Andy Burnham's Devolution Plan: Unbundling England's Centralised 2026

Andy Burnham's devolution plan to unbundle England's centralised state is a radical and welcome step toward regional empowerment. The proposal addresses the deep-rooted economic disparities caused by 40 years of centralisation, which left regions like Yorkshire and the Midlands without the tools to recover from rapid deindustrialisation.

Why England's Centralised State Is a Problem

England is among the rich world's most centralised countries, a fact that underpins Burnham's critique of past economic policies. Centralisation did not close every factory or pit, but it stripped regions of the powers, finance, and institutions needed to cushion shocks or build resilient replacement economies. This has led to stark regional inequalities that persist today.

The Three Pillars of Burnham's Devolution Programme

Burnham's plan has three facets. First, a cabinet paper released on Friday outlines concrete proposals to create a decentralised state organised around mayors as key regional economic actors. Pan-regional agencies could emerge for transport, energy, investment, and industrial systems that cross mayoral boundaries. Regions without mayors can choose to have one or limit themselves to weaker powers.

Second, mayors will be able to keep income-tax and business-rate revenues, with the forthcoming budget and spending review deciding on the exact amounts. Third, a duty modelled on Germany's Basic Law would require English regions to pursue equivalent living conditions nationwide. This means a mayoral authority would receive a share of tax revenues and benefit when its economy grows, but the national government would continue redistributing resources to poorer places.

Equalisation: The Critical Safety Net

Without equalisation, disparities would widen. For instance, a thinktank calculated that if mayors received 2.5% of the 20p basic rate of income tax, London would get £2.3bn in 2026-27 while Hull and East Yorkshire would get only £135m. This stark contrast highlights the need for a redistributive mechanism to ensure all regions can provide comparable services and invest meaningfully.

Comparison Table: Tax Revenue Allocation Under Proposed Plan

Key Takeaways from Burnham's Plan

• Devolution would give regions more control over economic development and tax revenues.
• Pan-regional agencies could coordinate transport, energy, and investment across boundaries.
• Equalisation is essential to prevent widening regional disparities.
• Germany's Basic Law provides a model for ensuring equivalent living conditions.
• Mayors would become central actors in driving regional growth.

Challenges and Criticisms

While the plan is ambitious, it faces challenges. Some Tory mayors, like Ben Houchen of Tees Valley, have expressed concerns about the implementation and funding mechanisms. There are also questions about how to ensure accountability and avoid creating new bureaucratic layers. However, Burnham's proposal is a significant step toward rebalancing England's economy.

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