Scotland Finance

The real deal? City Region Deals and the Budget


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Among the announcements in this week’s budget was the Chancellor’s affirmation that he is working towards more city deals for Scotland – a Tay Cities arrangement, and a City Deal for Stirling. This time last year, Philip Hammond was confirming a city deal for Edinburgh and South East Scotland, considering the Tay Cities deal and beginning talks on deals for Stirling and Clackmannanshire. Our briefing of a year ago examined the growing importance of city deals to Scotland – and their unusual nature.

More recently, we updated our members on how the city deals were progressing. At the time, the Local Government and Communities Committee had announced an inquiry on city deals. What was the point of them? Were they value for money? Would they help to decentralise services?

Although they’ve yet to report – this week the UK and Scottish Governments were due to give evidence – written submissions from councils, city deal cabinets, charities, public sector bodies and other organisations reveal a mixed bag. On the one hand, a number of projects – which might otherwise not have happened – have gone ahead. However, decisions about which projects to fund invariably take place behind closed doors – and even some councils admit public knowledge about what city deal boards get up to is limited.

As we’ve said before, cities are important – but so are the surrounding areas. Additionally, as in England, some areas are inevitably excluded from city deal arrangements – whether by accident or design. A glance at the map of city deals proposed so far reveals the gaps. Of course ‘talks are underway’ with Moray, Falkirk and Argyll and Bute, but if city region deals are the current golden opportunity in local government – what’s in it for them?

Dumfries and Galloway, of course, is part of the potential Borderlands deal – a cross-border arrangement with English councils as well as Scottish Borders. This week’s budget name dropped that deal too, with the Chancellor agreeing to open negotiations. Down the line, parts of North Wales and Cheshire might want to follow suit. Alongside Combined Authorities south of the border, City Deals are now a fixed feature of the local government landscape. 

While the additional funding and ability to get projects off the ground will always be welcome, deals of this kind promise something more than the sum of their parts. They are an opportunity for local councils – and others – to signal their ambitions for the area, whether that’s inclusive growth, new technologies or transport infrastructure. By working in partnership, councils can also hope to raise their profile and influence.

We’ll be returning to this topic time and time again – and looking beyond analysis of the economic benefits to questions over how these deals contribute, for example, to enhancing community empowerment in Scotland. We’ll also ask if city deals have the potential to address some of Scotland’s other pressing issues: inequalities, for example, and the educational attainment gap.