Andy Burnham's Devolution Pledge: Tricky to Deliver 2026

Andy Burnham's devolution pledge to transfer power from Westminster to every postcode is a bold vision, but delivering it will be tricky. As the UK's fiscal centralization remains a stubborn barrier, the plan to give regional mayors a share of income tax faces significant practical hurdles. This article examines the challenges and potential paths forward.

The Scale of the Devolution Challenge

The UK is among the most fiscally centralised countries in the developed world. According to the Centre for Cities, only 5% of tax revenue stays with mayors and local authorities, while the rest flows to Whitehall. In contrast, France retains 14% locally, and Japan 22%. This deep centralisation makes Burnham's promise a monumental shift.

England's devolution system is particularly messy. Successive governments have taken a piecemeal approach, creating dozens of ringfenced funding pots under the Conservatives, which fostered a 'begging-bowl culture'. These pots were also no match for the billions in central grants cut under austerity, leaving local leaders with limited autonomy.

Why Income Tax Devolution Is a Good Idea in Principle

Economists widely support the idea, first announced by Rachel Reeves, of allowing mayors to retain a share of locally generated tax revenues. This could help tackle Britain's deep regional inequalities. The Institute for Fiscal Studies estimates that between 6% and 9% of local income tax revenues would be enough to fully replace the integrated settlements mayors currently receive.

Practical Wrinkles and Implementation Timelines

However, introducing the plan will take time. Key wrinkles include negotiating the exact percentage, ensuring accountability, and avoiding unintended consequences like tax competition between regions. The autumn budget will set the stage, but full implementation may take years.

Key Takeaways

• UK fiscal centralisation is extreme, with only 5% of tax revenue local.
• Burnham's plan to devolve income tax could reduce regional inequality.
• Implementation will be slow, with technical and political challenges.
• The autumn budget is a critical milestone for the devolution agenda.

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