Prime Minister Andy Burnham Devolves Tax Powers to English Mayors

Prime Minister Andy Burnham announced a major devolution initiative on Friday to transfer fiscal power from Westminster to England's regional mayors. The plan allows metro mayors to retain a share of locally generated income tax and business rates for the first time, starting in April 2027 for business rates and 2028 for income tax. This shift replaces existing Treasury grants and enables combined authorities to secure long-term loans of up to 30 years for housing and transport projects without prior Treasury approval.

Under a new "local first" principle, government ministers must now justify why specific powers should remain in Whitehall. The government intends to reduce the civil service size as decision-making moves out of London. Chancellor John Healey will provide specific financial details on tax retention in the autumn budget, though the government stated the overall income tax rate for billpayers will not change.

Reactions to the plan have been divided. Mayor of the Tees Valley Lord Houchen intends to use the new fiscal freedoms to implement a tax rebate scheme for residents. Mayor of South Yorkshire Oliver Coppard welcomed the move as a way to escape the "death grip" of the Treasury. Conversely, Shadow Local Government Secretary Sir James Cleverly criticized the approach as "top-down Manchesterism" that sidelines local councils. Liberal Democrat spokesperson Zoe Franklin warned that the policy could create a "two-tier system" by neglecting areas without mayoral authorities.