Ministers urged to use Brexit to '˜reset' relationship between regions and Whitehall

Ministers are facing calls to use Brexit as an opportunity to 'reset' the relationship between Whitehall and local government, as experts warn that a prolonged failure to spread economic growth across the regions is fuelling feelings of 'disaffection' and division.
The Supreme Court has ruled on whether a vote in Parliament is required to trigger BrexitThe Supreme Court has ruled on whether a vote in Parliament is required to trigger Brexit
The Supreme Court has ruled on whether a vote in Parliament is required to trigger Brexit

The new report from the RSA Inclusive Growth Commission proposes a “radical” overhaul of the way Government approaches spending decisions once Britain leaves the EU, arguing that councils should be given much more responsibility for local investment in areas like education and public services.

The think tank also calls for the creation of a new regional investment fund, to replace the millions of pounds-worth of European investment that will dry-up once the latest round of spending comes to an end in 2020.

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And it warns that unless such steps are taken to empower local authorities, regional productivity and growth will remain low while the sense of discontent that led to Brexit will continue to fester.

Launching the report, Commission chairman Stephanie Flanders argued that for too long the Government has focussed on top-line figures for growth and investment, rather than assessing the needs and performance of individual areas.

She claimed that a result, low productivity and high levels of regional deprivation have become “mutually reinforcing”, leading to the “disaffection we see in so many communities across the country”.

“The government is beginning to grasp the seriousness of these issues. But the gap between aspiration and reality is very wide and will not be fixed by Whitehall pronouncements alone,” she said.

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“If we really are going to build a nation that ‘works for everyone’, then we need a reset in Whitehall and Town Halls which empowers all levels of government to deliver a more inclusive vision of prosperity across the UK.

“Failing to do so would mean a real risk the country becomes more divided outside the EU than it ever was within it.”

The report, titled Making Our Economy Work for Everyone, calls for a “radical transformation and reform of public policy, investment and delivery” in order to address the current regional imbalance. Described as a “new social contract” with Whitehall, this would see combined authorities given much more control over economic and public services spending in their areas.

The think tank also urges central government to establish a new independent UK Inclusive Growth Investment Fund, incorporating repatriated EU funding streams such as the regional development and social funds.

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It notes that councils in England have seen budgets cuts by 40 percent in real terms since 2010, and suggests that the new fund should be made available for at least 20 years after Britain is due to leave the EU.

Responding to the study, the Sheffield South East MP and chairman of the Communities and Local Government committee, Clive Betts, welcomed its recommendations. He told the Yorkshire Post: “[Brexit] should be an opportunity not just to take on the views of Scotland, Wales and Northern Ireland – important though they are – but also to look at the English regions as well.

“We are the only country in Western Europe where most of our major cities do less well than the national average for economic activity per head.

“EU funding is very important now both for regional development and social investment... so this idea of an independent fund is spot on.”