Heseltine calls for further action on English devolution

The Conservative peer, who authored a major report on regional economic growth for the Treasury in 2012, named Work and Pensions Secretary Iain Duncan Smith and Education Secretary Michael Gove as key figures who have failed to engage with his proposals to hand sweeping powers and funding to the regions.

Lord Heseltine’s report recommended stripping Whitehall of control over some £60 billion of Government spending covering areas such as housing, infrastructure, transport, skills training and back-to-work programmes. The Tory peer said the money should be made available to local areas to bid for and spend as they see fit.

It also called for a shake-up of the schools system, with more involvement of local business and the closure of ‘sink schools’.

Chancellor George Osborne praised the report and promised to implement it – but ultimately made available far less funding than the report recommended.

Having previously endorsed the Government’s approach, Lord Heseltine offered his first veiled criticism yesterday as he appeared before a Lords committee on youth unemployment.

“You’re asking me how I feel my report has been implemented,” he told peers. “As always in life, there are two ways of answering.

“The attractive way is to say what the Government has done, to make available £20bn over a five or six-year period, is a bigger act of devolution in the UK than anything I have seen in a long political career..

“The other answer is that I asked for £60bn. I did include in my report a warning that this would not be attractive universally to those administering central programmes – and so it has proved. The issue is ‘what I have, I hold’.

“Giving up the reins of power is not an attractive thought to anyone who holds them.

“So the Government has gone further than any previous Government – I admire that. But there is a lot further it could go.”

Lord Heseltine picked out Mr Duncan Smith’s Department for Work and Pensions – which runs job centres and back-to-work programmes across the country from its base in Whitehall – and Mr Gove’s Department for Education as key obstacles in implementing his raft of reforms.

“I have to say there are Government departments who are not particularly involved in the process,” he said. “I happen to be an admirer of the work Iain Duncan Smith is doing... He’s doing a brave and difficult job. But his department is not centrally involved in this devolution issue. And they have many thousands of employees employed at the centre.”

The peer added: “I’m a great admirer of what Michael Gove is doing – but we still have too many sink schools.”