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Devolution in English regions has mixed impact on local economies, NAO says

Mayors were elected in six combined authority areas last year.

Devolution of powers to English regions has a “mixed and inconclusive” impact on boosting local economies, the public spending watchdog has found.

The National Audit Office also raised concerns over the credibility of regional mayors, warning candidates had often made commitments that went beyond the powers of the role.

New authorities covering different towns and cities add more complex layers to already complicated local government arrangements, it said.

The extra powers and structure must drive growth if they are to avoid becoming another administrative “curiosity of history”, the NAO warned.

The watchdog said there was logic behind the decision to create combined authorities that can work strategically across areas on transport and economic issues and found the Department for Communities and Local Government had “worked speedily” to make sure the structures were set up in time for mayoral elections in May last year.

But it found the organisations often assumed there was a strong link between investment in transport and economic growth in their plans despite research showing there is no high-quality evidence on the impact of trams, buses, cycling and walking schemes on local economies.

The report states: “Evidence that investment, decision-making and oversight at this level is linked to improved local economic outcomes is mixed and inconclusive. Combined authorities themselves often assume in their plans that there is a strong link between investment in transport and economic growth, for example.”

Mayor of Greater Manchester Andy Burnham (Kirsty O'Connor/PA)

Mayors were elected in six combined authority areas – Greater Manchester, Liverpool City Region, West Midlands, West of England, Cambridgeshire and Peterborough, and Tees Valley – last year.

Analysis by the NAO of the mayoral candidates’ manifestos found it was “common” for them to campaign on issues beyond the powers of the job.

“This raises the question of whether mayors can be credible local advocates if they only deal with the limited issues under their remit,” it warned.

NAO head Amyas Morse said: “For combined authorities to deliver real progress and not just be another curiosity of history like other regional structures before them, they will need to demonstrate that they can both drive economic growth and also contribute to public sector reform.”

A Government spokesman said: “Devolution to English regions is working. The Government is injecting a combined £4.8 billion in six local areas across the country, as well as significant powers to boost growth – meaning more homes, jobs and better transport.”

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