This post is an update on three things I’ve been busy writing over recent weeks related to the topics of devolution, public service reform and Greater Manchester’s economy.

Firstly, for ThinkLabour I wrote a blog called “Where is Darlington?” pointing out the inconsistencies of governance boundaries around the town. Having been to Darlington many times - particularly when I used to work at the Treasury campus there - I feel the need to point out that I do know where it is.

But, it is difficult when pressed to describe which governance area it is part of given differing links to Tees Valley Strategic Authority, the Durham Constabulary and the North East and North Cumbria health area (see map below).

This handy map generator showing the different boundaries covering different areas was created by the excellent Dylan Cridland to highlight the issues. You can create your own just as I’ve done!

Secondly, I wrote a report called ‘Democratic Public Services’ also for ThinkLabour. This highlighted three public service reform trends - ‘the 3 Ds’ - that are democratising, devolving and digitising them. In the report, I highlight what this might mean for different public services and draw on examples here in the North such as the Greater Manchester and South Yorkshire pilots for health devolution.

Thirdly, for The Productivity Institute, I joined with Andy Westwood and Joe Peck to look into the recent debate about Greater Manchester’s economic growth. In the paper, we find that some of the ONS data is mixed, but there is significant evidence of economic dynamism when you look at property demand, falling investment risk premia, greenfield investment and rising skills levels in the area. There’s quite a few charts in there - including this one showing incomes by area.

Thanks again for taking the time to read this newsletter - I hope you also find these three papers interesting.

Source: YouGov

But the more you think about it, the more fascinating the results are as shown by the following charts.

Source: YouGov

It is clear that the worse people feel about their area, the worse they feel about the state of the country. But if we focus on the final column in the chart above, then there is one certainty. If you think that your area is in a very bad state, then you are certain to also think that the country is in a bad state. That is because zero people surveyed thought that the country was doing well, if they thought their own area was in a very bad state.

If people think their area is in a bad way, do not be surprised if they think the whole country is.

Looking instead at the first column in the chart above, for people who think their local area is in a very good state, they instead have a closer to 50% chance of thinking that the whole country is in a good state.

Now this isn’t surprising given how important daily life in a place is to perceptions of the wider world. And we should always remember that correlation does not mean causation. For example, people who feel optimistic about their area could also have the same tendency across the board - and vice versa. Age, voting intention and class might also be having an effect as YouGov discuss in their blog. But the results are striking and suggest that efforts to improve the country and places need to work in tandem.

The polling also allows us to look at the breakdown by political voting intention and region.

In terms of voting intention, Reform voters were clearly the most pessimistic.

Source: YouGov

And YouGov in their writeup pointed out that despite the question being geographic, the trends did not seem that distinct at a regional level. Intrigued by this, I’ve looked a bit further into the data here.

What we can see in the data below is that people in the Midlands are the least happy about the state of their area, and also about Britain in general (though similar to the North and close to the South outside London on this metric). London is the outlier in terms of people being most happy with Britain as a whole but not by much.1

So what should we make of all these results?

Some people and places seem more dissatisfied than others, though none are particularly happy. Especially areas outside London.2

Fixing places and fixing the country must work in tandem. Positive change in places should mean thriving high streets, good jobs and housing, a sense of community and more. This must then be the basis for positive momentum at a national level.

If there is one message it is this: if people think their place is in a bad state, good luck convincing them about the country.

There is a persistent idea, linked to the mythology of the ‘Red Wall’, that the North of England was the part of the country which most heavily voted to leave the EU back in 2016. And I saw it repeated on social media just the other week.1

But it was not the North that voted most heavily for Brexit, it was the Midlands.

I’ve collated the results for each broad region of England in the chart below. So even the South of England taken as a whole voted narrowly to leave.

In fact, in terms of individual regions, the only region in England which didn’t vote to leave the EU was Greater London. Scotland and Northern Ireland also voted to Remain. Every other region of England plus Wales voted to leave.

So did a northern region vote the most to leave? No again.

As the map shows, the North East voted 58.04% to leave, the strongest in the North, but was beaten by both the East and West Midlands with 58.82% and 59.26% respectively. This makes the West Midlands the region which voted most for Brexit.

And in terms of individual voting districts in the referendum, it was Boston, Lincolnshire - part of the East Midlands - which voted most heavily to Leave at 76% to 24%.

So next time someone suggests that the ‘North voted most for Brexit’ - remind them that not only did eight out of nine regions in England do the same, but it was actually the Midlands which voted most for it.

Ten years on from the referendum, the tired stereotype of the ‘Northern Brexit voter’ is one we should retire.

Looking at the leaderboard of Northern productivity, Lancashire comes out in the middle of the pack, though above the UK average, for the period 2019 to 2023. As we know, productivity is probably the most important statistic for understanding an economy as it tells us how much value is being created for the time being put in.

To understand what is driving this, I’ve analysed what has been happening in terms of output and jobs in different sectors.

Starting with growth, I’ve compared Lancashire’s top 10 sectors to UK wide GVA growth. There are some clear highlights compared to national growth in particular in professional activities, education and manufacturing.

If we’re interested in productivity - measured here as output per employment for data reasons - then we can see that the sectors listed above which have grown have also managed sustained increases in this measure of productivity.

It is very positive that the professional activities and education sectors have grown in this way - and these are the kind of service based industries that wealthier areas tend to focus on in the modern economy. In terms of education, student enrolments at the University of Lancashire are broadly flat at around 24,000 over the period so that cannot be the driver. Looking at subsectors, there have been big increases in architectural and engineering activities (GVA up 127% over 2019 to 2023) and in scientific research and development (up 97%). Would be interested in local views on what is driving this outcome.

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Manufacturing has seen a big increase in GVA and a modest increase in employment. Struck by this, I looked further into the data. The biggest manufacturing subsector is ‘transport equipment’ - and in terms of employment the largest subsector is listed as ‘other transport equipment’. Regular readers may remember the same issue in Cumbria. But after further digging what turned out there to be submarines, here is ‘Manufacture of air and spacecraft and related machinery’ - so clearly relating to BAE systems and its large sites around Preston.

But we can not draw the same conclusion that defence spending is driving growth - as this subsector has not seen the large growth as we found in Cumbria. Instead it is ‘manufacture of motor vehicles’ that has taken off - increasing by 214% from £225m to £707m over the 2019 to 2023 period. Is this being driven by a spin off from British Leyland - Leyland Trucks? There is a big demand for these vehicles and a move towards electrification which could be driving this trend?

So what does the future hold for Lancashire? Two big changes to the political system are likely coming down the track.

The three upper tier local authorities of Blackpool, Blackburn with Darwen and Lancashire County Council have come together to form a Lancashire Combined Authority. At present it will be the only part of the North without a mayor as of May 2027, but it seems that the Reform leader of the County and Labour leaders of Blackpool and Blackburn are seeking to move towards a mayoral model after previous disagreements.

Lancashire will also be going through a process of ‘unitarisation’ as it moves from the old county/district model to a unitary authority model in common with other parts of the North. The government is still sifting through the responses to the recent consultation on the five options put forward by different councils, with an outcome expected soon.

The political leadership of a changed Lancashire will inherit a growing area - with high potential in some sectors and with a potential tailwind coming from defence investment if it flows into some of major employers in the area.

But they will also need to contend with the deprivation in parts of the area. Recent statistics showed that Blackpool, Blackburn and Burnley in particular face significant deprivation which will need addressing if growth is to translate into opportunities across Lancashire. For example, see Table 6 from the above statistics showing deprivation in Local Authority Districts (LADs).

Source: English Indices of Deprivation 2025

The data from last week’s post suggests these political reforms might be a good idea for the economy. But as the inclusion of Manchester in the deprivation table shows it might take a long time to change trajectory, even if there has been a welcome fall there according to the Centre for Cities.

We will have to see if bringing the governance of Lancashire on a par with the rest of the North will change its economic and social fortunes.

Michiel N. Daams, Colin Mayer and Philip McCann have assembled a unique Europe wide dataset showing the investment yield on large real estate projects over a two decade period (2003-2023). And using this they are able to see the different rates paid in different places over time. This allows us to see the different ‘risk premiums’ that investors are putting on different projects based on where they are.

They find that the 2008 financial was a turning point in terms of investor perception of different parts of the UK - and almost two decades on we are still living in its shadow.

Prior to the crisis, expected differences across projects followed ‘textbook’ standard models. This can be seen in the map below which shows the authors’ calculations of the ‘risk premium’ in different areas. Blue indicates a lower risk premium - with investors asking for less of a return compared to ‘risk free’ assets like UK government debt. Red indicates they are asking for a higher return, which is linked to a worry that they won’t get their money back.

Source: Daams, Mayer and McCann (2026)

After the crisis, investor behaviour changed as they were unsure how to adapt to the tighter financial circumstances. What would this mean for the likelihood that they would get their money back? Would some places fare better than others? Their response to the uncertainty saw a ‘flight to safety’ across countries.

These ‘safe havens’ saw an increase in investment, reducing the rates at which projects in those places needed to borrow at. Other places saw the opposite - a reduction in available finance which increased the rate they would need to pay.

In the United States, investors sought out around 20 ‘safe haven’ cities which they thought would be a good bet for their property investments. In the UK, only one city and its hinterland benefited from this effect: London. This ‘blue chip’ status contrasts with the ‘junk bond’ status of the rest of the country suggested by the yellows and reds in the map below.

The authors calculate that difference in rates between places is equivalent to that between UK government debt and that of Chile or Romania.

Source: Daams, Mayer and McCann (2026)

So why did this happen in the UK? There are a few potential explanations.

Quantitative Easing comes under suspicion. This was the policy pursued by the Bank of England to increase the money supply by purchasing assets. The period of QE seems to have had the intended effect to bring down yields. But they find that this mainly happened in London - having little impact elsewhere despite the Bank of England assuming such a policy would be neutral across regions. But this is not the whole story - as something else must explain why QE had this differential effect.2

Their key theory is that this was all driven by the UK having one “one of the most highly centralised banking and financial systems in the industrialised world.” Regular readers will know that I am highly critical of the centralised nature of the country’s political system - well here the authors of this paper have found this mirrored in the country’s financial system.

Over many decades, banks consolidated into London based institutions. And most pension funds and venture capital firms are also based in the South East. Through the simple fact of location, this means that there is less knowledge of businesses in different places - and a firm in a Leeds or a Newcastle will struggle to have the same access or connections as one in London. Little more than ‘financial vibes’ driving huge societal issues.

Other countries like Germany or the US have more financial institutions based across their geographies. Could this be the reason they are less geographically unequal? The authors think so.

They also highlight one ray of hope in the data that comes from recent devolution. Between 2021 and 2023, two urban areas converged to London levels of risk-pricing and investment yields - Greater Manchester and the West Midlands. At this point, these were the two largest mayoral combined authorities and were also the most advanced in terms of powers. Is this a signal that successful institutions can create successful economies?

Greater Manchester in particular has used the ‘Greater Manchester Housing Investment Fund’ to support the development of new property across the area. A principle that is now being expanded across other mayoral authorities through a ‘Mayoral Revolving Growth Fund’.

But we might need to go further with more localised banking and professional services firms that can support businesses in every place. As with devolution of public sector decision making, this is a return to the past given many places used to support their own financial institutions.

For example, Manchester used to have its own stock exchange (inevitably it is now a hotel owned by Gary Neville) and perhaps most famously Halifax has its own building society (even if the proud legacy may be retired soon). And there have been some recent initiatives in this space like Northern Gritstone which I will write about in the future.

Taking this back to the IFS seminar - Andy Burnham used it to set out a view of ‘Manchesterism’. In it he said that:

And it seems that the data above might back such an approach - with the devolved political institutions in both Greater Manchester and West Midlands giving investors confidence as revealed through lower risk premiums.

To some it may seem a stretch to have more local banks and finance institutions, but if the above analysis is true, then by doing so we would simply be realising the economic opportunities that other countries manage for all their places.

Cheshire & Warrington is the most southern part of the North - geographically, but also seemingly in economic terms - with the Guardian recently headlining a piece on Warrington with the title ‘A southern economy in the north’.

So what makes Cheshire & Warrington different - and what can we learn from it?

Looking back at the leaderboard of Northern productivity over the period 2019-2023, the ‘Cheshire’ area below covers the area often now known as ‘Cheshire & Warrington’. This area has a newly established strategic authority, with its first elections for an elected mayor taking place in May 2027. Throughout the piece, I will use Cheshire & Warrington (C&W) and Cheshire interchangeably to refer to this area.1

The area has grown above the national average in terms of productivity, but below the growth seen in other parts of the North. However, the people of Cheshire & Warrington need not worry too much: their region is the most productive in the North as shown in the map below and the only one to be above the national average.2

Cheshire often has a ‘leafy’ reputation, but this misunderstands the economic base of the area - even if there are many footballers or other professionals who commute into Manchester or Liverpool. This area is one which retains specialisation in manufacturing, making up 20% of the economy and placing it third in the North in terms of manufacturing concentration. This compares with a national average lower than 10%. It may be the most southern part of the North, but it still has many Northern characteristics.

This is because the area hosts large chemical or car manufacturers such as Bentley (in Crewe), Stellantis/Vauxhall (in Ellesmere Port) or AstraZeneca (in Macclesfield) along with a big oil refinery at Stanlow. There is also a large nuclear industry presence at Birchwood Park in Warrington which I have written about in ‘We split the atom’.

Building on this, Warrington has the highest disposable income of any large urban area in the North according to the Centre for Cities, and has a high concentration of ‘new economy’ firms on a par with Oxford, particularly at the Birchwood site mentioned above.3

This extends across Cheshire as a whole, with Birchwood forming part of the Cheshire Science Corridor alongside sites like Alderley Park (former home of AstraZeneca - and now home to research intensive businesses) and Jodrell Bank for astrophysics research.

Cheshire’s combination of industries and assets - alongside its position between Manchester and Liverpool - supports its relative affluence and high productivity.

To look at recent trends, I’ve used ONS data to look at the ten largest sectors in Cheshire & Warrington below - and compared their economic growth (measured by Gross Value Added) with the UK average over the 2019-2023 period. This is to give an assessment of adjustment to the post pandemic economy - and unfortunately 2023 is the latest data available for areas. As an aside here, sorting out the ONS so we get more timely statistics would be a very high return investment.

This tells us a mixed picture - with C&W growing more strongly in some areas like construction, manufacturing and professional activities than the UK average, but growing less strongly in others like finance.

Looking at the top ten sectors across Cheshire and Warrington, we can see whether growth has been driven by increases in employment or increases in productivity (using output per worker as a rough proxy for this).

Looking at the data this way, the only real positive sector has been construction seeing growth in productivity at the same time as employment. Though there has been decent productivity growth in sectors like manufacturing and financial services too, these have been balanced by reduced productivity in professional, health and administrative activities.

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So a mixed picture for Cheshire - with high productivity to begin with, but lower recent growth than other areas. But what can we expect in the future?

The biggest change on the horizon is the election of a mayor for the area in May 2027. Cumbria is also electing at that time, which will leave Lancashire as the only part of the North without a mayoral authority.

The area is also set to receive big investment via Northern Powerhouse Rail which will run via Warrington as I outlined in ‘What does £45bn for the North buy you?’. And the government have also invested in the Hynet project to decarbonise local industry.

Time will tell whether Cheshire & Warrington can retain its top spot in terms of Northern productivity. With an industrial base amidst assets like those on the Cheshire Science Corridor it has an enviable position as it enters a phase of mayoral devolution like its neighbours.

In all the focus on national gains/losses and who is up/down nationally, what is often missed is the very real difference this will mean in places.

In particular, there is little discussion on what this will mean for mayors given that the membership of their combined authorities is formed of the leaders of the different councils. For example, mayors must get the approval of their combined authorities for many policy or funding changes.

So in this post I’m just going to focus on the implications for the combined authorities (CAs) and mayors of the North, in particular the big urban areas which are mostly covered by the new ‘Established Mayoral Strategic Authorities’. These EMSAs are the ones who now have integrated funding settlements - and all currently have Labour mayors in office from May 2024 to May 2028 in Greater Manchester, Liverpool City Region, the North East, South Yorkshire and West Yorkshire.

So where do the elections of May 2026 leave the North’s major political institutions? I’ll run through each of the five areas to analyse the results and think about the future - in order from biggest change to smallest change. I’ve shown how the composition of the CAs might change - but have not included the position of mayors or other members outside the core LAs so the actual control of CAs will differ. Where councils are ‘No Overall Control’ (NOC), I’ve categorised them by largest party - but this is no guarantee about who will lead the council.

At the end I’ll think about the implications of these results, given that a more fragmented political landscape will challenge previous ways of working.

West Yorkshire

The biggest changes have been in West Yorkshire and the North East.

All five of West Yorkshire’s LAs held elections, with four of these being ‘all outs’ due to boundary changes. An ‘all out’ election can lead to a very big change in the composition of the council compared to the more usual cycle where elections take place in ‘thirds’.

And as such, the results have seen a dramatic change in the likely leadership of the LAs and therefore in the composition of the Combined Authority led by Tracy Brabin.

Each WY council was led by Labour, with Kirklees being the only one under NOC (yet still had a Labour leader).

All of four of the councils holding all outs have moved to Reform control or Reform being the largest party - with only Leeds likely to have a Labour leader (this moved to NOC but Labour still has 48 out of 99 councillors).

So control of the Combined Authority will be more fragmented in West Yorkshire. However, the composition of the CA here differs to other areas due to the three ‘political balance’ members which will likely make a difference to the final composition of the CA.1

North East

The five metropolitan local authorities of the old ‘Tyne & Wear’ area held elections last week. Most were Labour controlled, except Newcastle and South Tyneside which were in NOC with a Labour leadership.

Gateshead, Newcastle, South Tyneside and Sunderland had all outs, whereas North Tyneside elected in thirds.

As in West Yorkshire, there has been a big shift of control to Reform, with the party gaining majority control of Gateshead, South Tyneside and Sunderland. North Tyneside has remained Labour controlled, but if the results of the election by thirds were to be repeated over the next two years then Reform would have a chance to control the council.

Newcastle has seen a fragmentation of the Labour coalition towards the Greens, Lib Dems and Reform - each of whom have 24 or 25 Councillors. Labour was reduced from 46 to 2.

This leaves control of the combined authority more fragmented as seen in West Yorkshire too.

Greater Manchester

The ten boroughs of Greater Manchester also held local elections, with all of these contests electing one third of the councillors in each area.

Bolton, Oldham and Stockport were NOC led by minority administrations, with the rest having Labour majorities. Two of the NOCs were Labour led before the elections, with Stockport providing the sole non-Labour leadership in GM by the Lib Dems.

Following last week’s results, Stockport has moved to majority Lib Dem control and Tameside has moved to NOC. Labour remains the largest party in each of these but large independent presences in each could make agreeing the leadership tricky.

And the fact that these elections were in thirds should not disguise the potential shift in GM. In Wigan, Labour lost every single ward that they previously held - with Reform gaining 24 - a result that would hand majority control to Reform if repeated next year. In Manchester, Labour won six councillors to 18 for the Greens - a result that would hand majority control to the Greens if repeated over the next two years.

So Labour retain control of the Combined Authority, but risk losing it if some of May 2026 results are repeated across councils in future years.

Liverpool City Region

Four of the Liverpool City Region’s six councils held elections and all four had a Labour majority. Sefton and St Helens had all outs, whereas Halton and Knowsley elected in thirds.

Labour managed to retain its majority in Sefton, despite the all outs, and also still controls Halton and Knowsley. St Helens saw a big shift to Reform who gained 34 Councillors to take control of the council.

This leaves Labour clearly in control of the combined authority.

South Yorkshire

South Yorkshire only had elections in two of its local authorities. Labour majority Barnsley had all out elections, whereas Labour led but NOC Sheffield was electing a third of its councillors.

In Barnsley, Reform took control of the council from Labour. This means that this is the first time since 1996 that Sir Steve Houghton will not be the leader of Barnsley Council. A 30 year track record as a Leader of the Council is some achievement!

In Sheffield, Labour remains the largest party on 25 councillors but closely followed by the Lib Dems on 22 and the Greens on 20. Reform gained 12 councillors in Sheffield for the first time.

So what does this all mean?

Firstly, in terms of composition, Labour will retain effective control in Greater Manchester, Liverpool City Region and South Yorkshire. Though the results indicate that this could be lost in future election cycles if 2026 were repeated.

Boundary changes that led to all out elections allowed for the greatest changes in the North East and West Yorkshire - with Reform now controlling or being the largest party on a majority of councils - which will likely affect the final control of the combined authority (though noting my point at the beginning about the role of mayors and other members).

Secondly, this is unchartered terrain for these institutions. New ways of working and getting stuff done will need to be developed - see here for an interview in which Tracy Brabin talks about ‘relationship building’ with new councillors in the light of the results. A stable political environment will be key to getting change delivered successfully, at the same time as providing the conditions for public and private sector investment.

There is also an interesting issue in terms of ‘dual mandates’. In a very simple way, mayoralties are a bit like a president / governor system as we see in the US, with a separately elected body (like congress or state houses) that wields ultimate power. Via the combined authority model they need to wield power together over a strategic authority area. If mayors want to do one thing, but their councils want to do another, then compromises will have to be made - especially as recent changes in the English Devolution Act 2026 mean that mayors now have an effective veto over CA decisions.

Given the key link between councils and mayors through combined authorities, could it be worth considering the election of mayors and their constituent councils (via all outs) at the same time?

Finally, in terms of policy, there may be some things that Labour mayors and different parties could find common ground on. For example, in ‘the local future of public services’, I wrote about how Reform led County Durham council seemed to support Kim McGuinness’s child poverty plan.

Perhaps common cause can also be found on issues around transport like the West Yorkshire tram and bus franchising too? Public control of buses begins in West Yorkshire from next year, with the North East also in the process of following this franchising route that has worked well in Greater Manchester. But it may prove difficult to develop a united front - as the recent divide between a Reform-led council versus directly elected Labour mayors in Doncaster has come to a head over reopening the airport.

Time will tell - but for the sake of progress we must hope that our politicians can work together across these party lines to make positive change.

This post is a bit different to my usual data focused ones. Parental leave proved bittersweet. We were delighted to welcome our second son to our family in mid March. But also had to say goodbye to my grandad who died at the age of 97 a couple of days earlier.

And following his death, I’ve spent a lot of time reflecting on the changes that he saw over those 97 years. So how did three of the locational landmarks of my grandad’s life change over those decades in the North?

Born in 1928, he was one year too late to be called up for the Second World War - but still did his national service from 1946 working in signals and learning morse code. For a time he was based at Bretton Hall near Wakefield, which had been requisitioned during the Second World War, claiming to have slept in the stables.1

Source: Wikipedia, User:J3Mrs

The grounds of Bretton Hall are of course now better known as being the home of the Yorkshire Sculpture Park, welcoming almost 400,000 visitors per year to its landscaped parkland filled with art installations. The Hall itself was mostly used as a further education college after being sold to the West Riding County Council after the War. Now disused, there are apparently plans for the Groucho Club to open up there.

For work, he started in the mills in Huddersfield after leaving school at 14. One day a machine broke and an engineer was called. My grandad was intrigued by the work and asked the visiting engineer if he could learn how to do it. Following this chance encounter, he trained as an apprentice at Sellers in Huddersfield, specialising in the machinery that finishes the manufacturing of carpets. This ‘shearing’ process was described by him as being like a ‘giant lawn mower’ that sliced the top off a carpet after weaving.

Source: Sellers

What became of Sellers? Well it still exists, exporting machinery all around the world based on over a century of local expertise. Though the machinery looks a lot more digital than that which my grandad would have been working on.

After his apprenticeship, he got a job at Crossley’s Carpets in Halifax - then the largest carpet factory in the world. He worked there in the carpet finishing department until he was made redundant in the 1980s - and had a few different jobs following that - including work overseas - but never anything as consistent.

Crossley’s Carpets no longer exists, but what became of the huge buildings known as Dean Clough that used to house the firm?

Source: Dean Clough

Today Dean Clough is home to offices, shops, hospitality, theatre, weddings and more!

A few years ago - we took my grandad to see what had changed at Dean Clough. He marvelled at the changes in the mill’s use, and seemed proud that Halifax was on the up again.

Photo: Bill Smithson (1928-2026) at work in Dean Clough2

Not to be too morbid, but every place will outlast its current use and current inhabitants. So the need for place reinvention is constant. The stately home has found a new life as an arts venue. A one hundred year old firm has adapted its technology and business model to become export led as carpet manufacturing moved overseas. And an old mill has found a new commercial purpose. Each reinvention required people to think again about what the future might hold for the places and assets under their care.

Thinking ahead to the 80 plus years my son might live according to life expectancy statistics - and the trajectory of somewhere like a Bretton Hall or a Dean Clough even in the past 50 years - it’s hard to imagine what they might look like in 2100. But someone will need to try.

But three sets of positive announcements for the North have caught my sleepy eyes over this time: the Mais Lecture, the Devolution Act and updates from Mayors.

Mais Lecture

Firstly, the Chancellors Mais lecture went big on the North, regional growth and plans for future devolution.1

Rachel Reeves pitched the Northern Growth Corridor as an investment opportunity matched only by the Oxford Cambridge Corridor. For the past decade, government’s have been missing a trick by not developing a ‘Transpennine Growth Corridor’ so I think this is very positive.2

The government also followed this up with a consultation on its Northern Growth Strategy, highlighting the following six areas as the focus:

• Supporting connectivity within and between city regions, including towns

• Increasing effective city size, density and town regeneration

• Supporting business investment and innovation

• Investing in skills and human capital

• Enriching culture

• Future devolution

The consultation closes on 31 July. These sound like the right themes, and build on similar themes from the past, but the devil as ever will be in the detail. Let me know in the comments what you think!

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But the biggest potential reform in the Mais lecture was when the Chancellor said that:

I’ve written many times - for example in Building the future - on how ‘fiscal devolution’ can transform the way our country works. Giving places the ability to simply get on with things like they used to in the past.

In the UK we often talk about being world leading; well we lead the developed world in being overly centralised. Giving more power to places so they can deliver for residents is one of the closest things this country has to a free lunch.

Devolution Act

Secondly, the government set out further changes to the English Devolution Bill. This has now passed the House of Commons, the House of Lords and received Royal Assent so as of yesterday has officially become the English Devolution and Community Empowerment Act 2026.

I wrote a while back in “What next for mayors” about how the Bill was good but should be improved. In particular I mentioned mayoral capacity and accountability arrangements.

Well over recent weeks the government have listened to suggestions in the House of Lords on these topics from the likes of Lord Bassam and Lord Bichard.

On capacity, the Act introduces the idea of commissioners - who will be a bit like deputy mayors. The government initially proposed that these roles would be defined in primary legislation and capped their number at seven. For example, mayors would have have had to appoint a ‘health wellbeing and public service reform commissioner’ if they wished someone to cover anything in that area.

Instead, Mayors will now be able to define the roles according to local need within a higher cap of ten. This will allow mayors to bring in the right people to the right jobs for their place.

On accountability, the government are increasing the role of overview and scrutiny committees for mayors rebranded as ‘local scrutiny committees’. These are the groups of local councillors who provide the vital role of formal accountability for strategic authorities, chaired by an independent person or someone from a different party to the mayor.

These committees will now be strengthened through the consultation of outside experts, giving local people the power to petition them if 0.1% of electors sign and the power for them to refer issues to government departments and public bodies if intervention is needed.

Such changes will put local institutions on a firmer footing, with the right scrutiny setting them up for better delivery and further devolution of powers in the future.

Mayors

And finally, there have been numerous recent announcements from mayors of future plans - many in line with the new funding settlements they have received. I wrote about this in Happy New Financial Year.

Ones that have caught my eye include:

• South Yorkshire People’s Network: this will be South Yorkshire’s version of the integrated public transport network being delivered elsewhere. In fact, SY has been on a bit of a winning streak with investment in the Crucible to keep the Snooker Championships in Sheffield, investment in ITM Power by Great British Energy and coverage in the national press of its renaissance.

• West Yorkshire investment: the fruits of the integrated settlement in West Yorkshire with new rail stations planned in Elland and at Leeds Bradford Airport as part of a £300m plan that will also enable more housing to be built.

• North East buses: The North East Mayor and CA moving forward with a bus franchising assessment to bring buses back into public control as part of the proposed ‘Angel Network’

These announcements are the fulfilment of the promise of mayoral devolution. Local politicians getting on with the things that will improve the lives of people in their area.

And as the most advanced part of the country in terms of this agenda, the North stands to benefit disproportionately from these changes.

I often talk about the need for optimism. With yet more international uncertainty we could all do with some! And the three reasons above give me good cause.

This means Liverpool City Region, the North East, South Yorkshire and West Yorkshire are joining Greater Manchester in this illustrious category of ‘established’ tier mayoral authorities. Over 10 million people equivalent to 65% of the population of the North will be covered by mayors with the highest level of powers.

This is great news as it gives place a bit more flexibility over spending than they had before. The total amount of funding for each area over the Spending Review period is as follows. 2

This works out at over £9bn total over the coming years. And in each of these areas it is roughly £250 per person per year in 2028/29. In fact, if you add in the £733m in the West Midlands and the £541m from Greater London then the total funding in 2028/29 controlled by mayors in integrated settlements will be almost £4bn.3 To put this in context, this is larger than the Department for Business and Trade. And all funding with more flexibility to be allocated to the most pressing issues in an area.

However, there is not full flexibility. Each area has been allocated money to one of six ‘themes’.4 Within each theme, the places technically have flexibility to allocate funding. There are also limited flexibilities to:

• Move up to 10% of the annual funding in a theme into another theme - from say skills to transport if they think that is where they will get the best results. There is no limit on the amount that can be moved out of the ‘economic development and regeneration’ theme into other themes.

• Move funding to future years

• Move up to 10% of capital funding within each theme to revenue/resource, and 100% of revenue/resource funding within each theme to capital.

But unfortunately, these are not the only controls.

Each area must also agree an ‘outcomes framework’ which sets out how the place will use the funds to improve different measures in their area. For example, for the 2025-26 funding, Greater Manchester had a target to increase the modal share for public transport from 5.7% to 5.9%.5

For large transport schemes, there is also still a ‘business case threshold’. Any project with a lifetime cost over £200m must still be approved by the Department for Transport. Such processes can add months if not years to a project delivery timeline. I have written before in ‘Let Tracy Build’ on how we should lift this requirement to let places get on with building, amongst other measures.

Together such arrangements mean that departments are still involved in many of the decisions being taken by places, with the impulse to exert control which that brings.

Integrated settlements are therefore a good start. But we need to go further. The key barrier to further devolution of funding is that the accountability for value for money still sits with civil servants in Whitehall.

As the framework sets out, the MHCLG Permanent Secretary (or ‘Accounting Officer’ in the jargon) will “will assume responsibility for the core accountability process to Parliament”.6 There will also be subsidiary roles for the Chief Executives of Mayoral Strategic Authorities as well as the Permanent Secretaries in departments where the funding is coming from. But the Public Accounts Committee in the House of Commons can still haul them all in.

Until this centralised accountability link is broken - as has been done in Scotland, Wales and Northern Ireland - places will not have the flexibility they need to get on with delivering. I think two steps are needed here.

Firstly, a beefing up of the accountability arrangements in places, supplemented by primary legislation to designate Chief Executives in Mayoral Strategic Authorities as the relevant ‘accounting officer’. This follows the trajectory we have seen in the Devolved Administrations. One example of this might be creating ‘Local Public Accounts Committees’ in each area.

Secondly, building on the first step, money can then be allocated via a block grant to mayors instead of using the complicated departmental arrangements found in the integrated settlements. Ultimately, this means a ‘Barnett Formula for Mayors’ arrangement.

There is often a fundamental misunderstanding about how the Barnett formula works. The formula simply applies the population weighted change in UK level spending to work out the change in the devolved administrations, removing the need for formulas in each department. People sometimes argue that different devolved administrations are ‘over’ or ‘under’ funded - this is the result of the original baseline set for those places and mostly consistent application of the Barnett Formula since - not a result of the Barnett Formula itself.

For example, the government could use the above integrated settlements as a baseline for spending - then any changes the UK government makes to similar spending elsewhere in the country would be applied.

One issue here is that when we have 100% devolution of a spending area, there would be no UK government spending to anchor it to. The only area where this has been the case really is in local government spending - and this has faced severe cuts from central government. So the use of the Barnett Formula can only be an interim step, unless we are to see similarly poor incentives.

So as we move to greater devolution across the country, we will need to think about the spending powers of each place more like other countries do. What we need is a funding system which takes account of need in different places, whilst retaining the incentives and ability for places to do things for themselves. This is something I plan to look into further. Thoughts very welcome on what this might look like - or countries we should learn most from!

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Overall, the expansion of integrated settlements is very welcome. It will give a total of five places across the North genuine powers and certainty to plan for their residents. But this must just be a start. Over time, greater accountability, ‘Barnett for Mayors’ and a fairer, more rational system of subnational finance will need to be brought in if we’re going to genuinely put power into places.

This post is a summary and reflection on the past six months. I’ve been posting about projects, issues and trends across the North of England; meeting some new people and ideas along the way. Thank you to everyone who has subscribed, shared or commented on any post - I really appreciate it.

This newsletter now has over 800 subscribers - not just in the North of England but across the whole UK and beyond.1

Part of my aim here is to highlight all of the amazing things going on and inject a little optimism. This isn’t to say everything is rosy, but far more things are within our gift to achieve if we have the means and put our minds to it. And these means are increasing all the time given the process of devolution. Milestones over the coming weeks will include the expansion of integrated funding settlements to four more northern mayors and the expected passage of the English Devolution Bill.

As I take a step back and think about the future, I have one small ask. Over the next few weeks, it would be great if you could fill out this reader survey to help me think about what to look at over the rest of the year. There are only four questions, none of them are compulsory and any views would be most welcome.

For example, do you like the posts about the economy and hate everything else? Or vice versa? Now you can let me know!

Complete Survey Here

Here are my most read ‘top’ posts according to Substack if you missed them:

1. Why is Greater Manchester the fastest growing part of the country?

2. Why Future North

3. What does £45bn for the North buy you?

4. What does the Budget mean for the North?

5. Building the future

6. What is driving the economy of the North East?

7. What lies behind the rise of Rotherham?

8. The wheels on the bus

9. Let Tracy Build

10. Trams and growth in West Yorkshire

Plus three of my favourites that didn’t make it onto this list:

1. A new national park for the Pennines?

2. AI and Tech - is the North catching up or falling behind?

3. Is this the future of local news? [Since I wrote this, Mill Media has announced its expansion to Leeds - will chalk this up as a win!]

And also here are three of my favourite charts:

1. Bus usage has taken off in Greater Manchester

2. AI adoption has been lower by businesses in the North than in the rest of the UK

3. Growth spending per head remains lower in the North than the Greater South East - but the gap has closed slightly

One final reminder about the survey:

Complete Survey Here

See you in a few weeks!

Eagle eyed readers might spot that for the most part I have focused this series on the mayoral geographies of the North, yet there is no ‘Mayor of East Yorkshire and Northern Lincolnshire’.

This is an area once covered by the old ‘Humberside Council’ which existed from 1974 to 1996 - a footprint that the ONS still use for many of their statistics. So for data reasons, I will stick with the geography of the old ‘Humber’ region - but I think it would be wise for the ONS to change their methodology to align it with the new areas of governance.

This area is split between mayors - but united politically. Both Hull and East Yorkshire and the Greater Lincolnshire mayoralties elected Reform mayors in May 2025. But the statistics in this piece only go up to 2023 so it is as yet far too early to render any verdict on the outcome of Reform on the economy.

But what can we learn about the recent past - and why was this area divided in two?

Looking at the leaderboard of Northern productivity, we can see that the Humber area was in the top half.

Focusing on the top ten sectors by GVA as defined by the ONS, there is a different pattern to other areas I have looked at. In common with the North East CA area, manufacturing is the top sector for output. But ‘information and communication, ‘financial and insurance activities’ and ‘professional, scientific and technical activities’ are absent. This is an economy that is one of the least focused on these kinds of services in the North.

In fact, before turning to look more in depth at the Humber area, it is worth pausing to note that this area is the most reliant on manufacturing of any in the North of England. As shown on the map below, it is worth 25% of GVA. This is followed by Cumbria on 22% and Cheshire on 20% (the chart is clickable - as most charts are on here!). Manufacturing trends in the North are a topic I will return to at a future date.

Turning back now to the Humber area, since 2019, the energy sector has grown strongly in terms of total output, as have construction and administrative and support services. Could this be related to the clean energy cluster in the area? For example, offshore wind has a big supply chain in the area.

Breaking this output growth down into the change in employment and a rough estimate of the change in productivity, there is an interesting pattern. Most of the increase in productivity is being driven by the property sector (“real estate activities”) and the construction sector is the only one to really register both a productivity and employment improvement. The largest sector, manufacturing, has seen little change in either employment or productivity.

Looking further into manufacturing, by far the largest sub-sector is ‘manufacture of petroleum, chemicals and pharmaceuticals’ accounting for £2.4bn out of the £6bn of manufacturing. This is because the Humber area is home to big refining businesses (particularly close to Immingham) and chemical businesses (particularly at Saltend near Hull).1

What does all this mean for the future of the area? Three things stick out.

Firstly, the geography is now complicated - with the Humber now forming a divide between two mayoral areas. The old ‘Humber’ area was never much loved by the residents of East Yorkshire and Northern Lincolnshire - with the council abolished in 1996. The old identities have reasserted themselves with politicians choosing to divide between a Hull and East Yorkshire strategic authority facing into the North and a Greater Lincolnshire strategy authority facing south into the Midlands. One headquartered in Hull; the other in Lincoln.

In terms of business, this might not make much difference: a Freeport was set up by the previous government across the Humber area and organisations like ‘Future Humber’ are looking to maintain links. There is a way of course to work across such boundaries - including a proposed mayoral joint committee - and actually having two combined authorities to coordinate could be said in some respects to be an improvement on four councils. But on the other hand, could this be an example of political boundaries not aligning with functional economic areas?

Secondly, manufacturing is in a process of change given geopolitical issues and moves towards clean energy. In the context of Reform’s national position on ‘net zero’ this has created tensions. Luke Campbell pulled out of an agreement with other Yorkshire mayors given their commitment to net zero, but he has said he will back green energy given the jobs and clean air benefit for his area. For example, a lot of the North Sea wind turbines are assembled by Siemans in Hull. Additionally, a carbon capture pipeline is proposed through the area to help balance growth imperatives with environmental objectives - this will be a key project to keep an eye on as success would be game changing for net zero. Any issues with political backing may put this investment at risk.

Thirdly, two new mayors from a new political party will provide the biggest signal of what Reform is actually doing in power. As yet there have been few real world deliverables given how early they are into their terms - but also perhaps more heat than light as shown by some of the debate around green energy above?

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Overall, East Yorkshire and Northern Lincolnshire is an economically important manufacturing centre divided by a big river - and now potentially divided between the North and the Midlands. Yet with manufacturing becoming more essential, two Reform mayors and projects like a carbon capture pipeline in the works there will be a lot to keep an eye on for the future.

And we also know that significant growth in the USA has been driven by the AI boom - whether in creating new datacentres or through the new services like Chat GPT operating on them. Some official estimates from the US put this at 1% of GDP.1

So I wanted to look more into the digital and tech sector in the North. I’ve been very optimistic about the data showing that places in the North are growing strongly.2 But I wanted to look more into the tech sector to think not just about the economy of today, but also the economy of tomorrow.

First, I’m going to look at the ‘information and communication’ sector as defined by the ONS - this includes areas like computer programming, publishing and telecommunications - which broadly covers ‘digital services’.3 Secondly, I’m going to look at what the data can tell us about AI in the North - from datacentres to usage. There are some signs of optimism - but the North risks being left behind in terms of AI.

So looking at the ‘information and communication’ sector as a proportion of the total economy - we can see that every part of the North has a smaller sector than the national average. This tells us that digital services are less important to the North than they are to the UK economy as a whole.4

But if we look at the growth over the 2019 to 2023 period as in the chart below, we can see that most places have been growing this sector faster than the national average - which is encouraging. 5

However, even with this catchup taking place - are other parts of the country about to pull further ahead in this sector again?

If Artificial Intelligence is the future - then should we care about three key areas related to it: datacentres, building AI firms or ensuring AI adoption?

On all three - there are potential warning signs. It can be debated whether we need to care about all these areas, but it would be disappointing for the North to miss the boat completely.

On datacentres, I was struck by the map below when it was published by the BBC last year.

Source: BBC

This map shows that new datacentres are mostly planned for the Greater South East around London. And this is not a new phenomenon. DSIT data for 2024 shows that most computing power is located in London.

Now some people say we don’t need datacentres - because it is what you use the datacentres for which matters. I find this Parliamentary report mostly convincing that having access to ‘compute’ is likely to matter to some extent as it gives faster, clearer access without needing to worry about different regulations or geopolitical issues. This does mean there is still an open question as to whether being in the same country is sufficient.

So for argument’s sake lets say we don’t need datacentres here - for example we don’t need to build computers here in the North to get the benefit of them - but I would therefore hope then to see that we are doing well on either building AI firms or existing firms adopting it. On neither score does the North seem to be succeeding compared to other areas.

The DSIT data below shows AI firms by the location of their registered office. It’s fantastic for the UK economy that London is seen as one of the top international centres for AI - for example this article puts London as the fourth city in the world (and the top outside the USA and China). But can we build firms elsewhere too?

Source: DSIT AI Sector Study

Data City data backs the above statistics up - listing London as the top urban area for AI with 44% of UK AI activity. Manchester comes second but far behind on 4%. It also worth noting that their separate data cites Sheffield based TUBR as one of the UK’s fastest growing AI startups. And Manchester based AI firm Matillion is one of the North’s few unicorns (firms with a valuation above $1bn).

So despite some notable AI success stories, the North is behind the Greater South East. Perhaps it is not surprising given economic history and the fact that Deepmind was founded in London - retaining a huge presence there despite its acquisition by Google. But given all our universities and urban centres could we be doing better?

So if the North doesn’t have the datacentres and hasn’t got the highest concentration of firms, then at least we can apply the new technology in existing firms? 6

Rates of AI adoption by UK nation or region according to one business survey put the North West in the top half of the pack which is good. But the survey also found that the North East has the lowest uptake of any region, with Yorkshire not much better.

Would be very interested in views on whether it is the infrastructure, businesses or uptake that we need to be most thinking about. My gut feeling is that the creation of AI firms and uptake by existing firms is likely the most important for future prosperity? And also let me know if there are any data sources or other things that I have missed.

So the North has been catching up in terms of digital services as shown by the first section, but there is a risk that we get left behind in terms of AI.

Looking to the future, there are some reasons for optimism. The UK government have designated Barnsley as the UK’s first ‘tech town’ with an aim of increasing AI adoption - and building on the great work of the council. Construction should soon begin on a £10bn project to create one of the biggest datacentres in the country at Blyth. The government have confirmed an ‘AI Growth Zone’ will be created in the North East which will mean dedicated support to help deliver the infrastructure and energy requirements. There are clearly some exciting companies here too as mentioned earlier. But could more be done?

Firstly, could our mayoral and local authorities be doing more to encourage datacentres in their areas if we think they are important?

Secondly, on AI innovation and firm growth, do we need new approaches to university research or business financing to support firms to develop and grow? Given the 30% difference in spending per head, does the government need to do more to rebalance research and development spending across the country?

And finally, on adoption, what can we learn from ‘Made Smarter’ that applies digital technologies to manufacturing - could such an approach be scaled in specific places and across other sectors? And similarly can we quickly learn from, scale and build on the ‘tech town’ approach in Barnsley?

Overall, what more is needed to ensure that the place that birthed the first industrial revolution takes advantage of this newest one?

What I’m trying to understand is why some places seem to be growing more than others - in particular in the North, but also seemingly in the North compared to the rest of the country.

In common with previous posts, I’ve looked at the top ten sectors in Tees Valley by Gross Value Added (GVA), to compare their growth in output with the UK average over the period 2019 to 2023. And two things clearly stand out from this chart.

Firstly, the ‘information and communication’ sector including subsectors like digital and tech has apparently seen remarkable growth in Tees Valley.1 And secondly that every other sector has seen below average or around average growth compared to the UK.

Breaking this output growth down into increases in employment versus increases in productivity (measured crudely by output divided by employment), an interesting pattern emerges.

Sectors in the top left box have been shedding jobs, leading to increased productivity, but with little difference in output.

Sectors in the bottom right box have been adding jobs, reducing productivity, also with little different in output.

But the information and communication sector alone is in the top right box - adding both jobs and increasing productivity which has led to a large increase in output.

This explains the weak productivity story in Tees Valley, particularly as the information and communication sector is the smallest in terms of GVA in its top ten sectors.2

What is behind this? Unlike the other part of the North with weak productivity growth, we can’t blame it on a lack of devolution: Tees Valley has had a Combined Authority since 2016 with Ben Houchen as Mayor since the first election in May 2017.

In fact, three mayoralties in the North were created in 2017: Greater Manchester, Liverpool City Region (described as Merseyside in the statistics above) and Tees Valley. I’ve already looked into the growth seen in GM and LCR, finding that service related sectors in particular have been driving those cities forward.

Tees Valley is not as large, so is less likely to be a service oriented urban hub, but the results here are disappointing given that devolution has been around for almost a decade. The promise of devolution is that local decision making should enable better prioritisation of resources - all else being equal. And given this it is difficult to avoid the political and policy differences with the other areas on two fronts.

Firstly, have the persistent governance issues in Tees Valley been holding it back? The government issued a Best Value Notice against the Tees Valley Combined Authority following a report that found issues with the Teeswork project including ‘allegations of corruption, wrongdoing, and illegality’. Teesworks is a huge project to redevelop the former Redcar steelworks, but the governance of the project has been lacking as per the report raising concerns about value for money for the taxpayer as reported on elsewhere - in particular by the Teesside Lead (their latest article on Teesworks here).

Secondly, where other areas have focused more on building up their public transport networks, Ben Houchen has heavily invested time and resource into the Airport. After a £40m acquisition agreed in 2018, the airport has made continual losses. This includes a recent £10m grant that allowed the airport to say it had made a profit of £1m in the last financial year. Are such investment losses having an opportunity cost when compared with the benefits that other areas are seeing?

Looking to the future, there are potential reasons for optimism. The government have allocated almost £1bn of ‘Transport for City Regions’ cash that looks like it will mostly fund public transport improvements - including redeveloping the station close to Teesworks. The Darlington Economic Campus is seen as a relative success, but it may either be too small or too soon to tell whether this will impact the wider economy. And perhaps Teesworks can fulfil its potential, if it can get over its teething issues.

Overall, Tees Valley is a bit of a puzzle. Having had a consistent mayor and a politically aligned government for a nearly a decade, I expected to see more positive data when I looked at this area. Very interested in views from others on what is going on in Tees Valley.

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Are we seeing growth in digital services as shown in the data to 2023 or is the 2024 employment data in the footnotes below a canary in the coalmine? Will the airport prove to be a success or instead soak up funding that could be used for wider transport improvements? And can the benefits of devolution be realised or will governance failures persist? The strange case of Tees Valley is one I want to keep an eye on.

I’ve copied the Northern productivity leaderboard previously developed below. Today, I’m going to be looking at the area catchily described by the ONS as ‘Northumberland, Durham and Tyne & Wear’ which is equivalent to the North East Combined Authority (CA) area. It is therefore known as the ‘North East’ for the remainder of this post.

As we can see, the North East did better than the UK average but was third from bottom in terms of productivity growth in the North.1

Why is this the case and what can we learn?

Looking at the top ten sectors in the North East, we can see that the majority of them have grown faster (in total output terms) than the UK average. In particular, construction has grown significantly over the 2019 to 2023 period.

But what we really want to understand here is productivity growth. This is the measure of how much economic output we get from the time people work. The higher it is, the better off we all are!

Regular readers of this series will know that we can’t look at the purest form of productivity due to the way the ONS does its statistics - but we can look at the economic output per employment.

The chart below shows this measure over the 2019-23 period, alongside the growth in employment. It is effectively telling us how much the growth in output is driven by increases in employment or increases in productivity.

What we can see here is that whilst seven of the top ten sectors have grown in productivity terms, only three of these have also recorded increases in employment. Construction, manufacturing and education stand out as increasing productivity and increasing employment.

Information and communication has grown significantly in productivity terms, in common with many other places, and employment is actually still up by almost 10% in that sector if measured since 2015 (despite the small fallback since 2019).

Manufacturing remains the largest sector in terms of output in the North East - something that is no longer the case across many of the urban centres of the North.

It has also grown by 7% in the North East, compared to the UK average decline of 1% over the 2019 to 2023 period. Given these facts, I thought it was worth looking a bit further into manufacturing.

The three largest subsectors in terms of manufacturing output are ‘petroleum, chemical and pharmaceuticals’ (output up 73% over the 2019-23 period), ‘transport equipment’ (up 49%) and ‘basic and fabricated metal products’ (down 22%).

The North East has a strong cluster of pharmaceuticals manufacturing particularly around around Newcastle and Cramlington. Are we seeing a large growth of this cluster? See this report from North East Pharma which says that the growth here cluster lies in its orientation to international markets and its long standing expertise and reputation.

Manufacture of transport equipment has also been growing in the North East. The Nissan plant near Sunderland is likely a big part of this - and there are further expansion plans in the works related to electric vehicles. But it could also relate to the Hitachi rail rolling stock plant at Newton Aycliffe - which has recently been boosted by a government brokered deal for advance orders of new rolling stock.

And one sector that is a key part of the North East’s plans but is hard to find in the statistics is anything to do with clean energy. This is not because there is no activity - see for example the recent clean energy summit here. Instead it is due to the way that industries are classified by the ONS more than anything. Are there any trends in clean energy industries and manufacturing that I’ve missed due to this anomaly?

Views very welcome on what is driving the manufacturing trends in the North East - and if there is anything I’ve missed.

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It is interesting to think why the North East may have grown less strongly than other parts of the North. Manufacturing growth has been strong, but not as strong as the defence led growth we saw in Cumbria. There has been growth in education but less strong in professional and other service economy areas - compared to say the picture in Liverpool City Region.

Could there be more broad based reasons for this? And what are the reasons for optimism in the North East?

Devolution in the North East was held up for many years by boundary disagreements - meaning that the full North East CA mayoralty only really began in 2024 with the election of Kim McGuinness (following a few years as a ‘North of Tyne’ deal only).

The area’s Local Growth Plan published in 2025 could therefore start to make a difference over the coming years; there will also soon be an integrated settlement coming on stream from April worth around £400-500m per year.2

The North East also has taken the decision to focus on tackling child poverty under Mayor McGuinness’s leadership - with a cross-party agreement to invest £28m that I mentioned before. There are also plans to franchise the region’s buses as part of a new ‘Angel Network’. And it must always be remembered that the North East has one of the strongest feelings of regional identity in England. An important foundation to build on.3

Source: YouGov

Overall, the North East has seen weaker productivity growth than most of the North but has still been higher than the UK average. And with a mayor with full powers now in place, new initiatives in the pipeline and strengths in manufacturing to build on in a time of international uncertainty, I think we can feel positive about the future economy of the North East.

In summary it is good news for two main reasons:

1. NPR is now properly defined - and the government has said it will spend £45bn to get it done. This ends the effective period of limbo since 2023. It is now going to proceed in three main phases starting with the Transpennine Route Upgrade and other upgrades in Yorkshire, then the new Liverpool to Manchester line and then further cross-Pennine links. Even finally linking Manchester to Birmingham is back on the table. And the overall plan has been backed by Northern mayors. Now each individual project must be properly planned and then constructed as quickly as possible. No excuses.

2. NPR is not just about rail - but about growth and wider society. A huge deficiency in other recent plans has been just focusing on the infrastructure and not thinking about what the point of it is. And in plans for a new ‘Northern Growth Strategy’, the government has put a figure on this by suggesting that bringing the five most populous mayoral parts of the North up to the national average in terms of productivity is worth £40bn per year. As I called for in Nation Rebalanced, we should be building ‘growth corridor plans’ around major transport schemes to set out what the transport infrastructure means for housing, skills, land use and more with the intention of spreading the benefits as widely as possible. I’m delighted the government have taken forward this recommendation with the intention to publish more in the Spring.

But to understand just how important this announcement is, I think we need to take a little walk through history. When did discussion about Northern Powerhouse Rail begin and why has it taken so long to get to this point? I’ll then get onto the detail of what’s in the January 2026 plan and what I think the key lessons from the past are.

Fundamentally, this plan must be the foundation for future construction and action - not just another plan that is ripped up again within a few years.

NPR: A History

I apologise to any purists as I’m sure I’ve missed out some key bits. But I think the history below represents the really essential background to NPR.

This story starts with John Prescott and George Osborne.

As far back as 2004, Prescott’s ‘Northern Way’ strategy identified the need for better rail links across the North - though the later focus of the New Labour government centred on the development of HS2.

Then building on this in 2014, the then Chancellor made his Northern Powerhouse speech saying:

“Today I want us to start thinking about whether to build a new high speed rail connection east-west from Manchester to Leeds. Based on the existing rail route, but speeded up with new tunnels and infrastructure. A third high speed railway for Britain.”

This was followed by a Northern Transport Strategy just before the 2015 General Election. Through various ups and downs, via Brexit, the pandemic and a couple of Prime Ministers, Northern leaders published a joint plan on what ‘Northern Powerhouse Rail’ (NPR) might look like via Transport for the North.

Published in March 2021, this first definitive plan as to what NPR could look like utilised HS2 infrastructure around Leeds and Manchester to provide the beginnings of a new East-West line - with plans to reach Liverpool, Newcastle and Hull too. The key points were:

• A new line from Manchester to Leeds via Bradford

• A new line from Liverpool to Manchester via Warrington (utilising HS2 between Manchester and Manchester Airport)

• Upgrades to the Hope Valley route between Manchester and Sheffield (with consideration of other connections)

• Upgrades to the East Coast Main Line between Leeds and Newcastle via York and Darlington

• Utilising HS2 between Sheffield and Leeds

• Upgrades to the lines between Leeds, Sheffield and Hull

Map 1 - Transport for the North’s proposal for NPR (2021)

Source: Northern Powerhouse Rail, Transport for the North (2021)

But, as we all know, a project of this scale - in a country as centralised as ours - requires central government support. So the North would need to wait to see what response would be.

This came in the form of the Integrated Rail Plan in November 2021. The IRP controversially cut the Eastern leg of HS2 to Leeds down to a spur from Birmingham to the East Midlands. This meant that large parts of NPR would rely on upgrades to existing lines rather than new infrastructure.

A new high speed line was effectively proposed between Warrington and Marsden (a village in West Yorkshire) that would provide the main bit of new infrastructure for NPR and connect it up with existing plans for the Transpennine Route Upgrade from Marsden to Leeds.

Map 2 - Integrated Rail Plan summary

Source: Integrated Rail Plan, Department for Transport (2021)

Though just a few months after the Integrated Rail Plan was published, Boris Johnson was out of office. We then had a new Prime Minister: Liz Truss. And to be fair on Liz Truss - she did say that she would revive NPR! But, her tenure lasted less than 50 days.

So the next real big moment in this tale is Rishi Sunak’s infamous speech at the 2023 Conservative Party Conference in Manchester. He said:

“HS2 is the ultimate example of the old consensus. The result is a project whose costs have more than doubled, which has been repeatedly delayed and it is not scheduled to reach here in Manchester for almost two decades, and for which the economic case has massively weakened with the changes to business travel post-Covid.”

And in doing so, he simply ended the government’s commitment to HS2 to Manchester, ripped up the Integrated Rail Plan and effectively Northern Powerhouse Rail too given its reliance on HS2 infrastructure as shown in Map 2.

There was little recognition that maybe central government constantly changing the scope of HS2 - whether it was cutting the Northern legs or adding the infamous costly tunnels through the Chilterns - was part of the problem. And clearly there is something very wrong with a system of government that allows such a decision to be taken and announced at a party conference with no scrutiny.

He committed to a ‘Network North’ proposal that would include a Manchester to Liverpool line, connections to Bradford and various other schemes like the West Yorkshire tram. But despite the name it also included funding for many other parts of the country.

And by this point the various changing plans meant the whole thing was a mess with a General Election looming in 2024.

How is anyone meant to plan a major engineering project like HS2 or NPR if they face two significant scope changes within a two year period amid the political uncertainty of a General Election?

2026: A Northern Growth Strategy

Which brings us right to 2026. HS2 is under construction to Birmingham. The Transpennine Route Upgrade is also making progress across the North. And NPR was stalled until now.

The government have confirmed what will hopefully be the final version of NPR alongside plans for a Northern Growth Strategy. But what does it contain?

The full Northern Growth Strategy will be published in the Spring, but the early indications are promising. A Northern Growth Strategy less than two years into a government is a major advance on previous efforts - it took the Conservatives about four years to get to the Northern Powerhouse and New Labour almost seven years to get to the Northern Way.

The Case for Change document published suggests a focus on two areas: a ‘Northern Growth Corridor’ between Liverpool and York containing 9.5m people and a separate plan for the North East. This reflects the geographic reality that there are effectively two urbanised parts of the North which need treating distinctly and fairly as part of the wider North.

Six priorities have then been identified by the government for the Strategy listed below:

a) Supporting improved connectivity within and between city regions

b) Increasing effective city size, density and town regeneration

c) Supporting business investment and innovation

d) Investing in skills and human capital

e) Enriching culture

f) Future devolution

The work on this strategy will be led by Tom Riordan - former Chief Executive of Leeds City Council and now the government’s ‘Northern Growth Envoy’. We will have to wait for the Spring for the detail, but the early signs are promising that the government is serious about Northern growth.

The NPR plan comes in three stages as shown in the map below and now considered in detail.

Map 3 - 2026 NPR Plan Phasing

Source: Northern Growth Strategy: Case for Change, HM Government (2026)

Phase 1: upgrades to existing lines in Yorkshire in the 2030s - modelled on ‘Yorkshire’s Plan for Rail’ by Lord Blunkett which came about as a result of the White Rose Agreement. Shown in green above. This includes the Transpennine Route Upgrade from Manchester to York via Leeds and Huddersfield but also electrification between Leeds and Bradford and Leeds and Sheffield. These upgrades should speed up journeys and increase capacity. Development work is also going to progress on the Leamside Line which would free up capacity on the East Coast Main Line in the North East as well as opening up more stations in County Durham.

Map 4 - Indicative Leamside Line plans put forward by campaigners

Source: Leamside Line

Phase 2: a new line from Liverpool to Manchester running via Manchester Airport and Warrington. Shown in blue in Map 2. This builds on the plans from the Liverpool to Manchester Railway Board whose map I have copied below. The intention is likely for new stations at Liverpool Airport, Warrington and Manchester Airport in the middle with onward connections into Yorkshire as shown on the map.

Map 5 - Indicative Liverpool to Manchester plans put forward by the Railway Board

Phase 3: a commitment to ‘improved connections across the Pennines between Manchester, Leeds, Bradford, Sheffield and York’. Shown in purple in Map 2. The implication here from the government is for new infrastructure as the commitment also talks about services running onwards to ‘Newcastle via Darlington and Durham; Hull; and Chester for North Wales connections’. Given the maps from the government, it is likely this new infrastructure will run from Manchester to Leeds via Bradford and Huddersfield as well as something new between Manchester and Sheffield. One option here would be to revive the idea of a new tunnel from Manchester Piccadilly to West Yorkshire (though the Pennine logistics of this will be difficult) and then potentially using the old ‘Pickle Bridge’ alignment between Bradford and Huddersfield. Views from rail experts very welcome on the feasibility of different options for Phase 3!

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Overall, it is positive to have this £45bn commitment from the government. But there are some lessons which must be learned from the HS2 debacle.

Firstly, political commitment is essential so it is welcome that this plan has the backing of Northern mayors - and aligns to the NPR plan developed in 2021. There are some differences and of course a phased approach, but the commitment to new infrastructure and upgrades has been mostly followed through on. Cross-party national commitment to progressing these plans would be very welcome.

Secondly, the real test of the new plan will be in its delivery and longevity. Once we have a plan, we should really stick to it. All the chopping and changing of HS2 plans to save a few £ here or there has undoubtedly made the whole project more expensive overall. Planning work must conclude a scope and get approvals quickly - with construction starting as soon as possible thereafter. Financially, the next big test will be the Spending Review expected in 2027. And I would personally like to see further changes to the major projects framework to lock in their scope and budgets as far as possible via legislation. We must never face the situation again where a Prime Minister can simply cancel a major project with no scrutiny.

Thirdly, delivery should use experienced teams. In standing up HS2, we were trying to do something that had not been done before - with bespoke infrastructure delivered through an arms length body. Other models seem to have worked better. For example, we also have very large teams working on the Transpennine Route Upgrade and on East-West Rail. Now that we have that expertise across all three major projects, we should aim to move those teams to work on these projects as the older projects complete. This ‘learning by doing’ or ‘pipeline’ approach is well recognised to lead to lower costs over time.

Let me know what you think in the usual way!

The plan says that these works will start in the 2030s and end in the 2040s. This evidently needs more specificity and given previous issues there is no time to lose.

We’re expecting a baby this Spring. They will be turning 23 in 2049 - the current estimated completion date of NPR. 22 years ago, in 2004, John Prescott talked of improved rail links in the North of England. We must not face another two decades of broken promises.

Wherever bottlenecks are identified, government should be putting in the time and resource to unlock them. Such an approach must also be taken to the West Yorkshire tram as I have suggested before. The above dates should be seen as ironclad - or even beatable - if the willpower is there; the usual delays must not be accepted.

That is because there is now a real opportunity to improve the infrastructure and economic potential of the North of England, building on recent economic successes, backed by £45bn of government funding and a new Northern Growth Strategy. Learning the lessons from the past, we must stick to the plan and deliver the infrastructure and economy the North deserves.

I have two main aims for this year. One - welcome baby number two to the world in the Spring. Two - continue to contribute in whatever way I can to improving things - particularly here in the North.

If you have any tips on either then let me know.

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When I started writing here last summer, I said that I wanted to focus on the ‘people, projects and ideas shaping the future of the North of England’.

I think I’ve done a decent job talking about some of the ideas and projects, but haven’t talked nearly enough about the people. So I wanted to start 2026 off right by correcting that omission.

One of the most exciting trends of recent years has been the renaissance in local news driven by online platforms. And one of the largest of these, Mill Media, was founded in Manchester with its first title ‘The Mill’ back in 2020 by Joshi Herrmann.

Also I really should have said ‘award winning’, because last month both Joshi and Mollie Simpson picked up the local journalism prize at the British Journalism Awards for coverage of the crisis at the University of Greater Manchester (formerly known as the University of Bolton).

I spoke to Daniel Timms at Mill Media to talk about the journey so far and what the future might hold.

When Joshi founded the Mill back in 2020, he said that he moved to Manchester for a love of United and with an idea born of previous experience in digital journalism.1

Mill Media now has six titles shown on the map below alongside their founding dates. There is a clear ‘northern bias’ with the first three titles (and half of the total as of now) located in the North of England, close to the Manchester headquarters on St Ann’s Square.

Each place produces its own regular email newsletter focused on ‘long read’ style pieces about the place - with articles also available on their respective websites. The Mill Media publications self describe as a ‘newspaper’ and hold themselves to the same editorial standards.

The titles in the different cities have their own newsrooms, led by an experienced journalist from that place. Against the grain of many titles who have closed their newsrooms, for Mill Media the in person aspect is key to the whole operation as it allows people to bounce ideas around and new joiners to get up to speed learning from the older hands (though everything is relative given the whole thing is barely five years old). The Mill’s newsroom happens to be based in St Ann’s Square in Manchester, close to where I took this photo.

Every week everyone on the mailing lists receives some free content, with only paying subscribers getting access to all of the material in common with many media organisations now.

And the growth of this model has been phenomenal. There are over 200,000 people subscribed to Mill Media across its six cities, with over 13,000 of these paying.

Some of the biggest news stories in recent Manchester history have been exposed by the Mill - ranging from issues at the University of Greater Manchester that led to the suspension of the Vice Chancellor (coverage of which won the award above) to the resignation of Sacha Lord from his role at the GMCA over allegations around covid loans.

What does all this tell us about the future of the North? And the future of local news and democracy?

Firstly, it is very exciting that a new media company has been founded and is headquartered here. Mill Media has raised significant investment to expand its operations from the likes of Mark Thompson (former Director General of the BBC) and Diane Coyle (a Cambridge Professor born in Bury). We need more things like this to be created and ‘exported’ from the North if we are to build prosperity.

Secondly, with the decline of many news titles, it is welcome that local democracy is getting the attention and scrutiny it deserves - as shown by some of the stories above. As a big believer in the power of local decision making, we are going to need new forms of media to report on key decisions and other issues that will keep the public informed and grease the wheels of democracy.

Thirdly, local news is reinventing itself. Mill Media was keen to stress that it does not see itself a rival to older print titles - but is complementary - in that these major urban areas should have a variety of news sources.

So far the focus has been on major urban areas - with only Leeds and Newcastle really missing in terms of big cities in England. Could we see an expansion to those cities soon? Timms was tight-lipped. Separately, there is an obvious question as to whether such a model is replicable in smaller cities and towns.

And others have been trying in this space. For example, The Lead has set up a number of newsletters alongside its main title in the likes of Blackpool and Teesside. There is also the independent Huddersfield Hub run by a former journalist for the Huddersfield Examiner. Whether these models work is of critical importance to the future of not just local media - but democracy itself.

To me, a key lesson from this story is the power of people to just do things - and people like Joshi Herrmann, Mollie Simpson and Daniel Timms have harnessed that power in setting up and expanding the Mill.

Part of the reason I wanted to start writing here is that this is an exciting time for the North of England given the potential for increasing power and prosperity. So let’s start off 2026 with a little bit of optimism, that with each of us playing our part, we can create a place and progress to be proud of.

It has also just been announced that the West Yorkshire tram scheme has been delayed. Details are emerging, but the second half of this post has some initial thoughts on what should happen next. Skip down to the picture of Leeds if you just want to read about trams.

Growth in West Yorkshire

Over the 2019 to 2023 period, West Yorkshire had the fourth highest productivity growth across the North. As a resident, I would hope it to be higher but at least we’re in the top half - not that we’re competitive.

When comparing the economic growth of the top ten sectors in West Yorkshire with the UK average over 2019 to 2023, it is good to see that West Yorkshire has been growing more than average - particularly in terms of support services and construction. Though the decrease in manufacturing output - the traditional powerhouse of the West Yorkshire economy - is disappointing.

Breaking down this growth to understand whether it is driven by improvements in productivity or increases in employment, there is a mixed picture - though support services, professional services and education have all been growing strongly in both measures which is encouraging. Manufacturing jobs have been maintained, but this suggests a decrease in productivity given the fall in output.1

The ‘information and communication’ sector (which encompasses digital services) is the 11th largest sector in West Yorkshire - but is also worth looking at. In common with other parts of the North, West Yorkshire has also seen a bit of a boom. Output, productivity and employment have all increased since 2015 - though with some dips in recent years. These are shown in the chart below, where we can see that output has more than doubled in under a decade.

Looking below at the breakdown of productivity between areas, measured here by output per hour worked, there are a few interesting points to note. Firstly, Calderdale and Kirklees have been growing strongly in productivity terms from bottom of the pack to overtake Bradford. Secondly, Leeds saw a significant uptick in 2023 - though as we can see for Calderdale and Kirklees in 2020 this is not always sustained - this is one to keep an eye on to see if it is an actual trend. And thirdly, related to this, there has been decreasing inequality between areas in terms of productivity (not necessarily a good thing given the higher productivity you would expect in a major city). The ratio of bottom to top ranked area was 73% in 2004 and has risen to 81% by 2022. However, the bump in Leeds productivity in 2023 took this back down to 75%.

So what does this all mean?

From the data, I think there is a clear trend for West Yorkshire specialising further in modern service activities. Productivity and employment have been increasing in areas like professional services, support services and education. Information and communication growth has also been strong. Though we’ll need to avoid the pitfalls of the past if we’re to build on these successes: see this interesting history of research spending choices between Leeds and Cambridge to see how emerging strengths can be undermined by central decision making.

Productivity growth has been strong in Leeds as the biggest city in the area - home to an emerging ‘Northern Square Mile’ in Leeds and booming construction. It has also been strong in Calderdale and Kirklees - homes to institutions like the Piece Hall and innovative companies like Paxman Scalp Cooling - perhaps also driven by services building on the industrial past.

Trams in West Yorkshire

And this is all despite West Yorkshire remaining the largest urban area in Europe without a mass transit system. And it seems it will remain that way a bit longer - after an exchange of letters between the Mayor Tracy Brabin and Lord Hendy at the Department for Transport (DfT) confirmed that ‘services will now start running later than planned, from the mid-2030s to the late 2030s’.

This is disappointing. The delay seems to be the outcome of an independent review which says that the business case process must be completed before the planning process in line with current frameworks.

As set out in ‘Let Tracy Build’, it takes far too long to get anything built in this country. In the associated report, ‘Let Mayors Build’, other countries were highlighted as being able to develop and build similar schemes in less than a decade whilst the West Yorkshire Scheme will be closer to two decades.

In an ideal world, West Yorkshire would be able to finance and approve its own tram system, just like places in other developed countries. The Devolution Bill should be amended to make this a possibility in the future - with mayors getting powers over Transport and Works Act Orders and further fiscal devolution so they can fund things locally.

However, whilst getting to this point for future projects should be the aim, this scheme is likely going to have to work within the broad system as it is. But this does not mean that the current process should suffice.

Given the growth potential - and sheer willingness to get on with building - of places like Leeds and West Yorkshire, this project should be a testbed for different ways of getting things done.

The government seem open to ideas on this, with Lord Hendy’s letter saying they would “explore the potential for existing processes to be sharpened and advise on opportunities to accelerate and bring the date for delivery into service forward”. This should be an urgent priority or business as usual will be the default. Here are some ideas based on my experience2:

• Scope: it is great that the government remain committed to ‘mass transit’ but there is some reporting that West Yorkshire are being asked to develop alternative modes of transport through the business case process - like buses. This is a waste of time and everyone should confirm now that trams are the preferred mode.

• West Yorkshire Mass Transit Taskforce: a bit like the Vaccines Taskforce, jointly develop and approve the business case between West Yorkshire and the Department for Transport. Sequential development and approval takes time, money and effort. I estimate each approval point can add around 3 months to the process, so getting this right could save years. If it could help speed things up, could it not be one of the pilots for a place-based business case that HMT are trialling? And the thinking should be done now to allow future business case stages and the planning process to run in parallel.

• Capacity: something is only a priority if staff are allocated to it. Lord Hendy has a busy portfolio which also involves nationalising the railways. I think he also oversees the Transpennine Route Upgrade, so I’m not sure the tram project is even his biggest project in the area. To support decision making by Lord Hendy and Tracy Brabin, there needs to be a big team on this - ideally working in a different way to normal as suggested above between WY and DfT - with delegated authorities to get on with stuff. As set out before, mayors will be banned from deciding the roles of their own commissioners under the Devolution Bill. Wouldn’t it make sense for West Yorkshire to be able to appoint a dedicated Mass Transit Commissioner if it needs to?

A combination of these ideas could potentially takes years off the project if the work is done now - and get us back to a mid 2030s timeline if we show some ambition.

So very interested in views on the above - or are there other ideas that haven’t been thought of? Let me know in the comments!

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So it is very important that the process for building trams is not unnecessarily slowed down, especially if West Yorkshire is to sustain the growth highlighted above.

But with bus franchising starting in 2027 through the Weaver Network (something we have seen working well so far in Greater Manchester) and the completion of the Transpennine Route Upgrade in the 2030s (and maybe Northern Powerhouse Rail finally confirmed?) then there are still reasons to feel optimistic about the future in West Yorkshire as we head into 2026.

On which note - this is the last post of 2025. There are now over 700 subscribers to this newsletter - if you haven’t already, please get in touch with ideas for the future, or subscribe if this has been forwarded to you. Hope you have a great Christmas break and see you in 2026!

And two recent statistical releases have helped to buoy that optimism.

Firstly, back in ‘the wheels on the bus’, I wrote about how public control of buses, alongside a more rational ticketing system, might improve public transport networks across the North.

The recently released statistics for 2024-25 show that bus passenger usage has increased. But the most significant increase has been in Greater Manchester, when compared to other parts of the North with large bus usage.1

As shown below, Greater Manchester bus patronage in 2024-25 was up 19% from 2022-23 - the last full financial year before the franchising process began. This is higher than the other areas on the chart. Could this show that bringing buses back into public control is starting to make a difference?2

Secondly, back in ‘building the future’, I talked about the ‘growth spending’ gap between the Greater South East around London and the North.

I defined growth spending as encompassing areas of government spend like transport, research, education, housing and community amenities. The kind of areas that economists broadly agree drive economic growth. Using Treasury statistics, it is possible to then see how much is spent per person in each region on these things.

The gap is simply the difference between how much is spent per head in one part of the country versus another. It symbolises the kinds of things we prioritise as a society in each area.3

The most recent statistics have made minor revisions to previous years as shown but also the beginnings of a potential trend towards closing the gap.

From a last parliament peak of 19% in 2021-22, the gap dropped to 14% in the period covering April 2024 to March 2025.

Comparing different areas of spending, I’ve looked below at the main components of ‘growth spending’ (defined as ones with over £100 per head in 24-25 in the North or GSE) to see what is driving the convergence.

From the above there is a mixed picture - but the closing gap in economic development, transport and education has effectively more than offset the marginally increasing gaps in science and technology and housing and communities spend. In fact, given the housing issues facing the Greater South East, the latter change is no surprise - but we must do better in terms of closing the gap in science and technology spend given the economic challenges of the North.

Overall, it is difficult to attribute credit for the gap reduction fairly. Financial year 2024-25 covered the last year of the previous government’s spending plans but also the beginnings of the new government making some adjustments. This is a trend to keep an eye on.

So what does this all mean?

To me, it shows that determined effort can start to close some of our divides. I’ve shown before how the economy of the North has been performing well since the pandemic - though from a low base. With a sustained decrease in growth spending gaps and statistics which show changes like bus franchising are starting to make a difference then perhaps we can enter the Christmas period with a bit of optimism?

The Bill will start to re-entrench local power within our system of government. For example, it means powers cannot be taken away from mayors without a vote in parliament, it gives them a ‘right to request’ any new powers which government must respond to and also a defined role in a host of policy areas alongside a ‘general power of competence’ to get things done.

One of the most exciting trends in the North is the move towards 100% coverage of mayors across the North alongside a deepening of powers. This is because the reassertion of local power is an essential part of how we get more things done in this country.

In the rest of this post, I’m going to look at two recent development in this space. Firstly, what the announcement of the abolition of Police and Crime Commissioners (PCCs) means for the North - especially in areas where their police force areas do not match the mayoral geography. Secondly, I’m going to take another look at the English Devolution and Community Empowerment Bill to suggest where it could be improved to further build local power with greater mayoral capacity and accountability.

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Police Structures

Abolishing PCCs is a positive step given the government’s intention to hand the responsibility over to mayors where they exist (or local councils where they do not yet exist). This will streamline local democratic accountability and allow for greater to join up between the police and other areas. For example, there is an important link between transport and public safety that some mayors are starting to think about in more detail now that they are responsible for both.

For the North, the impact of the PCC change differs across areas. There are effectively three categories:

1. Done/Co-terminous: areas where the mayor already is or will be accountable for the police given co-terminous boundaries of the police and strategic authority. This includes Greater Manchester, North Yorkshire, South Yorkshire and West Yorkshire police areas who already have the mayors in charge, plus Cumbria and Lancashire where the mayoral areas will have the same geography as the police forces.

2. Within Mayoral Area: areas where police forces are wholly within existing mayoral areas but not co-terminous. This includes Cleveland (wholly within Tees Valley), Merseyside (wholly within Liverpool City Region, LCR) and Northumbria (wholly within the North East).

3. Boundary Change Needed: areas where police boundaries cover multiple strategic authority areas. This includes Cheshire (divided between LCR and Cheshire & Warrington), County Durham (divided between the North East and Tees Valley) and Humberside (divided between Hull & East Yorkshire and Lincolnshire).

The status of each police area in the North is shown in the map below.

When the English Devolution and Community Empowerment Bill passes, an important change will be made that will allow the government to accelerate the abolition of PCCs. 2

The government will have a new power to amend police force areas to align them with mayoral areas. This is because Clause 45, Subsection 4 will allow the government to amend police force boundaries, if the Secretary of State’s purpose is to allow a strategic authority to meet the eligibility condition for the transfer of PCC functions and will enable a timeline to be specified.

The government should therefore use these powers as an opportunity to accelerate police force restructuring to create co-terminous areas as soon as possible. This would mean dividing up the forces marked in red on the map above so they cover the same areas as the mayors.

This would likely be the biggest change to police force boundaries in England since 1974 and mean some upheaval in affected areas. But in policy terms, it will improve democratic accountability and allow for greater join up of services between the police and other policy areas. And in creating greater structural consistency, it may also aid public and media understanding.

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Given where devolution in the North currently is, the Devolution Bill now entering the House of Lords needs to create a platform for the transfer of further powers to places. Not just for the next couple of years but thinking ahead over a five to ten year period.

Prompted in part by some of the discussions I’ve had since publishing ‘Pride and Prosperity’ and ‘Let Mayors Build’, the following issues have been cited as barriers in the Bill to achieving the vision of deeper local control over the long term.

Mayoral Appointments and Capacity

The Bill currently sets out seven areas of competence for mayors (e.g. transport and local infrastructure) and then says that mayors can appoint commissioners (effectively deputy mayors) for each of these seven areas. 3

Whilst the areas of competence are quite broad, putting restrictions on the number of commissioners and what job titles they can have in primary legislation will prevent mayors from appointing people to positions they may wish to fill. In the future, it will also prevent central government from devolving significant new functions to mayors without further primary legislation.

Mayors have already been making appointments of commissioners for different areas who would either be not allowed or have to sit outside the legislation. For example, mayoral appointments of ‘active travel commissioners’ would be outside the scope of the legislation, creating confusion.

The solution here is to allow mayors to appoint commissioners to more than the seven areas and also to roles determined by the mayor. This might generate concerns over cost or scrutiny. But the pay of commissioners is already going to be subject to review by a remuneration committee (and departmental guidance) and both the combined authority and overview and scrutiny committees are to be given a role in suggesting the potential termination of commissioners. Together, these are sufficient safeguards on competence and value for money without the need for restricting the number or roles of commissioners.

Additionally, the ability of mayors to appoint special advisers is also a hodgepodge of differing rules. Due to differences in legislation, the Mayor of London is allowed to appoint two advisers, the Mayor of Greater Lincolnshire is not allowed to appoint any advisers and the rest of the mayors are allowed to appoint one adviser. Their terms and conditions also differ between London and the other mayoralties.

These differences should be ironed out - potentially in the same way that central government has done for its own advisers. Under the Constitutional Reform and Government Act 2010, there are no restrictions on the number of advisers but their names and costs are published each year.4

The same provisions on number and transparency should apply to mayors so they can appoint as many advisers as they need given the functions they need to exercise - and where pay could be made with reference to the commissioner pay scales. Public and media scrutiny should be sufficient to ensure value for money. There is no reason why mayors should be more constrained than government ministers are.

Mayoral Accountability

In ‘Let Mayors Build’, we called for the government to increase the threshold on transport projects at which mayors will need to send a business case to central government from the current level of £200m. This will bring any moderately big project in scope - for example Greater Manchester’s Trafford Park line cost around £350m back in 2020. One of the likely reasons for this rule is the fact that integrated settlements still leave overall accountability with central government.

This is based on the idea that ‘departmental accounting officers’ - usually the permanent secretary of the relevant department - are personally responsible to parliament for value for money of public expenditure. The most visible manifestation of this is usually when officials appear for a grilling in front of the Public Accounts Committee.

Breaking this individual accountability for local spending would have two benefits. It would liberate accounting officers and parliament of the idea that they can control every single spending decision. And by doing so it would free up places to innovate - with appropriate local scrutiny.

One potential solution here is for strategic authorities to have Local Public Accounts Committees (LPACs) to scrutinise spending and for strategic authority chief executives to be designated as Local Accounting Officers (LAOs) who will be accountable to the LPAC for funding within an integrated settlement.

Keeping central control will inhibit innovation as mayors will always end up being accountable to Whitehall for spending. We are already seeing this with the development of onerous outcomes frameworks and the above cited business case thresholds which will prevent places from innovating or getting stuff done quickly. Improving local accountability is the surest route to creating genuine change in places and more active interest in local delivery.

As usual, very interested in views on the proposals above and anything else that might need to change in the Devolution Bill!

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Between the Devolution Bill and the abolition of PCCs, greater power is being invested in places in a more rational way. This will help to improve delivery, join up services and potentially save money. Over the next few years we could see mayors taking more powers over areas like 16-19 education, public service reform and other areas.

But to get structures right for the long term there may need to be changes to police force boundaries, greater freedoms given to mayors on their appointments and increased local accountability to free places up from central control. The current trajectory is good, but a few nudges are needed to get it right for the future.