28 July 2006
The city-regions agenda has been thrown into doubt after two of the chancellor's closest political allies this week revealed their 'deep scepticism' at its viability as a model.
Treasury ministers Ed Balls, Gordon Brown's former chief adviser and now economic secretary, and financial secretary John Healey are warning that a move to governance structures based around England's core cities risks 'a return to the old local antagonisms'.
In what amounts to a repudiation of existing government policy, Brown's allies argue that the way forward is to 'strengthen' existing structures and organisations, rather than create new ones under which smaller towns could lose out to their larger neighbours.
'We are deeply sceptical about the case for city-region government writ large – and believe it is false to suggest that a choice has to be made between new powers for cities on the one hand, and the current structure of regional and local economic decision-making on the other,' they say.
'By reforming existing institutions and using existing elected representatives to shift the focus from Whitehall to the English regions, we believe that the constitution of the United Kingdom will develop in a healthier, inclusive and fair manner.'
Their argument is set out in a pamphlet, Evolution and devolution in England, published by think-tank the New Local Government Network on July 26 and co-authored with its director Chris Leslie.
Its conclusions fly in the face of the reforms being developed by Communities and Local Government Secretary Ruth Kelly and due to be fleshed out in the local government white paper this autumn.
In recent weeks she has given enthusiastic backing to the city-regions model, arguing that it is the way to drive economic regeneration and allow cities such as Birmingham and Leeds to punch their weight against European rivals.
The pamphlet has provoked consternation among local government leaders. Sandy Bruce-Lockhart, chair of the Local Government Association, told Public Finance the ministers' 'unhelpful' comments were a 'bit of a mystery'.
He said he would seek an urgent meeting with Balls to help him 'understand what has been happening in local government in the past two years'.
Bruce-Lockhart added that he doubted Balls and Healey were setting out the chancellor's latest thinking on local government reform. 'I would expect Gordon Brown, as a serious politician, to have expressed these views to us in local government, and he hasn't done so,' he said.
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