Incoming Prime Minister Andy Burnham has been urged to speed up the expansion of England’s devolution programme amid warnings that delays could create a “two-tier England,” where businesses and communities outside mayor-led regions are left at a competitive disadvantage.
The warning comes in a new report by IPPR North, which argues that completing England’s devolution map should become an immediate priority as the new government prepares to expand powers for regional authorities.
According to the think tank, more than one-quarter of England’s population still lives outside a Mayoral Strategic Authority. These regional bodies increasingly oversee transport, housing, regeneration and economic development, giving businesses within their boundaries access to greater local decision-making and investment opportunities.
The report warns that companies located outside these areas risk missing out on funding and support available to competitors in regions such as Greater Manchester and the West Midlands, where elected mayors already control significant budgets and policy decisions.
Researchers also cautioned that uneven devolution could deepen regional inequalities and fuel public dissatisfaction at a time when confidence in political institutions remains low.
The report highlighted recent private sector investment as evidence of the growing importance of regional leadership. NatWest’s £20 billion investment commitment to northern England was presented as a vote of confidence in the devolution model, raising concerns that businesses elsewhere may struggle to attract similar levels of investment.
The government has already taken steps to strengthen regional powers through the English Devolution and Community Empowerment Act, which received Royal Assent in April. Ministers have also indicated they are considering expanding fiscal powers for regional authorities, allowing them greater control over taxation and local investment.
However, IPPR North argues that progress has been too gradual and that central government continues to dominate many key decisions.
The think tank recommends completing England’s devolution map before the end of the current Parliament while also exploring greater regional devolution in Scotland and Wales. It also calls for substantial fiscal reforms in the autumn Budget, including allowing regional authorities to retain a share of tax revenues and borrow to fund transport, housing and regeneration projects.
The report also advocates expanding community-level decision-making so local residents have a greater role alongside elected mayors.
Dr Ryan Swift, research fellow at IPPR North and author of the report, said the new government must move beyond incremental reforms.
“We know the incoming Prime Minister has signalled his ambition for devolution in England, but we must move beyond incrementalism, or his efforts could be in vain,” he said.
Swift argued that stronger regional powers, greater financial resources and constitutional protections are needed to deliver long-term economic growth and rebuild trust in politics.
Mirte Boot, interim head of IPPR North, said the government faces increasing pressure to deliver meaningful change quickly.
She said Whitehall’s resistance to reform and growing public frustration mean there is little time to lose if ministers want regional devolution to deliver lasting economic benefits.
Business leaders will be watching closely, as decisions on transport, skills, taxation and regeneration are expected to play an increasingly important role in shaping local economic growth under the next government.
