Devolve public spending to rural areas, urges CCN

Leaders of England’s largest councils have called on government to unleash the potential of the country’s economic ‘sleeping giants’ and devolve public spending and tax raising powers to rural areas.

Understanding County Economies, a new report by Oxford Economics, and commissioned by the County Councils Network (CCN), argues that devolving fiscal powers to county authorities could rebalance the economy, with growth set to slow to under two per cent each year over the next decade due to Brexit.

Full devolution of public spending, plus tax retention and raising powers, could generate over 1million new jobs over the next ten years and create an extra £26.3 billion for the national economy over a five-year period. This could see public sector savings of £11.7 billion per year over a five-year period.

If a radical programme of fiscal devolution is granted for county areas, England’s annual growth could be boosted to 2.7 per cent a year. CCN argues this report is crucial in the context of the government’s Industrial Strategy, which is welcomed by county leaders, but is too focused on the urban city regions.

Paul Carter, chairman of the CCN, said: “Successive governments have overlooked county areas in comparison to their metropolitan counterparts. The government’s Industrial Strategy and the country’s post Brexit fortunes depend on whether the potential of England’s sleeping economic giants – its county areas – is unleashed.

“With intelligent devolution deals and empowerment across county areas, so much more could be achieved to support economic growth and prosperity in England. We welcome the government’s intention to remove its requirement for metro-mayors as part of devolution deals, which would greatly simplify negotiations for county areas. We stand ready and waiting to work with this administration to create tangible devolution to our rural areas, ensuring we truly have an economy that works for everyone, and more importantly, an economy that is resilient and able to successfully adjust to life outside the EU.”