The government’s failure to clearly define what local areas are meant to achieve as a result of being handed powers and funding could put the wider devolution agenda at “risk”, the chair of the Public Accounts Committee Meg Hillier has told LGC.
While she did not believe the government had deliberately avoided setting specific targets for areas with devolution deals, Ms Hillier expressed concern about the fact it was “not uppermost in their minds” and warned them “it will come back and bite you”.
Ms Hillier was speaking to LGC to mark the launch of the latest PAC report, ‘Devolution in England: governance, financial accountability and following the taxpayer pound’, which highlighted what it said was the continued failure of central government to define its objectives for devolution in England. It also raises concerns about the lack of scrutiny, transparency, and accountability.
The report said it was important taxpayers can “understand who is spending their money, how that money is allocated and where responsibility lies if the system fails to deliver good value or things go wrong”.
Ms Hillier said a failure to clearly define objectives and expectations about economic growth could result in a “blame game” between elected mayors, combined authorities, and central government.
“I don’t think there’s a deliberate intent [to set devolution up to fail] but if it’s not done properly it could be a risk to devolution,” she said. “You have got to bring people with you.”
The report said the Department for Communities & Local Government “has not fully addressed our concerns about local scrutiny and accountability and the resources and capacity needed to rigorously oversee spending”.
As a result Ms Hillier said she was not confident that combined authorities had adequate funding and resources in place for effective scrutiny.
“Scrutiny is under-resourced across local government generally,” she said, and added it would not be viable for areas to have their own local public accounts committees due to a lack of resources.
The report said the devolution of health and social care funding “must not allow central government to absolve itself of its responsibility to ensure that devolved areas receive adequate funding for sustainable services”. It added reduced budgets meant “local bodies must ensure value for money when delivering vital services”.
Meanwhile, the DCLG should also ensure the benefits from devolution are spread to “all local areas”, the report said.
A DCLG spokesman said: “We have been clear that devolution is about putting power back in the hands of local people and helping them drive local economic growth and productivity.
“Our landmark devolution deals across the country will see strong, accountable local leaders take control of major economic priorities including transport, infrastructure investment, planning, skills and more.
“These deals, which include £5bn in new funding, will help communities take control of decisions that matter to them and build an economy that works for everyone.”