The committee of MPs called on local leaders and ministers to involve the public before and after deals are struck and criticised the “rushed timetables for negotiation” and the lack of clear goals to measure success or failure.
The report from the Communities and Local Government committee backs the Government’s moves to transfer powers to local control in areas such as transport, skills, planning and housing but argues the proposals should be more ambitious.
It says the current wave of agreements, which include one covering South Yorkshire, should be the “starting point, not the destination”.
The committee was particularly keen for the Government to explore the scope for giving areas more control over taxes, known as fiscal devolution.
The report suggests that by the end of the current parliament, the Government should move to “devolution by right” with a clear package of powers available to local leaders to adopt.
Sheffield South East MP Clive Betts, the committee’s chairman, said: “We believe that the current arrangements should only be a first step towards a much bigger devolution settlement and that devolution should be the default across all Government departments.
“If we are to achieve this local leaders and the Government must make far greater efforts to communicate with and engage the public so they embrace devolution as a positive development too.
“People rightly want to be involved in discussions and negotiations affecting their communities and local leaders and Government need to up their game to make the devolution process as transparent and engaging as possible.”
The report warns that the likely high profile of the elected mayors that will be created as part of the devolution deals could mean they are held accountable for services over which they have no control unless the public is given clear information.
The report has been published as wrangling continues over the shape of devoluton for Yorkshire.
So far South Yorkshire is the only part of the region to strike an agreement with the Government that will see powers and money transferred to the area.
However, questions hang over whether the deal will be implemented amid concerns from Sheffield City Council over the powers the mayor will wield.
Efforts to secure similar arrangements for other parts of Yorkshire have been hampered by disagreements over whether a single deal should be struck for North, West and East Yorkshire or whether a number of separate agreements should be pursued.
It is understood discussions between local leaders and ministers are continuing in the hope that agreement could yet be reached before the Budget next month.
The devolution deals are part of Chancellor George Osborne’s plan to create an economic “powerhouse” in the North of England.
Areas across the North from Merseyside to the North East have reached agreement on devolved powers and the creation of elected mayors but Yorkshire remains the notable missing piece of the jigsaw. Greater Manchester has taken the process furthest so far by taking powers over health services and combining the roles of mayor and police and crime commissioner.