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Osborne’s Northern Powerhouse centralises power and devolves blame


Central Control but local delivery

The Sheffield City Deal – part of George Osborne’s Northern Powerhouse project – was announced last week to coincide with the Conservative Party conference. The tone of the debate around devolution has been strikingly positive thus far from both right and left. Its proponents argue that it is an indispensable component of the solution to the UK’s economic, social and democratic ills.

Yet there is a great incongruence between the soaring rhetoric of devolution and the actual policy content of City Deals, such as the one in Sheffield, where only modest budgetary powers have been handed down. Moreover, an analysis of the specific powers being transferred speak to Whitehall’s existing objectives rather than an enabling of any deeper sense of decentralisation. In this sense, what we are witnessing is the shoring up of central control but the localisation of delivery. This is particularly so when considering that the devolved powers are ‘on loan’ to cities; contingent upon future performance evaluations by Central Government.

In this context, that HM Treasury is setting the tone of the debate is unsurprising. Currently, local government actors are effectively competing to make the case that they are best positioned to deliver Treasury objectives most efficiently.

Not only local delivery, but also local accountability

Even more worrying from a Labour perspective, is that accompanying this localisation of delivery is the obfuscation of accountability. It has already been suggested that the devolution agenda has been partly driven by a desire from certain actors in Central Government to ‘shift the blame’ for unpopular austerity measures.

It would certainly seem intuitive that delegating responsibility for ‘wielding the axe’ is likely to be an appealing proposition for some in Westminster. As Labour MP for Worsley and Eccles South, Barbara Keeley, noted, in the midst of all those trumpeting ‘Devo Manc’, local policy-makers are effectively ‘being handed over a funding crisis’.

Aided by the lack of clarity enabled by the myriad of bespoke City Deals being negotiated, devolution means that the lines of accountability for unpopular austerity measures and the perennially stagnant economic zones of the North are being blurred.

It is significant that Central Government is demanding the creation of Metro Mayors as preconditions of any City Deals being agreed. Erecting such a visible face (and in the North of England, a Labour face) of local politics, tasked with delivering the objectives which local government actors have claimed is possible, would seem to be a central pillar of this blame-shifting strategy.

The knowledge that devolved powers could be quietly revoked to significantly less fanfare in the wake of future ‘performance evaluations’ whilst prominent Labour figures in the North remain such visible mayors is a disconcerting thought.

This shifting of accountability is compounded by the language of empowerment and liberation in which the devolution debate has been couched (particularly by the local councils looking to build their empires) which plays right into the hands of the Conservative strategy.

So how does the Labour Shadow Cabinet respond?

Therefore, just as with Osborne’s devolution project at large, the Sheffield City Deal can be understood as the shoring up of central control and the localisation of accountability and delivery of Treasury objectives. Rather than a mode of engendering a rebalancing of the UK economy, it can instead by understood as part of the Conservative Party strategy for politically managing its failure through obfuscating accountability at a time of austerity and low growth in the North of England.

However, with the widespread disaffection with Westminster, and the enthusiasm of local Labour leaders for devolution, this agenda is a tricky one for Corbyn and the Labour Leadership to resist. But it is imperative both for the tackling of inequalities and the long-term electoral viability of the Labour Party that the case is made for the British State’s role in steering us towards a more progressive economy and society. Any genuine re-balancing of the UK economy demands a strong state capable of directing capital to areas of under-development and enforcing a decisive industrial policy.

Localism can be a virtue in many areas, but it is not a suitable response to existing inequalities and the uneven development within the UK. That more powers could be moved to the local level should not be discounted outright, but currently what we are seeing is a minor technocratic recalibration of delivery disguised by a discourse characterised by promises of ‘empowerment’.