Burnham Devolution Plan Frees Mayors from Treasury Grip 2026

Andy Burnham's new devolution plan aims to free regional mayors from the Treasury's death grip by granting them borrowing powers and a share of local income tax. This transformative shift in power from Whitehall is set to reshape how England's regions fund major projects.

What Does the Devolution Plan Include?

The plan, announced on Friday, introduces a local first principle requiring ministers to justify why powers should remain centralized. From 2028, mayors will retain a portion of income tax generated in their areas, and by April 2027, they will control business rates worth tens of millions of pounds.

These funds replace existing grants, but local leaders argue that escaping ringfenced Treasury handouts provides long-term certainty. Oliver Coppard, Labour mayor of South Yorkshire, emphasized that this gets regions "out of the death grip of the Treasury."

Key Features of the New Powers

• Borrowing authority for large-scale infrastructure projects
• Retention of local income tax revenue starting 2028
• Control over business rates by April 2027
• Greater oversight of technical education for teenagers
• Potential role in schools, GPs, and childcare via commissioners

How Does This Compare to Current Funding?

Currently, mayors rely on central grants with strict conditions. The new system replaces these with locally generated revenue, offering more flexibility. However, critics note that the total funding amount remains similar, just with fewer strings attached.

Why This Matters for Local Communities

With control over public transport, housing, and job creation, mayors can tailor investments to local needs. The plan also aims to reduce the civil service's size from 520,000 to a smaller, more strategic workforce, moving decision-making out of London.

Burnham stated, "More of the taxes raised in a community will stay in that community." This principle could unlock faster project delivery and more accountable governance.

Potential Challenges and Next Steps

While the plan is hailed as "transformational," it requires legislative changes and may face resistance from some Whitehall departments. The government will publish a devolution bill later this year, with mayors expected to gain full powers by 2028.

FAQ

This devolution plan represents a significant shift in UK governance, potentially setting a precedent for future decentralization efforts. Stay tuned for updates as the bill progresses.