Understanding Devolution a Critical Appraisal of the Greater Manchester Devolution Deal

UNDERSTANDING DEVOLUTION A CRITICAL APPRAISAL OF THE GREATER MANCHESTER DEVOLUTION DEAL

There has never been The devolution agenda of recent years has been heavily promoted a more urgent sense by its proponents as the key to across the UK of how tackling both economic imbalance desperately we need to and democratic deficits. Yet it has not, to date, represented the kind of rebalance the regional fundamental paradigm shift in how we economic differences design economic strategy nationally as well as regionally, which would really that see wealth and transform the centralisation of our decision-making so economy in a way that shifts wealth concentrated in the and prosperity substantially to the communities that feel so left behind. capital, and leave so many communities The New Economics Foundation has long argued for decentralisation of feeling left out of the economic and financial system, both entirely. as well as for the power of economic decision-making to flow from the bottom up rather than the top down. Devolution could offer an exciting opening to pursue these agendas – and we have been eagerly following the process to understand how far it may enable this shift. The Greater Manchester devolution deal was the first to take shape formally within this process. Beginning in negotiations for a ‘city deal’1 in 2011, and developing through further iterations between the Conservative-Liberal and Conservative NEW ECONOMICS FOUNDATION UNDERSTANDING DEVOLUTION A CRITICAL APPRAISAL OF THE GREATER MANCHESTER DEVOLUTION DEAL

governments led by David Cameron, • Devolution is too top-down. In it has most recently culminated with a its current form, it primarily reflects fourth ‘devolution deal’ struck between the priorities of central government, Whitehall and the Greater Manchester which are to increase aggregate Combined Authority (GMCA) in March growth and reduce public spending. 2016.2 Many devolved mechanisms can be clawed back by central government Exploring how this process has been if the growth requirement is not taking shape within the GMCA offers met, and are also circumscribed huge insight into the possibilities and by government requirements on challenges of the national process. This how resources are spent – often briefing is based on a combination by contracting private sector of interviews with senior officials, deliverers. Powers to deliver centrally policy experts, document analysis, determined objectives is hardly and an analysis of the basic socio- ‘localism’. economic dynamics of the GMCA area as well as their historical trajectory. • Devolution deal making Its aim is to evaluate the ambitions undermines democratic and plans of policymakers, and offer decentralisation. Deals have been recommendations for how, under the struck between elites behind closed existing devolutionary framework, doors, with minimal, and post- those implementing the devolution hoc public participation. Given deal, and the communities this affects, the well documented ailments of might best advance a more sustainable, representative democracy, electoral democratic, fair, and balanced economy links are not sufficient to legitimate and political system. these changes. Devolution’s democratic deficit needs addressing Regarding the national pursuit of through genuine, upstream, public devolution, we argue that: participation.

• Devolution needs broader Given this, we outline the challenges economic policy change. This that face Greater Manchester policy includes a shift away from a model makers who wish to pursue deeper and that continues to rely on the hope more systemic positive changes within of trickle down dividends from the the region, through the devolution economic dynamo of London and agenda. We suggest they will need to: the South East. This centralised economic structure cannot be • Challenge the dominance of a overcome by devolution in its current ‘trickle down’ logic. This prioritises form. boosting the city centre through big- business led development, external • Fiscal devolution needs investment, and demographic re-thinking. The current approach change. This is a well-trodden relies on business rate localisation to path towards gentrification, the grant more financial independence. marginalisation of existing residents, This will lead to a febrile regulatory and increases in inequality. Growth ‘race to the bottom’ to attract can be pursued but it should be business investment. It will also a means to improve conditions make local government finance for existing residents through much more vulnerable to economic endogenous and community-led fluctuations and will lead to a approaches to economic development. mismatch in many areas between level of need and level of resource.

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• Be wary of ‘responsibilisation’. We always that it was heavily dependent challenge the idea that disadvantage on the political will of the government portrays individual failure to in Westminster, especially that of the take advantage of opportunities, previous Chancellor George Osborne compounded by welfare dependence. who drove the agenda and, crucially, Ills such as social inequality, and kept the Treasury on side. are systemic failings. The corollary of this narrative, a “carrots and Prior to the Brexit vote and the sticks” welfare regime is mistaken: subsequent change in administration, it incentivises individuals to take the devolution agenda had continued advantage of trickle down benefits to evolve. This report focuses on that don’t materialise. developments in the devolution process to the GMCA, from its genesis • Pay attention to the need for in the city deals of 2012, through local democracy. Devolution offers its acceleration with the Northern Manchester an opportunity to Powerhouse pioneered with the GMCA revitalise local politics and democracy in 2015. Devolution was extended which needs to be more decisively nationally by the Cities and Local grasped. The role of civic participation Government Devolution Act (2016), is currently limited to generic, which applies primarily to the core consultative forms of engagement. cities group,3 and generalises provisions GM should experiment with for introducing directly elected mayors radical approaches to participatory (who can also replace police and democracy such as substantive crime commissioners) to combined participatory budgeting, which can authorities. It also removes statutory both increase the effectiveness of limitations on functions of local public spending, empower citizens authorities, thus paving the way for new and, in doing so, connect democratic deals, covering new competencies, to be renewal and social justice agendas. developed.

The new government has emphasised INTRODUCTION the need to develop an industrial Devolution was one of the central strategy for the whole of the UK. This pillars of Cameron’s Conservative has dampened a specific focus on the government (2015-2016) economic Northern Powerhouse. However, the (2010-2015) policy. Building on the devolution agenda has not ground coalition government policy of city to a halt. When the new minister for deals, the ‘devolution revolution’ was the Northern Powerhouse, Andrew underpinned by a stated ambition Percy, was appointed in July 2016, he to rebalance the UK’s economy by embarked on a tour of the Northern giving greater freedom to city regions, regions to reassure these that the policy especially in the North, to develop would continue. The new chancellor, and implement economic strategies. Phillip Hammond, expressed his However, the vote in favour of support for transport investments in Brexit at the EU referendum in June the North. The government published 2016, and the consequent change in a Northern Powerhouse strategy government cast some doubt over committing £1.8 billion funding for 4 the future of this devolution agenda. regions from 2017, and commitments Political centralisation in Westminster to continue developing the Northern and economic centralisation in the Powerhouse were made in the 2016 South East is the natural centre of autumn statement – although it gravity within the UK’s system. One of featured to a lesser extent than in 5 the vulnerabilities of devolution was previous statements.

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The devolution agenda is therefore DEVOLUTION TO THE GMCA: still an evolving process. Theresa POWERS, CONDITIONS, May’s inauguration speech focused AND PROGRESS heavily on the need for greater social equality, and the development of an Devolution to Greater Manchester inclusive economy, recognising that began in 2011 with the negotiations the referendum result in favour of for a city deal6 upon which the Brexit reflected big spatial inequalities GMCA was established. Further in the UK. In many ways, the in powers have been handed down and out vote spread reflected the through various iterations of this economic geography of the winners deal-making approach, which has and losers from economic restructuring been described by academics tracking since the 1970s. Devolution and real the process as ‘informal governance’ empowerment, both economic and – relatively uncodified in nature and political, of those regions that have characterised by the importance of been left behind, would be crucial to social and professional relationships fulfil May’s stated ambitions for more and networks.7 The ad-hoc policy equality and inclusion in the UK. style and resulting patchy nature of official documentation makes At the New Economics Foundation, the process difficult to track and we welcome the continuation of predict. However, one of the clearest devolutionary ambitions, and are aspects of the devolution deal is its excited about the potential interaction conditionality upon consolidating the of the policy with stronger rhetoric GMCA structure under the leadership about developing a more equal of a directly elected mayor, which economy. However, there are very real advocates argue provides clearer local concerns that bear scrutinising, about accountability structures for the new the specific way in which devolution powers being handed down.8 Many has been, and is being, implemented of the powers will not be fully drawn at national level, as well as devolved down until an elected mayor enters city-regional level. This briefing office in May 2017. explores these concerns, and sets out an alternative vision both for how The main elements that we have devolution could be approached by identified so far are the following: central government, and how GMCA policymakers might most effectively • Creation of a Combined Authority respond to the powers on offer. and the position of elected mayor: Established in 2011, the GMCA is directed by a mayor, held accountable by a cabinet consisting of the leaders of the ten local authorities. Greater Manchester Police and Crime Commissioner Tony Lloyd was appointed interim mayor in the run-up to the mayoral elections planned for May 2017, for which Andy Burnham has been confirmed as the Labour candidate, Sean Anstee stands for the Conservatives and Jane Brophy for the Liberal Democrats.

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• The integration of health and Draw down of funds from central social care: This is the most government is scheduled as £40 significant aspect of devolution, million in year 1, £120 million in year which reflects a long-standing 2, and £140 million in year 3. Plans national policy priority to deliver are to develop 10,000 units of ‘high efficiency gains and improve services quality, market-facing housing’ per through health and social care year, which will increase the private- integration. Through the devolution rented and owner-occupied sector – deal, Greater Manchester is one of especially targeted towards attracting the pioneers of this national policy a young, skilled, and highly mobile agenda. In collaboration with the demographic. Interviews with local NHS, devolved powers in this relevant officials suggest that, area cover a £6.6 billion budget. incentivised by the ability to recycle Integration operated in shadow form recovered loan funds, 50% of the in 2015, and went live in April 2016. moneys had been committed by July 2016 – under the condition that • Employment support: The GMCA private partners front-finance 50% has received co-commissioning of the contracted developments. rights with the DWP ‘working well’ By October 2016, a further £20 pilot which began commissioning million had been committed to projects in January 2016. The main three private contractors to develop objective is to reduce out-of-work 150 units across three sites.11 The benefit claimants. It was initially August 2016 Greater Manchester expected to cover 50,000 individuals Spatial Framework document, to be by 2020, with a £100 million budget. approved by the GMCA following It was set up as a payment-by- the election of the new mayor, sets results mechanism, to be delivered ambitions for the development of by private contractors, with new circa 230,000 new homes by 2035. payments and a phased programme expansion subject to evaluations to • Transport: demonstrate success. In March 2016, »» Operational since 2013, the ‘earn the pilot was expanded from 4,000 back’ tax-increment financing to 15,000 interventions.9 In addition, mechanism was expanded in central government has agreed to co- the 2015 deal. The GMCA will commission a new Work and Health receive 30 annual payments programme from April 2017.10 of £30 million to invest in infrastructure, with further draw- • The housing investment fund: downs being subject to reviews Established in 2015, the fund has every five years to ensure that given Greater Manchester access to growth objectives are being met. £300 million to be drawn down over So far the fund has been used 10 years, conditional on constituent to build extensions of the city’s local authorities taking collective Metrolink and to accelerate responsibility for repayment of the delivery of the SEMMS £240 million by 2025. Housing road strategy aimed mainly at development programmes must reducing airport congestion. be delivered by the private sector, Building has also begun on a funded on the basis of recoverable Metrolink extension to Trafford loans, which the GMCA can recycle Park, the largest employment three times before returning funds zone outside the city centre.12 to central government in 2025. Future plans for earn back are to

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deliver further expansion of the supplement, subject to the support light rail network, and projects of the mayor’s cabinet and with to increase connectivity between the agreement of the local business different urban centres in Greater community through the Local Manchester. Enterprise Partnership.

»» The 2015 deal included powers • Power to vary council tax by 2%: for Greater Manchester to In the 2015 autumn statement, introduce bus franchising, and George Osborne announced plans deliver integrated ticketing across to allow councils to increase council all modes of transport in the area. tax by 2%, with the condition that Our interviewees argued this funds raised are spent on adult social was a significant step in moving care. In December 2016, Theresa beyond the failings of a fractured May’s government announced that transport system that has failed this ceiling would be raised to 3% to deliver quality service to users. over 2017/2018 and 2018/2019. The devolution of management This is a national measure that is of train stations is another power not specific to Manchester but will received, which local advocates likely interact with the devolution of argue allows Greater Manchester health and social care to the GMCA. to invest in peripheral stations that have been under-funded There are plans in place to devolve by central agencies in the past. further competencies to the elected Greater Manchester officials GMCA mayor, some of which were argue that this raft of measures as passed through the Cities and Local a whole will allow them to plan Government Act (2016). The main transport services more effectively developments include: across the area. • Fire and rescue services to be • Devolution of business rates: absorbed into GMCA April 2017. In a move towards self-financing of local authorities, central • The mayor to take on the role of the government plans, through the Local Police and Crime Commissioner. Government Finance Bill (previously referred to as the Local Growth and • A commitment to establish Jobs Bill), to phase out the revenue principles governing expansion of support grant and replace it with prudential borrowing capacity. the local retention of business rates • Powers to implement a Community by 2020. The GMCA is a trailblazer Infrastructure Levy to spend on in this respect. In March 2015 plans development, regeneration, and were announced to allow Greater infrastructure projects. Manchester to retain 100% of growth in business rates from April 2017. This was announced alongside a national raise in the qualifying threshold, which will lead, at least in the short term, to a reduction in intake. However, it is expected that the elected mayor will also have the power to introduce a business rates’

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THE SOCIO-ECONOMIC Focusing specifically on the North CONTEXT West, beyond peaks and troughs, the region has diverged from the rest of the The Greater Manchester region UK: its average income per head was has a population of 2.75 million about 10% lower than the UK average spread between 10 local authorities, in 1989; it is now about 16% lower.15 with Manchester representing However, Great Manchester has fared approximately 25% of the region’s better than the North-Western average population (Figure 1). The devolution by keeping up with economic growth settlement essentially crystallises a rates of other UK conurbations.16 history of collaboration between the 10 constituent local councils that goes But despite a relatively decent back to the Association of Greater performance throughout the 2000s and Manchester Authorities in 1985. 2010s, Great Manchester’s income per head is still 8.3% lower than the EU28 In terms of the national macro- average (Figure 2) – an average which economic context, the most salient includes the poorest regions of the EU. development since the early 1980s Similarly, its productivity growth has is that Great Manchester has been lagged similar EU agglomerations – for affected by a wider pattern of economic example comparable second-tier cities 13 divergence across the UK territory. in France and Germany.17 This divergence process between London and the South-East with other British regions has resulted record- high regional inequalities, which are unparalleled in Western Europe.14 Reversing these regional inequalities is one of the main aims of devolution nationally.

FIGURE 1: POPULATION BREAKDOWN OF GREAT MANCHESTER

281,619 Key: 322,022 Bolton

187,884 Bury 233,288 Manchester

Oldham

221,692 Rochdale 530,292 Salford

Stockport 288,733 Tameside

Traﬀord 230,823 245,614 Wigan 214,195

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FIGURE 2: AVERAGE INCOME PER HEAD BY NUTS2 REGIONS COMPARED TO EU-28 AVERAGE

Northern Ireland (UK) EU-28=100 (Purchasing Power Standards) Highlands and Islands North Eastern Scotland South Western Scotland Eastern Scotland East Wales West Wales and The Valleys Devon Cornwall and Isles of Scilly Dorset and Somerset Gloucestershire, Wiltshire and Bristol/Bath area Kent Hampshire and Isle of Wight Surrey, East and West Sussex Berkshire, Buckinghamshire and Oxfordshire Outer London - West and North West Outer London - South Outer London - East and North East Inner London - East Inner London - West Essex Bedfordshire and Hertfordshire East Anglia West Midlands Shropshire and Staﬀordshire Herefordshire, Worcestershire and Warwickshire Lincolnshire Leicestershire, Rutland and Northamptonshire Derbyshire and Nottinghamshire West Yorkshire South Yorkshire North Yorkshire East Yorkshire and Northern Lincolnshire Merseyside Cheshire Lancashire Greater Manchester Cumbria Northumberland and Tyne and Wear Tees Valley and Durham

10050 150 200 250 300 350 400 450 500 550

Source: NEF based Eurostat18

Great Manchester is, on average, not seen as desirable, for fear of holding only lagging UK average economic London back as an economic dynamo. performance – both in terms of Comments by one Treasury official income per head and productivity – encapsulate this broad consensus: but also behind comparable second- tier European cities. Some of the “We do not want to hold London back. policymakers we interviewed in both We want to level up over time. London Whitehall and Greater Manchester is not the only reference point here. framed devolution explicitly as a There are many others, compared to response to this relatively poor other European cities, Northern Cities performance. Although this was underperform. We have a serious issue sometimes expressed in reference to in our second-tier cities compared with London, the overriding logic is that it France, Germany and probably even is not possible for the UK’s peripheral Spain – suggesting there is untapped regions such as Greater Manchester potential.”19 to catch up with London – nor is it

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The devolutionary logic is that it DEVOLUTION TO THE GMCA: can unlock this untapped potential. POLICY INTENTIONS Our baseline analysis shows that Northern regions of the UK also Through our research three policy areas post lower levels of employment, as emerged as the central pillars of the well as performing worse on health devolution deal in Greater Manchester: and education indicators, such as economic development, public service life expectancy and the proportion reform, and political reforms. Within of people with higher education each, we set out an overview of the degrees, respectively (Appendix 1). goals of the GMCA; the strategy The logic underpinning devolution is being developed to deliver these; our that decentralising decision-making evaluation of the goals and strategy; to more local units will enable policy- and some consideration of alternative making that is more responsive to local approaches. circumstances and therefore produces Economic development an economic dividend that will lead The main priority for all local and to improvements in these, and other, national policymakers we interviewed areas. 20 In the next section, we take a is for devolution to deliver economic more detailed look at the plans that growth. This priority is reflected in policymakers are developing and an annual 2.5% GVA increase in assess to what extent they can achieve the Spatial Framework consultation these aims, as well as develop the document published in August 2016.21 fairer, more sustainable, and balanced Related to this is the ambition of economy that we advocate at the New closing the output gap with national Economics Foundation. averages and comparable second- tier European cities, which, as already explained, is seen as a more realistic, and desirable, ambition than catching up with London. The focus on redressing imbalances within the region is less explicit from our interviews. However, as illustrated in Figure 3, there are wide differences within the conurbation of Greater Manchester. Geographical disparities are between the relatively affluent central and South West areas, scoring above national average in income per head, and South East, North West, and North East areas that are well below. Data within the Greater Manchester Spatial Framework provides a more granular picture of these imbalances: Central Manchester has an average annual income per head above the UK average while Bolton’s, Wigan’s, or Oldham’s income is significantly lower than the UK average.22

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FIGURE 3: GVA OF GREATER MANCHESTER’S REGIONS AS A PROPORTION OF UK AVERAGE: NEF BASED ON OFFICE FOR NATIONAL STATISTICS23

GVA 140 Key:  Manchester  GM South West  GM South East  GM North West  GM North East

130

120

110

100 UK average 90

50 2011 2014 2013 2012 1997 1999 1998 2010 2001 2004 2005 2003 2002 2007 2009 2006 2008 2000

Where they do arise within current pressure on acute hospital services. policy, concerns with delivering intra- At GMCA level, greater control over regional rebalancing are tied into the health appears also to be linked to an notion that growth will be delivered ambition to increase participation in as the ‘indigenous’ populations benefit the labour market, especially through from increasing the region’s role as improved mental health interventions. a growth dynamo. This relies heavily In housing, the main ambition is to on the assumption that economic increase the proportion of private opportunity and wealth will trickle rentals and owner occupation, which down, and that geographical disparities is itself linked to a strategy seeking will be ironed out in the process – an transformation of the labour force by assumption that, as will be explained, attracting young, affluent, and highly we find problematic. skilled workers who, our respondents suggested, currently commute to Accordingly, within the documents Manchester from surrounding areas, and interviews we analysed, all powers especially Cheshire – essentially, a being devolved are framed in one substantial demographic change. way or another as policy levers to Thus, the Greater Manchester Spatial deliver growth. Public service reforms Framework foresees population growth in welfare, education, and skills of 294,800, and sets a target of 227,200 are seen as a mechanism to boost new homes by 2035. Accommodation greater labour market participation needs for new dwellers are to be by Greater Manchester’s existing delivered by private sector property residents. Transport and infrastructure development, perpetuating a trend investments are explicitly linked to since de-industrialisation in the central government objectives to 1980s.24 Complementing this, increase Greater Manchester’s GVA; improved early intervention in schools, social policy areas such as housing incentives, and punitive social policy and health and social care are also tied measures are intended to increase into this. For national politicians, the employment of the indigenous primary objective of the integration workforce and future cohorts. of health and social care is to reduce

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Ambitions to close the UK output Figure 4 shows a relatively weak gaps are hampered by a continuation correlation between both measures, of what has been called the “Anglo- with London as a notable outlier. liberal”25/“privatized Keynesian”26 Interestingly, relative to other British growth model (based on consumption metropolitan areas and regions, Greater fuelled by private credit, housing Manchester sits within the ‘high price inflation, and service industry prosperity, low inclusion’ quadrant, concentrated in the South East) suggesting that a significant part of the which is structurally advantageous to local population is locked out of the London and the South East.27 Despite proceeds of growth. It is possible these this context, Greater Manchester’s patterns of exclusion also match onto “growth at all costs” strategy may the intra-regional inequalities shown in deliver increased GVA. The main Figure 1. problem is that the kind of economic development which is being planned We do not expect that the GMCA’s rests on the assumption that a rising plans under the new devolution tide lifts all boats. Unfortunately, this is deal will reverse this situation. First, a well-trodden path towards increased the speed with which growth is inequalities and the displacement and sought is greater than the speed marginalisation of significant parts with which sufficient capacity for of the population. Figure 4 uses data existing populations to take part from 2010–2014 to correlate ‘prosperity’ can be developed – for this reason (a compound measure made up of demographic change is both an multiple indicators of human capital, outcome and a strategy. Second, and employment, and output) with related to this, the parallel economy, or ‘inclusion’ (measured by indicators ‘gentrification effect’, can be expected of income disparity, living costs, and to be deepened between those able to unemployment/economic inactivity). and those unable to participate in the

FIGURE 4: REGIONAL INCLUSIVE GROWTH BETWEEN 2010 AND 2014 SHOWS AREAS ARE STRUGGLING TO BOOST PROSPERITY AND INCLUSION28

North Eastern Dorset Key:  Low prosperity & Low inclusion Black Country  High prosperity Humber & Low inclusion  High prosperity Leeds CR & High inclusion Liverpool CR  Low prosperity Sheﬀield CR & High inclusion D2N2 Oxfordshire Lancashire Greater Manchester INCLUSION

Greater Birmingham and Solihull

London

PROSPERITY

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well-paid economy and occupy new, DEVOLUTION DEALS private accommodation. Indeed, recent AND PRODUCTIVITY research into the relationship between city growth and poverty alleviation in The self-stated objective of current the UK from 2000 to 2010 concludes devolution deals is to raise the that the relationship is tenuous at productivity of peripheral UK best. Decreasing poverty depends on regions. One way of expressing the kinds of jobs created and who productivity is in terms of output accesses them. There is a danger that produced per hour worked. This the kind of economic development measures the efficiency of an being planned in the GMCA will not economy in producing goods and deliver for existing residents.29 Third, services, and, to a great extent, it a focus on increasing the ‘aspiration’ determines national income (GDP) of disadvantaged communities risks per head. Overall, the UK has placing the blame on those individuals consistently lagged behind many for their predicament, rather than of its international counterparts: focusing on the underlying structures British workers need to work longer of inequality. This logic very much hours to produce the same value of underpins changes in the scope and goods as their German or French focus of welfare provision which will counterparts. But this pattern is exacerbate social inequalities. localised: whereas London and the South East have higher-than- We suggest that ambitions to deliver EU-average productivity, most increased growth need to be more British regions, including Greater clearly aligned with strategies Manchester, are lagging. that ensure a fairer distribution of opportunities and proceeds. The Regarding devolution initiatives, the GMCA is influenced by theories of overwhelming focus on productivity urban agglomeration, positing that growth raises three questions: cities can follow generic approaches to should productivity growth be the development based on the clustering only economic target of devolution of enterprises in specific sectors initiatives? Is higher productivity where they can develop competitive growth alone likely to result in advantages. This approach has been inclusive regional growth models? criticised for failing to understand Are current devolution plans likely the diversity of cities as well as the to deliver higher productivity dependence of their development on growth, and be successful against variable historical legacies, economic their own targets? ‘hinterlands’ (including geographical surroundings and national / First, productivity growth is not an international economic networks) end in itself, but can be a means and national economic contexts.30,31 to achieving more and better jobs, The urban agglomeration approach is a higher wages, and a better quality deficient framework for policy making. of life. Historically, productivity As such, we recommend that GMCA has been central to raising living policymakers should be more creative. standards, but there is no automatic link between average productivity growth and an increase in living standards for all. For example, average productivity can be pulled up by a handful of concentrated high value added economic sectors

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which are detached from local number of good jobs across all Greater economies and the local population Manchester’s communities. As such, – resulting in what French economic interventions which aim to improve geographer Pierre Veltz has called local supply chains in more mundane an “archipelago economy”, a sectors of regional economies are model whereby high productivity necessary for increasing incomes and agglomerations linked to the global jobs retention across local communities. market become detached from their For example, empirical research has hinterlands.32 The example of London’s shown that money spent in local shops agglomeration clearly contradicts brings about 2.5 times more value to the that wealth simply trickles down to local economy and local jobs compared the benefit of everyone just because to money spent in chain stores.35 a concentration of high value added Empowering Greater Manchester’s activities is taking place.33 communities to strengthen sectors in the foundational economy should be Secondly, the GMCA deal’s definition central to devolution efforts. of economic success is narrow. The economy is, of course, composed of the Fourthly, the current GMCA deal seems market sector, which forms the basis set to fail even on its own terms, as of mainstream economic indicators it takes a narrow approach to raising such as GDP or GVA. But the economy productivity. Although productivity is also composed of, and depends on, growth is a complex and multifaceted realms of life which are not represent phenomenon, there is wide agreement or accounted for by the market that the key causes of the UK’s economy. This includes, for example, poor productivity performance have the environment, on which economic historically been:36 activity ultimately depends, as well as what is commonly called the core a) Low private investment in new economy – human activities such as plants, machinery, and tools. Low care, social participation, or citizenship, investment has notably been driven which support the economic system by the short-term profit imperatives of and societal wellbeing without being the shareholder capitalism model, as accounted for in conventional economic well as lack of provision of sufficient metrics. These crucial components of patient finance for companies across the economic system are peripheral to the counties, in particular for small and the GMCA agreement as it stands. medium enterprises (SMEs).

Thirdly, as the foundational economy b) Low public and private research literature highlights, a significant part and development spending, which of economic activity in regional has historically hindered both cutting- economies does not take place in the edge innovation and the uptake of realm of high-end technology sectors, new technologies across all sectors of or high productivity activities – but in the economy. services such as retail and wholesale, social care and healthcare, or utilities c) Low investment in public distribution.34 Although developing infrastructure, such as transport or clusters of high productivity sectors communications networks, including (e.g. sectors linked to high-end high-speed broadband across the UK manufacturing or creative services) territory. Poor infrastructure impedes is certainly important, these sectors better business performance. are unlikely to provide a sufficient

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d) A skills and education gap.37 officials to take inspiration from The UK has one of the highest rates international examples of alternative of youth innumeracy and illiteracy approaches to economic development, of all OECD countries. The skills including the development of the and education gap in turn is heavily social economy in Quebec which was determined by high socio-economic underpinned by a long term strategy inequalities which impede the that developed the necessary business educational advancement of most support infrastructure, especially in disadvantaged groups.38 local finance.40 For example, the GMCA could give greater consideration to The GMCA deal comprises how health and social care budgets, for no instruments to tackle poor example, can be aligned with economic productivity drivers, such as low development powers to develop similar business investment or the skills approaches. and education gap. And although it does encompass mechanisms for Public service reform improving public infrastructure, the One of the main arguments made financial and institutional firepower in favour of devolution is that it can granted to local and regional lead to more locally responsive and authorities is in reality extremely accountable public services. Indeed, limited. It is consequently doubtful having gained increased influence over that the instruments devolved to health as well as (to a more limited Greater Manchester authorities will extent) employment support, GMCA be a game changer for improving the policymakers are pushing for increased area’s economic performance. powers over education and skills, but report significant resistance from central government for devolution in this area. The main pillar of public service reform linked to devolution is currently the integration of health The focus on achieving rapid and social care, whereby Greater growth through agglomeration and Manchester will collaborate with the competitive advantage should be local NHS in the management of a complemented, and tempered, by £6.6 billion budget. The main aim alternative approaches, including underpinning integration is the need community economic development, to contribute to fiscal consolidation social innovation, and a focus on through generating greater efficiencies. improving conditions in the less GMCA officials highlighted that if the glamorous foundational economy.39 current trajectory continues, there will Such an approach would include be a 2.1 billion funding shortfall by developing an economy made up of 2021 in local health and social care. smaller enterprises and a variety of More localised delivery and integration ownership models, an economy that of health and social care is a key plank is designed to deliver on a range of of the strategy to deliver efficiencies broader socio-economic outcomes and stop “paying for the costs of beyond increased GVA. To be sure, failure” as one official put it. The shift the incentives of devolution deals to an integrated model is supported from central government are not by a £450 million transformation aligned to these ambitions, but fund provided by central government. local policymakers can still exercise Health policy aims to engender discretion. We encourage GMCA behaviour change that leads to health

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improvement, especially around change. Research into outsourcing greater prevention and focusing on the has demonstrated that this risks both social determinants of health. This is waste and inefficiency, and increases complemented by the search for more the influence of corporate interests efficient, joined-up, person-oriented over politics.42 National policy change pathways that integrate providers, NHS is necessary here. However, in housing, commissioners, and local authorities for example, the GMCA has some within and across localities as well as discretion to make demands of private changes in clinical provision aimed at developers. The same applies to reducing duplication across hospitals. interaction with the private sector more The main development has been the generally. A recent report outlining an creation of pooled NHS and social care economic strategy for Wales argued budgets across the 10 local authority that the public sector could “raise the areas. social ask”43 of private firms delivering basic goods and services: the GMCA The £300 million housing fund is could follow this approach to ensure another important aspect related to that businesses operating locally make public service reform – insofar as it is a fair contribution to the Greater contributing to the perpetuation of Manchester economy, and to increase the national model of predominantly the social impact of public funds private housing provision. Although spent financing projects led by the a reduction in social housing is not private sector – local labour clauses, an explicit aim of devolution, policy public realm development, and local officials were clear that this would be procurement commitments are just an effect of national policy against some of the ways a more positive social which devolution should not be used impact could be achieved. as a shield. Indeed, the devolution deal specifies that moneys from the housing It is in transport where local fund are to be used to provide loans policymakers are most critical of the to private providers. We agree with previous approach to delivery, arguing the recent assessment made by the that the outsourcing model has led to Centre for Research on Socio-Cultural a fragmented service while delivering Change that this approach perpetuates returns for private providers. By taking a model that favours private property control of local bus franchising and developers at the price of exclusive integrating ticketing across trains, growth and gross inequalities. There trams, and busses, Greater Manchester remains a huge gap in provision officials plan to improve intra-city of alternative funds for Greater connectivity. While local policymakers Manchester to embark on a substantial welcome increased powers, they social housing programme.41 also note that the national austerity imperative is holding them back. They Broadly, the approach to public service mentioned projects that are either on provision continues to be one of hold, or have been modestly delivered. outsourcing the delivery of services For example, Greater Manchester to private contractors, sometimes would like to significantly develop an with the use of payment-by-results active travel agenda based on cycling mechanisms, such as in the working- and walking, but progress has been well employment support scheme. limited because of funds. “We’ve had a In employment support, this is a bit of money to do that, but we’re not requirement of the devolution deals, going to become Amsterdam”, as one and there is therefore little space for official put it.44

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Finally, as noted earlier, many of in this report will generate new the welfare policies and plans demands and require the creation are underpinned by a logic of of new policy-making processes to responsibilisation, i.e., justifying channel these. In more decentralised changes in the scope and focus of political systems, a greater amount welfare provision that places the onus of political activity is directed at local on individual behaviour change. This institutions; local politics is more includes ‘workfare’ models based on salient. The key question is regarding meeting training and employment the quality of the institutions that conditions, using a carrot-and-stick exist and their ability to channel approach. This approach is locked in by demands. These are of electoral programmes such as the Working Well and non-electoral varieties, such as pilot, which focuses on individuals and elected mayors or different forms of pays providers once outcomes such a public consultation and participatory a return to employment are met. This policy-making. The extent to which is concerning, especially given that the political processes that accompany the prevailing approach to economic devolution will improve governance development is likely to marginalise and democracy is an open question. and displace significant parts of Supporters of decentralisation claim the current population. It is also that it can provide clearer channels compounded by a punitive approach for participation and accountability, to welfare provision that mistakenly while critics argue that it could increase attributes failings to individuals. opportunities for elites to capture This narrative justifies an approach policy processes. that continues to seek trickle-down dividends, while also retrenching As noted, mayoral models have been welfare provision, or reconfiguring it in favoured for their ability to increase ways that are based on what we argue responsiveness and accountability; is a misdiagnosis of the failings of however, the main advantage identified social policy. by respondents to our research was increased bureaucratic capacity. We Political reforms find this a concerning reflection Devolution to Greater Manchester was of a broader absence of ambitions conditional on the establishment of a for democratic renewal through Combined Authority led by a directly devolution. This came through in elected mayor. This office was set up our interviews with Treasury officials in 2011 and has been operating in and is also reflected in evaluations an interim capacity, in the lead-up to of the devolution process at national elections in 2017. Our desk research level.46,47 However, there was also little suggests a decision was made not to go attention given to considerations of for a London-style elected assembly.45 local democracy by local actors. Given Arguably, an elected assembly model the radical ambitions of the devolution may have increased the democratic agenda to reshape Manchester, this quality of local institutions. The lack of involvement of citizens poses decision may have been taken in serious questions as to the legitimacy order to increase buy-in to the and sustainability of the process. If formation of the GMCA and cater to the local public is not engaged in the devolutionary ambitions of the devolution, lower electoral turnouts leaders of the 10 local authorities. We could legitimise a drawback of powers are not aware of any other processes by the centre, which would further being set up. However, the handing reinforce the centripetal dynamics of down of powers and budgets cited British statecraft.

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As well as increasing local buy-in and We say ‘genuine’ because as it travelled therefore ensuring the sustainability of the globe, participatory budgeting the current drive towards devolution, has been designed and implemented participatory democracy could ensure differently. Especially in its application that devolution evolves in ways that are in the UK (and Europe more broadly), more favourable to existing residents more modest versions have been and ‘ordinary’ people. The GMCA is adopted. Its central aim – to deliver undertaking some public engagement social justice by empowering citizens following traditional approaches, to influence significant budgets – such as survey-based engagement has been dropped in favour of a techniques, to understand citizen softer approach that seeks simply priorities for health and social care to increase engagement in local policy,48 for example. Consultations politics. This has led to changes in have also been held on the broad its institutional design that have question of how the GMCA should rendered participatory budgeting less use its powers49 as well as to seek able to deliver meaningful change.53 responses to proposals for a spatial However, while it is no panacea, a strategy.50 We suggest, however, that commitment to meaningful and large- devolution offers Greater Manchester scale participatory budgeting could an opportunity to be more ambitious successfully connect a democratic and creative, and become a pioneer renewal agenda with the need for of democratic innovation in the UK. the proceeds of local economic Comparative analysis of genuine development to be more equitably participatory budgeting,51 for example, shared amongst the population of has demonstrated that this can increase Greater Manchester. the effectiveness of public spending by delivering investments that cohere to the priorities of existing populations. It also empowers citizens and civic groups to take part in the process and can make substantial contributions to distributive justice.52

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CONCLUSIONS AND a loud scream for a fundamental RECOMMENDATIONS rebalancing between and within regions: this is not the current While we support the decentralising direction of travel. and democratising ambitions that the devolution agenda offers, we are • Fiscal devolution needs concerned about how the process is re-thinking. More financial being driven and carried out at national independence for local authorities level. These are important concerns is a very welcome development. But in themselves, but also because the current approach risks backfiring they impinge on the way in which on several fronts. First, dependence devolution is taking shape from the on business rates threatens a bottom up. We summarise here four regulatory race to the bottom by concerns with the national process and encouraging competition between three concerns with how devolution is areas to attract new businesses. unfolding in the GMCA. If devolution This would result in a simple is going to deliver on stated ambitions displacement of economic activities for a more inclusive, equal, and from one place to another resulting balanced UK, the new government in a zero-sum game between should take heed of the following: regions, rather than an actual increase of businesses. Second, National process: a dependence on business rates alone means that local government • Devolution needs broader income will be highly dependent on economic policy change. economic fluctuations, which would Devolution has not been generate significant uncertainty accompanied by a rethink of while hindering its capacity to the broader economic model deliver in difficult times. Third, there followed by the UK. The country is a mismatch between the capacity continues to be dependent on to increase funds from business consumption fuelled by private rates and the needs across different credit, a deregulated financial areas: clearly, poorer areas have high sector, and housing price inflation needs (notably investment needs to as well as service sector growth improve infrastructure and private in the South East. Devolution sector performance) and these deals aim to enhance business-led areas will face the double-whammy growth, with local areas focusing on of high need and low tax-raising developing competitive advantages capacity. This clearly risks a vicious which will produce growth and a cycle for poor regions. Avoiding this trickle-down effect. This approach febrile form of localism will depend is essentially akin to the model on whether and how equalisation for regional growth followed by and redistribution measures are New Labour, adding devolution embedded in the system. deals and subtracting some of the redistribution from growth in the • Devolution is too top-down. Some South East through public sector steps towards decentralisation have job creation and welfare. This was been taken through devolution a strong characteristic of the British deals. However, the powers on political economy in the New offer, and the conditions under Labour years. The current approach which they are decentralised, is highly likely to result in increased reflect first and foremost the social and spatial inequalities. The priorities of central government Brexit vote can be understood as in terms of achieving increased

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aggregate growth and reducing that their legitimacy as elected public spending.54 Moreover, central officials is sufficient. However, government retains the ability to if devolution does constitute a pull these powers back, or reward fundamental change for the British local authorities, depending on state (as claimed in the rhetoric), evaluations of growth delivered, then electoral links are hardly as in the earn-back model, where sufficient in terms of democratic new sources of capital expenditure legitimacy, especially given the well- accessed are subject to central documented ailments of local, and approval that moneys are well spent. national, representative democracy Freedom to spend in a manner in the UK. approved of by central government is hardly localist. Powers allowing These issues lead us to be sceptical local authorities to increase of the prospects for devolution in its council tax by 2% are conditional current form to deliver the kind of on those moneys being spent on socially just and sustainable political adult social care, and there are no economy that the New Economics powers to reform council tax itself Foundation would like to see. by making it more progressive. In short, devolution deals grant Despite this unfavourable context, some financial powers to deliver however, there is some leeway for centrally determined objectives, and Greater Manchester to leverage new are underpinned by a logic that is powers in pursuit of an alternative reminiscent of the ‘earned autonomy’ economic model. To capitalise on this principle underpinning previous leeway effectively, it will be important approaches to the centralised for Greater Manchester policymakers to management of local government. avoid repeating the failings of previous approaches. We have identified three • The approach to deal-making main constructive recommendations to undermines democratic policymakers working on devolution decentralisation. Devolution deals now and in the immediate future: have been developed through negotiations between local and • Challenge the dominance of national elites behind closed a trickle-down logic. Plans doors. This approach of informal for economic development are governance has the virtues of underpinned by an assumption that increasing flexibility, adaptability, wealth trickles down, which has and speed in decision-making, been shown to be fundamentally but these gains come at the cost of deficient at improving economic and transparency and accountability. The social outcomes for communities. approach purportedly enables deals Local policymakers are prioritising to be crafted to meet local need an approach that focuses on and capacity. However, researchers boosting the city centre; delivering report that for other cities, the big business-led development context of uncertainty and lack of mainly through external investment; knowledge regarding what’s on and generating demographic the table has ironically led to the change by attracting younger, GMCA model becoming a blueprint more affluent, and highly skilled for other regions.55 Moreover, the residents. This is a well-trodden deal-making approach has not path towards gentrification, the engaged in any substantial way marginalisation of existing residents, with citizens. Politicians might claim and increases in inequality. We argue

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that policy needs to be composed the same way seen in the Thatcher of a judicious mixture of exogenous and New Labour eras, with the and endogenous approaches to added dimension of retrenchment in economic development. Growth is an welfare provision, as well as policies important part of this development that are more aggressive in their use model, but should feature alongside of carrots and sticks to incentivise other, equally important, measures individuals to benefit from an of socio-economic performance. The increase in the ‘size of the pie’, for dominance of aggregate growth as example, by prioritising on social a measure of success and a driver of housing lists those who have made strategy is understandable, given the a ‘community contribution’ (i.e., conditions imposed upon Greater participated in education, training or Manchester by central government. employment).57 However, we think more can be made of these powers to deliver • Paying attention to the need for, rather than displace, existing for local democracy. Elsewhere, communities. It is important to take we have argued that devolution is this approach if devolution is to an opportunity to revitalise local work for Greater Manchester, but politics and democracy, by engaging it is also important that other areas citizens and moving power closer follow it if devolution is to prove a to them.58 However, the notion sustainable model for an improved that devolution might revitalise political economy. The Joseph local democracy was notable for Rowntree Foundation has recently its absence in the interviews we developed an inclusive growth index carried out. Arguments in favour that highlights the failure of growth of a mayor’s office were cast in to deliver prosperity for all, but also terms of the increased bureaucratic offers one potentially useful tool capacity to handle new powers that policymakers could use to track and responsibilities, rather than in progress, in Greater Manchester and terms of improved accountability other regions.56 and participation in local politics. Moreover, the role of civic • Be wary of a focus on participation is currently limited to responsibilisation. Within our fairly generic, consultative forms of research, GMCA officials explained engagement. Devolution could offer the failure of the city-centre-focused Greater Manchester an invaluable growth model, at delivering for opportunity to experiment with the wider community, in terms of radical approaches to participatory the personal failures of those in democracy that should be explored disadvantaged positions to take to a greater extent. Comparative advantage of previous opportunities analysis of genuine participatory offered by economic growth, and budgeting, for example, has dependency on a generous welfare demonstrated that this can increase state. We question the causal the effectiveness of public spending logic underpinning this approach: and empower citizens and, in ills such as social inequality and doing so, contribute to distributive unemployment cannot be explained justice.59 Greater Manchester should away at individual level, but are embrace this opportunity to become systemic failings. However, this a pioneer of democratic innovation narrative justifies an approach that and renewal. continues to seek dividends from trickle-down approaches, in much

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APPENDIX 1: SOCIO-ECONOMIC CHARACTERISTICS OF GREATER MANCHESTER IN PERSPECTIVE

GREATER GREATER UK AVERAGE MANCHESTER LONDON

GROSS VALUE ADDED PER HEAD OF POPULATION £21,626 £25,601 £43,629 (CURRENT BASIC PRICES)

GVA PER HOUR WORKED (LABOUR £25.8 £27.8 £36.5 PRODUCTIVITY)

MEDIAN HOURLY PAY £11.32 £12.18 £14.96 (EMPLOYEE JOBS)

EMPLOYMENT RATE, 69.6% 72.7% 71.7% % OF 15-64 YEARS

PROPORTION OF EMPLOYEES PAID 25.8% 24.4% 19.1% BELOW THE OFFICIAL LIVING WAGE

TERTIARY EDUCATIONAL ATTAINMENT, 46.5% 47.4% 63.9% % OF 25-64

NOT IN EDUCATION, EMPLOYMENT OR 13.6% 11.9% 9.7% TRAINING (NEET), % OF 15-24

AVOIDABLE MORTALITY RATE PER 100,000 OF 222.96 195.4 204.6 POPULATION

LIFE EXPENCTANCY AT 79.7 80.8 82.5 BIRTH (YEARS)

Sources: Office for National Statistics and Eurostat Regional Accounts60

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APPENDIX 2: SELECTED SOCIO-ECONOMIC DISPARITIES WITHIN THE GREATER MANCHESTER REGION

FIGURE A1: HOUSEHOLD DISPOSABLE INCOME AS A PERCENTAGE OF UK AVERAGE ACROSS SECTIONS OF GREATER MANCHESTER (UK AVERAGE = 100)

Percent Key: 94  GM South West 92  GM South East  GM North West 90  GM North East

80 2011 2013 2012 1997 1999 1998 2001 2010 2004 2005 2003 2002 2007 2009 2006 2008 2000

Source: Office for National Statistics61

FIGURE A2: PERCENTAGE OF EMPLOYEES PAID BELOW THE OFFICIAL LIVING WAGE ACROSS GREATER MANCHESTER’S LOCAL AUTHORITIES

Percent

40 Key: 35  UK average

Bury Bolton Wigan Oldham Salford Traﬀord Rochdale Stockport Tameside Manchester

Source: Office for National Statistics62

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FIGURE A3: PROPORTION OF POPULATION WITH LEVEL 4+ EDUCATIONAL ATTAINMENT ACROSS GREATER MANCHESTER’S LOCAL AUTHORITIES

Percent 40 Key: 35  UK average

Bury Bolton Wigan Oldham Salford Traﬀord Rochdale Stockport Tameside Manchester

Source: Office for National Statistics63

FIGURE A4: AVOIDABLE MORTALITY RATE PER 100,000 INHABITANTS ACROSS GREATER MANCHESTER’S LOCAL AUTHORITIES (2014 AS PER LATEST LOCAL FIGURES)

Avoidable mortality rate per 100,000 350 Key: 300  UK average

250

200

150

100

Bury Bolton Wigan Oldham Salford Traﬀord Rochdale Stockport Tameside Manchester

Source: Office for National Statistics64

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ENDNOTES

1. GMCA. (n.d.). Greater Manchester City Deal. Retrieved from https://www.gov.uk/government/ uploads/system/uploads/attachment_data/file/221014/Greater-Manchester-City-Deal-final_0.pdf 2. GCMA. (2016). Fourth Greater Manchester devolution deal announced in budget. Retrieved from https://www.greatermanchester-ca.gov.uk/news/article/56/fourth_greater_manchester_ devolution_agreement_announced_in_budget 3. The original 8 core city regions that signed wave one city deals in 2012 were Greater Birmingham, Bristol, Leeds, Liverpool, Greater Manchester, Newcastle, Nottingham and Sheffield, these have since been joined by Glasgow and Cardiff. 4. UK government. (2016). Northern Powerhouse strategy. Retrieved from https://www.gov.uk/ government/uploads/system/uploads/attachment_data/file/571562/NPH_strategy_web.pdf 5. UK government. (2016). HM Treasury: Autumn Statement 2016. Retrieved from https://www.gov. uk/government/uploads/system/uploads/attachment_data/file/571559/autumn_statement_2016_ web.pdf 6. UK government. (n.d.). City deals and growth deals. Retrieved from https://www.gov.uk/ government/policies/city-deals-and-growth-deals 7. Ayres, S. (2015). Examining the Role of ‘Informal Governance’ governance’ on Devolution devolution to England’s Cities. Political Studies Association. Retrieved from - http://www.bris. ac.uk/media-library/sites/sps/documents/PSA%20Informal%20Governance%202016_final.pdf 8. Copus, C. (2012). What can a mayor do for your city? Submission to DCLG Consultation. De Montfort University. Retrieved from - http://www.dmu.ac.uk/documents/business-and-law- documents/copus-dclg-consultation-directly-elected-mayors.pdf 9. GCMA. (2016). 15,000 more people in Greater Manchester to start Working Well. Retrieved from https://www.greatermanchester-ca.gov.uk/news/article/44/15000_more_people_in_greater_ manchester_to_start_working_well 10. Marsh, G. (2016). GM Work and Skills Update, 8th February 2016. Retrieved from https://www. greatermanchester-ca.gov.uk/download/meetings/id/394/item_05_work_and_skills_update_ devolution 11. GCMA. (2016). More new homes for Greater Manchester. Retrieved from https://www. greatermanchester-ca.gov.uk/news/article/94/more_new_homes_for_greater_manchester 12. Metrolink. (2016). Green light for new Trafford Park Metrolink link. Retrieved from http://www. metrolink.co.uk/pages/news.aspx?newsID=388 13. Martina, R., Sunleyb, P., Tylerc, P., & and Gardinera, B. (2016)., “Divergent cities in post-industrial Britain.”, Cambridge Journal of Regions, Economy and Society, 2016, 9, 269–299. 14. Meadway, J. (2013). Towards an industrial policy for Wales. London: The New Economics Foundation. Retrieved from http://b.3cdn.net/nefoundation/76fbd0aabdb290c755_qim6bkj2q.pdf 15. For data before 1997: Office for National Statistics (2016) Historic economic data for regions of the UK (1966 - 1996). Retrieved from: https://www. ons.gov.uk/economy/regionalaccounts/grossdisposablehouseholdincome/ adhocs/006226historiceconomicdataforregionsoftheuk1966to1996 16. Lupton, R Rafferty A and Hughes C (2016). Inclusive Growth: Opportunities and Challenges for Greater Manchester. Inclusive Growth Analysis Unit, University of Manchester. Retrieved from: http://hummedia.manchester.ac.uk/institutes/mui/igau/IGAU-report-2016-FINAL.pdf 17. Cox, E., & and Raikes. L. (2014). The state of the North: Setting a baseline for the devolution decade, IPPR North. Retrieved from http://www.ippr.org/publications/the-state-of-the-north- setting-a-baseline-for-the-devolution-decade 18. Eurostat (2016). Regional Yearbook 2016, Chapter 6: Economy. 19. Interview with Treasury Official, February 2016 20. Rodriguez-Pose, A., & and Gill, N. (2005). “On the Economic Dividend of Devolution.”, Regional Studies, Vol 39,: 405-420. 21. Greater Manchester Spatial Framework. (2016). [website]. Retrieved from - http://gmsf-consult. objective.co.uk/portal/2016consultation/gmsfoct16?pointId=4204587#document-4204587 22. Lupton, R Rafferty A and Hughes C (2016). Inclusive Growth Analysis Unit, University of Manchester. Retrieved from: http://hummedia.manchester.ac.uk/institutes/mui/igau/IGAU- report-2016-FINAL.pdf 23. Office for National Statistics (2016). Regional Gross Value Added (Income Approach), 1997 to 2014.

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24. Folkman et al. (2016). Manchester Transformed: Why we Need a Reset of City Region Policy. CRESC Public Interest Report. Retrieved from: http://www.cresc.ac.uk/medialibrary/research/ ManchesterTransformed.pdf 25. Hay, C. (2013). The Failure of Anglo-Liberal Capitalism. Basingstoke: Palgrave Macmillan. 26. Crouch, C. (2009). Privatized Keynesianism: an Unacknowledged Policy Regime.; Retrieved from http://onlinelibrary.wiley.com/doi/10.1111/j.1467-856X.2009.00377.x/abstract 27. McCann, P. (2016). The UK Regional-National Economic Problem: Geography, Globalisation and Governance. Oxford: Routledge 28. Source: Wright, D., & and Case, C. (2016). Challenge for growing Northern Powerhouse Regions to Share the Proceeds of Prosperity. York: Joseph Rowntree Foundation. Retrieved from https:// www.jrf.org.uk/press/challenge-growing-northern-powerhouse-share-proceeds-prosperity 29. Lee et al. (2014). Cities, Growth and Poverty: A Review of the Evidence. York: Joseph Rowntree Foundation. Retrieved from http://www.theworkfoundation.com/DownloadPublication/ Report/354_cities-growth-poverty-full.pdf 30. Engelen et al (2016) How Cities Work: A Policy Agenda for the Grounded City. Centre for Research on Socio-Cultural Change 31. Engelen et al. (2016) How Cities Work: A Policy Agenda for the Grounded City. Centre for Research on Socio-Cultural Change. Retrieved from http://www.cresc.ac.uk/medialibrary/ workingpapers/wp141.pdf 32. Veltz, P. (1996). Mondialisation, villes et territoires. L’économie d’archipel. Paris : Presses universitaires de France, Collection Economie en liberté, Paris. 33. As illustrated in Figure 2 of this report, while Inner West London has an income per head which five and a half higher rather EU average, other parts of London’s agglomeration, such as outer Eastern and North-e Eastern London, have an income per head below EU average. 34. Justin Bentham, J. et al. (2013), ‘Manifesto for the Foundational Economy.’, CRESC Working Paper 131. Retrieved from www.cresc.ac.uk/medialibrary/workingpapers/wp131.pdf 35. Sacks, J. (2002). The Money Trail. Retrieved from: http://www.proveandimprove.org/documents/ TheMoneyTrail.pdf 36. Besley, T., & and Van Reenen, J. (eds.) (2013)., Investing for Prosperity: A manifesto for growth., London: London School of Economics and Political Science. 37. Leitch, M. (2006)., Prosperity for All in the Global Economy: World Class Skills Prosperity for All in the Global Economy: World Class Skills, Leitch Review of Skills, HM Treasury. Retrieved from http://webarchive.nationalarchives.gov. uk/20061209025249/http:/www.hmtreasury.gov.uk/media/523/43/leitch_finalreport051206.pdf 38. Pickett. K., & and Vanderbloemen, L. (2015)., Mind the Gap: tackling social and educational inequality Retrieved from http://cprtrust.org.uk/wp-content/uploads/2015/09/Pickett- Vanderbloemen-report-ONLINE.pdf 39. Policy officials in Greater Manchester need not look far and wide for knowledge on how to develop these approaches. Local organisations such as the Centre for Local Economic Strategies and the Centre for Research on Socio-Cultural change have a strong track record of research and advocacy on alternative approaches that can deliver more inclusive and sustainable urban development. For a recent paper critiquing neoliberal urban development paradigms, and proposing alternatives, refer to Engelen et al. (2016). How Cities Work: A Policy Agenda for the Grounded City. Centre for Research on Socio-Cultural Change Retrieved from http://www.cresc. ac.uk/medialibrary/workingpapers/wp141.pdf. For an example of an approach to community economic development being taken in nearby Preston, refer to Jackson, M. (2015). Creating a Good Local Economy: the Role of Anchor Institutions). Centre for Local Economic Strategies. Retrieved from http://community-wealth.org/content/creating-good-local-economy-role-anchor- institutions 40. Mendell, M., & and Neatman, M. (2010). The Social Economy in Quebec: Towards a New Political Economy. GIREPS. Retrieved from http://www.gireps.org/publications/the-social-economy-in- quebec-towards-a-new-political-economy/ 41. Folkman et al. (2016). Manchester Transformed: Why we Need a Reset of City Region Policy. CRESC Public Interest Report. Retrieved from: http://www.cresc.ac.uk/medialibrary/research/ ManchesterTransformed.pdf 42. Bowman et al. (2015). What a Waste: Outsourcing and How it Goes Wrong. Manchester: Manchester University Press. 43. Brill et al. (2015). What Could Wales Be., Federation of Small Business. Retrieved from http:// www.mbs.ac.uk/news/research/people-management-organisations/what-wales-could-be/

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44. Interview with GMCA official, March 2016 45. OECD, Local Economic Leadership Report, p 88 - http://www.oecd.org/cfe/leed/OECD-LEED- Local-Economic-Leadership.pdf 46. APPG. (2016). Devolution and the Union: A Higher Ambition. Retrieved from (http://www.local. gov.uk/documents/10180/6917361/Devolution+and+the+Union+-+a+higher+ambition.pdf/ fd980893-cb5c-465f-a711-d241d22364b5); 47. HM CLGC (2016) Devolution: the Next Five Years and Beyond: http://www.publications.parliament. uk/pa/cm201516/cmselect/cmcomloc/369/369.pdf 48. HM CLGC. (2016). Devolution: the Next Five Years and Beyond. Retrieved from http://www. publications.parliament.uk/pa/cm201516/cmselect/cmcomloc/369/369.pdf 49. “Taking Charge together Initiative. (n.d.).” for example, [Website]. Retrieved from https:// takingchargetogether.org.uk/taking-charge-of-our-healthcreating-insightour-findings/ 50. GMCA. (2016). Have your say on new powers for the Greater Manchester Combined Authority. Retrieved from https://www.greatermanchester-ca.gov.uk/devopowersconsultation 51. GMCA. (2016). Draft Greater Manchester Spatial Framework. Retrieved from https://www. greatermanchester-ca.gov.uk/info/20081/draft_plan, for example, Baiocchi, G., & and Ganuza, E. (2014). participatory budgeting as if emancipation mattered., Politics and Society, Vol. 42, (1),: 29-50 52. Baiocchi, G. and Ganuza, E. (2017). Popular Democracy: the Paradox of Participation. Stanford: Stanford University Press 53. Bailey, D. 2016. Economic renewal through devolution? The effects of the City Deals on the political economy of the North. Presentation at the Political Studies specialist group on British and comparative political economy panel, Political Studies Association 66th Annual Conference, Brighton 54. Baiocchi, G., Heller, P., & and Silva, M. (2011). Bootstrapping Democracy: Transforming Local Governance and Civil Society in Brazil. Redwood City, CA: Stanford University Press. 55. Ayres, S. (2015). Examining the Role of ‘Informal Governance’ on Devolution to England’s Cities. Political Studies Association. Retrieved from - http://www.bris.ac.uk/media-library/sites/sps/ documents/PSA%20Informal%20Governance%202016_final.pdf 56. Beatty C., Crisp, R., & Gore, T. (2016) Joseph Rowntree Foundation, ‘Inclusive Growth Monitor. York, UK: Joseph Rowntree Foundation. Retrieved from - https://www.jrf.org.uk/file/49152/ download?token=-g_uHpcZ&filetype=full-report 57. Interview with GMCA Official, March 2016 58. Laurence, R., & and Lyall, S. (2015). England’s Dreaming: The Role of Devolution in Strengthening Regional Economies. London:, New Economics Foundation. Retrieved from : http://b.3cdn.net/nefoundation/9be9be324fa02979fe_hjm6i2idc.pdf 59. Baiocchi, G., Heller, P., & and Silva, M. (2011). Bootstrapping Democracy: Transforming Local Governance and Civil Society in Brazil. Redwood City, CA, USA: Stanford University Press. 60. Eurostat (2006). Regional Statistics by NUTS Classification. Retrieved from: http://ec.europa.eu/ eurostat/web/regions/data/database 61. ONS (2015). Regional Gross Disposable Household Income (GDHI): 1997 to 2013. 62. ONS (2015). Annual Survey of Hours and Earnings (ASHE): Appendix 4: Proportion and number of employee jobs paid less than the living wage in each GB Local Authority, 2014 63. Office for National Statistics (2014) Annual Population Survey: Occupational skill levels of those in employment. 64. Office for National Statistics (2015). Age Standardised Rates from Avoidable Causes, by sex and five-year age group, in Greater Manchester local areas.

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