David Gauke is a former Justice Secretary and was an independent candidate in South-West Hertfordshire at the 2019 general election.
A Prime Minister needs a big idea. A big idea can cut through, providing both a narrative and a policy programme that can be readily understood. Margaret Thatcher sought economic renewal by controlling inflation and the unions; Tony Blair was about modernising the country; David Cameron prioritised restoring fiscal sustainability. Keir Starmer never had an overarching idea, and the absence contributed to his downfall.
Andy Burnham appears to have a big idea – devolution. As a political project, it has a lot to be said for it. Burnham, as a former mayor of Greater Manchester, embodies it. He is not from London (a point he has occasionally mentioned), and can weave a personal narrative into his political messaging. And it is a big idea, capable of conveying a sense of purpose to the country and a sense of direction to ministers.
There is also much merit in pursuing devolution not just as a clever political project but in delivering better government. We are a centralised country and making decisions closer to the ground can allow a greater understanding of local conditions, improve accountability, deliver greater public consent, and breakdown the silos that tend to exist with large national departments. Devolution allows innovation and provides an evidence base as to what works, and what does not. With dynamic leadership, we can see evidence of the benefits of devolution. Burnham points to Greater Manchester, although Andy Street has a stronger case in the West Midlands.
I make these points because I want to be explicit that the case for devolution is an attractive one. But, from what we have heard from Burnham, there are at least three concerns that must be made.
The first relates not directly to devolution as such but a related matter, which is his enthusiasm for dispersing central government policy functions to outside of London. This is not a new idea, with Rishi Sunak having established a Treasury office in Darlington, but Burnham wants to go further, establishing Number 10 North in Manchester.
It has been reported that this is a major restructuring of the State, with many of the growth functions currently performed by the Treasury stripped away from it, just as Harold Wilson attempted to do in 1964 with the establishment of the Department of Economic Affairs, albeit elsewhere in Whitehall. This, in itself, would be a mistake (just as it was in the 1960s). Weakening the Treasury so that it became solely a finance ministry and no longer an economy ministry would be a retrograde step. If anything, the Treasury needs to be more focused on the economy, not less.
There is more to be said on this topic, but I want to focus on the geographical point and challenge the fashionable view that more policy work should be done outside the capital.
This is essentially a practical point. We live in a Parliamentary democracy, and ministers (including the Prime Minister), have to be physically located near to the Houses of Parliament. If ministers are in Westminster, so are senior civil servants. Virtual meetings have their place, but it is in in-person meetings where personal relationships can be developed and trust can be built. Diaries are always crammed but are also fluid, and senior ministers value the ability to call impromptu meetings. Proximity matters – someone located near to a busy minister will have opportunities to grab five minutes here or there. This often matters.
This is not just about ministers. If Number 10 North is supposed to be leading on regional policy and transport, how does it work with other parts of the national civil service? The Department for Transport, the Department for Business & Trade, the Ministry for Housing, Communities & Local Government, and most of the Treasury will still be located in London – as will the rest of the Number 10 operation (chief of staff, James Purnell, for example). The answer is presumably through virtual meetings and travel, but it makes governing harder not easier.
There are agglomeration benefits from having policy officials all in one place. There are wider career opportunities as officials can move from one department to another without moving home. It is possible to build up personal networks across departments. You get a deeper and more flexible talent pool.
It might work to disperse specific functions out of London but even with this there have been problems (moving the Office of National Statistics to Newport has been a disaster, with many highly qualified staff leaving). But moving central policy functions out of Whitehall is likely to lead to more disjointed government.
There are, however, much stronger arguments for devolution proper, allowing decisions that have an impact in a specific place being made in that place. But it is does not guarantee that the right decisions will be made. It is very hard, for example, to make the case that devolution to Scotland and Wales – including substantial fiscal devolution – has had a transformative positive impact on the economies of those nations. When it comes to public services, it is pretty clear that it has had a negative impact (Scotland’s educational system has fallen further behind England’s).
The point here is that whatever the structure, if bad policies are pursued you will still get bad outcomes.
And this brings me to the biggest incoherence in Burnham’s devolution agenda. He favours greater devolution but he also favours greater equality of outcome – and the two do not go together.
Devolution means giving cities, regions or nations greater freedom to choose their own path. But with that freedom should come greater responsibility. Make an area more economically competitive and attractive for investment, the area should benefit from the economic upside. But make it worse, it should bear the costs. Diversity of policy should mean diversity of outcome.
This does not sound like what Burnham is proposing. His big message appears to be about reducing regional inequality, even proposing in a co-authored book a ‘basic law’ that everything that government does should be to further that objective.
If that is the case, it is hard to see how devolution can work to turn the country round. Those areas that succeed in delivering growth end up subsidising those areas that fail. There are plenty of vested interests that make prioritising growth hard to do (principally, NIMBYism in various forms), but if you are protected from the downsides of low growth and do not get to benefit from the upsides, why bother? The easy answer is to placate vociferous local campaigners, deprioritise growth, blame central government, and wait to be bailed out.
One of the reasons devolution can face Treasury resistance, is the suspicion that even if we devolve power, we cannot devolve responsibility. Even if a region or a city goes badly wrong, central government will step in and protect it. This happened with Liverpool in the 1980s, a city that was appallingly run by the far left, when even Mrs Thatcher’s government felt compelled to intervene and invest heavily in its regeneration. Incidentally, this has not necessarily resulted in the gratitude of generations of Liverpudlians.
This, I repeat, is not an argument against devolution. But it is an argument for a hard-headed devolution that considers local responsibility to be more important than regional equality, and makes the tough argument that we have to live with the local consequences of devolved decisions. This is not the vision of devolution that our next Prime Minister is going to offer.