Places that haven’t secured a devolution deal may have to wait until 2020

Who's that guy on the right? Bit familiar. Nope, can't place him. Image: Getty.

In the last few years of George Osborne’s time in government, it was a fairly safe bet that any major speech by the chancellor would bring significant announcements on the devolution agenda. His last budget in March, for example, included new devolution deals for the West of England and Solent city regions; and the key moment of his final speech to Conservative Party Conference as chancellor brought the landmark announcement on the devolution of business rates.

However, predictions for the first Autumn Statement under Theresa May’s still relatively new administration were harder to make. While the new chancellor Philip Hammond had made it clear that Britain has “passed a tipping point in devolution”, it remained to be seen whether his enthusiasm for the devolution agenda would match that of his predecessor.

What did seem certain, however, was that this Autumn Statement was likely to mark the cut-off point for any places hoping to secure and implement devolution deals in the foreseeable future. Here are four reasons why:

1. Time constraints

Electoral Commission guidance on the metro mayor elections stipulates that legislation for new devolution deals which include a mayor should be introduced in Parliament at least six months before elections take place. But with the first metro mayor elections scheduled for May 2017, places currently without a deal are running out of time to secure one in time to meet the Commission’s deadline.

And with the second mayoral elections due to take place in 2020 (to bring them in line with London’s mayoral elections), it’s unlikely that the government would countenance the idea of holding separate mayoral elections before that point (in 2018, for example) for places which fail to agree a deal for next year. A two year term would not give new mayors nearly enough time to build their institutions, raise their profile, and demonstrate results to voters before second elections in 2020. Indeed, this will be a difficult enough job for the 2017 cohort of mayors in the three years they have in office.

2. The government’s commitment to devolution beyond current deals is unclear

While the government has emphasised its commitment to the existing devolution deals for major city-regions, it has shown little indication that it will pursue more deals for other places, or that it is open to renegotiating the terms of current deals.

When local leaders in the North East failed to reach agreement on how to progress with their deal in September, the government did not step in to salvage the agreement – instead telling local leaders that the £900m deal they turned down in September was now “off the table”. While that deal may be resurrected on a smaller geographical basis and for a smaller financial settlement, it won’t be as a result of active government intervention.

Beyond 2017 the government’s devolution priorities, if they have any, are as likely to be about doubling down on places with established deals such as Greater Manchester and the West Midlands, as they will about extending devolution deals to a whole raft of new places. Andrew Percy, the Northern Powerhouse Minister, has already said that a greater share of Local Growth Funding will be allocated to those places with a mayor than those without.

This doubling down approach is even more likely if the Conservatives win a couple of the mayoral contests, such as the West Midlands and West of England.


3. Other issues will consume the government’s attention

With Brexit negotiations likely to drag on for the next two years at least, and the current business secretary Greg Clark (who has been pivotal in driving the devolution agenda) now focused on delivering the government’s new industrial strategy, the reality is that devolution will come some way down the government’s priorities list in comparison. Places which hope to open negotiations on a new or revised deal are therefore likely to be disappointed.

4. Leaders in many places don’t want a devolution deal on the government’s terms

Communities secretary Sajid Javid has been clear that in order for places to gain a devolution deal, they will need to introduce a metro mayor. This proved the sticking point for local leaders in the North East, and in recent weeks has also led to the collapse of tentative agreements for places such as Greater Lincoln and Norfolk and Suffolk. It is also likely to deter leaders in other parts of the country from putting forward proposals for a deal in their area.

So while cities with nothing confirmed should continue to try to work with government to get deals in place, it is unlikely they will be able to secure anything that matches those deals already agreed before 2020.

Simon Jeffrey is an external affairs and research office at the Centre for Cities, on whose blog this article first appeared.

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Worried Guildford will be destroyed by Chinese trains? Then you might not be very nice

A South West Train at Waterloo. Image: Getty.

Despite the collapse of everything else that more-or-less worked in 2008 Britain, before the Hunger Games years began, some things remain constant. One of the things that’s near-mathematical in its constancy is that, when a new train contract is let, people on both sides of the political spectrum will say extremely stupid things for perceived partisan advantage.

This week saw the award of the contract to run trains to the south west of London, and unsurprisingly, the saying stupid things lobby was out in force. Oddly – perhaps a Corbyn-Brexit trend – the saying of egregiously stupid racist lies, rather than moderately stupid things, was most pronounced on the left.

As we’ve done to death here: rail in Great Britain is publicly run. The rail infrastructure is 100 per cent publicly owned, and train operators operate on government contracts, apart from a few weird anomalies. Some physical trains are owned by private investors, but to claim rail isn’t publicly run would be like claiming the NHS was the same as American healthcare because some hospital buildings are maintained by construction firms.

Every seven years or so, companies bid for the right to pay the UK government to operate trains in a particular area. This is the standard procedure: for railways that are lossmaking but community-important, or where they are within a major city and have no important external connections, or where there’s a major infrastructure project going on that’ll ruin everything, special measures take place.

The South Western England franchise is not one of these. It’s a profitable set of train routes which doesn’t quite live up to its name. Although it inherited a few Devon and Dorset routes from the old days, its day job involves transporting hundreds of thousands of Reginald Perrins and Mark Corrigans from London’s outer suburbs and Surrey, Hampshire and Berkshire’s satellite towns to the grinding misery of desk jobs that pay a great deal of money.

(If your office is in the actual City of London, a fair trek from the railway’s Waterloo terminus, then you get the extra fun of an extra daily trip on the silliest and smelliest Tube line, and you get even more money still.)

Anyway. The South Western concession went up for auction, and Scottish bus and train operator First Group won out over Scottish bus and train operator Stagecoach, the latter of which had run the franchise for the preceding 20 years. (Yes, I know 20 isn’t a multiple of 7. Don’t ask me to explain, because I can and you wouldn’t enjoy it.)

First will manage the introduction of a bunch of new trains, which will be paid for by other people, and will pay the government £2.2bn in premiums for being allowed to run the service.

One might expect the reaction to this to be quite muted, because it’s quite a boring story. “The government does quite a good deal under which there’ll be more trains, it’ll be paid lots of money, and this will ultimately be paid back by well-paid people paying more train fares.” But these are not normal times.


First Group has decided for the purposes of this franchise to team up with MTR, which operates Hong Kong’s extremely good metro railway. MTR has a 30 per cent share in the combined business, and will presumably help advise First Group about how to run good metro railways, in exchange for taking a cut of the profits (which, for UK train franchises, tend to be about 3 per cent of total revenue).

The RMT, famous for being the least sensible or survival-oriented union in the UK since the National Union of Mineworkers, has taken exception to a Hong Kong company being involved in the railways, since in their Brexity, curly sandwich-eating eyes, only decent honest British Rail has ever delivered good railways anywhere in the world.

“A foreign state operator, in this case the Chinese state, is set to make a killing at the British taxpayers’ expense,” the RMT’s General Secretary Mick Cash said in a press release.

This is not true. Partly that's because a 30 per cent share of those 3 per cent profits is less than 1 per cent of total revenues, so hardly making a killing. Mostly, though, it’s because it’s misleading to call MTR “state-owned”. While it’s majority owned by the Hong Kong government (not the same body as the central Chinese state), it’s also partly listed on the Hong Kong Stock Exchange. More to the point, this a really odd way of describing a transport authority controlled by a devolved body. I wouldn’t call the Glasgow subway “UK-state owned” either.

So this fuss is intensely, ridiculously stupid.

There’s an argument – it’s a bad argument, but it exists – that the entire UK rail system should be properly privatised without government subsidy.

There’s an argument – it’s a slightly less stupid argument, but it exists – that the entire UK rail system should be returned to the public sector so we can enjoy the glory days of British Rail again.

The glory days of British Rail, illustrated in passenger numbers. Image: AbsolutelyPureMilk/Wikipedia.

But to claim that the problem is neither of these things, but rather that the companies who are operating trains on the publicly run network are partially foreign owned, makes you sound like a blithering xenophobe.

In fact, if you think it’s reasonable for a Scottish company to run trains but not for a Hong Kong company to run them, then that's me being pretty bloody polite all things considered.

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