Call for evidence on fiscal devolution

27 November 2013

The Committee intends to examine whether and how fiscal and financial powers could be devolved to London and English cities.

The Committee invites written submissions on the concept and on its detailed operation.

On the concept, the Committee invites views, specifically on

  • how ‘devolved’ areas would be defined geographically and set up;
  • how public services, including employment, skills and welfare, should be organised to complement devolution;
  • how ‘devolved’ areas would be governed, including the role of business in decision making;
  • how ‘devolved’ areas would be held to account;
  • the strength of the evidence that devolution would lead to economic growth, local improvement and better local governance, including examples of what areas could do with their new powers such as use them to invest in infrastructure and local services;
  • the impact on areas not included in any new devolution arrangements, including those on cities’ borders and those affected by resulting changes to national financial equalisation and distributive arrangements; and
  • whether reform of the existing system (for example, re-banding council tax, revaluing business rates, Community Budgets, Government grants, formulas and taxes such as stamp duty) would be a precursor to, or run along with, large-scale constitutional change.

On the details, the Committee invites views on

  • what taxes might be devolved—for example council tax, stamp duty and business rates;
  • what changes should be made to "devolved" authorities’ borrowing powers;
  • the scope for areas to introduce new taxes and funding methods such as bonds and crowd-sourcing, fees and charges; and
  • the extent to which high-performing areas would be expected to redistribute their proceeds of growth via the Treasury.

Commenting, Clive Betts MP, Chair of the  Committee, said


"England’s nine largest cities make up more than half the country’s economy. The Core Cities Group and the Mayor of London suggest that, freed from the shackles of central Government control, with greater powers to raise and spend money locally, cities can become the engine room of a thriving national economy and reduce demand on public services. My Committee wants to test the evidence and hear from those who would be affected.

The proponents of change point out that unlike cities elsewhere in the world only England’s capital consistently outperforms the national economy. And its big cities still get most of their money in grants from central Government, directly controlling only 5% of the taxes they raise. These cities also provide local services to more than half the population. 

We will also examine how such a devolution would work in practice – how will devolved areas be defined, for example? How will they be governed? And, crucially, how will they be held to account?

As well as focusing on cities, the impact on areas not included in any new arrangements must also be considered. How will those areas on cities’ borders fare? How will rural areas be impacted by changes in national distributive arrangements?"

The Committee particularly welcomes any evidence from local authority scrutiny bodies such as scrutiny committee reports on fiscal devolution.

The Committee asks for written submissions in accordance with the guidelines below by 5pm on Thursday, 9 January 2014. As a guideline submissions should be no longer than 3000 words.

Link to submit evidence

Link to guidance on submitting written evidence

Submissions should be uploaded onto the website in word format no later than the deadline.

If you have any problems with uploading your submission please contact Emma McIntosh, Senior Committee Assistant on 0207 219 4972.

image: iStockphoto (Liverpool Skyline)


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