Burnham Devolution Plan Frees Mayors from Treasury Grip 2026

The Burnham devolution plan promises to free England's regional mayors from the 'death grip of the Treasury' by granting new borrowing powers and income tax retention. This transformative shift aims to move decision-making out of Whitehall and into local communities, empowering leaders to invest in infrastructure, housing, and jobs. Under the proposed measures, mayors will retain a share of income tax from 2028 and business rates by April 2027, replacing existing grants with more flexible, long-term funding.

Key Features of the New Devolved Powers

The plan, announced by Prime Minister Andy Burnham, represents what he calls 'the biggest transfer of power from Westminster in a generation.' It introduces a 'local first' principle, requiring ministers to justify why powers should remain centralized rather than devolved. This shift is designed to give local leaders the certainty and resources needed to address regional priorities effectively.

Financial Autonomy and Borrowing Flexibility

For the first time, mayors will have the ability to borrow for large-scale projects, moving away from ringfenced Treasury handouts. Oliver Coppard, the Labour mayor of South Yorkshire, emphasized that this change 'gets us out of the death grip of the Treasury' and provides long-term income certainty. The new funding model will replace existing grants, but local leaders argue that the flexibility outweighs any potential reduction in total funding.

Expansion of Mayoral Responsibilities

Beyond financial control, the plan includes greater oversight of technical education, with some advisors suggesting mayors could also manage schools, GPs, and childcare providers through health and education commissioners. This would mirror the role of police and crime commissioners, extending local accountability to public services. The civil service, currently 520,000 strong, is expected to become 'smaller and more strategic' as functions move out of London.

Comparison: Current vs. Proposed Funding Model

Key Takeaways

• Mayors gain control over income tax and business rates, replacing grants.
• Borrowing flexibility enables investment in transport, housing, and job creation.
• Local leaders gain long-term funding certainty, reducing reliance on central government.
• Potential expansion into education and health oversight for mayors.
• Civil service reforms aim to decentralize power and reduce London dominance.

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