Devo Manc: A new contract for social progress?

Poster at a homeless camp in Albert Square, Manchester, April 2015

The story of Manchester’s economic success jars with the city’s poverty levels. Can Devo Manc plug the gap?

‘If Engels came back to Manchester today he would still recognise the inequality that exists. After nearly 200 years of social progress what’s changed?’

Mike Wild has been chief executive of Manchester’s community and voluntary sector support organisation Macc for ten years, and has chronicled the rise of inequality in the city region.

According to the latest figures from the Greater Manchester Poverty Monitor, almost 30% of children in the region live in poverty and one in five households claim housing benefit. In the last five years rough sleeping has risen 50%. ‘We’re being overwhelmed by demand,’ Wild says.

This picture contrasts starkly with the economic story of Manchester, now at the heart of George Osborne’s vision of a ‘northern powerhouse’. In that story, the city is a model of post-industrial regeneration with GDP growth eclipsing that of London – at 4.6% – and inward investment booming.

The steady hand of the current governance structure – the leader and chief executive of the council have each been in place for almost 20 years – has been praised as an example of civic leadership and rewarded with Devo Manc, the region’s devolution package.

It gives the Manchester city region powers over transport, housing, planning, policing, skills and employment, worth around £1bn in public spend, as well as control over its £6bn health and social care services budget, which will be integrated across the region.

Leader of Manchester council Richard Leese told New Start that greater control at a more local level will allow the city region to improve its social record: ‘National one- size-fits-all social interventions are inefficient and haven’t delivered the outcomes we need. The alternative route of public service reform, place-based budgeting, integrated services at a local level gives far greater opportunity for innovation.’

Devolved centralism
But doubts are surfacing about how far the deal will shift the region’s stark economic inequalities, and bring decision-making closer to the people. At a New Start event held in the city on the day that plans for devolution to be enshrined in law were announced, representatives from civil society and the public sector said that they had been left out of any discussions about the deal, and worried that it would lead to little change on the ground.

The speed of Devo Manc meant that it was brokered with little consultation with civil society, and none with citizens, delegates reported. The deal is not perfect, one delegate said, and in a time of cuts we must guard against a problematic national economic model being transplanted onto the local.

‘What we are getting is a particular type of devolution which is about economic growth and about managing the cuts – passing the book on austerity,’ said one charity boss. ‘What would be the difference between getting hit by a central stick and a local stick? It still hurts.’

In particular delegates questioned how far the city’s doughnut – the entrenched ring of poverty that surrounds Manchester – and the region’s satellite towns that are a long way from being a ‘powerhouse’ would benefit from a decentralisation of power with no change in economic policy.

While the need for partnership with the treasury is clear, what’s missing from the devolution deal on the table – and the key question in all devolution agreements – is how much room it offers to local players to forge an alternative economic and social model.

The chip building in New Islington, part of the urban renewal of east Manchester

What’s the alternative?
The city is not short of alternatives to the current model and one of the most compelling is for Manchester to become Europe’s answer to America’s hippest city – Portland in Oregon. Here social and economic outcomes are matched and intertwined, a ‘whole place’ approach sees neighbourhoods and civic life as important as business and its high-tech green economy and buzzy cultural life makes it one of the best places to live in the world.

This vision was set out in a report by Macc called A Civic Economy for Manchester. For the first time the social sector in Greater Manchester – the voluntary and community bodies, co-operatives and social enterprises active in the region – were mapped and given a value – £477m total income each year –, one that eclipses income from the football and cultural sectors.

The report set out a number of principles aimed at strengthening the social sector that exists and helping it to play a key role in the region’s economic story. It called for greater links between the social and the private sectors, for a social enterprise strategy for the region and for collaborative place-based leadership.

‘We need to accelerate social and environmental outcomes and democracy in Greater Manchester as we think we can achieve something better’, said Neil McInroy, chief executive of the Centre for Local Economic Strategies, which produce the report.

The plan made some headway within Manchester Council but preceded the Devo Manc deal. In an article on progress with the civic economy work a year on from its publication Mike Wild blasts the unambitious mindset that holds back the social sector by insisting it do everything ‘at scale’.

‘The potential for the social sector will remain untapped if devolution is focused solely on an economic strategy which is only implemented as large scale programmes’, he says. ‘It seems to me that this is to mistake structural simplicity for efficiency.’

Other visions for the region include the Viable Economy produced by Steady State Manchester, integrating social, economic and ecological wellbeing and Manchester: A Certain Future, the city’s shared plan to tackle climate change, with strong involvement of the private sector.

Progressive procurement
But the city’s radical economic past is today all but hidden in its reverence to the mainstream capitalist model. The region that witnessed the birth of the co-operative movement, that saw the chartists flourish, and where Engels got much of his inspiration is today less tolerant of alternative models.

Chris Walsh, co-founder of the Kindling Trust, an organisation creating a local food ecosystem in the region, has witnessed numerous reports published and pilots tested around sustainable living in the city but says that little gets embedded.

He cites the Homes for Change project, introduced in Hulme in the 80s as a pioneering example of high density co-operative living but which never fulfilled its potential. ‘The city talks the talk in terms of sustainability but doesn’t embed it. It is obsessed with very traditional economic growth.’

His organisation works with local schools and universities to embed local organic food into public procurement processes. With one in four meals eaten outside of the home being paid for by the public sector he says that progressive procurement could bring about a sea change in health and environmental outcomes.

Manchester Council has undertaken pioneering work in its procurement practices to align them with social and environmental outcomes. Since 2009 it has mapped its top 300 suppliers; more than 60% of this procurement budget is now spent within Manchester and its work linking spend with social outcomes has had knock-on effects down the whole supply chain.

‘We were involved in delivery of social value way before the social value act. Back in 2007 we made it an objective to maximise the benefits of our significant spend’, said Ian Brown, head of corporate procurement at Manchester Council.

China town in the centre of Manchester

Small is beautiful
But elsewhere the city’s engagement with social sector aims appears to be going in reverse. Funding cutbacks means that the third sector infrastructure has been reduced and the council’s engagement with communities –and the community sector – has suffered.

Atiha Chaudry is the lead for the city’s BME network and has seen a sharp reduction in funding for community networks across the city. ‘Civic engagement has been destroyed’, she says. ‘Networks that were there are no longer being funded. The demographics of the city are changing and new communities are coming in. The infrastructure for supporting them is not there which is impacting on cohesion and could have serious implications.’

While the larger organisations delivering contracts are thriving, the value to the local economy of small and medium sized civic organisations is not always recognised.

Organisations like Wai Yin, which supports ethnic minority groups across the city, and Levenshulme Market, have developed strong social networks in parts of the city left behind by the economic success story, and provide pathways to employment for those far from the labour market. Recognising and supporting the added value of smaller organisations such as these is part of the civil economy vision and has the potential to bridge the gap between the region’s economic and social success.

The Asset Based Community Development approach being developed by the city’s foundation Forever Manchester for example has proven the economic potential of small pots of funding for community-based organisations.

It is not only a lack of vision from those at the top that is holding back progress in the city. Charity bosses in Manchester admit that there has sometimes been a lack of innovative thinking between the council and the third sector and a lack of entrepreneurialism among their sector.

And some councils within the Greater Manchester region are busy building alternative approaches. Oldham council is part of the co-operative network and is rolling out a more participative approach to social and economic change, while Stockport is on its way to becoming a sustainable food city. Salford recently became the first social enterprise city in the north of England.

A new social contract
Richard Leese admits that poverty is already a drag on the local economy and says that poverty levels are coming down within Manchester. It’s not too late for the new devolved administration to use its new settlement to build a new social contract for a city region that is famously fuelled by people power. Civil society organisations are now focusing on developing a more powerful collective voice around devolution, amplifying their voices about the need for the alternative and making the case for change.