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North Yorkshire’s devolution deal: What’s in it and how will it work?

The historic devolution deal struck between North Yorkshire and the government on Monday will bring millions of pounds into the county — but it could have been more.

Signed off by Greg Clark, secretary of state for levelling up, housing and communities, the 32-page document promises £540 million over 30 years.

It will also see North Yorkshire and York join other major counties and cities in getting its own mayor and a combined authority to oversee the funding.

Local leaders have lauded the deal as an opportunity not to be missed, but analysis of the document shows it could have offered more.

Guaranteed funding

In 2020, officials at North Yorkshire County Council started discussions with government over the potential for a devolution deal for the county and City of York Council.

This culminated in a 140-page document being drawn up listing the requests for new powers and funding from Whitehall.

It was formally submitted in January 2021 and included proposals such as a £750 million mayoral funding pot over 25 years and more powers over skills, transport and energy.

The funding pot, known as “gainshare”, is guaranteed annual funding from central government.

Fast-forward 18 months and the fruits of the negotiations between ministers and council bosses have produced something slightly different.

Instead of the requested £750 million funding pot over 25 years, £540 million over 30 years has been agreed.

The initial proposal tabled by council bosses would have seen £25 million a year come into North Yorkshire and York – instead it will be £18 million.

North Yorkshire County Council’s offices in Northallerton.

However, more power over skills and transport will be devolved.

It will see whoever is elected mayor and the new combined authority have control over the adult education budget and the ability to draw up its own transport strategy.

Control over bus franchising has also been granted to the county and the power to set up Mayoral Development Corporations, which have the power to buy land for housing or employment to regenerate a defined area.

Much of the deal echoes what was given to Tees Valley in 2015, whose Conservative mayor Ben Houchen has since exercised his economic development powers to buy Teesside International Airport and Redcar Steelworks.

Extra funding for homes

Aside from the £540 million over three decades, funding has also been allocated for specific areas.

For example, ministers have awarded £12.7 million towards building homes on brownfield sites over the first two financial years of its existence.

A further £2.65 million has been allocated specifically for low carbon and affordable housing.

It suggests that ministers were more happy to part with cash on housing schemes under the deal than in other areas.

The only other area in the deal awarded specific funding was £7 million to “drive green economic growth” towards the ambition of creating a carbon negative county.

However, this cash is subject to a business case being submitted to government.

No Harrogate Convention Centre money

While the deal offers funding for the wider county, much of the detail on specific towns and areas amounts to “commitments to engage” or mentions already announced cash for schemes.

Harrogate itself is mentioned four times in the document. Three of those mentions are for the A59 Kex Gill realignment and Station Gateway projects, which are underway. Ripon, Knaresborough, Pateley Bridge, Boroughbridge and Masham are not mentioned.

The fourth time Harrogate is mentioned is for Harrogate Convention Centre.

As previously reported, funding for a £47 million upgrade of the centre was requested. But although the centre is mentioned in the devolution document, funding was not pledged.

However, the deal is a provisional agreement and it remains to be seen where the funding will go when the mayor and combined authority is established.

‘Very relieved’

Much of the deal is years in the making for those who have sat around the negotiating table with ministers.

Cllr Carl Les, leader of North Yorkshire County Council, said he was relieved to have signed off on the provisional agreement with ministers.

He told the Stray Ferret:

“I’m very relieved that we have got to this point. We have now got to explain it to the public.”

Cllr Carl Les, leader of North Yorkshire County Council.

A glance at the main points of the deal shows the government willing to part with millions of pounds worth of funding on the condition that a new layer of governance is set up to oversee it.

For the IPPR North think tank, the new money is welcomed and “should be seized”.

However, Rosie Lockwood, head of advocacy at the think tank, pointed out that cuts due to austerity meant North Yorkshire still faced a difficult future.

She said:

“A devolution deal which unlocks funding and transfers powers from Whitehall to North Yorkshire and York is good news for communities across the area. This is an opportunity to be seized.

“But North Yorkshire and York will face challenges as it moves forward, not least because local government has already been eroded by austerity. We can’t forget that the north saw a £413 per person drop in annual council service spending over the austerity decade.”

What happens now?

Despite the secretary of state for levelling up, housing and communities, putting his signature to the deal, it will still require approval from both North Yorkshire County Council and City of York Council.

A public consultation will also be carried out on the devolution deal in the coming months.

From there, the councils can then undertake a governance review to set up the combined authority and mayor, should councillors back the deal.

If all goes ahead, a combined authority for North Yorkshire and York could be in place by autumn next year and a mayor elected in May 2024.

North Yorkshire devolution deal announcement ‘imminent’

A devolution deal for North Yorkshire and York looks set to be announced by the government in just over a week.

There were fears recent ministerial resignations and sackings could have derailed the process.

But details of the deal are now expected to be revealed before the summer Parliamentary recess starts on July 21.

It follows almost 20 months of negotiations between North Yorkshire and York council leaders and officers, government ministers and Whitehall officials.

The deal could potentially unlock around £2.4 billion of investment over 30 years.

It would be targeted on improving economic prosperity, creating more affordable housing and lead to the area becoming England’s first carbon negative economy.

Every first and second tier council in the area, except Hambleton, put forward some ‘asks’ to the government in December 2020 about what they’d like in a devolution deal.

Concerns were raised that following Michael Gove being fired from his role as the Levelling Up, Housing and Communities Secretary by Boris Johnson, it would mean the new minister, Greg Clark, would want to spend time fully digesting the complex deal before signing it off.

Political commentators have highlighted how during his first stint at the Department for Communities Mr Clark negotiated devolution deals and served as minister for decentralisation, but his economic preference was for city-led growth rather than the levelling-up approach focusing on non-metropolitan Britain.

Following news of his appointment and entering his second stint at the department, Clark tweeted that he had a “duty to ensure that the country has a functioning government in the weeks ahead”.

We have a duty to ensure that the country has a functioning government in the weeks ahead. Having been Secretary of State at the Communities department before, I will do my best to provide stability, good governance and accountability to Parliament at this important time.

— Greg Clark (@GregClarkMP) July 7, 2022

When asked if he was confident about a deal remaining on track following Mr Clark’s appointment, North Yorkshire County Council leader Cllr Carl Les said he was optimistic the transfer of power and funding would be in time to form a Mayoral Combined Authority next year, with Mayoral elections in 2024.

He said the negotiations were at a very advanced stage.

Cllr Les said:

“I do hope this will not derail the negotiations and having worked with Greg Clark before as secretary of state I have every confidence that he will treat this matter with the urgency it requires.

“We are at not only the 11th hour, but at the 59th minute of the 11th hour.”

Cllr Les said he felt the county council and City of York Council had been listened to during the negotiations, which he described as having been “fruitful”.