A Powerful Central Government Loosens the Reins

The United Kingdom is giving unprecedented authority to its cities under a program that the United States could learn a thing or two from.
by | January 31, 2013
 

The United Kingdom’s national government is pursuing a bold, new program that will give unprecedented authority to its cities. The initiative, City Deals, is devolving some power and responsibility from the central government to cities across England. Already, the national government has crafted deals with England’s eight largest cities (outside of London), and another 20 have been invited to apply.

The move may not seem dramatic to observers of American cities, which have long enjoyed directly elected mayors and the ability to generate most of their own revenue. But in England, power, including the power to tax, is largely centralized and cities have a very different role from those in the U.S. For example, London became the first city to directly elect a mayor in 2000, and there is still only a handful of elected mayors today. “It’s a real culture shift for the English,” says Bruce Katz, who leads the Metropolitan Policy Program at the Brookings Institution.

The change began in 2011 when a new national government office, the Cities Policy Unit, was created to help lead a different approach to governance. Deputy Prime Minister Nick Clegg has said City Deals is necessary because British cities are “lagging behind” their European counterparts in terms of job growth. By empowering them, he says, they’ll be better positioned to close the gap. (Scotland and Wales are looking at the model but haven’t taken any steps to implement a similar program.)

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The effort gives local governments in England the chance to take unprecedented control of budgets and also provide hundreds of millions of pounds for infrastructure and broadband investment. City Deals emphasizes collaboration and consolidation between local governments, shifting of revenue power towards cities, and giving more flexibility to cities by combining programs and revenue streams. “This is the kind of policy change I think the U.S. could embrace,” Katz says, referring to the idea of cities getting more flexibility and responsibility. Many experts have long argued that the federal government needs to loosen the reins and give states and localities more autonomy.

Under City Deals, Manchester, for example, can keep a portion of national tax revenue generated by increased development. The idea is to give cities a financial incentive to pursue ambitious growth. “In other countries, that doesn’t sound revolutionary,” says Alexandra Jones, chief executive of the Centre for Cities, a U.K. research and policy institute. “In the U.K., it really is.” In Sheffield, public and private sources will be able to leverage their funds to help tap into a national pool of money used for job training. “The aim of these deals is to empower cities to forge their own path, to play to their own strengths and to find creative solutions to local problems,” Clegg wrote in a recent report.

Indeed, forging its own path is a familiar challenge for U.S. cities. But Katz is impressed, in particular, by job training and apprenticeship programs in the works. It is something that, he says, U.S. cities could certainly learn a lot from.

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