Power shifts out of Westminster

What's happened

Mayors will keep a share of income tax and business rates from 2027-28, replacing central grants and empowering local areas to fund transport, housing and jobs. The reform is pitched as the biggest transfer of power in a generation, with details to be announced in the autumn budget as Burnham leads devolution push.

What's behind the headline?

Analysis

• This reform represents a structural reallocation of fiscal power from Whitehall to regional authorities, potentially accelerating local investment if revenue retention matches growth in local economies.
• The plan invites debate over which regions gain most, and how equalisation schemes mitigate disparities if some areas fail to grow.
• The policy aligns with a broader push to frame devolution as a driver of growth, but critics warn of a two-tier England if weaker regions receive less.
• The next Budget will be critical to set the specifics, including the exact tax shares and any protection against revenue volatility.

What it means for readers: areas with strong growth will see more resources staying local, enabling longer-term projects. We should watch for how rebates or targeted relief might be proposed as part of the rollout.

How we got here

The policy follows a long-running push for devolution, championed by former mayor Andy Burnham. It centers on giving English metro mayors control over local tax receipts to fund growth. Details on the exact shares and mechanisms are to be clarified in the autumn budget, with phased implementation starting next year for business rates and from 2028 for income tax.

Our analysis

The Mirror reports Burnham framing devolution as delivering growth, noting he has promised to carry power home to every postcode. BBC Business outlines phased implementation and the PM’s framing of devolved powers as a major shift. The Guardian explains the timeframe and the concept of a ‘local first’ approach, while Independent highlights the boundary between grants and devolved revenue. The Telegraph was not included in the provided data.

Go deeper

• What does this mean for your local services in the next two years?
• Which regions are set to gain the most under the new plan?
• When will the exact tax shares be published and how will they be protected from volatility?

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