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It’s fair to say it hasn’t been a straightforward first year for the government.

They’ve certainly faced a very difficult international context and a hard economic outlook - whilst stumbling over the political handling of some key domestic policies. Yet on the regional agenda, we’ve seen welcome focus and flurry of action to deliver on the government’s promise of “raising living standards in every part of the United Kingdom”. One year in, it’s time to take stock of the big decisions shaping the future of our regions.

First off, the government’s decision to change the fiscal rules to allow for greater capital investment at their first Budget was significant - for the North and our regions. Following interventions from colleagues at IPPR amongst others, the government decided to change the self-imposed rules which determine how much Government can borrow to invest. As a result, government gave itself the ability to borrow to invest an additional £100bn over this parliament which has since enabled significant capital investment across the country.

At the same time, the government’s ‘Green Book’ - a method of appraising the cost and benefits of projects which is often seen as a big constraint on investing in regions by government – has also received a welcome update. But perhaps even more importantly, the political will to invest in places like the North has been evident.

Transport in the North and the Midlands was a significant beneficiary of the changed fiscal rules. The Chancellor announced £15.6bn of transport funding to be handed to mayors for intra-regional transport last month. This means the beginnings of a new mass transport system in West Yorkshire and tram extensions in Manchester, amongst several other projects. The key difference to previous announcements on transport was that it was attached to a Comprehensive Spending Review (CSR), a fiscal event, which means the finances are in place to deliver. Next, we need to see investment between, as well as within northern places, to begin to continue our journey to catch up on the £140bn our region missed out on since 2009/10.

The government’s recently announced industrial strategy also shows promise, setting out a clearer direction for the UK’s economy after the chaos of 11 economic strategies in 13 years. It has come down hard on some clear choices – with a focus on clean energy, defence and advanced manufacturing. These are sound choices not just from an economic and security standpoint, but they’re regionally focused too. After years of an economy tilted towards financial services and the South East, this plan takes a place-first approach, investing in the industries that the North leads in. Green manufacturing, for example, is one of our superpowers: we already produce half of England’s renewable energy and deliver 36 per cent of UK jobs in green goods and services.

There are other areas we are expecting to see progress in, too.

The upcoming English Devolution and Community Empowerment Bill sets out the government’s latest devolution plans and will seek to put “devolution by default” into practice. This is to be welcomed. Unfortunately, the narrative has been dominated by the unitarisation proposed as part of the package (one can only assume a Treasury – MHCLG stand-off). For communities, it’ll be critical that in the context of unitarisation, power is felt going downwards not only up to a higher level of local government.

But of course, it hasn’t all been smooth sailing.

The early promise of the government’s new Council of Nations and Regions, with a focus on investment and growth across the UK, has yet to demonstrate that it is the new frontier of government and mayoral relations. At risk of becoming the meeting where agendas are rubber stamped, it seems to have lost momentum.

Local government finances, the underpinnings of all local and regional plans, remain precarious. Whist they received modest increases at the Comprehensive Spending Review this year, it by no means undoes the past 14 years of rampant cost cutting by the previous government. And there are still big questions to answer, not least on social care. However, the recent local government consultation on fairer funding shows government is willing to take on the big question of fairness in local spending, with deprived places set to receive a greater share.

Elsewhere, fiscal devolution is still the elephant in the room. The mayors well know that without even some financial independence they will still, in many ways, be beholden to government. Quite rightly they’re calling for change. We’ve called for the visitor levy – a small tax on tourists – to be introduced to help mayors upgrade their places. It would be small step to show Treasury gets it and may help us move towards progressing fiscal devolution in the years to come.

The government have made some substantial down payments on the regional agenda. The mayors, with their “place before politics” mantra, are also rightly taking what they can into their own hands. With ongoing support, the regional agenda might be the government’s best bet for securing the improvements living standards our country is crying out for.

This article was originally published in the Northern Agenda on 04/07/2025.

Zoë Billingham is the director of IPPR North. She is on BlueSky @zoebillingham.bsky.social and tweets @zoe_billingham.