Decentralising Governance in England

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Decentralising Governance in England UK2070 Commission and Rebalancing the UK Economy decentralising governance in england Andy Pike, Mike Coombes, Louise Kempton, Danny MacKinnon and Peter O’Brien consider the UK2070 Commission’s initial proposals for decentralising governance in England through trans-regional ‘provinces’, and argue for clarity on what decentralisation is for, what powers and resources it comprises, and how it works in England The UK and, especially, England are among the most complex map and patchwork of different highly centralised major countries internationally.1 The governance arrangements across England. UK had a relatively stable level of decentralisation Addressing the central problem of highly centralised between 1950 and 1986, underwent further governance and marked geographical inequalities, centralisation until the late 1990s devolution, and this article sets out the definitions, rationales, has settled at a relatively higher level. In addition, benefits and costs of decentralisation, and considers the UK and England have long-standing and the UK2070 Commission’s initial proposals for persistent geographical inequalities in economic and decentralising governance in England. Specifically, social conditions that are high in an international it examines the establishment of trans-regional context. While the causal relationship between ‘provinces’ by situating them in their national and centralised governance and spatial inequalities is not international context in Europe and assesses their clear and direct, it has been a persistent association appropriateness as governance arrangements in UK political-economic and geographical history.2 alongside mayoral and combined authorities. It The need to find appropriate forms of decentralised argues for a more comprehensive and strategic governance for England has been a recurrent concern.3 approach to clarify what decentralisation is for, what In the post-war period, decentralisation resembles a powers and resources it comprises, and how it works pendulum swinging between different geographical in England. A clearer and more transparent policy is scales and institutional arrangements at the local, needed to articulate and progress this agenda. sub-regional and regional levels. The limited decentralisation since 2010 has Definitions, rationales, benefits and costs of been ad hoc, incremental, and piecemeal. decentralisation Multiple rationales have been presented, pulling Decentralisation is defined as the allocation of decentralisation in different directions and powers and resources from national to sub-national muddling its objectives. These motives comprise levels of government. There are different kinds of local growth, public service reform, expenditure decentralisation, distinguished by their powers and reductions, democratic renewal, and addressing resources, ranging from the highest level, devolution, societal challenges such as ageing and climate to the lowest level, administrative (see Table 1). change. This episode has been based on the What is called ‘devolution’ in the discussions informal governance of deals and deal-making in about decentralised governance in England is more negotiated central-local government agreements accurately termed ‘delegation’ because of the limited on decentralised powers, responsibilities, and nature of the powers and resources involved. resources. Differentiated combinations of powers The main rationales for decentralised governance and resources have been allocated to different are better matching of public expenditure and services areas. This kind of decentralisation has created a to local preferences, mobilisation of local knowledge Town & Country Planning November/December 2020 403 UK2070 Commission and Rebalancing the UK Economy Table 1 Forms of decentralisation Level Form Characteristics Low Administrative Administrative functions and responsibilities undertaken at the sub- national levels Deconcentration Dispersion of central government functions and responsibilities to sub- national field offices. Powers transferred to lower-level actors who are accountable to their superiors in a hierarchy Delegation Transfer of policy responsibility to local government or semi-autonomous organisations that are not controlled by central government but remain accountable to it Political Political functions of government and governance undertaken at the sub- national level Fiscal Autonomy over tax, spending and public finances ceded by central government to sub-national levels Devolution Central government allows quasi-autonomous local units of government High to exercise power and control over the transferred policy Source: Decentralisation: Issues, Principles and Practice 4 Table 2 Potential benefits and costs of decentralisation Potential benefits Potential costs Devolved policies better reflect Additional administrative costs of additional layers of territorial preferences (allocative government and/or governance institutions efficiencies) Loss of scale economies in policy formulation and delivery Improved knowledge of territorial economic potential (productive Increased ‘rent-seeking’ by interest groups better able to efficiencies) influence sub-national territorial rather than national institutions Democratic accountability improves efficiency of policy formulation and Weaker disciplines of monitoring and evaluation (national implementation; fosters innovation finance ministries as tougher drivers of efficiency than territorial institutions) Fiscal autonomy provides hard budget constraints, and (where applicable) tax- Budget constraints increasingly tied to territorial fiscal capacity varying power allows marginal changes Weak incentives due to lack of a mechanism linking public to taxation and spending spending with tax revenues raised within sub-national territories Lower co-ordination and compliance Reduced co-ordination with the rest of the national territory, costs vis-à-vis the rest of the national with possible negative spillover effects both on and from sub- territory national territories Source: Adapted from BK Ashcroft, JK Swales and PG McGregor: Is Devolution Good for the Scottish Economy? A Framework for Analysis. Devolution Briefings No. 26. ESRC Devolution and Constitutional Change Programme, Mar. 2005. https://strathprints.strath.ac.uk/15669/1/Briefing_26_McGregor.pdf on economic potential and costs, and increased The UK2070 Commission’s proposals for accountability of local governments to citizens. decentralisation Depending upon its form and combination of powers Addressing the problem of intermediate governance and resources, decentralisation can generate in England and the complex patchwork of current potential benefits and costs (see Table 2). While arrangements, in the UK2070 Commission’s first there are other countries, such as France, Italy and report 5 proposals for ‘effective devolution’ comprised: Spain, that have asymmetrical or geographically ● increasing devolution of powers and resources to uneven decentralised governance systems with the ‘local’ level, to a ‘comprehensive framework’ different powers and resources allocated to different of mayoral and combined authorities and rural areas, the degree of asymmetry in England is acute. counties; Asymmetrical forms of decentralisation have specific ● setting up four new ‘trans-regional arrangements’ potential benefits and costs, too (see Table 3). for ‘provinces’ for the North, the Midlands, the 404 Town & Country Planning November/December 2020 UK2070 Commission and Rebalancing the UK Economy Table 3 The benefits and costs of asymmetrical decentralisation Potential benefits Potential costs Accommodating diverse preferences for autonomy across regions Lack of accountability and transparency Adapting the institutional and fiscal frameworks to the capacities of sub-national governments Complexity and co-ordination costs Advanced form of place-based policies Lack of clarity for citizens Experimenting Potential risks of increased Sequencing decentralisation disparities (in capacities) Providing the enabling institutional environment to design territorial Secession and autonomy development strategies more targeted to local needs Tailoring solutions for special challenges Source: Adapted from Asymmetric Decentralisation: Policy Implications in Colombia. OECD, 2019. www.oecd.org/colombia/Asymmetric_decentralisation_Colombia.pdf South East, and the South West, constituted from Investment Bank’s regional arms, and, following the existing local leaders and aiming to ‘complement’ examples of the Northern Powerhouse and Midlands strategic planning for pan-regional issues at the Engine, overcome lower-scale rivalries between local and joint or combined authority level; and cities and towns. In terms of governance and ● decentralising national government functions, democratic accountability, the proposal is that each responsibilities and budgets covering England to Economic Executive would be governed by a new ‘align with’ the ‘local and trans-regional devolution’. Regional Council, elected indirectly from their constituent local authorities. Proposed funding Similar proposals were originally outlined in the arrangements would be based initially on a block Institute for Public Policy Research (IPPR) Commission grant from the UK Treasury and then a new and on Economic Justice recommendations to create a more decentralised fiscal framework for England. ‘new tier’ of ‘English regional authorities’ or ‘economic executives’ that would be ‘responsible for regional English ‘provinces’ in context
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