Time is our most precious commodity. The Budget just gone is testament to how vital a political resource it is. By keeping up appearances and supplying more than 150 pages in the main document and a veritable micro-publishing industry of fascinating supplementary documents, John Healey's hold-steady statement, a nothingburger in the greater scheme of things, has certainly bought his sometime neighbour at Number 10 some valuable time in which to plot and ponder.
At the end of reading through the big red book, one must ask how much of the promised ‘breathing room' and ‘fresh hope for the future' local government should genuinely feel. There is a sense of bigger decisions and the necessary trade-offs, compromises and being shunted down the line for future sequencing. So as former Bank of England adviser Andy Haldane predicted, a bit of manana time for what exactly to do with defence and welfare with the Milburn and Timms reviews.
Looming above all until publication before the end of the year is what is now known as the ‘Rewiring the State Delivery Plan', in other words the decentralisation and devolution playbook for however long this parliament lasts. This new vision for state organisation will establish how different tiers of government will work together and which mayoral strategic authorities (MSAs) will promote growth and rewire public services in partnership with ‘strong and sustainable' local authorities'.
This suggests a greater role for strategic authorities, and deputy mayors in particular if taking our cue from the Rewiring the State cabinet statement, in the commissioning and directing of local public services, something that was perhaps always on the cards. In addition, options for giving mayors more control over how the public property estate is used to deliver public services and housing and to unlock growth seems to be another arrow in the strategic authority quiver.
As part of a wider and more ambitious agenda for local public service integration, the future promise of ring-fenced preventative spend at government departmental level at the next spending review could well fuel a genuine renaissance for whole-place budgeting. Existing approaches such as Total Place 2.0 and the successful ‘Test, Learn and Grow' models could accelerate the evolving role of councils within public service reform, serving as modern place-based business plans to tackle systemic challenges like worklessness and skills shortages.
In the immediate context, 95% of all English councils are engaged in housing delivery, 82% of local authorities are already committed to providing affordable housing and 69% of local authorities are using companies and or joint ventures to deliver housing. So, it's not as if there isn't willingness. However, in the Office for Budget Responsibility's economic and fiscal outlook, we learn that housing delivery will plummet by 190,000 homes between now and 2030/31, with new housing stock additions falling from 230,000 this year to 220,000 in 2026/27.
Well, that's form and function taken care of, leaving just one of the three ‘fs' to be dealt with. So yoked to the rewiring plan is the financial mechanism. Cue the eagerly awaited roadmap to fiscal devolution, which seems less like a rally-driver's friend than a staged and staggered handicap race among the MSA jockeys. We get some indication of how carefully set redistribution and rebalancing would ensure that business rates retention, localised income tax for areas with a directly elected mayor, and the overnight visitor levy don't create a winners and losers culture. Negotiating all this won't be for the faint-hearted and the tensions over who gets the finance and controls the functions of the rewired state will prove contentious.
The complexities of individual business rates retention deals will be replaced in the long term by the consistency of a uniform system, and the mayoral share of retention will not cut into local authority core funding.
Taking its cue from Manchester, the Good Growth Fund is a parallel track to fiscal devolution which is designed to gather diverse funding routes into a single local investment approach. Here the big idea is to align the blended funding of our Public Financial Institutions, or PuFIns – such as the National Wealth Fund, National Homes Bank - which in total have £209bn at their disposal, pension funds including the Local Government Pension Scheme and private capital to invest in the sort of development and regeneration that can catalyse local growth.
One very immediate piece of economic and social infrastructure for this to play out on is the command for our local authorities to rise to the challenge of a revolution in building council houses at scale once more. The context here is the 10-year affordable housing programme now backed by £40bn in central government funding.
In the immediate context, 95% of all English councils are engaged in housing delivery, 82% of local authorities are already committed to providing affordable housing and 69% of local authorities are using companies and or joint ventures to deliver housing. So, it's not as if there isn't willingness. However, in the Office for Budget Responsibility's economic and fiscal outlook, we learn that housing delivery will plummet by 190,000 homes between now and 2030/31, with new housing stock additions falling from 230,000 this year to 220,000 in 2026/27.
Even with the headwinds of regulatory lightening, borrowing uplift and political determination, in this area as in others of our rewired future, there is a worrying amount of complexity to get right in very short order, to say the least.
Jonathan Werran is chief executive, Localis
