As the devolution debate swings back and forth we hear that the Northern Powerhouse is either powering forward or being sidelined depending on which pundit you read.  But what is driving devolution?

Aileen Murphie, the Director at the National Audit office for DCLG recently provided a reminder of the question that devolution has to answer and the problem it is supposed to address.

In a speech to the “Powering the North” seminar supported by the Municipal Journal and CapacityGrid she highlighted the question of why so many UK cities are underperforming by international standards.

Under-performance is a painful stigma that few local politicians will admit.

While arguments about devolution often circle around local and regional identity it is this harsh question of economic performance that government is trying to answer and that will drive future funding.

She highlights the other key questions that are at the centre of funding debates.

What is the scale and regional footprint that works to create growth? What are the approaches that work, and what are the measures by which success will be measured?

Sustainability over the coming 2, 5 or 10 years will be dependent on growth for many councils as demands on their resources also become more complex. It is a long way round of saying that many smaller councils will simply not have the scale for sustainability.

For finance directors and senior councillors it is well worth taking 10 minutes to follow her argument to remind ourselves of the core driver of devolution from the Treasury point of view.

The devout local government wonks amongst you can also visit the launch of the Lyons Report and watch the original speech from Mike Lyons we covered back in 2007, featuring a supporting appearance from Ed Balls, now of strictly come dancing and Ken Livingstone.  The mighty may have fallen, but their ideas live on.

Neil Stewart
Editorial Director, Policy Review