Andy Burnham's Devolution Pledge: Why It's Tough to Deliver 2026

Andy Burnham's devolution pledge to transfer power from Westminster to every postcode is a bold vision, but delivering it is fraught with complexity. The UK remains one of the most fiscally centralised nations, with only 5% of tax revenue staying local, according to the Centre for Cities. This article examines the hurdles and opportunities in making devolution a reality.

The Scale of Fiscal Centralisation in the UK

The UK's tax system is heavily concentrated in Whitehall, unlike other developed countries. In France, 14% of tax stays local, and in Japan, 22%, while the UK lags at just 5%. This centralisation has led to regional disparities and a "begging-bowl culture" under previous governments, as ringfenced funding pots proliferated.

Burnham's proposal to let mayors retain a share of income tax aims to shift this balance. The Institute for Fiscal Studies estimates that 6-9% of local income tax revenues could replace current central grants, but implementation will take time and careful design.

Comparing Devolution Models

Challenges in Delivering the Pledge

First, the complexity of existing funding settlements makes a smooth transition difficult. Second, political resistance from Westminster may arise, as central government is reluctant to cede control. Third, regional disparities mean some mayors may benefit more than others, requiring equalisation mechanisms.

Burnham's plan also needs to address the patchwork of devolution deals across England, where some regions have more powers than others. A uniform approach may be necessary, but that could take years to negotiate.

Key Takeaways

• Fiscal centralisation in the UK is extreme compared to peers.
• Income tax devolution could boost local economic development.
• Implementation requires overcoming political and administrative hurdles.
• Regional inequality must be managed to avoid widening gaps.

Potential Benefits and Risks

Economists argue that devolution could tackle regional inequalities by giving local leaders more control over revenue. However, risks include reduced central oversight and potential fiscal mismanagement. Burnham's pledge, if delivered, could set a precedent for other regions.

The autumn budget will be a key test, as the government fills in details. The success of this initiative will depend on how well it navigates the existing structures and gains buy-in from all stakeholders.

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