This article was originally published by the Financial Times on November 22, 2024

Over the past twenty years, I’ve had the chance to observe a remarkable experiment in urban governance reform: England’s efforts to devolve more power to local decisionmakers through metro mayors, creating, in essence, a new layer of government in England.

The rationale for English devolution remains as strong as ever. England remains one of the most centralized nations in the OECD, with regional and local taxes amounting to 1.7% of GDP, compared with 9.4% in the US and 16.2% in Canada. The result of this imbalance is to concentrate an extraordinary degree of power in the hands of a small number of government ministers around policies as disparate as policing, education and regeneration, and as specific as the performance of a specific school or the removal of chewing gum from sidewalks.

This model of governance simply doesn’t work in a complex and rapidly changing global economy. It distances decision makers from the complexities of community challenges and opportunities, which differ from one region to another. It thus leads to rigid policies that fail to unlock fully the assets of disparate places and prevents the formation of a robust democracy that engages citizens not just at the voting booth but in active problem solving.

The unappreciated power of mayors is their ability to convene networks of leaders who would otherwise be divided by jurisdiction or sector or siloed by subject matter or discipline. Cities are not mirror images of national governments that tend to act vertically through bureaucratic compartments; they are networks of institutions and leaders capable of moving horizontally to deliver collective responses to difficult challenges. If unleashed fully, this power to coordinate across borders can contribute to national aims to drive growth and reduce the gaps between London and the rest of the country.

Talk of a “devolution revolution” is both encouraging and worrisome. National leaders have defined this revolution in exceedingly narrow terms, focusing on the delivery of objectives set by national government and funding divided by departmental area. This is a truncated vision that makes localities just another arm of national agencies.

True devolution must go further in three ways. First, the devolution of fiscal powers needs to accompany the direct election of mayors. It is only then that metro mayors can be given full agency and autonomy to unlock local assets. Financing investment requires predictable (“bankable”) future revenue streams, but this is impossible in a world in which all taxes are collected nationally, and all local expenditure is subject to the sequester of national spending reviews. Whitehall should remember that the expansion of water, gas and electricity networks was financed through local taxes – a repetition of which has not been matched by centralization and deregulation.

Second, devolution must involve metro mayors as central players in the design and delivery of industrial policy. To this end, devolution policies forged in the 2000s and 2010s must align with the radically changed economic situation of the 2020s. Strained relations with Russia and China have renewed focus on the safety of supply chains, making the reshoring of critical military and civilian manufacturing capacity an issue of national security.

Third, metro mayors must be empowered to compete on the global stage. Local growth plans cannot just be part of domestically oriented government programs; the trading and investment realities of a radically changed world order must serve as context.

Devolution has established metro mayors as an important part of a largely centralized governmental system. But that is only partial devolution. To grow the nation, English cities must be empowered to engage with policymaking. Therein lies the true revolution.