Where should devolution go next?

Why we're setting up the Devo Next Initiative to shape the future of English devolution policy

English devolution is entering a new phase – one where the prize is not only additional functions, but fiscal firepower. The Chancellor has announced she will draw up plans for the Autumn 2026 Budget to devolve a share of national taxation, and the ball is already rolling on an Overnight Visitor Levy – the first new local tax power in decades. Fiscal devolution has long been the great white whale of English devolution, the key to unlocking so much else. All eyes will now be on the Treasury as it pulls together its plan.

The story behind this significant step forward is a long one. Devolution policy has been shaped by years of incremental deals, negotiated settlements, and institutional improvisation. But now a more coherent framework is beginning to emerge, with Strategic Authorities soon to cover most of England’s population and Integrated Settlements pointing the way to greater spending flexibility. The forthcoming English Devolution and Community Empowerment Act will put a right to request further powers into statute, and lay out a pathway to bring every devolved authority more in line with the most established mayoralties. Serious discussion about ambitious devolution of functions in transport, skills, employment support, planning, and health is now more common, and happening in more places.

The progress is undeniable. And this, paradoxically, may be the source of the next obstacles for the devolution agenda. Incremental progress can be the enemy of revolution. With a group of very sensible reforms in train, it might be tempting to consider the job done – but it would be a terrible legacy of this moment if it represents the high point of ambition rather than only the beginning of the English devolution journey. Complacency now would surely scupper the realisation of the promised “devolution revolution”.

The priorities of Strategic Authorities are, by design, defined by their capacity and the particularities of place. They call, variously, for more control over rail, over post-16 skills, over revenue raising, and for stronger roles in housing, planning, employment support, and public service reform.

Taken one by one, and without a clear underpinning narrative, these are too easily pigeonholed as opportunistic bids for more power, more money, or more institutional profile. These arguments are not yet adding up to a convincing account of what an effectively devolved England should look like, how it should work, or why it would transform and improve the governance of the country.

Some devolved institutions have reached a point where they can no longer be treated as provisional experiments. These are places – mostly with an urban core – where devolved institutions are now working at the heart of transport strategy, economic planning, local growth, and public service reform, and with their mayors playing a crucial role in the wider political identity of the area. By contrast, some places are at the first basecamp of the devolution mountain. They may be on track to set up small “Foundation” Strategic Authorities without a mayor on old county-scale geographies.

It would be a mistake to imagine that all these places have identical interests. And if devolution were held down to the things that they could all agree on, it could become an even more incremental project.

There is now no shared vision about what should follow the English Devolution and Community Empowerment Act. The talking points are well rehearsed, of course. But there is neither a sense of the ultimate end state of a more devolved State nor a clear consensus on the main next step powers or accountabilities that should become the specific focus for devolution policy in the next few years.

The coming period will be decisive. If there is no coherent view of the next stage after the new Act comes into force, central government policymaking will fill the vacuum. The risk is not that devolution will stop altogether, but that the Act, and the coming concessions on fiscal devolution, will be seen as the high-water mark for this agenda, after which everything else will be about details.

To avoid this, it will be up to devolved institutions themselves to develop and promulgate a new, ambitious vision for the next stage of the devolution agenda – and they will have to do so in time to sustain the momentum from, and make best use of, the new powers in the forthcoming Act.

In short, a simple question must now be answered: “what next?”.

Devolution as an organising principle for the State

Devolution needs to go beyond the sense that it is a special intervention and become part of the regular syntax of government. A vision is needed for the eventual end state – a radically different, decentralised public sector – and a road map that explains the concrete steps required to get there.

The end state matters because it helps to tell a story about what a country governed by more decentralised norms might look like and forces harder questions than the current debate usually allows. What should be held nationally, and what should not? Which powers genuinely belong at Strategic Authority level? Which should sit lower down, with councils, neighbourhoods, and communities? What kind of fiscal autonomy is compatible with solidarity and equalisation? Should the end state look the same everywhere? How far should Whitehall itself change if devolution is to be real? What should happen to the current landscape of quangos, arm’s-length bodies and fragmented local delivery systems? And what kind of democratic accountability should accompany stronger devolved power?

The road map matters because none of the above questions should be answered only by day-after-tomorrow rhetoric. Yes, it is vital to be thinking ambitiously about the future – but a path to it must also be built, with the next steps putting the agenda on the right track. Existing and emerging Strategic Authorities need a collective, practical, and evidence-backed package of changes that could plausibly be achieved over the next five years – one that recognises and works with the fact that institutions are at different stages in their development. A genuine programme for the next frontier of devolution.

The new domains for devolution policy

So where should the debate go next? There are several key domains across which the end state and the road map need articulating.

To start, the next era for devolution policy must not be too narrow – it should begin to focus on the complexity of the local state as a whole. While, in some areas, different public services, planning geographies, and public sector accountabilities sit on different maps, a sophisticated version of devolution will remain out of reach. This means that a serious new devolution policy platform would need to address questions of boundaries, coterminosity, and integration.

England’s governance map remains crowded, overlapping, and often incoherent. The current settlement still leaves too many places trying to reform systems that do not line up geographically, institutionally or politically. That creates friction, duplication, and blurred accountability. In the years to come it should be made easier to propose and secure sensible jurisdictional change where existing boundaries are impeding effective governance. Reorganisation, where it happens, should not be treated as a technocratic exercise in neatness. It should be judged by whether it gives places greater agency, stronger stewardship capacity, and more coherent public authority.

The coming era of devolution should also seek to bring clarity and firepower to the core strategic role of devolved institutions. In some areas, that role is increasingly clear, if still underpowered: economic planning, transport and local infrastructure, labour market coordination, system stewardship, and place leadership are at the heart of Government’s implicit vision for Strategic Authorities. But even with this targeted view, aspects are missing. Meaningful control over employment support is the classic example. There is little logic in retaining a fragmented, centrally controlled employment support system if the stated ambition is genuinely to equip places to shape regional growth, coordinate services, and respond to their own labour markets. Similar questions arise across transport and skills, where the issue is no longer simply whether local leaders can influence outcomes, but whether they have powers commensurate with their increasing responsibilities.

This would also mean articulating a clear understanding of devolution’s role in public service reform, something that the current devolution debate still too often underplays. The case for devolved power is not only that it produces better transport plans or more tailored growth strategies. It is also the level at which prevention, integration, and reform can most credibly be joined up. If England wants a state that intervenes earlier, pools budgets more intelligently to deliver outcomes, joins services together, and reshapes delivery around people’s lives – all of which can also have a positive impact on economic performance – then it will need institutions capable of doing that work across organisational boundaries and acting with sufficient autonomy to tailor approaches to local assets and needs. Place-based budgeting, neighbourhood-enabled reform, and stronger local capacity to act as public service test beds should not be seen as optional extras. They are a core part of what devolution is for.

And without fiscal devolution this potential will not be realised. Rethinking where revenue is raised and with what powers, and how money flows through the system, is integral for devolution to mature. For Strategic Authorities to continue progressing from delivering central government priorities to pursuing independent agendas, it is vital they can raise their own revenue. When Strategic Authorities succeed in growing their economies, they should benefit directly – and with their own locally raised funds, there will be less standing in the way of budget pooling and other innovations. Accountability can be reorientated away from Whitehall and towards the local electorate and more substantial scrutiny bodies. Recent Treasury interest represents a genuine sea-change, and an opportunity which must be capitalised upon. There are important questions that now need to be addressed to ensure that momentum is maintained and there is sufficient discretion to unlock these benefits – and that the right balance is struck, for example, between redistribution between areas with different starting points and the important incentives that fiscal devolution would help to generate.

There is also a wider institutional question that English devolution has not yet fully confronted: the potential for a post-quango State. Over recent decades England has built up a dense landscape of national and quasi-national bodies that exercise real influence over housing, infrastructure, planning, the environment, growth, and service delivery. These were created to solve real problems, in some cases successfully. But in aggregate they have also contributed to a system in which power is dispersed upwards and sideways rather than outwards and to places. If England is serious about devolution, then some functions currently held by arm’s-length bodies will need to move. This is not about decrying expertise, but locating more power with democratic institutions that can integrate priorities, weigh trade-offs, and act on behalf of places as a whole.

None of this will work unless capacity, accountability, and legitimacy keep pace. Stronger devolved institutions cannot simply be handed more responsibility without the machinery to exercise it well. The strategic tier needs leadership capacity, policy capability, governance maturity, and scrutiny arrangements that match its role. Indeed, further devolution will be almost impossible to achieve unless officials and politicians at the centre are convinced by the institutional maturity of subnational systems. Part of achieving this will be a stronger democratic grounding. Community mobilisation is not an optional add-on to devolution. If the argument for devolved power is that decisions should sit closer to the people and places they affect, then devolved institutions must show that they can build legitimacy, participation, and public trust, not simply inherit powers from the centre.

Taking the initiative

As English devolution enters this new era, defining a shared account of both the near-term and long-term vision across these central domains is a vital task. And it is devolved institutions themselves that must lead the charge. This is why we are establishing the Devo Next Initiative – a partnership with the West Yorkshire Combined Authority, Greater Manchester Combined Authority, East Midlands Combined County Authority, West Midlands Combined Authority, and North East Combined Authority. Its explicit purpose is to shape the future of the devolution policy debate in exactly this way: by defining the end state; identifying the next steps; and doing the engagement and thinking that will help make them happen.

The English Devolution and Community Empowerment Act may open a new chapter for local places and people, but it cannot write it. The choice facing England now is between the plateauing of the devolution agenda – the normalisation of a permanent half-way house – and a serious attempt to treat the most recent advances as a launchpad for a better-defined and more ambitiously decentralised State.