Levelling Up Locally inquiry report

The LGA’s City Regions and People and Places Boards convened this inquiry in early 2022 out of the ambition held by local leaders everywhere to do the best for their people and places and with the aim of bridging the gap between national diagnosis and local delivery. We gathered a panel of independent experts to consider in detail the realities of levelling up locally, the role of councils and the relationship between this agenda and the future resilience of the UK.

This final report highlights the need for a step change in devolution, with greater powers and resources to drive prosperity transferred to a local level and an end to Whitehall funding competitions. It identifies the need to bridge the gap between local and national priorities, to better connect marginalised people and places with the design and delivery of policies developed for their benefit. And it points to crucial contribution of local leadership, while recognising that councils cannot do this without the support of national and local partners.

Within this spirit of partnership, we would like to thank all the contributors to the inquiry for the hard work that has gone into developing these recommendations. We would also like to thank steering group members, who regularly fed in insights, practical examples, and expertise.

The Government’s Levelling Up White Paper was a landmark achievement. It diagnosed the deep rooted and persistent socio-economic challenges facing communities across the country. It also placed local government and its partners centre stage in delivering an exceptionally ambitious agenda.

In the year since the White Paper launched these challenges have been joined by rising inflation and a cost-of-living crisis, while the country continues to feel the impact of the pandemic, and struggle with low levels of labour productivity.

Crucially, alongside these additional challenges has come the recognition by all major political parties that ‘levelling up’ is one of the preeminent national policy issues of the next decade and local government is the key partner for delivering improved public services, higher levels of inclusive growth and prosperity and more resilient communities.

We hope the recommendations of this report act as a catalyst for helping shape the way in which all national political parties are thinking about how local government and its partners can genuinely address the geographic and demographic challenges facing this country. Our Boards will use the inquiry’s recommendations, which have received cross-party support within local government, to steer our future work programmes and priorities as we move into an important year for the LGA to lobby on behalf of local government.  

Cllr Kevin Bentley and Mayor Marvin Rees

Co-Chairs of the Levelling Up Locally inquiry

Creating the conditions for levelling up locally

• To better address regional and demographic inequality councils’ and combined authorities' key role in economic growth and prosperity should be recognised and they should be empowered to fairly keep the proceeds of local growth to reinvest according to local need.
• To reduce inefficiency and strengthen the case for investment, competitive funds should be replaced by a single pot of capital funding allocated according to a robust evidence base, allowing councils and combined authorities to invest in social and community infrastructure.

Strengthening the role of local government and its partners

• Pilot and quickly roll out single budgets for all places that want them under the leadership of local government, enabling better join up of public services, more preventative investment and improved outcomes for communities.
• At its best, local government leaders are representative of the communities they serve. Local and national government should build on existing campaigns to work with communities and partners to develop a talent pipeline of future leaders that better reflect the diversity of need facing people and place.

Bridging the gap between local and national priorities

• Improve policy making by giving local and community leaders a formal role in ensuring people’s experiences are a key part of policy design.

• Embed progress for those facing the greatest inequalities by working with diverse and underrepresented groups to shape the levelling up metrics and missions and evaluate tangible progress over the longer term.
• Strengthen the ability of Whitehall to act as a strategic partner to places by creating transparent and targeted cross-departmental plans to accelerate joined up delivery across government.

The Government’s Levelling Up White Paper was published in February 2022.It set out an ambitious programme to reduce inequality and close the gap in productivity, health, income and opportunity within the United Kingdom, presenting a decade long policy agenda to change the UK’s geography and narrow regional inequality through twelve national missions.

As leaders of people and place, councils have a material interest in the outcome of this agenda. They want their local economies to thrive, their vulnerable to be taken care of and their places to provide attractive and healthy environments to live, work and visit. They also recognise that these are long term challenges that require sustainable finance, a coherent strategy, partnership, and policy stability: there are few, if any, quick fixes available.

The Local Government Association is the national voice of local government. We are a politically led, cross-party membership organisation, representing councils from England and Wales and we have long argued for decisions to be brought closer to the people affected by the outcomes of these decisions. Moreover, we believe that the Government can only deliver its ambitious levelling up agenda if local leaders are properly engaged in its design and delivery.

To support this ambition the LGA’s cross-party City Regions and People and Places Boards launched the Levelling Up Locally inquiry in February 2022 to explore how the Government’s levelling up agenda might better strengthen local communities and investigate the role local leadership can play in shaping a recovery that reduces inequality for all.   

The Inquiry took place over the course of 2022 and was overseen by an independent steering group: Stephen Beechey, David Buck, Professor Francesca Gains, Professor Michael Kenny, Sarah Longlands, Raheel Mohammed, and Osaro Otobo. Neale Coleman CBE also supported the project as an independent adviser.

While the LGA is exceptionally grateful for the expertise and advice of the independent steering group, the recommendations and findings in this report are made and supported by the People and Places and City Regions Boards.

Reflecting the broad geographic and demographic scope of the levelling up agenda, the inquiry heard from a range of participants, including representatives from the private sector, local government, central government, voluntary, community and social enterprise groups, think tanks, and academics. In total, around seventy organisations were engaged as part of the process. The LGA would like to thank them and the members of the independent steering group for generously sharing their time and expertise.

The inquiry took place over the course of four roundtables, drawing in contributions and sparking a constellation of new ideas and best practice, and a final workshop session for contributors to discuss the emerging recommendations. A Smith Square debate event exploring the question ‘Is England set to level up?’ was held discussing whether England has the right systems and funding in place to meet the wide-ranging and systemic challenges facing the country. 

The first roundtable focused on funding and alignment exploring practical questions about how the levelling up agenda might be paid for and, at a more granular level, the opportunities to align policy and funding interventions at the local level to improve the quality of public service outcomes and address concentrations of deprivation. An initial provocation was provided by Professor Philip McCann, professor of urban and regional economics, who discussed why levelling up has become the focus of government policy, contextualising the high concentrations of intraregional and interregional inequalities the UK faces and the way in which the UK’s fiscal system is a hinderance to the levelling up agenda. Matt Whittaker from Pro Bono Economics provided the second provocation sharing views around where the money for the levelling up agenda would be best spent and how resources can play to the strength of local institutions.

The second session focused on the role of local leadership in binding communities and anchor institutions together to strengthen resilience, align national priorities with local needs, and articulate policy interventions necessary to support balanced economic growth and reduce inequality. The session heard from Professor Joy Warmington MBE from Brap who opened with a provocation around the way in which leadership approaches have the potential to deliver transformational change in tackling systemic inequality to deliver on the levelling up agenda. Patricia Wharton, a community advocate from Brent, discussed a need to strengthen the talent pipeline so there is a continuation of people who have the skills and are representative of communities to fill positions of leadership. Nick Gardham from Community Organisers provided the final provocation of the session outlining the uneven distribution of power in society whereby power is ‘done’ to people giving them limited ability to be part of decisions that affect them.

The third session looked at productivity and prosperity exploring the role of the private and public sector in addressing inter and intra-regional inequalities and considering the shift towards sustainable and inclusive models of prosperity. The session heard from Sacha Romanovitch from Fair4AllFinance who explored the connection between people’s financial situation and growth and prosperity, and practical steps which can be taken to enable people to become economically active. Connor MacDonald from Policy Exchange provided the second provocation contextualising the productivity challenge facing the UK and discussing ways in which this might be addressed.

The final session explored place and identity within a post-pandemic context and examined the potential of local social and cultural infrastructure to strengthen inward investment, encourage entrepreneurialism and address economic inequalities. A presentation was given by colleagues at Neighbourly Lab who discussed what makes people feel connected to where they live, what makes people deep rooted and proud, and the wider role of place identity in building a strong community.   

In the year since the publication of the White Paper, new devolution deals, new resources and new legislation have taken steps towards greater local control, but the scale of the challenge continues to demand nothing less than a wholesale reinvention of the relationship between national, local and community governance. The recommendations provide key elements of that new relationship and the LGA looks forward to working with partners across society to explore their potential.

Policy background

The United Kingdom displays larger spatial disparities compared to most other OECD countries contributing to a widening gap between London and most other regions across a broad range of social and economic metrics, and contributing to substantial differences in living standards.

The Government’s White Paper, published in February 2022 described ‘levelling up’ as an ambitious mission to end the longstanding geographical inequality which persists within the UK, to provide everyone with the opportunity to live longer, lead more fulfilling lives, and benefit from sustained rises in living standards and well-being. It outlined four key areas that this agenda aims to address:

• Boosting productivity, pay, jobs and living standards by growing the private sector, especially in those places where they are lagging.
• Spreading opportunities and improving public services, especially in those places where they are weakest.
• Restoring a sense of community, local pride and belonging, especially in those places where they have been lost.
• Empowering local leaders and communities, especially in those places lacking local agency.

Across the political spectrum parties have emphasised tackling spatial and social inequalities and empowering local communities in their policy proposals. From Labour’s ‘Take Back Control’ proposals, the Liberal Democrats’ plans to ‘unlock a fairer Britain’ and the Green Party’s ‘fairer, greener country’ commitments, there is a surge of interest in greater local decision making. We must make sure we work with national politicians and decision makers to capitalise on this energy and empower local leaders for the long term.

This inquiry heard evidence that chimed with much of this analysis. Despite decades of funding and intervention longstanding disparities of economic and social disadvantage have only grown. For example, in the UK’s former industrial regions there are still disproportionate levels of premature mortality accompanied by lower rates of employment growth and substantially higher rates of poverty.

When examining regional economic productivity levels, many parts of the UK outside London and its surrounding regions continue to face ongoing low productivity and growth challenges. Expanding on this research shows the more economically prosperous half of the UK (London, South East, East, South West along with Scotland) has a higher GDP per capita than the same in Canada and Finland, and the half of the UK comprising of the Midlands, North of England, Wales and Northern Ireland have a GDP per capita score below the Czech Republic and Slovenia. 

Marginalised communities continue to experience discrimination, as seen throughout the COVID-19 pandemic with high mortality rates among Black, Asian and minority ethnic groups living in more deprived areas, working in high-risk occupations, and living in overcrowded conditions compared with their counterparts.

Sir Michael Marmot has spoken of structural racism as a social determinant for poor health which has clear knock-on impacts for local economies and public services. The McGregor-Smith Review into race in the workplace found tackling the racial disparities in the UK labour market could result in an annual economic boost worth £24 billion to the UK economy.

At the same time the COVID-19 pandemic has exacerbated pre-existing gender inequalities, with increasing numbers of women dropping out of the workforce to look after family. When exploring how gender intersects with race, the challenges become even more acute. Compared with White British men, women of colour consistently earn less per hour and during the pandemic BAME mothers were furloughed at a higher rate compared to white women. 

Similar trends have been observed for disabled people who had an increased COVID-19 mortality risk across all waves of the pandemic yet make up 22 per cent of the total UK population, with disability prevalence continuing to rise.

With the above in mind the inquiry found levelling up the country means addressing the following two areas:

1. Deep-rooted social inequality persists among different groups of people irrespective of where they live in the United Kingdom.  
2. Even when groups in different areas face similar levels of inequality there are unique local factors that create additional barriers as well as opportunities. 

Crucially, this is an agenda that all national political parties have committed themselves to addressing, with local government playing a key role in driving economic growth and boosting local prosperity.

Socio-economic background

The Levelling Up White Paper was published almost two years after the World Health Organisation declared COVID-19 a pandemic. To provide context for the Inquiry, post-pandemic demographic changes were examined to determine whether there has been a continuation or departure from pre-pandemic trends and consider what these demographic trends might mean for the levelling up agenda. The following section explores how profoundly COVID-19 has disrupted the makeup of our population and sets the context for levelling up locally.

It was natural that such a major global event led to assumptions about whether the way people led their life might radically change, with predictions made about where people would choose to live; birth rates; and the future of the office. However, many headline assumptions made about demographic shifts because of the pandemic have not been found to be correct. It was assumed there would be a widespread urban-rural change with the pandemic exposing shortcomings in people’s living arrangements and people wanting more space as they work from home. Although the price of homes in London saw the smallest percentage increase in value (seven per cent) of any region between February 2020 and April 2022, and rents in London fell by 10 per cent during lockdown, they have recovered from this drop and increased by 18 per cent on average in the last year. As of August 2022, with the biggest relocation being amongst low-paid, younger workers moving within densely built-up areas, urban areas continue to exert a considerable pull on young people. 

Similarly, despite predictions of a baby boom, birth rates have fallen rather than increased. Notwithstanding the significant loss of life amongst older people as a direct consequence of the pandemic, the UK continues to have an ageing population, with associated implications for health, tax revenue and wider government spending.  

The COVID-19 pandemic and the resulting restrictions have led to some of the most rapid and drastic changes to the way people live and work. Between October to December 2019, and January to March 2022, homeworking in the UK more than doubled from 4.7 million to 9.9 million people. Amongst non-homeworkers, flexible working increased, with over 14 per cent of those who did not mainly work from home having reported working from home at least one day a week across the UK. This percentage was even higher in London, with 24.3 per cent of non-home workers having worked from home at least one day a week. This varied across regions, with the largest increase in Scotland, up 203.5 per cent since before the pandemic. This pattern of hybrid working looks set to continue, with 84 per cent of workers who had to work from home as a result of the pandemic reporting in February 2022 that they planned to work from a mix of home and their place of work in future. At the same time, the number of workers commuting into a different regions has fallen in all UK regions.    

Although homeworking has increased significantly, these changes have a disproportionate impact on office based jobs. Higher earners are more likely to work either from home or do hybrid working, with 38 per cent of workers earning over £40,000 having worked a hybrid role between 27 and 8 May 2022 versus only eight per cent of those earning up to £15,000, and 24 per cent of those earning between £15,000 and £20,000. It was suggested by some commentators during the pandemic that this increase in homeworking would break the geographic link between work and home, enabling both a higher quality of life for those working in areas with high house prices, and access to better work for those outside core economic hub areas. 

Polling carried out by YouGov for the LGA on 31 January and 1 February 2022 found that 41 per cent of respondents thought it was difficult for people in their area to achieve their career goals, and 59 per cent thought it was difficult for people in their area to achieve their life goals (for example, buying a house, or raising a family). This indicates the scale of the challenge involved in levelling up, with minimal regional differences between respondents indicating that people across the country are finding it hard to achieve their goals.  

These challenges may have been further exacerbated since this polling was carried out by the rising cost of living. The implications of rising prices, inflation and higher interest rates are already being reflected in housing data. During the pandemic, having private outdoor space (such as a garden or balcony), a more spacious home, and living near public green space became important factors for Londoners considering moving home and house prices reflected these preferences. In contrast, data from September 2022 shows that rental demand for two bed flats is growing again at the expense of two and three bed houses, as people look for more affordable homes that may also have lower energy bills. Rising numbers of renters are choosing to stay in their current home as competition for rental properties increase, and research suggests landlords are not raising rents as steeply for existing renters as they are for new tenants. 

Furthermore, although some indicators have increased at a faster rate during the pandemic, particularly around measures such as unemployment rate, people on universal credit, and life satisfaction, it is difficult to entirely disentangle these from an unpredictable and rapidly evolving global macroeconomic context. 

Inequalities that existed before COVID-19 hit meant that those communities at risk of greatest vulnerability were affected the most and have struggled the most to recover. For example, women had a greater likelihood of being furloughed through the Coronavirus Job Retention Scheme and employed in shut-down sectors from the first lockdown, as well as being disproportionately likely to work in less secure, part time employment, both before and during the pandemic. 

Against the background of a particularly bleak period of global history, it is perhaps difficult to understate the impact these events have had on the inequalities faced by communities across the country. However, by the same token it also easy to lose sight of the positive role councils and their communities played in protecting the vulnerable, keeping businesses solvent and local places vibrant.

Local leaders offer hope and resilience. This is as true in the face of a global pandemic as it is in the face of a changing global climate. While national government has a clear and strategic role to play in addressing these issues, the benefits of a more granular placed focused approach can be seen in the local vaccine rollout with councils playing a key role coordinating the rollout on the ground setting up vaccination centres at short notice and using their networks to ensure accurate information reached communities. Similarly, a study by UKRI found a devolved model delivering Net Zero up to 2050 would cost an average of £490,000 a day and return £7 million in wider returns, compared with a national centralised model costing £1.7 million a day and returning £3.7 million. At a national level progress towards further devolution also validates local governments' leadership and ability to drive inclusive economic growth. The new devolution deals announced recently may still be green shoots, but developments in Greater Manchester, the West Midlands, Tees Valley and elsewhere show just how much of an impact bring powers and resources closer to local people can make.

In this context, the challenge of ‘levelling up’ that all parties have committed to stands out as one of the pre-eminent national policy challenges of the next decade, one that can best be tackled by seizing on the opportunities and ambitions that comes with strengthened local leadership.

The Inquiry highlighted three key themes: creating the conditions for levelling up locally; strengthening the role of local government and its partners; and bridging the gap between local and national priorities.

The following sections set out the Inquiry’s findings and recommendations against each of the themes.

Growth and prosperity

The current context cannot be ignored. The rising costs of fuel, food and other essentials are combining with existing disadvantage and vulnerability within communities to put many households at greater risk of both immediate hardship and reduced opportunity and wellbeing.

Participants in the inquiry heard the scale of the economic challenge people are facing across the country: 8.5 million people are struggling with debt, 2.4 million are in problem debt and 14 million people have less than £100 in savings. As a result, the possibility for economically precarious people to be actively involved in society is increasingly at risk.

Local government has a key role to play in getting people to a stage where they have financial stability, can support their wellbeing, and have the ability to care for their families, undertake work and be economically active in their local communities. At the same time the inquiry heard the impact of workforce challenges such as in the social care sector with high vacancy rates, rising demand, low pay and burnout exacerbated by the COVID-19 pandemic.  

It is therefore more vital than ever to ensure money is spent locally and in communities with the greatest need. However, in the UK public spending is concentrated in central government and is uniquely centralised compared with international examples. Four years ago, 95 pence in every £1 was taken by Whitehall (compared with just 65 pence in Germany). This has now increased to 96 pence. This centralised funding model means that funding decisions are not able to be taken at the kind of granular level required to ensure funding goes to those places with the greatest need. The inquiry heard about how maximising the social and economic role of public expenditure in local economies can help support the creation of good quality local jobs, support businesses and help create and support new sectors such as net zero. There is an opportunity to transfer this learning to thinking about expenditure on levelling up funds, particularly on capital schemes to help make the most of the levelling up investment in a time of increasing need.

It is important to view levelling up in the context of the national economic agenda. It should not be regarded as a peripheral challenge but instead one deeply embedded within the economic system of the United Kingdom. This requires a shift to focus on the strengths of a place as opposed to viewing areas through a deficit approach. A think piece for the inquiry highlighted the importance of private sector growth in driving regeneration and a key role for local leaders from both the public and private sector to understand the comparative advantage of their population and place and turn it into a strategy for broad-based and sustainable growth. Business In the Community’s Place Taskforce stated the importance of business, civil society, and local government in setting the strategy for a place.  

All national political parties have rightly put skills, retraining and job creation front and centre of their plans to kick start the economy. Investment and interventions to achieve this must connect at a local level and for all places if they are to support people of all ages – learners, unemployed people, career changers – as well as businesses and other employers of all sizes – progress to being part of a high skilled economy. A joined up and locally responsive employment and skills offer is critical to this, and local government should be trusted to have lead responsibility for this locally.

The current skills and employment system is fragmented and unable to adequately address current labour market and productivity challenges including record high vacancy rates or tackle social and economic inequalities like low skills levels. LGA analysis shows that across England, £20 billion is spent on at least 49 nationally contracted or delivered employment and skills related schemes or services, managed by nine Whitehall departments and agencies, and delivered by multiple providers and over different geographies. This makes it difficult to plan, target and join up provision, leading to gaps in provision or duplication.  Within this context, local government is striving to join up the system as best it can.

By further empowering local government to convene and lead skills and employment support through the LGA’s Work Local proposal, a typical medium sized authority could improve employment and skills outcomes by about 15 per cent, meaning an extra 2,260 people improving their skills each year and an extra 1,650 people moving into work. This would boost the local economy by £35 million per year and save the taxpayer an extra £25 million per year.

Local authorities understand the urgent need to address the consequences of inequality. They recognise the need for efficiency, speed and the value of public policy interventions that go with the grain of local economic conditions and deliver the best outcomes for communities and country. They also understand that an over reliance on Whitehall systems and silos has led to waste and a concentration of power at the centre has been unable to connect people from all walks of life with the proceeds and opportunities of prosperity. For example, LGA research estimated that the average cost to councils in pursuing each competitive grant was in the region of £30,000, costing each local authority roughly £2.25 million a year chasing down various pots of money distributed from across Whitehall. Councils as leaders of place have an important role to play in shaping the conditions for growth locally. Where investment is needed, allocations should be made using a robust evidence base.  Alongside this, powers and functions should be devolved to the local level to ensure decisions are taken closest to the people most likely to impacted by them.

Pride in place

The Bennett Institute highlighted the way in which interventions to improve the social infrastructure (the services and facilities that meet local and strategic needs of communities) of local areas should be seen as complementary to a growth-focused policy agenda, not as extraneous or rival to it.

Research by Local Trust and others shows ‘left behind’ places have a significant social infrastructure deficit – that is the spaces, facilities, and networks that are crucial to development and maintenance of social connections within a community. Their research found that a £1 million investment in social infrastructure in a ‘left behind’ area would be expected to deliver £2 million of economic and social benefits, and £1.2 million of fiscal benefits over ten years.

Ethnographic research carried out by Neighbourly Lab for the LGA showed the extent to which local government has a role to play in creating strong, resilient communities that people can be proud to live in. They found that pride in place is contingent on a level of deep rooted contentedness, which in turn relies on basic needs being met. The four necessary conditions they identified were:

• core material needs (for example, acceptable quality of housing, employment) are met
• good local amenities (especially shops and open spaces)
• sufficient social connections
• an optimistic view of the place’s future, in which people can see their own role.

This research found that while deep rooted contentedness was linked to many personal factors, including having memories located in place, local government could create the conditions for contentedness, and support emerging initiatives which were boosting local pride. Where local government lacks the capacity or means to meet these conditions for contentedness, local residents are unlikely to experience pride in place.

Recommendations

• To better address regional and demographic inequality councils’ and combined authorities' key role in economic growth and prosperity should be recognised and they should be empowered to fairly keep the proceeds of local growth to reinvest according to local need.
• To reduce inefficiency and strengthen the case for investment competitive funds should be replaced by a single pot of capital funding allocated according to a robust evidence base, allowing councils and combined authorities to invest in social and community infrastructure.

Local autonomy

The inquiry noted that The Levelling Up White Paper recognises the importance of local leadership as ‘essential for delivering better local outcomes and more joined up public services.’ It commits to ‘by 2030, every part of England that wants one will have a devolution deal with powers at or approaching the highest level of devolution and a simplified, long-term funding settlement’.

The LGA has long made the case that different parts of the country will need different governance models to ensure their communities benefit from effective devolution and the inquiry therefore discussed the importance of local leadership in securing powers from central government.

Local leadership ‘is proving to be the key ingredient that allows central government officials and politicians to overcome, at least in part, their traditional reluctance to share meaningful powers and accountabilities with their counterparts at a more local level’. Dr Simon Kaye, Director of Policy at Reform also suggested an extension on the current model of devolution so that powers and capabilities are also strengthened at smaller scales of local government. Local leadership shouldn’t just be at mayoral scale but instead there should also be a shift to ‘intelligently distributed leadership that respects the complexity and contextual nuance in local places’. 

The Levelling Up White Paper recognises that ‘local government consistently points to the inefficiencies, decision-making complexity and reporting burdens which result from the number of local funding pots and strings attached to them.’ This overly complicated system limits the impact leaders can make.

Local leaders

Despite a concerted effort across local government to engage with communities, the inquiry heard people can feel power is ‘done’ to them resulting in a limited ability to affect positive change. Democratically elected local leaders have the mandate to reach out, listen, connect, and motivate people to build collective power in communities.

The inquiry noted that marginalised communities are often excluded from decision making processes. For example, a study by the Global Network of Women Peacebuilders, which works closely with the United Nations, looked into the exclusion of women, youth and other marginalised groups in decision-making, crisis response and recovery from the Covid-19 pandemic and found at a local level women’s contributions were overlooked.

As public leaders increasingly grapple with the impacts on public services and local economies resulting from systemic social and geographic inequalities, the inquiry heard how leaders’ skillsets will need to evolve. Leaders across public services will need to further hone their ability to carefully listen to a range of views as well as distil what is being said and enact change. They will seek to understand how systems of discrimination operate and have knowledge of themselves as a leader, including their own biases. Lasting trust and empathy depends on leaders understanding where they come from and how other people experience them – this is a strength of many political leaders and will give them a strong base to build from.

As a sector, local government recognises that certain groups are excluded from positions of leadership due to socioeconomic and cultural factors, with programmes such as Be A Councillor set up to promote change. The inquiry heard that a greater understanding of the causes of exclusion will enable new initiatives to be developed to ensure marginalised communities play a key role in future decision-making processes and further strengthen local government leadership.

Throughout the pandemic, councils stepped up to protect their communities and keep businesses going. Their resilience and efficiency is matched by the high levels of trust shown by residents in their councils. Councils are already leading the way in providing support to households and businesses hit hard by the rising cost of living. They will be crucial partners in enabling the transition towards a more productive and efficient economy, but to do this councils must be sufficiently resourced to deliver.

Devolution offers the best value for money and is the right response to fiscal constraints and the ambition for a smaller central state. Given the tools and resources to tailor spending to local needs and opportunities councils will deliver better outcomes than a centralised system characterised by micro-management and duplication. Crucially, place-based approaches such as the Supporting Families programme, demonstrate the value of early intervention and preventative activity.

Over the longer term, local government’s placed based leadership is uniquely positioned to invest in sustainable preventative approaches that save money for other parts of the system. No other part of the public sector offers the same scope for unlocking savings in the NHS, the Department for Work and Pensions and the criminal justice systems. Through targeted investment in social care and children’s services, public health and unemployment support we can transform people’s lives and move away from the costly pressures of acute intervention.

Recommendations

• Pilot and quickly roll out single budgets for all places that want them under the leadership of local government, enabling better join up of public services, more preventative investment and improved outcomes for communities.
• At its best, local government leaders are representative of the communities they serve. Local and national government should build on existing campaigns to work with communities and partners to develop a talent pipeline of future leaders that better reflect the diversity of need facing people and place.

Policy development

The inquiry explored how the over-centralised UK governance system which works against both central government learning and local government institutional capacity building. This is illustrated by considering the ‘A-frame challenge’ in which the UK governance system can be thought of as a pyramid with citizens at the bottom and central government at the top and multiple degrees of separation between the two. As a result, central government is only able to hear from a small subset of life in the UK (including highly influential companies, think tanks, academics, professional and political associations predominantly London based). A lack of an upward flow of knowledge results in people disincentivised from engaging with the top and the centre lacking the capacity to meaningfully engage with the breadth of experiences of across the country leading to a concern that decisions and policy might be ‘parachuted down into communities’.

This raised the question of what a local-first approach to policy making might look like in practice and the ways in which it can complement representative democracy. The inquiry heard about the trade-offs between central policy making and greater local autonomy. Councillors attending the inquiry roundtables noted the constraints of political cycles and short term, fragmented budgets (the LGA published research which revealed that local government received at least 448 unique grants from central government between 2015/16 to 2018/19) often work against robust consultation processes. They also noted capacity is a challenge: community engagement and communications are often non-statutory roles in councils and can be the first to come under pressure in the context of reduced budgets.

However, it was clear that the realities of people’s lives are best captured at a local and community level, and where policy is centrally imposed on people without buy-in it is less likely to be successful when enacted. Policy@Manchester recently established key design principles for decision making to extend ‘people power.’ They found hearing from more people, particularly from diverse communities, can add to formal democracy and help political decision-makers in real time with more ‘fine grain’ perspectives and choices. The four design principles for local decision making are: ensure it is open, porous and transparent; inclusive with diverse representation; embedded and routinised; and the expertise of different kinds are valued including lived experience.

Previous local government involvement on the EU Committee of Regions (giving local government a formal advisory role in the EU law and policy-making process through its membership) ensured that EU laws were improved by the experience of those at the front line of delivery. Bringing forward and implementing proposals to replicate the functions of the Committee of Regions within the UK, without recreating its institutional bureaucracy would strengthen future policy development.  

Policy monitoring and evaluation

The inquiry highlighted a broken feedback loop between central government, local government, and wider communities. The inquiry heard evidence is often not given enough weight due to a need for urgency to address symptoms rather than causes. Often project-based activities only evaluate the immediate project rather than what is sustained after an intervention ends meaning long-term change is not achieved – this is of particular concern given current short-term political cycles. Systems are built around quantitative evidence which can often be viewed as more ‘accurate’ or ‘acceptable’ and greater thought needs to be given to how to give qualitative evidence equal consideration.

A recent project commissioned by the LGA aimed to capture learning for policymakers in central and local government from eight place-based programmes that have been delivered over the last 20 years. The findings highlighted the way in which ‘data and evidence in programmes were over-engineered, leading to tick box compliance and the bureaucratisation of programmes’.

The inquiry heard that the better evaluation should focus on:

• Monitoring explicit structural changes such as changes in local policies, laws or how resources are distributed to address issues of unequal outcomes and opportunities for different groups of people.
• Changes in relationships, connections or power dynamics between different communities and partners in a place.
• Changes and transformations in how we think about issues of systemic disadvantage affecting particular communities.

Shifting to this model is a long-standing difficult issue that will require resource to address but is important in order to be able to identify successful interventions that will result in long-term change. Although data usage and sharing are essential to use resources effectively, the inquiry heard it must be accompanied by sufficient budgets and resources and there must be a more effective way in which Government works with underrepresented and diverse groups to enable them to play an integral role in the design of evaluation approaches from inception.

The Levelling Up White Paper looked to overcome this challenge through the introduction of a new data body, now confirmed as the Office for Local Government, with a focus on ‘local data, transparency and outcomes’ and to ‘strengthen local leaders’ knowledge of their services, enabling them to share best practice, innovate and drive self-improvement’ as well as to ‘encourage innovative uses of real-time data at the local level, giving leaders across the UK the information they need to deliver, experiment and evaluate swiftly and effectively.’

Local government already has a very strong record of data transparency, including through the LGA’s LG Inform data platform which already enables residents and leaders to compare information by presenting up to date published data about local areas and the performance of councils utilising existing data. It is important local government and wider partners are consulted with to ensure the levelling up missions and accompanying metrics identified in the White Paper reflect the diverse needs and aspirations of communities across the country.

Recommendations

• Improve policy making by giving local and community leaders a formal role in ensuring people’s experiences are a key part of policy design.
• Embed progress for those facing the greatest inequalities by working with diverse and underrepresented groups to shape the levelling up metrics and missions and evaluate tangible progress over the longer term.
• Strengthen the ability of Whitehall to act as a strategic partner to places by create transparent and targeted cross-departmental plans to accelerate joined up delivery across government.

The Levelling Up White Paper arrived as the UK was just about beginning to emerge from the deadliest pandemic of recent history. It was praised for providing a clear assessment of the challenges of ‘building back better’ and for offering solutions that recognised the strengths of local leadership.

In the year that has followed, these ambitious proposals have faced continued political and economic turmoil and councils have, once again, found themselves on the front line, supporting communities, delivering public services, striving to do their best for people and places in an uncertain and changing world.

This inquiry sought to take the golden thread of local leadership, of councils’ role in bringing partnerships together to genuinely tackle the challenge of geographic and demographic inequality and to consider what it would take to turn three-hundred-pages of diagnosis and ideas into a better experience for all. The evidence and examples set out above provide a strong framework for doing this. They also point to the irreducible role of local leaders and their communities.

There are no shortcuts to turning around the systemic challenges facing the UK. The White Paper was a positive step forward, but local and national leaders must continue to be bold and to work together to make progress.

More than a decade of pressure on budgets means that levelling up nationally will not succeed without investment in levelling up locally. Equally, decades of overcentralisation mean that levelling up locally cannot be left to cookie-cutter solutions from the centre or competitive funding pots that reward those best able to compete. Local councils draw their strength from the hope and resilience of their local communities. With the right powers, policies and partnerships they can help chart a way through the turmoil and unlock the potential for people right across society to play bigger part in the nation’s prosperity.

The Levelling Up Locally Inquiry would not have been possible without the support and contribution of the following individuals and organisations. Thanks to our contributors below:

Abigail Gibson - Friends Provident Foundation

Adam Hawksbee – Onward

Akash Paun – Institute for Government

Alison McCann - Fields in Trust

Amahra Spence - MAIA group

Amreen Qureshi - IPPR North

Angela Harrowing - Cabinet Office

Charlotte Zemmel – Neighbourly Lab

Cllr Abi Brown - Stoke-on-Trent City Council

Cllr Anthony Hunt - Torfaen County Borough Council

Cllr Bev Craig - Manchester City Council

Cllr David Mellen - Nottingham City Council

Cllr Emily O’Brien - Lewes District Council

Cllr Emily Smith - Vale of White Horse District Council

Cllr Gareth Roberts – Richmond Upon Thames London Borough Council

Cllr Jason Brock - Reading Borough Council

Cllr Morris Bright - Hertsmere Borough Council

Cllr Simon Henig - Durham County Council

Cllr Sue Roberts - South Oxfordshire District Council

Connor MacDonald – Policy Exchange

David Buck - King’s Fund

David Phillips - Institute for Fiscal Studies

Dominic Coleman - Trafford Council

Douglas White - Carnegie

Dr John Wright - Centre for Cultural Value

Dr Roger Barker - Institute of Directors

Ed Gordon – COSLA

Ellen Vernon – One Public Estate

Fidelia Elias - Justice Together

Gavin Atkins – Mind

Gemma Mitchell – Cornwall Council/Britain’s Leading Edge

Harry Hobson – Neighbourly Lab

Jeremy Leggett – Acre

Jess David – Association of Directors of Environment, Economy, Planning and Transport

Josephine Namusisi-Riley - Citizens UK

Kate Levick - e3G

Leah Davis - New Philanthropy Capital

Lindsey Brummitt - Eden Project

Luke Raikes - Fabians

Madeleine Gohin - The Countryside Charity

Matt Dunkley - Association of Directors of Children’s Services

Matt Whittaker – Pro Bono Economics

Matthew King - Department for Levelling Up Housing and Communities

Melanie Leech - British Property Federation

Mike Harries - One Public Estate

Naomi Clayton - Learning and Work Institute

Natalie Turner - Centre for Better Ageing

Nick Gardham - Community Organisers

Nick King – Henham Strategy

Nicky Dewar - Crafts Council

Osaro Otobo - British Youth Council

Patricia Wharton – Brent resident

Paul Bristow - Arts Council England

Professor Francesca Gains - University of Manchester

Professor Graeme Atherton – Centre for Inequality and Levelling Up

Professor Joy Warmington – Brap

Professor Michael Kenny - University of Cambridge

Professor Philip McCann – University of Sheffield

Raheel Mohammed - Maslaha

Richard Prothero - Office for National Statistics

Rosie Lockwood – IPPR North

Sacha Romanovitch – Fair4All Finance

Sarah Longlands - Centre for Local Economic Strategies

Sarah Watters - COSLA

Simon Kaye - Reform

Steph Edusei - St Oswald’s Hospice

Stephen Beechey - Wates Group

Steve Hughes - WPI Economics

Tim Peppin - Welsh Local Government Association

Tony Blake - Shared Intelligence

Will Tomson - Social Investment Business

Yolande Burgess - London Councils