The government set out its early blueprint for the overhaul on Friday in a policy document called Rewiring the State, in what is described as the most radical shake-up of British government in a generation. The plan strips power away from London politicians and civil servants and hands control over money, transport and public services directly to local leaders.
At the centre of the project is a new regional command hub dubbed 'No. 10 North', where central government officials will work alongside local mayors every day. The aim is to drive economic growth across all four nations of the UK and end the 'begging bowl' system in which councils plead with London for project funding, often in competition with one another.
The Cabinet statement explains that 'true economic growth requires a fundamental rewiring of how the country operates, surrendering power that has long been hoarded in Westminster and Whitehall and returning it directly to the communities where people live, work, and invest.'
Tax money kept local
For decades, English councils have retained far less of their local tax revenues than towns in almost any other developed country, leaving them financially squeezed and micromanaged by central government. Under the new framework, traditional central government grants will be gradually phased out and replaced by assigned shares of local income tax paid directly to every mayor from April 2028. If a mayor grows the local economy, the resulting income tax boost stays in the region.
From April 2027, councils and regional authorities will also gain more control over locally raised business rates. By March 2028, all regional authorities will get the legal power to introduce an Overnight Visitor Levy - a local tourist tax on hotel and holiday stays - to fund roads, transit and cultural projects. Mayors will also set up local Good Growth Funds, combining national public finance with local government pension funds to back major regional developments.
Transport, housing and high-tech industry
Local leaders will gain immediate powers to bring bus routes under public control, create unified single-ticket travel networks and expand cycling and walking routes. They will also play a larger part in managing commuter rail lines through formal partnerships with Great British Railways. Central government approval for locally funded transport projects will be removed entirely for areas with integrated funding deals, unless a project touches the national network. The spending threshold requiring Whitehall sign-off has been raised to £500 million, and rigid central funding schemes are being replaced by flexible local infrastructure partnerships.
This echoes Andy Burnham's approach in Greater Manchester, where the Bee Network has already brought buses under public control. Mayors will also take over the Social and Affordable Homes Programme, giving them tools to build council housing and upgrade insulation. Dedicated public development teams will let local leaders design, build and oversee new neighbourhoods and transport links from start to finish.
Large pots of national innovation funding will be transferred to regional leaders to back local tech hubs and research clusters. Decisions on local sports and arts funding, previously controlled by Arts Council England and Sport England, will move to local communities, although independent panels will award the actual grants to avoid political favouritism.
Jobs and joined-up services
To tackle youth unemployment, mayors will take full control of technical training. They will design technical and vocational learning routes for teenagers from age 14, with guaranteed access to high-quality local work experience. From 16 to 19, mayors will control the regional skills budget, combining education, employment support, health and social care into a single safety net. Job centres and long-term unemployment support will also be handed over, allowing training to be tailored to local business needs.
Public services will be forced to share the same regional boundaries by the end of this Parliament. Local police units, regional police forces, fire services and NHS Integrated Care Boards will have to line up with local council borders. Mayors will be able to appoint Deputy Mayors for public service delivery, and regional authorities may merge budgets for preventative care to invest early in public health and family support.
A new map of England and a shrinking Whitehall
By the end of 2028, the government wants every part of England to be covered by a regional strategic authority. Communities will not be forced to elect a mayor if they strongly object, but the document says mayoral regions are the gold standard and will receive the greatest powers and funding. Areas not ready for a mayor will establish non-mayoral foundation authorities, which will still get enhanced core powers including the right to introduce a tourist tax.
Four regions have already been granted established mayoral status: Cambridgeshire and Peterborough, the East Midlands, the West of England, and York and North Yorkshire. In September 2026, the Prime Minister, Cabinet ministers and regional mayors will review implementation, leading to a formal Devolution White Paper and Fiscal Roadmap in the autumn. Elections for a new wave of strategic authority mayors follow in May 2027, including newly created positions in Cumbria as well as Cheshire and Warrington. By late 2027, every area in England is expected to have an authority, with local income tax sharing and visitor levies going live in spring 2028.
The scale of the power shift requires a smaller central government under a Cabinet mandate called 'Devolve by Default'. Ministers must now justify why any policy or service should remain in Whitehall rather than be handed to local leaders. Central policy and strategy teams will be streamlined, with savings transferred to local budgets. What the document calls pointless statutory consultation rules will be scrapped in favour of direct public engagement led by mayors. Arm's Length Bodies will face systematic reviews to close redundant departments, while civil service swaps and training programs will build regional expertise. Chief executives of regional authorities will become Local Accounting Officers, subject to oversight from watchdog groups, the National Audit Office and local MPs.
Not everyone loves the plan
Regional leaders have welcomed the announcement as a historic step toward local self-determination, but policy experts and economists urge caution. They warn of an inequality trap: prosperous regions with high wages will naturally collect more from local income tax and business rates, while former industrial and rural areas will generate less. Without an aggressive central system to redistribute revenues fairly, fiscal devolution could widen the gap between wealthy and struggling communities.
There are also warnings that forcing the NHS, police and fire services to redraw their geographic footprints will be a bureaucratic nightmare and cause immense disruption. And history suggests the government rarely surrenders authority without a fight; when local services face crises, public pressure falls on national ministers, creating a temptation for Westminster to reclaim control.
Despite the critique, the plan represents a decisive bet on 'Manchesterism' - local accountability and regional decision-making in a bid to unlock growth where Westminster has failed for decades. All eyes now turn to the proposed autumn White Paper to see how effectively Whitehall can unravel its century-old grip on power.
