In his Waitangi speech in 2024, the Prime Minister said that, “We, like you, believe in localism and devolution, not centralisation and control. No one understands your iwi like your iwi does.”
Since then, reforms to water services have kept them more local than had otherwise been planned. Housing incentive payments to councils will make it easier for them to say yes when developers want to build. There has been some progress in undoing the amalgamation of the polytechnics.
Local councils have been commanded to come up with ways of delivering integrated regional spatial plans that suit the proposed new resource management framework. But there is still space for more decentralised approaches within those amalgamated bodies around other functions. Probably safest to call that one ‘less than localist’ overall.
But it seems at best unlikely that election 2026 will have either National or Labour campaigning on localism. And it is a bit of a shame. The change in leadership of the UK’s Labour Party has brought a thoroughgoing proposal for decentralisation. Parts of it would be well worth the attention of parties here forming up their own election platforms.
Last week, Andy Burnham’s Labour government published a Cabinet Statement on “Rewiring the State”. It proposes radical decentralisation and outlines a model that it would like to apply in England, with the devolved governments in Wales, Northern Ireland, and Scotland encouraged to follow a similar approach.
Burnham had been Mayor of Greater Manchester – ground zero for England’s experiments with devolution – for almost a decade before becoming Labour leader and Prime Minister.
Core to the proposal is letting local governments keep more of the tax revenue generated in their jurisdiction.
Currently, British regional governments receive grants from central government to provide services. From 2028, those grants will be replaced by a share of the income tax collected by His Majesty’s Revenue and Customs in the area.
The Cabinet Statement argues that it will “enable greater investment to fund interventions that will deliver a return.” In short, if a region invests in projects that increase local income, it will see the benefits directly in its accounts.
Mayors will also have more authority over outcomes that had previously been under centralised control. They will take up control of vocational training budgets for 16- to 19-year olds and build training pathways suited to their regions. Employment support will devolve to mayors as well, along with greater devolved responsibility for social housing. Funding lines would follow devolved authority.
Other funding currently controlled by bodies covering England as a whole, like sports and cultural funding, could also flow down to mayors.
At the same time, Burnham’s government proposes strengthening local accountability to accompany mayors’ greater funding authority. The Local Audit Office will be strengthened. Chief executives of mayoral strategic authorities will become Local Accounting Officers, personally accountable for the use of public money
UK Labour suggests a “smaller and more strategic Civil Service”, with functions devolved down to the local level rather than delegated down from central government. There is a considerable difference between delegation and devolution. Under delegation, central government tells local councils to perform a duty, and takes responsibility back if it does not like the outcomes. Devolution means local communities own the issue.
Central government will focus on the things that are best suited to central government; other functions devolve. And Cabinet agreed that devolution will be the default: Secretaries of State will have to justify maintaining central government control when policies or services are being designed or altered.
It would be a radical transformation.
The UK and New Zealand are among the world’s most centralised governments. Central governments and central government officials strongly resist arguments for devolution. And it is easy to wind up in self-reinforcing spirals where underperformance by local government leads to greater centralisation, and greater centralisation means local governments lose the capability to perform well.
It will be challenging for Burnham to achieve the change he seeks. Just as it would be challenging here.
But consider the opportunity.
New Zealand will soon have amalgamated councils. I believe none of the stories arguing that amalgamation will provide administrative cost savings. But they will mean that the larger councils will have more in-house capacity and resource. They will be more capable.
Those larger authorities would be well advised to maintain space for localism within their jurisdictions. It would be absurd for decisions about the location of a crosswalk in Masterton to go to a body that spans from Miramar up to the Kapiti Coast.
But they could also pitch for greater devolved responsibilities and associated funding lines. A proposal from a small district council to take up responsibility for aspects of social service delivery might be laughed at by central government officials. But one coming from strong regional mayors could be taken more seriously.
New Zealand’s Labour Party has not yet released much of its election platform. I hope they, and others, look at the UK’s proposal before finalising their plans.
Dr Eric Crampton is Chief Economist at the New Zealand Initiative. This article was sourced HERE
Local councils have been commanded to come up with ways of delivering integrated regional spatial plans that suit the proposed new resource management framework. But there is still space for more decentralised approaches within those amalgamated bodies around other functions. Probably safest to call that one ‘less than localist’ overall.
But it seems at best unlikely that election 2026 will have either National or Labour campaigning on localism. And it is a bit of a shame. The change in leadership of the UK’s Labour Party has brought a thoroughgoing proposal for decentralisation. Parts of it would be well worth the attention of parties here forming up their own election platforms.
Last week, Andy Burnham’s Labour government published a Cabinet Statement on “Rewiring the State”. It proposes radical decentralisation and outlines a model that it would like to apply in England, with the devolved governments in Wales, Northern Ireland, and Scotland encouraged to follow a similar approach.
Burnham had been Mayor of Greater Manchester – ground zero for England’s experiments with devolution – for almost a decade before becoming Labour leader and Prime Minister.
Core to the proposal is letting local governments keep more of the tax revenue generated in their jurisdiction.
Currently, British regional governments receive grants from central government to provide services. From 2028, those grants will be replaced by a share of the income tax collected by His Majesty’s Revenue and Customs in the area.
The Cabinet Statement argues that it will “enable greater investment to fund interventions that will deliver a return.” In short, if a region invests in projects that increase local income, it will see the benefits directly in its accounts.
Mayors will also have more authority over outcomes that had previously been under centralised control. They will take up control of vocational training budgets for 16- to 19-year olds and build training pathways suited to their regions. Employment support will devolve to mayors as well, along with greater devolved responsibility for social housing. Funding lines would follow devolved authority.
Other funding currently controlled by bodies covering England as a whole, like sports and cultural funding, could also flow down to mayors.
At the same time, Burnham’s government proposes strengthening local accountability to accompany mayors’ greater funding authority. The Local Audit Office will be strengthened. Chief executives of mayoral strategic authorities will become Local Accounting Officers, personally accountable for the use of public money
UK Labour suggests a “smaller and more strategic Civil Service”, with functions devolved down to the local level rather than delegated down from central government. There is a considerable difference between delegation and devolution. Under delegation, central government tells local councils to perform a duty, and takes responsibility back if it does not like the outcomes. Devolution means local communities own the issue.
Central government will focus on the things that are best suited to central government; other functions devolve. And Cabinet agreed that devolution will be the default: Secretaries of State will have to justify maintaining central government control when policies or services are being designed or altered.
It would be a radical transformation.
The UK and New Zealand are among the world’s most centralised governments. Central governments and central government officials strongly resist arguments for devolution. And it is easy to wind up in self-reinforcing spirals where underperformance by local government leads to greater centralisation, and greater centralisation means local governments lose the capability to perform well.
It will be challenging for Burnham to achieve the change he seeks. Just as it would be challenging here.
But consider the opportunity.
New Zealand will soon have amalgamated councils. I believe none of the stories arguing that amalgamation will provide administrative cost savings. But they will mean that the larger councils will have more in-house capacity and resource. They will be more capable.
Those larger authorities would be well advised to maintain space for localism within their jurisdictions. It would be absurd for decisions about the location of a crosswalk in Masterton to go to a body that spans from Miramar up to the Kapiti Coast.
But they could also pitch for greater devolved responsibilities and associated funding lines. A proposal from a small district council to take up responsibility for aspects of social service delivery might be laughed at by central government officials. But one coming from strong regional mayors could be taken more seriously.
New Zealand’s Labour Party has not yet released much of its election platform. I hope they, and others, look at the UK’s proposal before finalising their plans.
Dr Eric Crampton is Chief Economist at the New Zealand Initiative. This article was sourced HERE
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