On the 2nd November 2022 Derby City Council agreed to proceed with the consultation on the new East Midlands Combined County Authority (EMCCA). This is a new governmental body proposed in the Levelling-up and Regeneration Bill. The concept devolves funding, and powers from central Government into a new body comprising:

• Derby City Council
• Derbyshire County Council
• Nottingham City Council
• Nottinghamshire County Council

This new body will be led by an elected person. The Bill leaves the title open for other options, apart from Mayor:

(a) county commissioner;
(b) county governor;
(c) elected leader;
(d) governor;
(e) a title that the CCA considers more appropriate

s.40 Levelling-up and Regeneration Bill

The elected person does not have to be someone who is a member of a political party.

The rationale for the new body is to encourage the 4 Councils to work together on those issues which require regional collaboration e.g. Integrated Transport Strategy. One of the main principles is that the EMCCA “adds value” and is not a duplication.

The EMCCA does not take powers away from the constituent Councils they maintain their existing autonomy; representatives from each of the 4 Councils sit on the Authority.

The Bill is prescriptive about how the Authority will be constituted, its general powers and the process for consultation. The “deal” issued by the 4 Authorities provides more details on its powers and the specific funding due to the Authority, should this be implemented.

Given that so much has been “agreed” already, it’s not clear what the purpose of the Consultation is, other than to “follow the process” in the proposed legislation. This ambiguity surfaced in the Council meeting as a number of Cllrs were suggesting options to improve cost effectiveness, democracy etc ; this resulted in some confusion amongst Cllrs.

One of the advantages of the new Authority is that it will draw in £1.14bn of funding. This is not new money as such – it has been earmarked ( for the short term) as part of the UK Shared Prosperity Fund. Whitehall is effectively giving the job of distributing the money to local representatives rather than it being done by the Department for Levelling Up, Housing and Communities in Westminster.

£1.14bn might sound a lot however this is over 30 years; it equates to £38m per year and is split 50% Capital and 50% revenue. The combined annual net revenue budget of the 4 Councils is £1.7bn – the funding represents ~1% of that total pa.

The Authority will have the power to borrow money. It also has the power to raise money to fund the “Mayor’s Office” through an additive to the Council Tax ( precept) and to increase Business rates.

Comment

On the face of it some aspects of national government operating regionally is a good idea. It should hopefully lead to better decision making, more funding and a net benefit the region. There are a number of issues/concerns:

• Finance – nothing is firm and fixed with Government funding so promoting the notion of a 30 year £1.14bn deal is a little disingenuous ( NB: The deal was signed before the ill-fated Truss administration). Cuts to Government spending are expected in just a few weeks time. It is more appropriate to say, at best, that the EMCCA gives the region a better “lobbying hand”.
• Integrated Transport – the EMCCA excludes Leicestershire and therefore East Midlands Airport and the adjacent logistics park which should be considered in a regional strategy. This is a significant omission.
• The EMCCA will take responsibility for the nationally funded Adult Education budget. This does not fit the test for a regional level added value. It should be fully devolved to the constituent Councils.
• The EMCCA will have more powers to build homes on brownfield sites / affordable homes and compulsory purchase orders – it will be interesting to understand how this will represent an increment to the existing Council planning arrangements.
• The proposal suggests that there will be a regional approach to homelessness, rough sleeping and domestic abuse. Many of the root causes for these issues are on a personal level not strategic/regional.
• The EMCCA will cost the Council Tax payer more money through an additional precept. It is likely, but not required, that the “Mayor” will be a “politician” – this has the real risk of empire building and cost escalation. There are levels of scrutiny but those typically are not that effective.

What doesn’t make sense is the “Consultation”. The Councils have already signed a “deal” with the Secretary of State on 30th August 2022.

“On 30 August 2022, Derbyshire County Council, Derby City Council, Nottinghamshire County Council and Nottingham City Councils (“four upper tier authorities”) signed a £1.14 billion devolution deal with the Government. The signing of the deal, will, subject to relevant approvals, consultation, and primary and secondary legislation passing through Parliament, establish the first ever Mayoral Combined County Authority in the country.”

Council paper 2 / 11 / 2022

The Levelling-up and Regeneration Bill does not contemplate a “deal” being signed and agreed in advance of the consultation and Proposal. The published “deal” looks very much like a concluded “proposal”. The legislation does say:

(4) Before submitting a proposal under this section to the Secretary of State, the authority or authorities preparing the proposal must—
(a) carry out a public consultation across the proposed area on the proposal, and
(b) have regard to the results of the consultation in preparing the proposal for submission to the Secretary of State.

s42 (4) Levelling-up and Regeneration Bill

The question is “when is a deal (signed by the Secretary of State) not a proposal ( to the same Secretary of State), and how will they demonstrate that the consultation has influenced the legally required proposal…that’s already been signed and agreed?

It is bizarre that an Extraordinary Meeting of the Full Council was called last week to “agree” to a consultation, on a Draft Proposal, a process that’s mandated in the legislation yet the Draft Proposal, itself, was not open to any debate or approval by the Full Council. The Mayor strictly refused Cllr Graves the right to speak on wider issues and instructed him to focus on the “motion” about consultation only.

In Article 4 of the Council’s Constitution under s4.2 “Function of the Council” ( in this respect it means the meeting of the Full Council – 51 Cllrs). Whilst a Legal Officer might split hairs, the principle of the authority of the Full Council is on broad constitutional matters – agreeing to become part of a new Combined Authority is constitutional.

4.2 Functions of Council

k. making arrangements for the discharge of any of the council’s functions by another local authority or a joint committee with other authorities

m. approving any proposals relating to local government areas and the transfer, conferment or withdrawal of powers of local authorities

p. dealing with all non Executive policies ,strategies and procedures that do not form part of the policy framework

q. making decisions about any functions that by law, or as a result of local choice are not the responsibility of the Council Cabinet and have not been delegated to a committee or officer.

Derby City Council Constitution Part 2 Article 4

In the Council Cabinet meeting 9th March 2022 which introduced the paper on “Levelling Up and Devolution” A key recommendation was:

2.2 Subject to discussions with Government and the D2N2 authorities, to note a further report will be brought to Council Cabinet and Full Council, on the proposed governance model for any future devolution deal with Government.

And under the “Legal Implications” of the same report it states:

8.1 Any form of devolution would require a clear constitutional framework which sets out the extent to which devolved powers are transferred from central government to either a county deal or combined authority, and how those functions are exercised and monitored at a local level. This will be developed with Government in due course and brought to Full Council for approval.

This has not happened.

In summary, a Draft Proposal on the new Combined County Authority will be put to the public for consultation which has not been subject to scrutiny or expressly approved by the Full Council ( despite recommendation 2.1 Council paper 2/11/22). If the plan is to seek Full Council approval after the consultation, this would suggest that, if the Full Council agreed to materially change the content that it would need to go back to the public for consultation – which doesn’t make sense!

It’s clear that the Tory Leadership is short-cutting the democratic process and avoiding full and proper debate and scrutiny on a constitutional change which will be significant for the future of Derby.

Why?