The Chamberlain News

West Midlands Combined Authority – the mayor and the issues facing the region

History will be made tomorrow (Friday, 10th June) when leaders of seven metropolitan councils sit down with the leaders of eight shire districts and chairs of three Local Enterprise Partnerships for the first meeting of the West Midlands Combined Authority (WMCA). Chamberlain News’ chief blogger Paul Dale takes a look at what’s in the new body’s inbox.

The inaugural session of WMCA at Birmingham’s International Convention Centre will herald the biggest change in the local government landscape since the demise of the West Midlands county council over 30 years ago.

Run by a cabinet of council leaders under the chairmanship of Solihull council Tory leader Bob Sleigh, and from next year with an elected metro mayor as chair, WMCA has limited devolved powers to take region-wide strategic decisions over transportation, economic development and skills. A 30-year devolution deal, said to be worth £8 billion, has been negotiated with the Government.

Here, then, are the main issues for Birmingham, Solihull, Coventry, Sandwell, Wolverhampton, Dudley and Walsall councils, as well as the non-constituent WMCA members Cannock Chase, Nuneaton and Bedworth, Redditch, Tamworth, Telford & Wrekin, Stratford-on-Avon, Shropshire and Warwickshire council.

Metro Mayor

It suits both the Government and the council leaders to pretend that the combined authority is absolutely nothing at all to do with having an elected mayor. Nothing could be further from the truth – the mayor, and the powers to be given to whoever gets the job, is the number one issue for WMCA from now until the mayoral election is held next May.

MPs debating WMCA in the House of Commons were told by Local Government Minister James Wharton that the West Midlands need not have a mayor. This is correct, up to a point. Mr Wharton failed to spell out that an £8 billion devolution deal negotiated by the shadow WMCA board is dependent on the combined authority being overseen by a mayor. No mayor, no deal.

The West Midlands will have a mayor post-May 2017, whether the councils like it or not, and mostly they do not like it. Even on a low turnout, the mayor will have a democratic mandate from upwards of 250,000 people. This will change regional politics for ever.

Between now and May, WMCA must conclude negotiations with the Government over mayoral powers. Most of the council leaders remain highly suspicious of the mayoral model and will want to retain as much power as possible for the combined authority cabinet, effectively reducing the mayor to cabinet chair, or a first among equals.

And sooner or later someone has to decide how much the mayor should be paid. An opening gambit by WMCA, between £30,000 and £40,000, seems highly unlikely to receive Government backing. Ministers would raise doubts about finding the best candidate for what in public sector executive terms remains a very small salary indeed.

It will be fascinating to see when the mayor takes office the type of back-up team the successful candidate recruits to run the mayoral office and give advice. Keep an eye out, too, for use of ‘Greater Birmingham’ to describe WMCA. Most councils will hate this, but it’s just the sort of thing a mayor can do, if he or she wishes.

Transport

Improving the West Midlands’ woeful connectivity, by road, rail and tram, is a key issue for the combined authority and the mayor. The West Midlands Integrated Transport Authority is to become Transport for West Midlands, similar to Transport for London, and will have powers to push through strategic transportation decisions across the region.

Work here will tie in closely with the Midlands Engine project and Midlands Connect in particular, bringing the west and east Midlands together, crucially to improve west-east road and rail services.

WMCA’s statement of intent sets out the aims:

We need a fully integrated rail and rapid transit network that connects our main centres with quick and frequent services, and that increases the number of people who can readily access HS2 stations and main centres.

By delivering this, we will reduce transport’s impact on our environment, improving air quality, reducing carbon emissions and improving road safety. The resulting network will enable the efficient movement of goods to help businesses to connect to supply chains, key markets and strategic gateways.

Housing

This is an issue where friction between WMCA’s component councils and the mayor could quickly become apparent. There is a housing shortage across the West Midlands with some estimates suggesting as many as 250,000 new dwellings are required. This inevitably will mean development in the green belt, which would be vigorously opposed.

The shadow combined authority has named housing as one of its key priorities, but WMCA will not have any powers to force the issue – planning applications for housing will remain the responsibility of local councils, whatever grand strategies the combined authority may hatch.

There are no proposals from the Government to give the West Midlands metro mayor powers to force through housing decisions, although the mayor could influence and persuade behind the scenes. Crucially, if the mayor was of a mind to ask the Government for direct powers to control housing development, might Ministers be inclined to agree?

A metro mayor may be placed under pressure by the Government to get homes built quickly and could expect support from Birmingham city council where leader John Clancy has named house building as his main priority. Neighbouring Solihull council however would fight any plans to build on the ‘Meriden Gap’ green belt between the M42 and the west of Coventry.

WMCA has set up a land commission to produce “a constant supply of land for housing and employment use”. The statement of intent warns:

We need to ensure that the supply of development sites can meet demand, and we need to find a way to bring brownfield land back into use. We need to ensure that the opportunities afforded for development on public sector-owned land are fully exploited. We also need to ensure that transport investment is properly linked to priority employment and housing sites.

The Economy

The West Midlands has for years failed to punch its weight in terms of job creation and GVA. Unemployment is higher than in most other English regions, productivity is lower, and there is a highly damaging skills deficit which is becoming more of a problem as traditional volume manufacturing factories are replaced by new industries, particularly high-tech R&D and medical and life sciences.

If the West Midlands economy could grow at the rate of the London economy until 2030, rather than its slower trend rate, then this would add a further £24.6 billion to the regional economy. The problem is all previous efforts to close the gap have failed.

Martin Reeves, chief executive of the WMCA, described it as the “best opportunity for economic regeneration that this region has ever had” in his Chamberlain News interview.

WMCA’s statement of intent, published last summer, sets out the challenge in stark terms:

The West Midlands suffers a significant shortage of skills. The region’s share of people with no qualifications is higher than the national average.

Only 21 per cent of the population have skills training at or above level 4, significantly worse than the average across England and Wales at 27 per cent. The skills deficit is reflected in the high level of unemployment across the seven metropolitan authorities. If unemployment across the West Midlands was to fall to match the England average there would be some 14,500 less claimants resulting in a saving in excess of £35 million per annum in benefit spending.

The three LEPs will produce a strategic economic plan which is expected to be launched at tomorrow’s AGM. The intention is to create a regeneration and development growth board to oversee a portfolio of major development projects considered critical for WMCA to achieve its GVA growth target.

Low production is blamed in WMCA’s statement of intent on historically low levels of capital investment in plant and machinery. The productivity gap is £16 billion which translates to output of £20,137 per head, some £4,000 lower than the national average.