Labour to set out plans for devolving UK economic powers

Sir Keir Starmer, Labour leader, will on Monday set out plans to devolve economic powers and create a series of growth “clusters”, as part of “the biggest ever transfer of power from Westminster to the British people”.

Starmer will make the promise at the launch of a report, led by former Labour prime minister Gordon Brown, into Britain’s constitution that makes 40 recommendations, including overhauling the House of Lords.

Reforming the second chamber is a complex task that has defeated previous prime ministers and Starmer will instead focus on proposals to devolve economic power to local councils and business.

The Brown report calls for the creation of hundreds of “clusters” of economic activity in cities and towns across the UK, building on local strengths and bringing together civic and business leaders.

“The centre hasn’t delivered,” Starmer will say at the launch of the report looking at the future of the UK in Leeds. “We have an unbalanced economy which makes too little use of the talents of too few people in too few places.”

The Brown commission proposes giving local communities more powers over skills, transport, planning and culture to drive growth, involving elected mayors, council, entrepreneurs and unions.

The Centre for Cities think-tank has identified 300 embryonic clusters which could be developed, focusing on areas such as life sciences, advanced manufacturing, green technology and digital services.

The report proposes devolving power in sectors including transport and infrastructure, giving councils powers for the compulsory purchase of vacant sites and creating a new regionally focused investment bank.

Powers over economic development, job creation and the provision of services by jobcentres should also be devolved, Brown will propose.

Starmer, a Remainer who once campaigned for a second Brexit referendum, will claim that devolution answers some of the concerns expressed by people when they voted to leave the EU in 2016.

“During the Brexit referendum I argued for Remain but I couldn’t disagree with the basic case that many Leave voters made to me,” Starmer will say.

“They wanted democratic control over their lives so they could provide opportunities for the next generation, build communities they felt proud of and public services they could rely on.”

Starmer will argue that people who voted for Scottish independence in 2014 did so for similar reasons because the Westminster system seemed “remote”.

The Labour leader will announce a consultation on all of the Brown report’s proposals; the exercise will determine which of them will make it into the party’s election manifesto.

Replacing the unelected and bloated House of Lords, which has around 800 members, is a key part of the Brown report, but Starmer is reluctant to commit to making it a first-term Labour priority.

Starmer supports the idea of an elected second chamber and last month told Labour peers that reforming it was vital to restore the trust of the public in government. He said former prime minister Boris Johnson had appointed “lackeys and donors” to sit on the red benches.

But attempts to reform the upper house by David Cameron’s coalition government — championed by the then Liberal Democrat leader and deputy prime minister Nick Clegg — were thwarted by opposition from peers and Tory MPs.

Starmer refused to say in a Sunday Times interview whether Lords reform would be a priority for a Labour first term. “Of course that gives rise to questions of implementation,” he said. “I don’t shy away from that.”

The final contents of the Brown report have been the subject of horse-trading throughout the summer, with the publication delayed by several months.

The report is expected to steer clear of sweeping fiscal devolution, which would give greater tax-raising powers to cities and regions beyond London. However, it will recommend a review of Scotland’s borrowing powers.