Putting innovation at the heart of devo

Andy Burnham is now Britain's seventh Prime Minister in a decade. Having outlined an ambitious 10-year plan to raise living standards and drive growth across every nation and region, he'll certainly want to have more longevity than his recent predecessors.A core part of his plan to solve the challenges facing the country lies in devolving more power away from Westminster. The UK is the most centralised country in the G7, with non-capital European metro cities outperforming their UK counterparts in productivity and quality of life, thanks to their ability to make decisions, run services and invest in innovation.His plans would therefore involve handing greater control over spending to England's metro mayors to improve outcomes in areas such as health, social care, skills, welfare and housing.It's a familiar ambition we've heard before from leaders in Westminster, but unlike his predecessors Burnham brings with him nearly a decade of experience of local and regional politics. Other mayors, like Steve Rotheram in Liverpool and Ben Houchen in Tees Valley, have both recently won third terms, while West Yorkshire's Tracy Brabin is now five years into her tenure.Compared to Westminster, mayoral politics tends to be more collaborative, focused on bringing groups together to solve local problems, while giving leaders the stability and longevity to see long-term plans to fruition.With more powers now expected to flow to the regions, mayors will have greater responsibility for driving growth and solving problems locally. Local innovation challenge funds are one proven way of doing this. The approaches of mayors like Brabin and London's Sadiq Khan provide first-hand insight into how they work in practice, gathering local groups, businesses and public authorities with the expert local knowledge needed to solve problems specific to the places they live.Take West Yorkshire, where the health inequality gap, like much of the North, is stark – just £21 is spent per person on health innovation, against a £62 average across London, Oxford and Cambridge. To improve local health outcomes, we worked with Mayor Brabin and local authorities to tap into the region's entrepreneurial community and develop innovations to tackle this pressing challenge.Burnham is also keen to put universities at the heart of local economies as part of his devolution plan and with it, an innovation-led approach through start-ups and scale-ups. The aptly named Manchester Prize – a £1m award for AI innovation – exemplifies thisAs a result of this process, £1m has been awarded to local teams developing solutions based on their own lived experience, with winners covering surgical care, mental health and wellbeing now being supported to scale their solutions so more people in West Yorkshire can benefit.In cities like Bristol, the challenge was how to deliver affordable, carbon-neutral housing at scale, in a city aiming for 24,000 new affordable homes by 2050. Collaborating with developers, planners and Bristol City Council, winners are now unlocking the potential of underused brownfield sites and demonstrating what viable development looks like. This work has since informed the creation of the Small Sites Aggregator programme, which the Government recently announced will be rolled out nationally, helping deliver 10,000 new social rent homes a year.Elsewhere, we've worked with local leaders, academic institutions and industry across Southampton, Bradford and Preston to explore how drones can help solve specific regional challenges, convening academic and industry expertise alongside local government. This has supported the delivery of medical supplies from Southampton across the Solent to the Isle of Wight, enhanced fire and rescue services in Bradford and backed construction and regeneration projects in Preston.Burnham is also keen to put universities at the heart of local economies as part of his devolution plan and with it, an innovation-led approach through start-ups and scale-ups. The aptly named Manchester Prize – a £1m award for AI innovation – exemplifies this. Named after the world's first stored-program computer and built at the University of Manchester in 1948, it's a reminder of UK universities' long history of pioneering innovation and local productivity.These initiatives work because they bring together the right people, businesses and authorities to solve problems that are genuinely local, from housing and health to social care and skills.If Burnham is serious about devolving more responsibility to the regions, mayors, councils and combined authorities will need more than just additional spending powers – they will need the tools and means to bring people together, harness local ingenuity and foster real, long-lasting solutions to problems unique to their own lives and areas.Challenge funds rooted in place offer a proven way to do just that, not only unlocking solutions to local problems but driving the type of productivity gains central to the new PM's economic agenda. Getting this process right will be critical to making the next phase of English devolution a success.Kathy Nothstine is director of cities & societies at Challenge Works, Nesta

Title

DEVOLUTION

Putting innovation at the heart of devo

By Kathy Nothstine | 28 July 2026

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