This week saw four out of the seven councils that would have made up the North-East combined authority vote against devolution thus leading to the Secretary of State for Communities & Local Government, the Rt. Hon. Sajid Javid MP, to take the deal “off the table”.
Having seen the effect of devolution in Manchester and Liverpool one must ask, does having a devolution deal really make a difference to achieving the development potential of a region?
Since its introduction in 2014 by George Osborne, the idea of regional devolution with directly elected mayoralties has been the topic of a great deal of discussion, with regional hubs around Manchester and Liverpool taking up the offers of devolution presented by the Government early on.
One of the reasons that many thought of this reorganisation as a positive, apart from the £30 million a year, was the raft of new powers that would be devolved to the region on transport, skills and housing which many saw as the key strategic factors affecting the rate of development in the region.
Looking briefly at the three regions, it does become starkly obvious that devolution did indeed have an effect on the realisation of the development potential in the two regions where it was introduced and raises alarm bells for the North-East region.
Newcastle is currently experiencing a crisis in office space, with less than 100,000 sq ft available at present. As I am sure one can appreciate, this makes it difficult for business to grow in the area. While there is some cautious optimism with hotel and student conversions helping to plug the gap, as well as a 10-acre site near Central Station being delivered by the City Council in partnership with Clouston Group, it is apparent that the lack of certainty in terms of the future of devolution has meant that Newcastle has been left behind.
Contrast this with the progress thus far made in Manchester, where in their first year alone £150 million of funding from the Greater Manchester Investment Fund has been loaned to businesses in support of creating thousands of jobs, and £66 million has been put towards over 1,000 new homes. These are all signs towards a new prosperity that will ensure the region has a bright future.
The key difference between the two scenarios?
Knowing where the buck stops.
In Greater Manchester, a system is being developed which will allow the authority, vision and crucially responsibility for delivery of regional growth to rest squarely in the hands of one person who will be accountable at the ballot box.
Without something similar in the North-East region, the varying priorities for different areas will hamper the strategic co-ordination needed to deliver future development in the way we can see it is being delivered in Manchester.
So, in short, while development can always be achieved, devolution is needed to give the best chance of realising the full development potential of a region.