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The blog discusses the West Midlands’ 2023 devolution deal, which grants local authorities more powers and funding, as well as the relocation of civil service jobs to the region, driving economic growth and local governance. It highlights the potential benefits and challenges of these changes and how the region could become a model for successful devolution in the UK.
The West Midlands has become a focal point for discussions on devolution and the decentralization of government powers. Over recent years, the region has experienced significant developments, especially with the UK government’s announcement of a ‘trailblazer devolution deal’ in March 2023.
This deal marks a crucial step in the UK’s devolution journey, offering increased powers and financial flexibility to local authorities in the West Midlands. The shift towards greater local autonomy in the region, coupled with an expanding civil service presence, signals a changing political landscape with potential long-term economic benefits.
Key Features of the West Midlands’ Devolution Deal
The 2023 trailblazer devolution deal offers several key elements aimed at enhancing the region’s governance capabilities and promoting economic growth. Central to the deal is the concept of a ‘single settlement,’ which provides consolidated funding for local authorities in the West Midlands. This approach simplifies financial management and gives local governments greater flexibility to allocate resources according to regional priorities.
Another important feature of the deal is the increased focus on regeneration and housing. The West Midlands now has access to funding and powers to regenerate brownfield sites and increase the availability of affordable housing. Additionally, the deal allows the region to retain business rates for up to 10 years, creating a long-term incentive for economic growth and local investment.
The deal also introduces the possibility of establishing up to six ‘levelling up zones,’ which would provide targeted support to economically disadvantaged areas within the region. Furthermore, the devolution of the Bus Service Operators Grant gives local authorities more control over public transportation, potentially improving services and infrastructure.
While the powers granted in the deal may appear modest at first glance, the emphasis on co-designing policies with central government represents a significant shift. By involving local governments more directly in the policy-making process, the deal aims to foster greater trust and collaboration between Westminster and regional authorities. This approach aligns with the broader goals of increasing local input into national decision-making and strengthening local governance.
Civil Service Relocation to the West Midlands
Parallel to these devolution efforts, the West Midlands has also seen a notable increase in the presence of civil service roles outside of London. By 2023, the region hosted 34,445 civil servants, a 13% increase from just two years prior. This growth is part of the UK government’s broader strategy to decentralize government functions, with a target of relocating 22,000 civil service positions outside of London by 2030.
Key developments include the opening of a second headquarters for the Department for Levelling Up, Housing and Communities in Wolverhampton in 2021. Birmingham, too, has benefited from the civil service relocation, with two major hubs now operating in the city. These hubs, located at Arena Central and Stephenson Street, accommodate thousands of civil servants from a range of government departments, including HMRC and the Department for Work and Pensions. Plans for a third hub, set to accommodate up to 4,000 officials, were announced in 2023, further boosting the region’s status as a government employment hub.
The relocation of civil service jobs to the West Midlands presents both economic and social opportunities. It can bring well-paid jobs to the region, stimulate local economies, and ensure that civil service functions are more representative of the diverse needs of the UK’s regions. Additionally, the concentration of government departments in Birmingham and Wolverhampton could help foster innovation and collaboration between different sectors and local stakeholders.
The Benefits and Challenges of Devolution
Devolution is widely regarded as a means to promote more efficient and effective governance. Research consistently shows that devolving powers can improve resource allocation, better align public services with local needs, and stimulate economic growth. In regions with greater autonomy, studies have observed a reduction in income inequality and an increase in political stability. These benefits are particularly evident in city-regions that have successfully implemented devolved governance structures.
However, the success of devolution is not guaranteed. Several factors must be considered to ensure its effectiveness. These include clear definitions of roles between central and local governments, appropriate fiscal autonomy for local authorities, and robust mechanisms for accountability and transparency. Local governments must also develop clear strategies and long-term plans to address regional challenges and opportunities.
International examples, such as the experience of Lille, France, in managing devolved powers, provide valuable lessons for the West Midlands. Lille’s success in strengthening relationships between local actors and collaborating on regional development issues demonstrates how both formal and informal networks can play a critical role in fostering innovation and economic growth. The West Midlands can learn from such examples to strengthen its own governance structures and maximize the potential of its devolved powers.
The Future of Devolution in the West Midlands
Looking ahead, the West Midlands is poised for even greater devolution as the political landscape shifts. Labour’s 2024 election manifesto includes a commitment to introducing “landmark devolution legislation,” which would further transfer powers from Westminster to local communities. The English Devolution Bill, part of this manifesto, seeks to provide metro mayors and combined authorities with extended powers, enabling them to exercise greater control over key policy areas such as housing, transport, and skills development.
For the West Midlands, these proposed changes could significantly enhance local control over economic strategy and policy-making. The emphasis on local growth plans would allow regional leaders to tailor their economic strategies to the unique needs and opportunities of the area, while the introduction of a Devolution Framework could provide more clarity and consistency in the allocation of powers. This increased autonomy could lead to more responsive governance, better policy innovation, and a more effective alignment of resources to address regional challenges.
However, the shift towards greater local autonomy also comes with increased responsibility. The success of devolution in the West Midlands will depend on how well regional leaders can leverage these new powers to foster economic growth, improve public services, and address long-standing inequalities. With careful planning, collaboration, and strategic thinking, the region has the potential to thrive in this new era of devolution.
Conclusion
The West Midlands stands at the cusp of a transformative period in its political and economic development. With the devolution deal and the relocation of civil service jobs, the region is gaining more control over its governance and resources. These changes present opportunities for increased local innovation, economic growth, and improved public services. However, the success of devolution will depend on careful implementation, effective governance, and strategic planning. As the region continues to evolve, it will undoubtedly serve as a model for other parts of the UK looking to take advantage of the benefits of devolved powers.
Disclaimer:
The views expressed in this analysis post are those of the author and not necessarily those of City-REDI or the University of Birmingham.