devolved city status”. This body would vet devolution bids from May’s general election onwards.
The RSA commission said combined authorities had “great potential” as governance structures, but suggested directly accountable “metro mayors” may offer a more “resilient” oversight mechanism.
It said Greater Manchester, London and West Yorkshire could all take on the extra powers it moots now, with the north-east not far behind.
It recommended that the new devolved authorities should take on strategic planning powers, similar to those exercised by the Greater London Authority.
Planning at the metro level would also make it easier for poor quality greenbelt land to be rezoned and swapped for better sites elsewhere across the conurbation, it concluded.
The commission estimated its proposals would boost economic output across England’s 15 largest metropolitan areas by £79bn a year, or 5% of current GDP.