Power to the cities
Author: Dermot FinchDate: 18/09/2008
Publication: Beyond Whitehall: A new vision for a progressive state
More than three million families now live in households where no one is in full-time work. Most of these households live in cities.With unemployment set to rise above two million, this situation will get worse before it gets better. It's time for a radical, devolved approach to increasing employment rates, with new powers for cities.
Worklessness is primarily an urban problem that requires an urban solution. Recent research from the Centre for Cities confirmed that worklessness is disproportionately concentrated in cities. Urban areas contain 59 per cent of Great Britain's population, but they are also home to 68 per cent of benefit claimants and 64 per cent of the workless.
National approaches to worklessness, such as the New Deals, have largely failed to move those furthest away fromthe labour market into work and have had lower success rates in cities than elsewhere. A more localised approach could help deliver better results, and boost employment rates - even through an economic slowdown.
Ministers say they are committed to devolution, but there's not much to show for it so far. Hazel Blears has long proclaimed herself ‘a localist, to my bones'. James Purnell has promised ‘power to the people' and ‘triple devolution' to individuals, service providers and communities. But so far, none has put forward any radical devolution of financial or political powers to city leaders. There's a gap between ministerial rhetoric, and reality on the ground.
We should hold Purnell to his word on devolution, and press for fully devolved backto- work programmes in our biggest cities, tailored to employers' needs. In particular, we need to give city-regions like Greater Manchester direct control over employment and training budgets, through powerful new skills and employment boards.
The London Skills and Employment Board is a good example. It now has a big say in directing training budgets across the capital - so the mayor and employers can now do more tomatch up courses and qualifications, with job vacancies and employer demand.
Powerful skills and employment boards should be set up in places like Greater Manchester, Merseyside and Greater Bristol. Each board would control budgets for local back-to-work and training programmes - using funds devolved from the Department for Work and Pensions, JobCentre Plus and the new Skills Funding Agency. Based much closer to local labour markets, these boards would be more effective than existing national programmes in helping local people skill up and get back to work.
Business leaders and employers would sit on these boards, alongside elected city leaders and training providers. Employers would be able to shape and direct bespoke training programmes that fit the needs of their local economy. Local business leaders would be challenged to identify the workforce skills they need - and in return would be given a much bigger role.
Both Labour and theTories are talking the devolution talk, and there's considerable cross-party consensus on welfare reform. But neither party has yet delivered the powers that cities need to tackle worklessness.As we move towards the next general election, we need a manifesto commitment that empowers our cities to increase employment and help their economies grow.
A version of this article first appeared in the Progress pamphlet Beyond Westminster: A new vision for a progressive state
