The Case for Cornwall

8/8/2019 The Case for Cornwall

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Devolution and decentralisation -

the case for Cornwall

“The Government believes that it is time for a fundamental shift ofpower from Westminster to people. We will promote decentralisationand democratic engagement, and we will end the era of top downgovernment by giving new powers to local councils, communities,neighbourhoods and individuals.”

Coalition Agreement 2010

“I am convinced that if we have more local discretion - moredecisions made and money spent at the local level - we'll get betteroutcomes.”

David Cameron 2009

“If ever there was a time to push for action on decentralisation, it’sright now”

Nick Clegg 2014

“Centralisation has for too long held back our regions from being

able to deliver a coherent vision and plan for future economic

success”

Ed Miliband 2014

“We don't want the way we spend our money and deliver services to

people in Cornwall to be dictated by the Government - we want to

make our own decisions. Cornwall has a proud history of standing

up and fighting for what it believes in and we are determined to

take advantage of this moment and shape our own destiny."

John Pollard, Leader of Cornwall Council 2014


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Contents

1. Why now?

2. Why Cornwall?

Our geography

Our recent history

Our governance

Our sense of place and identity

3.

Our challenges and opportunities

4. Draft proposals

5. Initial case studies


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1. Why now?This moment is a vital one for the future of Cornwall. We have long

campaigned for Cornwall to have greater autonomy from London.

We believe that Cornwall has demonstrated that it is now ready to fulfil

that ambition.

The time is right on many levels.

Firstly, the Government has signalled a clear commitment to devolution

supported by a groundswell of academic and popular opinion.

Secondly, the status quo is not an option - doing things differently is an

imperative. Cornwall faces unprecedented financial challenges with the

need to save £196m over the next four years. We know we have a strong

case for a fairer funding - Cornwall receives £49.5m less than the average

urban council – but we are also realistic and recognise that we need to

find new ways of closing the gap.

Thirdly, our peripherality and distance from London means that Cornwall

needs an over-emphasis of self-sufficiency. That requires new modes of

delivery, funding and administration than the current system of local

government provides.

A devolution deal can deliver a more self-sufficient and sustainable

Cornwall – a prosperous place that is resilient and resourceful, and less

dependent on Government and European Union funding.

This is no short term fix. We are serious about a different approach to

economic growth and social strength. We understand Cornwall, how it

works, our challenges and our opportunities. We understand the

interdependencies which impact on our economy, affect our people and

shape our environment.

This understanding has shaped our proposals and is why we are eager to

secure a devolution deal for Cornwall.


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2. Why Cornwall?We have the right geography to make it work

Cornwall Council is the largest rural unitary authority in the country,

serving a population of just over half a million.

Cornwall has a strong identity and the benefit of a simple geography with

the majority of our key public sector partners focused exclusively on

serving the people of Cornwall.

Crucially, Cornwall functions as a single economic entity which negates

the need to establish a Combined Authority as the vehicle for devolution.

This is not an isolationist agenda. Cornwall has always taken the

opportunity to work with other places in the UK and Europe, where it is in

the interests of Cornish residents. That approach will not change.

One Council

One functional economic area

One Clinical Commissioning Group

One Local Enterprise Partnership

One Health and Wellbeing Board

One Local Nature Partnership

One Voluntary, Community Sector and Social Enterprise Board

One clear identity and sense of place


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Recent history supports the case for devolution

This timeline charts the key decisions and achievements that provide the

foundations for greater devolution to Cornwall and make our case all the

more compelling …

Objective One programme of £350m EU funding to improveprosperity following recognition of Cornwall as a single economic area

European Regional Development Fund Convergence Funding awarded to Cornwall

Cornwall as one of five councils selected by the Government to movefrom the two tier structure to a single purpose, unitary authority

Cornwall Council established creating one of the largest rural unitaryauthorities in the country

Four year Medium Term Financial Strategy agreed to save £170m asa result of the 30% reduction in Government funding

Wave hub at Hayle fully connected to cement Cornwall’s reputation forinnovation in marine energy technology

Roll out of Superfast Broadband commences to make Cornwall one ofthe best connected regions in the world

Cornwall & Isles of Scilly Local Enterprise Partnership established,reflecting our status as a functional economic area

Cornwall named as one of three ‘can do councils’ by the Government

Enterprise Zone status awarded to create an Aerohub at NewquayCornwall Airport

Cornwall Health and Wellbeing (shadow) Board established – one ofonly a handful nationally

Awarded Pioneer status for our plans to join up health and social careservices – one of only 14 areas selected

Selected by Government as a one of the country’s first new LocalNature Partnerships

2013

2012

2011

2010

2009

2007

1999


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Transformation Challenge Award funding granted tointegrate ‘blue light’ services within a new Community FireStation

Four year Public Service Obligation for Newquay Airport

confirmed by the Government

Government agreement for Cornwall and the Isles of ScillyLocal Enterprise Partnership Growth Deal

Council secures £10million to improve sea links betweenCornwall and the Isles of Scilly

Recognition of the Cornish as a national minority

Council secures £146.6m rail investment

Cornwall held up as leading the way on the Localism Act byUnder Secretary of State Stephen Williams

Selected for the Government’s One Public Estate programme

Integrated Territorial Investment status agreed by Governmentto enable Cornwall and the Isles of Scilly to use EU funding moreflexibly

Government go ahead for Cornwall Council to carry out muchneeded improvements to the A30 on behalf of the HighwaysAgency

Four year Medium Term Financial Strategy set to protectessential services for people in Cornwall within reduced levels ofGovernment funding

Council secures £1m from the Government’s TransformationChallenge Award to work with the voluntary and communitysector to improve the lives of local people

2014


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We have strong and visible governance working in

partnership for the benefit of Cornwall

Cornwall’s geography and political infrastructure provide a strong foundation for

devolution. Our unitary status sets us apart from other areas and providesstrong, visible and democratic governance.

The visibility of the organisation creates a strong sense of accountability.

Cornwall’s coherent public sector structure lends itself to integration both in

terms of service delivery and co-location and public sector leaders already have

a proven track record of working effectively together and with the private and

community/voluntary sectors.

Whilst our defined geography provides a natural functional economic area and a

basis for clear governance, in no way do we seek to isolate ourselves from therest of the UK.

We are already working with other places, not just in the UK, but also in Europe

and around the world in order to secure economic, environmental and social

benefit for Cornwall.

We’re working with Plymouth City Council to develop a City Deal focused on the

development of the marine technologies (including renewables) to boost

productivity, improve the economy, and provide supply chain, research and

innovation opportunities for marine industry and allied clusters across the

peninsula.

Cornwall’s natural resources and growing reputation for new technology in

sectors such as construction, energy, manufacturing and processing gives us a

unique opportunity to marry the two and develop that knowledge with other

local authorities, LEPs and academic institutions to develop appropriate

partnerships based on opportunity and not just the coincidence of geography.

We have sound financial management

We have a strong and proven track record of financial competence: a record ofun-qualified statements of account and audit opinions; the highest level of audit

approval for our accounting policies, estimates and judgements; and an AA+

credit rating.

We have demonstrated a responsible and planned approach to reductions in

government funding with a robust four year Medium Term Financial Strategy and

Business Plan. This had led to significant transformational change across the

organisation delivering £170m in savings over the last four years, with the vast

majority of this related to efficiencies and management savings with only £11m

of actual service cuts.


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We have a strong sense of place and identity

Not only is Cornwall and the Isles of Scilly already a defined functional economic

area, it also has a distinct identify and heritage which the Government intends to

recognise under the Framework Convention for the Protection of National

Minorities.

This will give the Cornish parity with the Welsh, Irish and Scottish; parts of the

UK that already benefit from devolved administrations.

This sense of place and belonging is evidenced through high levels of community

engagement – Cornwall compares favourably with other parts of the country in

terms of electoral turnout and rates of volunteering.

We understand what Cornwall needs

The Council has just agreed a long term Strategy that provides a clear direction

for the organisation to follow, with eight ambitious aims that we will pursue over

the coming years to create a more sustainable Cornwall.

Cornwall is faced with four fundamental challenges: our population is changing

and growing; our economy is still underperforming; our geography and

settlement pattern places strain on the public purse; and the cost of living is

increasing inequality.

Our Strategy aims to address these issues by focusing on the areas that areholding Cornwall back, low wages levels for example, by capitalising on the

areas where Cornwall is best placed to excel, such as the development of

renewable energy and technologies.

The Strategy sets out our commitment to championing Cornwall with elected

members working with partners and communities to improve local wellbeing;

being ambitious for Cornwall, spearheading social and economic change as well

as protecting and supporting the most vulnerable; and crucially, creating a

leaner, more resourceful organisation that delivers essential services in the most

efficient and effective way.


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3. Challenges and opportunitiesImproving Cornwall’s connectivity is crucial – road, rail, air, sea and digital links

are the arteries of our economy. Our ports, harbours, airport and investment in

broadband infrastructure are key components of our economic vision of Cornwallas an outward-facing, modern place to do business.

Our natural resources and geology gives us amazing opportunities to lead on the

development and deployment of renewable technology including wind, wave and

geothermal power.

Cornwall’s population is amongst the fastest growing areas in the UK. There is

increasing pressure on care and support services from a growing ageing

population requiring a new partnership for health and social care.

Improving skill levels and training opportunities is vital. Although we have seen

improvements, over a fifth of the economically active population have no

qualifications.

In some neighbourhoods over a quarter of the working age population are

claiming out of work benefits. These areas suffer from high levels of

worklessness, low educational achievement and lower life expectancy which the

Council and partners are determined to address.

Providing affordable and decent housing is a key priority given the gulf between

average property values and earnings; this is fuelled by competing uses such as

demand for holiday and second homes. Despite recent growth in Cornwall’s

economy we are still beset by low earnings, low GVA on one side and high house

prices, high levels of fuel poverty, the highest water bills in the UK, and high

transport costs on the other.

Stimulating private sector investment is a key priority. Cornwall has many great

businesses but many others who have yet to realise their full potential. Affording

Cornwall greater powers and freedoms will help us reduce worklessness and

unemployment, improve productivity and build on our recent strong GVA growth – this is good for Cornwall and good for the Government.

We’ve shown what we can achieve when conditions are right. We need further

empowerment to translate that ability into improving productivity, tackling low

wages, being creative about using digital communications to maximize markets

and links.

We want our growth to be smart, to tackle inequality, and so Cornish residents

have access to the things that matter, education and skills, jobs and housing.


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The following graphic shows the key challenges faced by Cornwall, relative to

other unitary and county councils.

It also highlights the income opportunities that will help tackle those challenges if the Government’s provides the support and empowerment needed to realise

Cornwall’s potential.

Cornwall’s relative position in the country (compared with

other unitary and county councils)


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4. Our draft proposals

What Cornwall wants to achieve now …

A five year funding settlement We want a five year fairer funding settlementfor all public services in Cornwall, which reflects the true costs of providingservices in a rural area and enables a phased and co-ordinated approach totransforming and integrating services over the remaining decade.

Government investment in the deep geothermal industry in Cornwall Wewant the Government to co-invest in a geothermal site to access and use thesignificant renewable energy that is under our very feet.

Addressing the issue of second homes We want to work with Government to

identify a workable solution to manage the number of second homes and ensurethat our communities remain sustainable.

Devolved delivery of funding and investment streams Intermediary Bodystatus for Cornwall would enable devolved delivery of funding streams andinvestment programmes at a strategic level and support to establish our ownOperational Programme, allowing us to accelerate and simplify EU investment tobusinesses and communities.

Powers to pool and invest capital receipts from the public sector estateWe want to remodel the entire public estate in Cornwall; this means having the

ability to pool and reinvest all capital receipts, including those from relinquishingunsuitable health, police, HMRC and DWP properties and co-locating publicservices.

Overcoming barriers to health and social care integration We want towork with Government to develop solutions to overcome the practical barriers tohealth and social care integration.

A fuel duty to maintain Cornwall’s extensive road network We want theopportunity to pilot the LGA’s suggestion of a Better Roads Fund funded bylocalisation of 2p in every litre from existing fuel duty.

Greater control over large scale energy infrastructure We want local

planning powers to give us strategic control over renewable energy

infrastructure and investment.

Additional public transport powers We want the opportunity to decentralisebus regulation in Cornwall to provide a fully integrated public transport network.

Further investment in Superfast Broadband The rise of home-working inCornwall has been boosted by investment in Superfast Broadband, which is fastreaching 95% coverage. We want to ensure that the remaining 5% of

households and businesses enjoy faster broadband speeds.


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What Cornwall wants to achieve next …

Devolution of the Crown Estates function and the Marine ManagementOrganisation We want to establish a more visible and accountable localgovernance structure that would allow for greater control over offshore planning

and consenting decisions.

Devolved energy policy with powers to develop local carbon taxes fornegative environmental impact We want elements of local discretion andinfluence built into the national energy policy framework.

An Infrastructure Board for Cornwall We want the ability to establish anInfrastructure Board that brings together all the key Government agencies withstrategic planning powers to support the Council and our Local EnterprisePartnership to go beyond our existing housing programme and ensure Cornwallhas the supporting infrastructure in place.

Urban Development Corporation (UDC) powers We are seeking a revitaliseduse of UDC powers to take forward an ambitious programme of housing delivery,utilising the ability to CPO land at ‘no scheme value’ under the governance andcontrol of the Council.

Retention of Stamp Duty to build affordable housing A ten year fundingcommitment to establish an ambitious affordable and social housing programme,financed in part by retaining a proportion of the increasing amount of StampDuty generated from escalating house prices in Cornwall.

The first rural earnback model We want to retain and reinvest a proportion ofthe uplift in taxes and welfare savings generated where new jobs or othersignificant benefits to the local economy can be attributed to public sectorinvestment.

Local powers to influence skills funding We want local involvement in theplanning and allocation of a fairer allocation of skills funding to avoid duplicationof provision, whilst ensuring what is provided is both high quality and addressesthe needs of industry.

Fully integrated budgets Removal of artificial and disproportionate ring-fences

to departmental budgets for health and local government, and providing theflexibilities, appropriate incentives and legal framework for the public sector inCornwall (including Government agencies) to pool budgets.

Local powers to invest in and protect Cornwall’s heritage We wantdevolution of the English Heritage historic site management budget andstatutory powers.


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Integration reward payments We want to explore the introduction of a modelthat provides a financial incentive where public sector transformation hassuccessfully reduced pressure on central budgets - an ‘earnback’ model for

shared public sector improvement and efficiency.

A bespoke strategic flood deal package We want to work with Governmentto design a strategic flood deal package for Cornwall which will provide the floodresilience we need and which could serve as a test bed for other rural areas.

Greater freedom and control over council tax We want to have localdiscretion to provide better choices for local people and provide support to thosewho need it most.

Creating a blue light service for Cornwall We want to work with the

Government and partners to explore the proposition that Cornwall has its own ‘blue light’ service, which would bring together the emergency centres providedby Cornwall Fire and Rescue, Devon and Cornwall Police and South WestAmbulance Service Foundation Trust.


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5. Initial case studies

A. Powers to pool and invest capital receipts from the

entire public sector estate

Unitary status has enabled us to realise significant property dividends. We havehalved the office estate from 180 buildings to 90 in the last 5 years, and plan toconsolidate further to 60 offices by the end of 2015. There is huge potential togo further, working with partners to achieve significant efficiencies and make thevery best use of our collective resources. However, fragmented estatemanagement arrangements and national retention of capital receipts currentlymakes this impossible.

The local NHS estate provides a prime example. With responsibility shared

across six NHS bodies, strategic direction and town based approaches areimpossible to achieve. It also creates significant duplication in administrationand recharging.

The centralisation of NHS Propco capital receipts presents a further obstacle tomaking decisions that maximise value for money and the best outcome forservice provision. For the best decisions to be made in Cornwall, for Cornwall,we need to retain and manage these locally.

The complexity of Cornwall’s health estate (value £268m)

We want to remodel the entire public estate in Cornwall; this meanshaving the ability to pool and reinvest all capital receipts, includingthose from relinquishing unsuitable health, HMRC and DWP propertiesand co-locating public services.

NHSPS

FM Service

Delivery

Reactive ServicesPlanned

Maintenance

Programme

Plan

Backlog

assessment

Statutory

Compliance

Planned

Inspections

Schedule of

Works

Soft FM provided

by Lead TenantLift Premises

Hard FM

Soft FM Provided

by NHSPS

Capital Works

Major Capital

Works

Minor Capital

Works

Asset

Management

Acquisitions and

Disposals

Property

management

NHSPropertyServices (national)

CornwallHealthcare Estates

and SupportServices

Community

1st Cornwall Other


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B. Retaining a share of stamp duty

Low wages represent a significant challenge for Cornwall. Average salary levelsin Cornwall are very low, with only two other local authority areas in Englandhaving lower average full time pay. Total workplace gross annual median

earnings in 2013 were £17,390 - 79% of the UK average.

In stark contrast house prices are high, largely fuelled by the buoyant secondhomes market which represents nearly 9% of Cornwall’s housing stock overalland exceeds 20% in 47 out of its 211 Parishes. The average cost of housing is8.4 times the average annual salary (compared to 6.7 nationally) which putshome ownership beyond the reach of many people.

HMRC received £59m in stamp duty from Cornwall and the Isles of Scillyresulting from 12,690 transactions. Comparing the ratio of property prices toearnings in Cornwall and other parts of the UK shows that the average cost of

properties sold in Cornwall in the last 3 years is around £80,000 more thanCornwall's average earnings can afford.

Cornwall is contributing stamp duty to the Treasury at a rate that it cannotafford. Comparing the ratio of residential stamp duty yield to earnings showsthat the average yield to the Treasury per property sold is around £3,000 higherthan Cornwall's average earnings 'buying power' would be expected to afford.

With around 10,000 property sales per annum this amounts to over £30m higherstamp duty to the Treasury per annum than Cornwall's earnings 'buying power'would be expected to create.

We face significant pressures for affordable homes with an annual need for2,240 affordable homes over the next five years. We are aiming to increaseaffordable homes delivered annually from 739 to 1,200 by 2020 and lead on thedevelopment of 500 new homes that could be for sale, for private rent foraffordable rent.

With the support of the Government to retain a share of stamp dutyrevenue we could go further to provide the affordable housing that ourcommunities need so much.

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The Case for Cornwall

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