Andy Burnham has been warned that he must complete England’s devolution map swiftly or oversee a “two-tier England” where a firm’s prospects depend on whether it lies within a mayor’s boundary.
The warning comes from a leading northern think tank in a paper published as the incoming prime minister prepares a programme centred on transferring power to regional mayors.
More than a quarter of England’s population still lives outside a Mayoral Strategic Authority, the bodies increasingly responsible for transport, housing, and regeneration decisions.
For business owners in those areas, the absence of a local champion means lacking the powers and budgets available to competitors in places such as Greater Manchester or the West Midlands.
Researchers argue that leaving gaps in the devolved map risks deepening resentment in communities that feel left behind, at a time when public confidence in political institutions is already at historic lows.
Capital is already flowing on the strength of the mayoral model. A recent £20 billion commitment to the North of England was framed explicitly as a bet on devolution, while firms outside mayoral areas risk seeing that investment pass them by.
The current government has legislated for devolution through an act receiving Royal Assent in April and has signalled willingness to go further on tax powers for mayors.
However, slow incremental change has left Whitehall dominating decision-making, and the full benefits of devolution have yet to be realised.
The think tank’s recommendations are direct: complete the devolution map by the end of this parliament and explore extending regional devolution to city regions in Scotland and Wales.
It also urges ambitious fiscal devolution at the autumn Budget, allowing places to retain a share of taxes and borrow to invest in transport, housing, and regeneration.
Expanding “hyperlocal” government is recommended so communities, not just mayors, can shape local decisions.
The fiscal dimension demands closest attention from small business owners. Consultations are under way on visitor levies and devolving revenues from income, business, and land taxes.
Who sets and spends those taxes, and where, will significantly affect firms’ costs and their local trading environment.
A research fellow behind the publication said the incoming prime minister’s ambition for devolution must move beyond incrementalism to avoid wasted effort.
The researcher warned that gradual change is no longer sufficient and that regions need powers, resources, and democratic legitimacy to drive real change.
Embedding these changes constitutionally would ensure lasting benefit regardless of who holds national office, the researcher added.
An interim head at the think tank said the incoming prime minister cannot afford delay amid a political trust crisis.
The official argued local leaders should control local decisions, pointing to Manchester’s experience as a model to replicate nationwide.
The official cautioned that Whitehall resistance and populist exploitation of failures will test whether Burnham can act quickly enough to deliver meaningful change.
For a business community where eight in ten small firm owners have voiced concern about a Burnham premiership, the stakes cut both ways.
If Burnham delivers what he calls “the biggest rebalancing of power the country has ever seen,” key decisions will be made closer to affected firms; failure would leave England’s businesses operating in two very different countries.
