The Chamberlain News

Shock and awe: Greater Birmingham sidelined as Manchester councils given £6bn NHS budget

The ten councils that make up the Greater Manchester combined authority are to be given sole charge of £6 billion of NHS spending in a ground-breaking move by the Chancellor that demonstrates vividly how far behind Greater Birmingham has fallen in the devolution stakes, writes Paul Dale.

George Osborne will visit Manchester tomorrow to unveil the scheme which is the first of its kind in the country and an important move towards single place budgeting – where all public sector spending in an area comes under the control of a single administrative body.

While the ten Greater Manchester councils can hardly believe their good fortune – the NHS deal comes on top of the – councils in the West Midlands are still unable to agree a deal on forming a combined authority.

Birmingham and the Black Country councils have informally agreed to press ahead with the new body, which will have control of transport and economic development, but Solihull and Coventry councils remain undecided.

Conservative-controlled Solihull is wary of throwing its lot in with Labour Birmingham and the Black Country, at least until after the General Election, although all of the councils are happily collaborating over economic development.

The Manchester NHS deal is part of the Chancellor’s ‘Northern Powerhouse’ strategy designed to reinvigorate the city-region economies of the north of England.

From April 2016 the Greater Manchester combined authority will have control of every penny spent on public health, social care, GP services, mental health and acute and community care. It is claimed the change will lead to better integration of health and social care.

The cash – most of which is currently administered by NHS England – accounts for the region’s entire health and social care system.

, the move is described as ‘ground-breaking’ and ‘unprecedented’ in an internal document and will include powers over the workforce, regulation, information sharing and NHS buildings – as well as the cash itself.

Greater Manchester is to have a directly elected mayor under an agreement thrashed out with the Government. Acceptance by the council leaders of the mayoral system was regarded as essential by the Chancellor for maximum devolution to be granted.

Tony Travers, a local government expert at the London School of Economics, told The Times newspaper that devolution of the entire Greater Manchester health budget would be “the most radical change in health care since the NHS was created” and that every city region in the country including London would “want to get in on this”.

The failure of Greater Birmingham councils to close the deal on forming a combined authority is highlighted in the Kerslake Review of Birmingham city council’s governance capabilities.

Kerslake notes: “Greater Manchester, the North East, Liverpool, West Yorkshire and Sheffield have already established combined authorities. Combined with appropriate devolution, these combined authorities have the potential to become powerhouses for economic growth. In our view the west midlands is behind the curve and risks missing out on this opportunity.

“We heard that part of the reason for the delay in establishing a combined authority in the area is the long history of relatively poor partnership working. We were told that in the past this was because Birmingham City Council had sought to lead the process and in doing so were perceived to be an over dominant partner. We welcome that BCC have told us they are taking a very different approach this time.”

Kerslake says plans should be in place to develop a combined authority based on the core functional economic area of Birmingham, Dudley, Sandwell, Walsall, Wolverhampton and by by July 2015. Once this has happened the Government should begin to engage in a dialogue about further devolution.