There may be more than a rumbling of uncertainty over local government's future with the political machinations playing out in Westminster currently but one promise the sector is determined to keep grasp of is fiscal devolution.
Chancellor Rachel Reeves pledged in her Mais Lecture earlier this year that councils and mayors could look forward to receiving a share of income tax revenue, with details to follow in the Budget.
And as the clock ticks towards Reeves stepping up to the dispatch box in the autumn The MJ, Impower and Core Cities gathered senior officials for a round table on fiscal devolution.
A clear consensus was obvious – this was a positive moment for the sector's much sought-after fiscal devolution. A seismic moment maybe.
Given councils and combined authorities now appear to be pushing at an open door, the gathering recognised the need to proactively set the agenda on this potentially prize piece of fiscal devolution. Yet they also recognised they were a significant distance from presenting a clear picture to the Treasury.
The conversation illustrated a sense of urgency for the sector to get its ducks in a row, not least because fiscal devolution is deemed just a means to an end.
‘Fiscal devolution is not an end in itself,' remarked one senior official at the breakfast event. ‘The purpose is drawing down the interventions that can be measured for their impact.'
This, said the official, needed to be addressed to combat mandarin resistance.
But the grim reality around the table was that reaching a shared agenda about what the sector wants from Whitehall appears a distant prospect. Not a promising position with just a few months to go before Reeves reveals details on potentially the most seismic of fiscal devolution offerings.
She had, after all, stated in her lecture that there would now be a conversation with mayors and councils about what income tax devolution – however small it may initially be – should look like.
There were clear frustrations around the table at the sector's failure to articulate an ask and vision.
‘We need to be reacting and responsive to whatever happens,' said one participant. ‘We need a single voice and to be fighting as a single unit.'
‘The question is how can local government shape the debate and set up a blueprint. We do this altogether or not at all.'
They widened their point to argue that, with the prospect of strategic authorities covering all of England now having a mild question mark hovering above it, there was an ever-greater need for clarity on the sector's ask.
‘If all of that is going into bat, we need to think hard about what we want.
‘We need to think if we are just providing lip service to the public service reform agenda.
‘It worries me that it will only be lip service.'
This, they added, risked regional mayors ending up as little more than big versions of existing councils.
And alongside the need for consistency, clarity and continuity in the mayoral and council ask, another person voiced the need to be able to demonstrate the benefits.
‘We have to go beyond a list of projects. We need to present why this is best for local growth and sustainability.'
Yet, there was noticeable positivity in the room at the synergy that had emerged between councils and mayoral combined authorities. This success story no doubt helps explain the chancellor's willingness to step further towards fiscal devolution.
Listening to the round table discussion, however, the daunting complexity of fiscal devolution became all too obvious. Let's face it, Reeves' offer to engage with the sector ahead of the Budget illustrates the Treasury is equally struggling to articulate a coherent package.
What does it actually mean in practical terms?' questioned one senior officer present. They welcomed the Government's recent granting of a visitor levy as a ‘huge step' but warned any devolving of income tax was far more ‘technically demanding'.
‘It requires not just a transfer of tax but also of responsibility if we want it to fund stuff. ‘The fundamental question is about where responsibility sits.'
If Treasury plans to offer regions some income tax revenue are to be truly ambitious – coming with some control over rates rather than simply a reworking of ring-fenced grant – then one officer pointed to the challenges inherent in the country's parliamentary system.
While there was a chorus of agreement over articulating a ‘precise' ask of government, a sobering suggestion was that the answer may not yet exist.
This came with a call for the sector to push for co-design with the Treasury. It was felt that Whitehall already recognised that different solutions were needed and the Government is once again warming to whole place and whole system solutions.
It was a climate, argued one participant, in which councils and mayors would be pushing at the open door if they could articulate their ask and ‘outcomes focus' approach, placing people at the centre of their plans.
But as councils and mayors race to get up to speed with a clear ask on fiscal devolution there was a warning from around the table that the sector needed to challenge itself to think radically and differently.
‘Most of the people in this room have got where they are today by working in a certain system and structure,' one debater claimed.
‘We need to question if that is the way to get things done today.'
Another concurred, arguing there was a danger that regional government just replicated national government.
A key challenge expressed by a further voice around the table was demonstrating the connectivity between service improvement and any additional charge or levy, something national government regularly fails to do but which councils have recently started to succeed at.
In a political time where disaffection is running wild there is a particular onus on councils to build on these early achievements so communities can be won over to the benefits of public services. It will be a vital component should true fiscal devolution emerge in years to come.
‘Tax and spend is the big issue,' said one officer. ‘If we want people to be energised about what we do and in the debate then we need to have a system where that trade-off exists.'
If there was space for a second sobering thought at this round table it was that, despite the gathering articulating plenty of challenges and must-dos on the road of fiscal devolution, answers were in short supply.
With time running out before the Budget there is little space for the sector to sort its position and strategy out.
But the increasing synergies emerging between councils and mayoral combined authorities is unquestionably a silver lining. The hope is that the clouds sufficiently part for the light to emerge.
COMMENT
Jon Ainger – Executive director, Impower
Taking part in this Core Cities roundtable at UKREiiF, I came away with more than the usual devolution debate. Something in the room felt unusually live.
For years the direction has been clear enough, even if progress has been slow. What felt different in Leeds was that we're now pushing at an open door. The Government's invitation to help design the next phase of devolution gives cities and regions a chance to stop reacting to proposals and start shaping them.
The prize is obvious. A fiscal settlement that ties growth to the things residents actually care about would fix one of the system's most stubborn tensions. Combined authorities are focused on growth; councils are left managing the consequences of demand. Bring those two together under a more coherent framework and both can succeed on their own terms.
What struck me was how far that alignment has already come. The relationship between councils and mayoral combined authorities isn't just a negotiation anymore. In a lot of places it's becoming a genuine partnership, with a shared stake in inclusive growth. That shift might matter as much as any single fiscal lever.
It's also clear the leadership is in place. Across the Core Cities and the mayoral combined authorities there's real depth — experienced people, genuine talent and the institutional capability to put greater fiscal freedom to work. With the Autumn Statement approaching, there's a rare chance to shape government thinking before the decisions are taken rather than after.
The ability to go further, and faster, is plainly there. The job now is to use it – while the door's still open.
Round table attendees
Jon Ainger, Executive director – Impower
Jon Day, Economic policy manager – Cardiff City Council
Katherine Fairclough, Chief executive – Liverpool City Region
Amy Harhoff, Chief executive – East Midlands Combined County Authority
Nick Hibberd, Chief executive – Bristol City Council
Stephen Jones, Chief executive – Core Cities UK
Kate Josephs, Chief executive – Sheffield City Council
Henry Kippin, Chief executive – North East Combined Authority
Paul Lawrence, Chief executive – City of Edinburgh Council
Andrew Lewis, Chief executive – Liverpool City Council
Mark Lloyd, Executive director – Impower
Damien Martin, Strategy director of place and economy – Belfast City Council
Susanne Millar, Chief executive – Glasgow City Council
Stephen Peacock, Chief executive – West of England Combined Authority
Cathy Reynolds, Director of city regeneration and development – Belfast City Council
Mark Rogers, Interim chief executive – Sussex and Brighton Combined County Authority
Sajeeda Rose, Chief executive – Nottingham City Council
Caroline Simpson, Chief executive – Greater Manchester Combined Authority
Graham Smith, Head of investment, international and innovation – Glasgow City Council
Ed Whiting, Chief executive – Leeds City Council
Andy Williams, Director of economy & skills – Birmingham City Council
Heather Jameson, Editor – The MJ (chair)
Paul Marinko, Deputy editor – The MJ (reporting)
