A devolution revolution?

By Ben Lucas

The immediate headlines from the Spending Review 2015 will be all about how George Osborne escaped from the straightjacket he had put on himself. This is particularly true with the U-turn on tax credits and the decision not to cut the police and FE budgets. He was hugely helped in this by the OBR happening to find £27bn of extra revenues as result of revised forecasts - proving the old adage that there's always something to be found at the back of the sofa.

But the real significance of the Spending Review lies elsewhere. Two substantial and important shifts are taking place, from the state to the private sector, and from central government to cities. The state may be shrinking to 36% of GDP by the end of the Parliament, but it is business that is being asked to pay for this. This is a fairly ruthless appropriation of Labour policy before the last election. Business will pay the cost of phasing out tax credits in the future through the introduction of the Living Wage and yesterday we learned that the Apprenticeship Levy will raise £11.6bn over the next four years.

Business rates and fiscal devolution: the beginning but not the end…

By Sarah Whitney

The MJ is running an interesting survey this week  reporting local government’s view of the planned 100% retention of business rates. Almost 90% of chief executives and finance officers surveyed considered that giving local government control of the business rate still didn’t go far enough in terms of fiscal devolution.

Here’s why…

First some history. Prior to 1 April 2013, business rates were collected by local authorities and then remitted to the Exchequer. The Exchequer then redistributed the rates back to local authorities, on a needs-basis, through the Formula Grant System. In that context, variations in business rates, which total approximately £23 billion per annum, were dwarfed by the £548 billion of other tax receipts central government receives. 

Cities must scale up their ambitions for devolution to work

By Mike Emmerich

“The average civil servant thinks that cities only ever ask for one of three things in devolution deals: things they can already do, things that don’t make any difference, and things they bloody well can’t have.”

That’s an opening line I often use when speaking on devolution. There is more than a hint of truth in this observation borne from my years of experience with devolution-free devolution deals. Even Greater Manchester, now a poster-child for the government’s devolution agenda, was until recently a serial devolution failure. Despite endless negotiations of local public service agreements, local area agreements and a host of other agreements, there was no devolution.

We have no builders: Skills shortages threaten Government’s house building targets

By Peter Skalski

Last September the government announced an ambitious target to get a million new homes built by the end of the parliament. Unfortunately, grand pledges on housebuilding from politicians have to be taken with a pinch of salt. Governments of both sides have consistently failed to ensure that the country builds the sufficient number of homes it needs. Many commentators are sceptical that this million homes target can be realised, particularly as the Government’s Housing Bill is aimed at enabling home ownership rather than increasing the supply of homes. 

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