Andy Burnham’s devolution drive is reshaping how construction projects are planned, funded and skills are delivered across England, with industry bodies broadly welcoming the direction while pressing hard on the risks of fragmentation. Within ten days of taking the reins at Number 10 on 20 July, Burnham announced what his government called an “era of devolution” that would “end the Whitehall-first culture”, handing mayors and strategic authorities greater control over planning, regeneration, transport and skills.
Fiscal autonomy and the Burnham devolution drive: what the funding timeline means
The fiscal architecture underpinning the announcement carries direct consequences for capital investment in construction. According to BBC News, mayors are expected to start retaining some revenue from business rates from April 2027, with a portion of locally generated income tax following from April 2028. The exact share of taxes mayors will receive has not yet been decided, with the government indicating that further detail will be set out when the Budget is delivered this autumn.
The report’s own account aligns with this: from spring 2027, mayors will begin retaining a greater share of locally generated revenues, starting with business rates. The government’s stated ambition is that “over time, local areas will move away from dependence on Whitehall grants and towards funding that rewards local growth.”
Allan Wilen, economics director at industry insight firm Glenigan, argued that tying local government finances more closely to taxes raised in their area would give local leaders a greater incentive to approve new homes and infrastructure investment, helping grow their local economy and future tax revenues. In that way, he said, Burnham’s devolution plans could “galvanise local government to support increased investment in their area.”
Sam Rees, senior public affairs manager at the Royal Institution of Chartered Surveyors, said that if accompanied by greater fiscal autonomy, mayors and combined authorities could have “more freedom to invest in local growth priorities, including housing delivery, transport infrastructure, town centre regeneration and skills programmes.” Investment decisions could then be calibrated to regional economies and labour markets, he added.
New strategic authorities, fragmentation risk and skills pipeline pressures
The geographic footprint of devolution is itself expanding. According to the UK Parliament Lords Library, new strategic authorities will be established in 2027, with new mayors elected in Cumbria and in Cheshire and Warrington. For national contractors and consultants, this means more commissioning bodies with potentially distinct procurement frameworks, design code preferences and local skills plans to navigate.
Rees flagged exactly this risk. “There is also a risk of increased fragmentation and duplication, especially in procurement and tenders,” he warned. National contractors, he said, could end up facing a raft of different processes across the country. While he acknowledged scope for greater local leadership over areas such as design codes and place-shaping, he was clear that “core technical and safety standards, including building regulations, should remain nationally consistent.”
Build UK chief executive Suzannah Nichol put the same point differently, arguing that “clarity, certainty and consistency is key to the delivery of all sizes of projects across the country.” A degree of joined-up thinking was needed to make the most of devolution, she said, with national best practice on procurement, payment practices, employment and competence benefiting everyone. Layering closer local and mayoral relationships on top of that foundation, she suggested, “could make faster and smarter decisions and be a win all round.”
The skills funding picture is where these tensions become most concrete. West Yorkshire Combined Authority is seeking devolution of a £600m national construction skills funding package announced at the 2025 Spring Statement, pointing to data showing that local colleges’ construction courses are massively oversubscribed. A spokesperson for the authority said talented young people were being turned away from institutions including Bradford College and the Leeds College of Building due to a lack of places on construction programmes.
Victoria Hills, chief executive of the Chartered Institute of Building, described skills as a “particularly important” element of the devolution drive. CIOB research shows that although two-thirds of young people had a positive view of construction careers, fewer than one third would consider pursuing one. Devolving skills funding and giving strategic authorities joint ownership of Local Skills Improvement Plans could help areas respond more quickly to labour market needs, she said, creating clearer pathways from education into construction careers. But she cautioned firmly against the result becoming “a postcode lottery for skills”, arguing that Skills England should be tasked with maintaining national consistency.
On housing, James Stevens, director for cities at the Home Builders Federation, said devolution “has the potential to create better conditions to support the delivery of new homes.” Greater mayoral powers over transport could open up residential development in locations previously considered less attractive due to poor accessibility, he said. Crucially, he added, all mayors will now have the power to make a spatial development strategy, which he described as essential to enabling the government’s housing targets to be delivered in full.
Hills framed the overall challenge in terms familiar to anyone who has watched previous rounds of planning reform come and go: devolution “needs to be matched by long-term, sustainable funding, clear accountability and the capacity within local government to use these new responsibilities effectively.” Businesses, she stressed, need certainty to plan, invest and recruit, and a fresh wave of short-term initiatives would undermine exactly the pipeline stability the construction sector requires. The Budget this autumn, when the Chancellor is expected to set out the fiscal roadmap for mayoral revenue-retention, will be the first real test of whether that certainty materialises.
