Creating the civic architecture for regional growth

England's devolution journey has reached a pivotal moment. Devolution is accelerating. Andy Burnham's recent call for deeper fiscal devolution, stronger strategic authorities and a more ambitious role for city regions in driving economic renewal has helped shift the national agenda from the transfer of powers towards the broader transformation of England's system of governance.The next step is to build the civic, financial and institutional capability required to govern effectively at the regional scale over the long term.For two decades the debate has centred on transferring powers from Whitehall while reshaping England's system of local and regional governance through strategic authorities, mayoral leadership and local government reorganisation.The next phase of devolution lies at the intersection of civic regionalism and civic finance. A good economy depends not simply upon growth but upon institutions capable of retaining, circulating and investing wealth in the long-term interests of people and place.The next phase is less about constitutional design than institutional capability: whether these emerging arrangements possess the civic, financial and governing capacity to make devolution work.England is not starting from scratch. It is a mature democracy, but one with a fragmented institutional landscape. The current programme of devolution and local government reform creates a rare opportunity to reshape England's civic architecture around the realities of modern regional economies and the communities they support.Where devolution settlements have taken root, they are strengthening regional leadership. As devolution extends, the priority shifts from constitutional reform to developing the institutional capacity through which regions can govern, co-ordinate investment and shape their own economic futures.This requires a deeper constitutional partnership between national government, regional government and the civic institutions that understand the economies and communities they serve.Andy Burnham's leadership has helped articulate that ambition, but the next settlement cannot be designed by any one institution or individual. National government, including Whitehall itself, must evolve alongside the regions by establishing the constitutional framework and enabling a new partnership with regional institutions.Regions, in turn, should co-design the governance through which devolved powers are exercised. Political leadership can convene and enable that partnership and civic institutions must translate it into lasting regional capability.The next phase of devolution lies at the intersection of civic regionalism and civic finance. A good economy depends not simply upon growth but upon institutions capable of retaining, circulating and investing wealth in the long-term interests of people and place.Civic regionalism recognises that labour markets, transport, health, housing, skills and investment increasingly operate at the city-region scale. They are too interconnected to be managed effectively by individual councils and too place-specific to be directed from Whitehall. The same functional relationships apply across urban, rural and mixed regional economies.Civic finance complements this approach. Britain does not lack sources of capital, but coherent institutions capable of aligning them with regional priorities.Regions cannot shape their economic futures while remaining overwhelmingly dependent upon centrally allocated funding, competitive bidding rounds and prescribed spending programmes. They require continuity together with greater capacity to retain and recycle the wealth they generate, invest strategically and borrow responsibly.Regional fiscal capability is not created by additional funding alone. It is created through institutions capable of retaining wealth, mobilising capital and coordinating long-term investment.The Good Economy's work on Local Government Pension Schemes illustrates how existing capital can increasingly be aligned with regional priorities.Different regions will require different institutional arrangements. These might include Regional Civic Investment Funds to aggregate public, pension and private capital; Regional Wealth Funds to retain a share of locally generated value for long-term regional investment; Strategic Utility Stewardship to align essential infrastructure and utility investment with regional priorities; Regional Land and Housing Corporations to assemble land and co-ordinate development across functional housing markets, building on Homes England, Mayoral Development Corporations and Civic Development Banks to mobilise patient capital for businesses, infrastructure and regeneration.Political institutions provide democratic legitimacy and constitutional authority. Civic institutions provide operational capability. They bring together local government, universities, colleges, NHS partnerships, housing providers, employers, community organisations, regional finance and the voluntary sector to translate regional ambition into coherent collective action.Although still evolving, Greater Manchester provides strong evidence of integrated regional governance in practice. Over three decades the city region has assembled a connected civic ecosystem linking public institutions, employers, universities, health services and investment around shared regional objectives.The partnership between Sir Richard Leese and Sir Howard Bernstein demonstrated how sustained political and civic leadership can align institutions over successive electoral cycles.The mayoralty strengthened that architecture through democratic leadership and convening power, but Manchester's success has depended less upon individual personalities than upon the gradual alignment of its civic institutions around a common purpose.Devolution transfers powers. Civic capability determines whether those powers can be exercised effectively. The strategic and combined authorities emerging through current devolution legislation provide the constitutional foundation. The logical next step is to evolve them into city region municipalities: governing vehicles capable of integrating civic institutions, fiscal capability and democratic leadership at the scale on which modern regional economies actually function, whether urban, rural or mixed.Greater Manchester's real contribution may prove to be not simply its own success but its demonstration that sustained institutional collaboration can be adapted elsewhere.Britain does not lack wealth, leadership or regional ambition. What it lacks is the civic architecture through which regions can govern, invest and act collectively. Devolution transfers powers. Civic capability determines whether those powers deliver lasting regional renewal.Neil Johnston is an associate in civic economics at The Good Economy

Title

DEVOLUTION

Creating the civic architecture for regional growth

By Neil Johnston | 22 July 2026

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