Draft Newcastle Upon Tyne, North Tyneside and Northumberland Combined Authority (Establishment and Functions) Order 2018

Jim McMahon Excerpts

Monday 22nd October 2018 General Committees

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

It is a pleasure to serve under your chairmanship, Sir David.

It is good to be here again talking about devolution. Hon. Members may expect me to rush straight into an attack on how superficial the Government’s devolution is, but before I go there, I congratulate the leaders of all seven local authorities in the area on what has been achieved, in what has been a very testing time for local relationships. The Government could have approached things differently. They could have been far more inclusive and created greater opportunities for further devolution to the existing local authorities, which are more than capable of delivering far more. They are tried and tested, delivering good value for money and good public services, and they should not have artificial requirements laid upon them.

When it was clear that a deal could not be done, some local authorities naturally took a pragmatic view of how best to attract more investment from Government. Let us not fool ourselves about what the order is and what it is not. At best, it is a light-touch mayoral devolution package. The type of powers being devolved do not even come close to the existing devolution deals across the country. The type of money being devolved down to local authorities in those areas pales into insignificance compared with the austerity cuts that they have faced since the coalition Government—cuts that continued with the majority Conservative Government.

Local leaders are sick of waiting for the Government to come to their aid with investment and an idea for the future economy. Instead, they are developing their own visions for their local identity. There are good examples of that right across the north-east from Labour-run local authorities, which are showing real leadership of their place. The Government, to be frank, have walked off the pitch entirely. Given the type of powers being devolved in this order, my question is: why stop there? Local authorities in those areas can deal with far more than is being given in the devolution settlement.

Powers are one thing, but we need serious money. Let us look at the amount of transport investment across the north-east. Compared with most other regions, bar Northern Ireland, it gets nowhere near its fair share of capital or revenue investment. We know how important transport is for boosting local economies, connecting people to jobs and attracting inward investment. If the Government are determined to see a golden era, as the Minister said, where is the cash? They cannot do that on the cheap. Despite the best endeavours of local politicians, their economies have been left for a very long period to fight for themselves while Government have turned a blind eye to underinvestment in those areas. I credit those councils for negotiating the devolution deal on offer, but where is the Government cheque book?

It strikes me that since George Osborne walked away—or was moved to one side—the Treasury has just not been committed to devolution. From a Conservative point of view, it was originally a Treasury-led expedition—perhaps for different reasons, but that is where it came from. At the time, I was negotiating as one of the leaders on the Greater Manchester combined authority. In those devolution deals that were being struck, I witnessed a real tension between the Treasury and other Departments about where powers sit and how power is to be wrestled away from Whitehall.

The construct of some of those deals was quite odd, but they were reflective of the struggles and the frustration in Government. I do not see any of that here; I see a Government desperate to show that devolution is still making progress, when actually it is fairly superficial. I see a Minister who, perhaps for the best reasons—although he hides it well—is trying to make progress. But I am not seeing any real power given away from central Government. I am certainly not seeing any significant money being given away from central Government. The Government have realised—we have known this all along—that those best placed to deliver decent public services and make the best of limited resources in public investment are people in their local communities.

The question still remains: given their track record of delivering good public services, why should councils that could not quite get over the line on a mayoral devolution deal be cast to one side, without any devolution proposed at all? Will the Minister explain why local authorities are not fit to take on more budget responsibilities in adult education, for instance? Why can they not take on more responsibilities for getting people into work? Why are they not capable of taking transport capital investment from the Government and using that as a catalyst to attract inward investment? Why can local authorities that are tried and tested, and trusted by the public not do those things?

It is great that councils have come together. Again, I pay tribute to the council leaders who have created the deal, but if the Government are clear that there has to be a devolution deal for the whole of England, they cannot be so prescriptive about what that devolution should look like. With all due respect, it is a bit hypocritical for a Minister who is not directly elected to say to local politicians that if they want a fraction of the power that is held by a Government Minister who is not directly elected, they must move to a directly elected model in return. We do not directly elect our Chancellor, our Minister for adult education or Ministers in the Department for Work and Pensions, and the Minister here today is not directly elected either. For a fraction of the power from this place, local communities are mandated by Government to have a mayoral model or they get zero. I do not think that is in the spirit of a balanced and equal relationship. For me, that is still central Government telling local authorities what they can and cannot do in a very old, tired and untrustworthy way.

If the Government are really determined to see power shifted and to give people back the control that we know they demanded during the referendum, at some point—and pretty quickly—they will have to introduce a devolution framework that covers the whole of England, so that every community is included without having one set against the other. We want to see not only powers and legislation passed in this place, but genuine resources devolved down.

It cannot escape the attention of anyone in this room that the region most affected by a hard Brexit—which is what some Government Members are looking for—will be the north-east. It will take a hit the likes of which it has not seen for decades. In that context, it is legitimate to ask whether the devolution on offer is sufficient to meet the challenges that lie ahead. It is progress and it is a step forward, but it cannot be the end. I say to the Minister: this is not “Game over”. This is not the end. The devolution on offer should be seen as minor progress—progress, by the way, that is mainly to the credit of local leaders in the local authority. The Minister needs to step up, get back round the table and ensure that further power and resources are devolved as soon as possible.