Sir Keir Starmer has promised “no more talking shops of the past” when he meets regional mayors and leaders of the devolved nations on Friday as part of his programme to transfer power away from Westminster.
But despite the rhetoric, some mayors are concerned Treasury officials are already putting the brakes on a project designed to give locals greater say over housing and adult education.
Downing Street said the meeting in Scotland is intended to bring together First Ministers John Swinney, Michelle O’Neill and Eluned Morgan; 11 English metro mayors; and Mayor of London Sadiq Khan to discuss “shared challenges” and “opportunities” to boost inward investment across the country.
Also expected to join is Sue Gray, the PM’s former chief of staff, who was ousted by him on Sunday and given a new job as his envoy for nations and regions.
On Thursday, Deputy Prime Minister Angela Rayner will meet the regional metro mayors in the North East to discuss Local Growth Plans ahead of the wider summit on Friday. These plans aim to bring together the private sector, education providers and trade bodies to boost regional growth.
However, without spending clout there is a limit to what they can achieve, sources said. While the mayors broadly welcome how Sir Keir has promoted devolution, some say they are frustrated by the Treasury, which they say is hoarding power by putting national priorities for growth and jobs creation ahead of giving local leaders control.
“The Treasury is saying to the mayors, ‘This is the national strategy; we see you as just implementing our strategy,’” one mayor told i. “They don’t see it as devolution or, ‘You have control, and you decide.’ They just see us as a mechanism for delivering their national plans. And the mayors hate it.
“It’s not a fight yet, but there’s a big, very, assertive discussion going on at the minute about the strings that the Government is still trying to attach to all the pots of money that we’re going to get.”
Regional authorities have differing levels of freedom from London. The West Midlands and Greater Manchester are working towards withdrawal from ring-fenced funding from the Treasury as two “trailblazer” authorities, allowing them greater flexibility over their budgets.
Meanwhile, other mayoral areas are playing catch-up and manage pots of money on behalf of Whitehall departments in areas such as adult education, brownfield regeneration and housing. It’s this control from Westminster which is rankling some mayors, who are eager for greater local investment, and it could cause some tension at the meetings at the end of the week.
“We sit down with officials in the Treasury and MHCLG [Ministry of Housing, Communities and Local Government], they say, ‘You should spend more money on certain projects but there are other things we need to do now,’” the mayor told i.
“We say, ‘All of those things are going really well already, but if we’re going to raise our economy and deal with pockets of deprivation and public transport, we need to spend it on all this other stuff and not just stick to what you’ve told us.’
“And the civil servants are like, “Well, no, those are your USPs [unique selling points]. stick to those,’ and we say, ‘No, there are other USPs that come of the back of what we’re doing; we need to invest in all kinds of things.’”
The source added: “We are basically being told what the USPs should be, and then when they’re adopted, they will say, ‘You can only spend money on these things,’ which is very narrow. It’s very central control, which is why there is this thing with the mayors
“It’s a Treasury orthodoxy issue rather than a political one with Angela [Rayner] or Rachel [Reeves].
“What’s the point of mayors, if you’re just basically going to tell us what to do and how to do it without giving us the freedom of having devolution? At the moment the mayors are not getting devolution, it’s decentralisation because it’s all linked to the national industrial strategy.”
The mayor said that “the Government rhetoric on devolution is really good, but they love central control. So how do you deliver devolution without giving us more control over jobs and skills or our local industrial strategy? Instead, you have a national industrial strategy, you have a national jobs plan.”
Another mayoral source told i: “There is a tension as these two things work out alongside each other; how the local growth plans sit alongside the national industrial strategy. The discussions are going on at the moment.”
Matthew Fright, expert on devolution at the Institute for Government told i: “There is a bit of a lag between what some of the mayors want and what central Government can let them do. That’s because in the West Midlands and Greater Manchester they are doing the groundwork to adjust their financial processes to align to the Treasury’s approach to managing public money and agree a new outcomes framework so they can account for how money is spent.
“Some of the other regions haven’t had the chance to do this yet and so the Treasury is putting up guardrails for them while it learns the lessons from West Midlands and Greater Manchester rollout. This is another growing pain of devolution.
“The Government is keen to roll devolution even further across the country but developing new accountability approaches and aligning this to the spending review cycle will take time. So these discussions will keep going.”
The Treasury and MHCLG declined to comment after numerous requests.
Sue Gray hit the headlines again on Sunday when Starmer Sir Keir sacked her as his chief of staff. Whatever her current relationship with central Government, she is likely to find a warm welcome from the mayors on Friday. “She has been really helpful; she’s had dealt with the Civil Service and been really useful in kind of unpicking the machine.”
Asked if it could be awkward with her sitting alongside the Prime Minister, a mayoral source was keen to downplay any prospect of drama. “There is normally a structure which will give her the chance to say what she wants to say and make the points she wants to make,” the source said.
A Government spokesperson said: “Devolution and the Industrial Strategy are at the heart of our mission to boost growth across the UK, helping to drive investment and put more power into the hands of local leaders who know their areas best.
“That’s why we have reset our relationship with local leaders to ensure they are involved in decision making, and Local Growth Plans designed by mayors specifically for their regions will empower them to relight the fire of our regions in true partnership with government.”
