Poised somewhere between bemused and aghast, the property industry around Southampton has watched an epic political row stymie a devolution deal to regenerate the area.
While industry figures do not see devolution as essential to the local economy’s prospects, they think it would only bring benefits if the package of investment and devolved powers on offer could be put into effect – in particular, for improving infrastructure.
A deal was proposed last year that would have seen a Solent Combined Authority gain £900m in funding over 30 years from the government, as well as devolved planning and transport powers.
In theory, all local authorities involved are in favour. In practice, there is stalemate.
Council leaders disliked the government’s insistence that a combined authority should be led by an elected mayor, but would have lived with that had it been the only stumbling block.
Power struggle
The central problem is that for a combined authority to address planning and infrastructure successfully it needs powers over highways and transport. Hampshire County Council holds these powers for the area outside the unitary councils of Portsmouth, Southampton and the Isle of Wight, and has flatly refused to pass them to any combined authority that covers only part of the county.
It sees the Solent devolution idea as undermining Hampshire – and indeed is equally hostile to the Heart of Hampshire Combined Authority proposed for the remaining area.
A further complication is that parts of Winchester, the New Forest and Test Valley council areas lie in the Solent conurbation, while the bulk of these councils do not.
The three unitaries lost patience and bid to form a combined authority themselves, hoping the Hampshire districts could join later if the political climate changed.
This idea in turn fell into limbo with a change of political control on the Isle of Wight in January from Independent to Conservative, with the latter sceptical about the combined authority. Relations have become so bad that Hampshire’s Conservative leader, Roy Perry, was barely polite when he attacked the Solent devolution idea in January in a letter to the area’s leaders.
He said both the Solent and Heart of Hampshire bids “make no economic sense in creating false divisions – geographically and between authorities”.
Perry says: “I have written to Solent leaders explaining why the technical analysis they had commissioned doesn’t work and doesn’t support their case. We have gone through it carefully and know that to be so. The Solent bid would not help the local economy; it would do it harm by isolating the area from the economic resources of the wider county as well as forcing the dismantling of vital county services.”
This stance unsurprisingly infuriated Solent leaders, with Fareham’s Conservative leader, Sean Woodward, now canvassing a Greater Portsmouth unitary council in which Fareham, Gosport and Havant would leave Hampshire altogether and fuse with the city. It is noteworthy that however bitter these rows have become, they are not party political – apart from Southampton and Eastleigh, all the leaders involved are Conservatives. Elections are due for the county council in May and could see changes.
The Solent devolution deal
In its most recent permutation, a Solent combined authority would be led by an elected mayor and be allocated £30m a year for the next 30 years by government to invest in transport, infrastructure, housing and business support.
Its powers would include:
- Planning, housing, new transport links, leisure and business developments
- Better support for both exporters and inward investment
- Setting targets to meet housing need
- Control of road and rail funding improvements and local buses
- Control adult education and training budgets
Areas that could comprise a combined authority
- East Hampshire
- Eastleigh
- Fareham
- Gosport
- Havant
- Isle of Wight
- Portsmouth
- Southampton
Disunity over devolution: market reaction
What is the property industry to make of this exhibition of civic disunity over devolution?
Keygrove director Andrew Archibald sees these manoeuvrings as “a power struggle going on with Hampshire County Council trying to hold onto its powers” and thinks the local property fraternity “is ignoring it until something happens”.
He would like to see the entire conurbation in a combined authority, regardless of the niceties of current boundaries, and hopes that body could deal with major infrastructure needed to open up areas for development. “Much of that has been hanging around for years,” he says.
Tim Guymer has seen things from both sides, being a planning associate at Barton Willmore and previously a planner for Eastleigh and Winchester councils. He thinks local politicians have let down the region’s economy.
He believes the Solent area has underperformed the rest of the South East for at least 20 years, but notes that politicians and the South East Local Enterprise Partnership usually emphasise investment in skills and infrastructure.
Guymer says: “That is fine, but they should be more focused on creating the kind of homes and the numbers of them needed, and on showing that Solent is ambitious to leverage in as much as it can from investors.
“Instead, the area has fallen into a way of thinking about what is ‘just about good enough’ to make development acceptable, rather than what we want this place to be. This region needs to punch its weight, but it doesn’t.”
Martin Hastelow, Savills’ head of office commercial agency in Southampton, thinks that while it’s difficult to say that it is the lack of devolution that is holding back infrastructure, the region needs better road and rail communications between Portsmouth and Southampton – and a devolved body could have that as a priority.
“I think in the commercial agency sector, there is a feeling that there are too many local authorities along the M27 and it’s hard to get agreement between them,” Hastelow says.
He favours the Solent devolution model, but thinks devolution to a body covering all of Hampshire – the only model Perry would countenance – would not work “as it is too big as an economic area”.
Meanwhile, JLL director David Ramsay thinks the industry views devolution as “a sideshow” lost in the intricacies of local politics.
He sees the disputes as unfortunate because a combined authority could focus in particular on improving the M27, which, he says, “suffers from serious congestion during most rush hours”, and potentially on ideas for a light rail network.
“If devolution is not possible, there should at least be a transport/infrastructure body for south Hampshire to ensure joined-up thinking and promote and support development,” Ramsay says.
“A sub-regional transport plan would be a good step forward, but there is little point if we don’t have the money to implement it.”
Solent is hardly a depressed area. Hastelow notes: “Everything is picking up. Industrial is good but there is a lack of stock. Offices were slow to recover from the 2008 crash but they are recovering now and there is very little stock, and what there is can often be lost to residential or student accommodation. Rents are starting to go up.”
Keygrove’s Archibald says he sees an acute shortage of land for development generally, but especially for employment use.
“To some extent, the local authorities have got their heads around land for housing – under pressure from the government – but land for employment is difficult,” he says. “In Southampton, people just cannot find it, though industrial and warehousing are doing well.”
Things are not bad for the industry in Solent, but devolved control over a large budget and the powers to sort out planning and infrastructure could make them better.
That, though, would need peace among politicians. Until then, the industry will just get on with business.
