PAPER C
Purpose: For Decision

Committee

EXECUTIVE

Date

24 OCTOBER 2016

Title

SOLENT COMBINED AUTHORITY GOVERNANCE REVIEW
AND SCHEME

Report of

THE
LEADER
AND
EXECUTIVE
RESOURCES,
ORGANISATIONAL
CHILDREN’S SERVICES

MEMBER
CHANGE

FOR
AND

This report is being considered by Southampton City Council and Portsmouth
City Council as well and hence is in a slightly different style.
1.

Purpose of report

1.1.

This report provides Executive with the detail of responses made during the
consultation conducted in relation to the Strategic Governance Review (the
Review (at appendix 1)) and the draft Scheme, and proposals for a Mayoral
Combined Authority (as described in the Review, and draft Scheme) and
invites Executive to decide whether the establishment of a combined authority
would be likely to improve the exercise of statutory functions in relation to the
area of the combined authority.

1.2.

Subject to that decision, Executive is invited to publish the attached Scheme
(appendix 2) and to submit it to the Secretary of State (together with the
Review, and consultation response report (appendix 3) which incorporates the
Solent Local Enterprise Partnership consultation of businesses, and also the
letters received (appendix 4)). The Scheme incorporates proposals from
amongst those described in the Review and the draft Scheme, amended in
response to feedback provided during the consultation and represents the
consolidated proposal for a Solent Combined Authority, covering the local
authority areas of Portsmouth City Council, Southampton City Council, and
the Isle of Wight Council (the Solent Unitary Authorities), as constituent
members. Similar reports and recommendations are being considered by the
Cabinets of Portsmouth City Council (12th October) and Southampton City
Council (19th October) and details of their decisions will be provided orally at
the meeting.

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 1.3.

It is for the Secretary of State, before he makes any order establishing a
combined authority, to satisfy himself that to do so is likely to improve the
exercise of statutory functions in the areas to which the order relates (and the
other considerations described in the legal comments within the report). The
Secretary of State will carry out a public consultation unless he is satisfied
that no further consultation is necessary in the light of the consultation already
carried out in connection with the proposals contained in the Scheme.

1.4.

Any order establishing the combined authority will also require the consent of
the constituent authorities. It is anticipated that the submission of the Scheme
to the Secretary of State will lead to a period of discussion about the detail of
what is proposed. It will be when this final decision is taken (and hence all the
details known) that the decision on whether, , to hold a referendum will also
need to be considered by the Executive.

1.5.

Where a submission to the Secretary of State is approved, the report seeks a
delegation to the Chief Executive in consultation with the Leader to take all
actions necessary to make the submission and any further actions that arise.

2.

Recommendations

2.1. Executive is recommended to:
2.1.1. Note that a thorough 8 week consultation exercise was undertaken
across the Isle of Wight, Southampton and Portsmouth council areas
on the draft Governance Review and the Draft Scheme.
2.1.2. Note that the consultation results (see appendix 3) confirmed support
for the three authorities working together to achieve devolution from
central government through a mayoral combined authority.
2.1.3. Publish the Scheme and Review, and submit a request to the
Secretary of State for Communities and Local Government to
establish a Solent Combined Authority (such a submission will be
dependent on the other two Councils also resolving to publish the final
Scheme and review).
2.1.4. Agree that if a decision is made to make a submission to the Secretary
of State, that Executive approve the Governance Review
(appendix 1), revised scheme (appendix 2), and the consultation
responses (appendix 3), and include these as part of the
submission to the Secretary of State alongside the letters that
have been received on this issue (appendix 4). Note that the
onward procedure of the Secretary of State is described in the Legal
Implications section.
2.1.5. Agree that if a submission to the Secretary of State is made, that the
Chief Executive be given delegated authority, in consultation with the
Leader, to negotiate the final terms of an Order to establish a Solent
Mayoral Combined Authority alongside colleagues from Portsmouth
City Council and Southampton City Council.
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 3.

Background

3.1. Full Council has previously discussed the issue of devolution at its September
2015, March and June 2016 meetings and have agreed:
3.1.1. THAT the prospectus for a devolution deal for Hampshire and Isle of
Wight as the basis for negotiation with government be supported.
3.1.2. THAT the final devolution deal must ensure the financial security of Isle
of Wight and availability of public services to its communities be
confirmed.
3.1.3. THAT at this stage [September 2015] the council is making no
commitment beyond continued involvement in the development of a
potential deal, be noted.
3.1.4. THAT the fullest possible consultation with the Isle of Wight community,
including consideration of a referendum on any devolution deal
document that the council is considering accepting, be agreed.
3.1.5. THAT Council agrees that a referendum of Islanders will be held on any
agreed or imposed devolution deal with Hampshire local authorities,
once the details are known - particularly the financial redistribution and
governance elements.
3.2. Last summer the expectation was that the devolution proposals would be
based on an Hampshire and Isle of Wight geography. However as the work on
these proposals progressed, and the Government insisted that it would be
necessary to have a directly elected mayor, it became apparent that it would
not be possible to secure an agreement on the governance arrangements that
would be needed to have a combined authority covering 15 local authorities, 2
national parks and 2 local enterprise partnerships.
3.3. HM Treasury then invited representatives from authorities in the Solent area to
explore whether it would be possible to agree a devolution deal for the Solent
area. The hope was that a deal could be announced at the March Budget. A
draft deal was agreed very quickly and this provided significant opportunities
for authorities in the Solent area although as part of the deal the authorities
had to agree to set up a Combined Authority with a Directly Elected Mayor
(DEM). The draft deal included:
3.3.1. £900m funding for the area over 30 years (£30m p.a.) to invest in
economic growth and housing.
3.3.2. Keeping all business rates generated in the area (approximately
£400m) in exchange for the current system of government funding for
local councils - meaning the area would have better control of its own
financial future and piloting the new approach
3.3.3. Powers over strategic planning, such as future spatial plans
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 3.3.4. Increase productivity and create more jobs and better jobs by
simplifying and strengthening support for business growth, innovation,
and global trade and investment
3.3.5. Control of the budget for adult education and training in the area,
enabling a focus on the skills businesses want people to have,
therefore people get jobs and businesses prosper
3.3.6. Development of a new programme to help the hardest to help claimants
back into work and provide them with support
3.3.7. Delivering 52,000 homes in the area by 2026
3.3.8. Control of a dedicated transport budget, franchised bus services and
the network of local authority roads
3.3.9. Innovative and integrated approaches to public service reform,
including health
3.4. The expectation was that the deal would be announced by the Chancellor of
the Exchequer at the Budget in March. Initially the deal was agreed by
representatives from Hampshire County Council, the three unitary authorities
and the five district councils in the Solent area. Unfortunately before the deal
was announced Hampshire County Council (HCC) changed its position and
stated that it was no longer prepared to sign up to the deal. The Government
asked the Solent authorities to work with HCC in the hope that a deal could be
agreed with all partners allowing a deal announcement to be made. Despite
the best efforts of partner authorities it has not proved possible to persuade
HCC to sign up to the deal and the creation of a Solent Combined Authority.
Indeed the County Council has now made it very clear that they oppose the
creation of a combined authority in either the south or north of Hampshire.
Without HCC's agreement to be part of the Solent Combined Authority it is not
possible for the Solent district councils to be part of the formation of the Solent
Combined Authority. The District Councils outside of the Solent area were also
seeking to create a Combined Authority (the Heart of Hampshire Combined
Authority) and to negotiate a devolution deal. HCC were actively involved in
these discussions from the start but still felt unable to support the final
proposition.
3.5. In this situation, encouraged by central government, the three unitary
authorities within the Solent area (Portsmouth, Southampton and the Isle of
Wight) are looking to create a Solent Mayoral Combined Authority to deliver on
the draft devolution deal. The first stage in creating a combined authority was
to undertake a Governance Review and approve a Scheme for the combined
authority.
3.6. At its meeting on 14 June 2016 the Executive considered a detailed report on
the Governance Review and a draft scheme for the combined authority and
the Executive agreed:
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 3.6.1. THAT the report, and the findings of the Solent Governance Review
and its conclusion that a Mayoral Combined Authority is in the best
interests of the Isle of Wight, be noted.
3.6.2. THAT the draft Solent Combined Authority Governance Scheme for the
purposes of a full public consultation be approved.
3.6.3. THAT the views of Full Council on devolution, the proposed Solent
Combined Authority and the outcomes of the consultation process be
sought which will inform the Executive’s substantive decisions in
respect of the governance review and scheme of governance in
connection with a Solent Combined Authority.
3.6.4. THAT the Chief Executive be delegated any actions necessary to
facilitate the consultation upon the Solent Combined Authority
Governance Scheme.
3.7. All three Solent unitary authorities undertook the same process detailed above
at their various July meetings and a thorough 8 week programme of public
consultation on the review and scheme commenced on 22 July 2016 (see
section 4).
3.8. Subject to approval at the respective Cabinets / Executives, a proposal could
now be made to the Secretary of State to request the establishment a Solent
Combined Authority. This proposal would include the finalised review and
Published Scheme and also the consultation results and letters of support. The
finalised review and scheme takes account of the outcomes of the consultation
exercise. The Secretary of State will consider the proposal and also consider
whether or not he believes that the consultation that has been undertaken by
the three Councils has been sufficient. It will be up to the Secretary of State to
decide whether or not to start the discussions about the nature of the
legislative order that would need to be laid before Parliament to establish a
Solent Combined Authority. If the Secretary of State considers that the
consultation already undertaken by the three councils is inadequate, he may
either require that further consultation is undertaken or may undertake that
consultation himself. It is worthy of note that the levels of engagement and
response achieved by the three Solent councils far exceeds that achieved in
other areas that have been successful in securing a devolution deal and
establishing a Combined Authority.
3.9. If the Secretary of State does so decide to set up a Solent Combined Authority
this will have to be considered and approved by all three councils, it is also at
this stage that the Executive will need to consider the matter of holding a
referendum on the suggested deal offered by the Secretary of State (the
decision on the holding of a referendum being an Executive function). If a
referendum is to be held Full Council will need to identify the necessary
funding.
3.10. This paper deals with the process of forming a Solent Combined authority in
order to take the benefit of a Solent devolution deal. There are therefore two
decisions to ultimately be made; the first is to seek and agree the Secretary of
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 State’s proposals to form the combined authority, the second is to accept the
terms of the Solent devolution deal.
3.11. In most parts of the country a consultation exercise for the establishment of a
Combined Authority follows on from the announcement of a devolution deal
with Government. This is not the case in the Solent where although a draft
deal was agreed with Government in March, it did not get formally announced
because of the change of position by Hampshire County Council. Government
have indicated that the terms of the deal remain the same, that the deal is still
on the table for the three Solent unitary authorities and there is a hope that if
the Solent unitary authorities were to submit a proposal to the Secretary of
State to create a Solent Combined Authority, that the deal may yet be
announced as part of the Autumn Statement on 23rd November 2016.
3.12. As previously outlined to Members, the draft deal provides significant
opportunities for authorities in the Solent area, although as part of the deal the
Government's expectation is that the three authorities would agree to
undertake a process that if followed through would set up a Combined
Authority with a Directly Elected Mayor (DEM). In other words the
establishment of a Mayoral Combined Authority is a pre-requisite and would
form the primary delivery vehicle for the deal. The draft deal includes:
•
•

•
•
•
•
•
•
•

£900m funding for the area over 30 years (£30m p.a.) to invest in
economic growth and housing (and the enabling infrastructure).
Keeping all business rates generated in the area, including any growth
in business rates, and exiting the current system of government funding
for local councils - meaning the area would have better control of its
own financial future and piloting the new approach
Powers over strategic planning, such as future spatial plans
Increasing productivity and creating more jobs and better jobs by
simplifying and strengthening support for business growth, innovation,
global trade and investment
Control of the budget for adult education and training in the area,
enabling a focus on the skills businesses want people to have,
therefore people get jobs and businesses prosper
Development of a new programme to help the hardest to help claimants
back into work and provide them with support
Delivering 52,000 homes in the area by 2026 (this was the number in
the published deal for the eight Solent planning authorities)
Control of a dedicated transport budget, the opportunity for franchised
bus services and control of the key network of local authority roads
Innovative and integrated approaches to public service reform,
including health

3.13. As part of the Scheme the three Solent Unitary Authorities have provided for
the Solent Local Enterprise Partnership (LEP) to be a non-constituent member
of the Combined Authority with full voting rights on matters related to the LEP
remit. Also, that if Hampshire County Council maintain its opposition to being a
fully participatory member of the Combined Authority the Leaders have said
that they will invite Hampshire County Council and the Solent Districts to join
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 the Combined Authority as non-constituent members and non-voting
members. The Leaders have also agreed that pending any election for a DEM
and subject to agreement at the Combined Authority, the position of interim
Mayor would be filled by the unitary Leaders on a 6 monthly rotating basis.
3.14. Hampshire County Council (HCC) was one of the respondents in the preconsultation phase and also submitted a detailed response at the end of the
consultation period which challenges the approach adopted by the three
unitary authorities. The points made by HCC have been considered and are
addressed as appropriate in the consultation report attached as Appendix 3.
The detailed critique offered by HCC (which is set out in full at Appendix 4)
was taken into account among other consultation responses, and in reviewing
the proposals, Review, and in producing the scheme. The councils have
sought legal advice on the key points raised by HCC. On the basis of this legal
advice we do not believe that their submission casts any doubt upon the
lawfulness of making a proposal to the Secretary of State if that is what
Executive wishes to do. To the extent that HCC suggests that existing
consultation has been inadequate, that will be a matter for the Secretary of
State to consider, and to carry out further public consultation if that is thought
to be required. However, it is worth in the body of this report dealing with
some of the specific points raised by HCC:
•

HCC stated that people could only respond online. This was incorrect.
Paper copies of the questionnaires were placed in Libraries, in Housing
Offices and at each of the civic offices. People could also request paper
copies, or make representations, via the Solent Deal email address. In
total 207 paper copies of the questionnaire were received and these
were all included in the analysis. Public meetings were also held and
people were encouraged to respond using social media.

•

HCC is concerned that the consultation did not adequately set out the
powers to be devolved or the mechanisms for their exercise. The
consultation pack referred to both the Review and a draft scheme, and
whilst the consultation questionnaire was brief by its nature, consultees
were pointed to the website and this had links to the draft scheme and
draft review, as well as further information about the proposals and the
reasons for them. Consultees were given an open opportunity to
comment generally. It is considered that the essential nature of the
proposals was made sufficiently clear for the purposes of consultation.
To the extent that the Review and draft Scheme did not address or left
open certain aspects of exactly how the combined authority would
operate, then it was open to HCC or any other consultee to make
representations about how such matters ought to be addressed as part
of their response to the consultation. The consultation in fact attracted a
large number of responses for an exercise of this nature, as set out in
Appendix 3, and it does not appear from the consultation report that the
great majority of the respondents felt that the information provided
caused them difficulty in responding intelligently to what was proposed.

•

HCC believe that the scheme is different from the original Solent Deal
and that the Solent authorities are consulting on proposals that do not
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 have the Government's blessing. There are two considerations here.
Firstly the Deal document agreed with Government by the eight Solent
Councils back in March was not a governance scheme and had a
different number of councils involved. Secondly it will be for the
Secretary of State to consider whether the scheme proposed by the
three unitary councils is acceptable to him, and to independently be
satisfied of the key tests (described in the legal comments, below). We
have spoken to Government advisors about the consultation and the
scheme and will continue to discuss with them as the process
continues but they have not raised any concerns with us
•

HCC also posed a number of questions about the proposals, as set out
in the Review and draft scheme, including for example, governance
processes, who will chair the Combined Authority in the absence of the
DEM or interim Mayor, how decisions will be made, and the extent of
powers sought for the Combined Authority. These provide a useful
checklist and have been addressed through the final scheme as
amended in the light of the consultation results. Full details are
provided at Appendix 4.

3.15. There has been considerable local and national speculation that there has
been a change in Government policy towards Directly Elected Mayors. This
has been discussed at both political and officer level with Government and
there is a clear message that there has been no change in policy. It has
always been possible to have a deal without a DEM but the strong message
we have been given is that a deal without a DEM would not be an ambitious
deal. The Solent deal is considered a very ambitious deal and as such there
will be a requirement for a DEM.
3.16. It is important to note that under the Local Government Act 2000 and the Local
Authorities (Functions and Responsibilities) (England) Regulations 2000 (SI
2000 No 2853 as amended – “the Functions Regulations”) the decisions in this
paper relating to the creation of a Combined Authority are Executive decisions
not decisions for Full Council. For this reason the Economy and Tourism
Select Committee have discussed the proposals on 2 occasions and 3
member information sessions on the development of the proposals have been
facilitated to enable all Members to engage but it is for Executive to make the
decision. Each of the three unitary authorities will be discussing the matter at
Full Council before taking the decision at their respective Cabinet/Executive.
4.

Consultation

4.1. The Isle of Wight Council, Portsmouth City Council and Southampton City
Council undertook consultation regarding proposals to establish a Mayoral
Combined Authority in the Solent region between 22 July 2016 and 18
September 2016. The three authorities made a decision to run the consultation
for over eight weeks from 22 July to 18 September 2016, many other
consultations on establishing a combined authority have run for six weeks. It
was felt that this period allowed for any interruption that could be caused by
the summer holiday season. It also ensured that it ran across three calendar
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 months; July, August and September. Appendix 3 outlines the full consultation
process and the detail of the responses received.
4.2. The agreed approach for this consultation was to use a combination of online
and paper questionnaires as the basis, supported by a range of open drop-in
sessions, discussion groups, public meetings, a generic email address and
social media.
4.3. Particular effort was made to communicate the proposals in a clear and easy
to understand way. This was achieved by using a clear and informative
bespoke website to outline the background to the proposals, a Frequently
Asked Questions (FAQs) document and by dividing the questionnaire into
themed sections which included key information. All of these documents were
available at www.solentdeal.co.uk or in paper copies at libraries and civic
offices across the three local authority areas. Each of the local authorities’
communications departments adopted tailored approaches to suit the
respective areas and promoted the consultation significantly through a wide
range of channels.
4.4. The consultation questionnaire was the main way that feedback was gathered
for the Solent Deal consultation. In total 2,531 questionnaires were completed,
of which 207 were paper copies and 2,324 were completed online. This
response rate compares favourably with other consultations on the
establishment of Mayoral Combined Authorities for example the West
Midlands combined authority (with a population over six times that of the
Solent) received 1,907 questionnaire responses. Lancashire Combined
Authority received 500 less questionnaire responses than the Solent
consultation with over double the population. While the Sheffield City region
combined authority consultation received 188 more questionnaire responses
than the Solent consultation but the population of the Sheffield City Region is
three times that of the Solent region. In total there were 3,867 engagements
with the consultation.
4.5. The consultation questionnaire showed that agreement with the principle of
moving power and funding from local government to groups of local
governments working together was 71% with 32% of respondents strongly
agreeing. Southampton has the highest level of agreement and those who live
outside the Solent Deal area have the lowest level of agreement.
4.6. Consultees were also asked about their agreement with the principle of the
Isle of Wight, Portsmouth and Southampton councils and the Solent LEP
working more closely together. Overall 71% of respondents either agreed or
strongly agreed. The difference between the location of participants shows
Southampton agreement level at 77%, Portsmouth 71%, Isle of Wight 69%
and outside the area 65%.
4.7. The central question of the consultation asked consultees to what extent they
agreed with the preferred option to create a Solent Mayoral Combined
Authority as set out in the draft Governance Scheme, the total level of
agreement with this was 58%. The breakdown of agreement by the local
authority areas shows that the highest level of agreement is in Southampton
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 (64%) and the lowest is Portsmouth (55%) with the Isle of Wight is in the
middle (57%).
4.8. There were a number of open ended questions within the questionnaire which
enabled consultees to express their views in their own words. In total 1,533
respondents made a comment of some description and a total of 5,128
comments have been analysed. The four largest themes that emerged through
the analysis of these comments were as follows (with examples of types of
comments shown);
4.8.1. Mayor and cabinet
Just over a quarter of respondents made a comment on this
issue with 60% of these people against the proposal. People
often commented that they did not like the concept of a mayor,
they thought it would add bureaucracy or they were concerned
about bias
4.8.2. Working together practicalities
Need for fairness e.g. representing all three areas equally and
making sure the Isle of Wight wasn’t disadvantaged
Recognising the different needs of the area
Issues around conflicts e.g. taking longer to get things through
4.8.3. Finances
Concerns about it being an extra cost and in particular the costs
of the extra staff
Concerns about it being a waste of money
4.8.4. Different options
In total about 10% of survey respondents said that they preferred
the status quo
Work together in a different way e.g. by creating "super" unitary
authorities
Exclude some of the proposed members
4.9. The consultation also gathered views via a range of other channels such as
face to face events, public meetings, social media, letters and through
business engagement. The themes that emerged from these broadly mirrored
the views held by the respondents to the consultation questionnaire.
4.10. Over the course of the consultation period the Solent LEP engaged with a total
of 130 organisations from across the region in a range of ways. Most
businesses are supportive of the proposal to create a Solent Mayoral
Combined Authority, especially given the focus on economic growth and
transport. Many businesses are supportive of the principle and would like to
continue to be involved if and when the detail of the proposed deal is being
developed.
4.11. Overall the consultation has gathered a range of views and feedback on the
proposals to create a Solent Mayoral Combined Authority from a wide range of
residents and stakeholders. The majority of respondents are positive about
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 devolution and the proposed option, the comments and suggestions gathered
through the consultation have resulted in a number of changes to the draft
Governance Scheme which are detailed in Section 5 below.
4.12. A number of key stakeholders, including significant employers and
businesses, wrote in to give their views on the Solent proposals. General
letters of support, or otherwise, were not included in the consultation results
referred to above. Attachments that came with the letters were coded and
have been included in the consultation results above. For information all of
these letters, and their attachments, have been attached as Appendix 4. We
have also included the were letters that received during the pre-consultation
engagement with key stakeholders when we invited stakeholders to give their
views on the initial conclusion of our draft governance review - which was
issued without the accompanying draft Scheme, and was subject to minor
amendment. Though it is important to note this in considering the weight to
accord the letters, they are regarded as relevant to this decision
4.13. It is particularly welcome that a number of significant businesses in the Solent
area have welcomed the Solent proposals and also that this was confirmed by
the Solent LEP who also undertook their own consultation process (details
attached to their letter at Appendix 4).
Additional Isle of Wight Specific Consultation Feedback

4.14. At the various Isle of Wight stakeholder meetings the following 10 themes
were raised:
•
•
•

•
•
•

•
•

Marginalisation of the Isle of Wight – a view that the Island may be
treated as a junior/smaller partner in the arrangements and not receive
an appropriate share of the benefits of the combined authority.
Independence of the Mayor – a view that the mayor would favour their
‘home’ electorate rather than work for the benefit of the area as a
whole.
Securing financial sustainability for the Island – a view that the offer of
funding as part of a devolution deal and the potential to share in any
growth in business rates does not address the Isle of Wight’s
immediate financial challenges.
Securing a ‘fair share’ of the investments fund – a view that any
agreements for the sharing of economic funding improvements should
be made before a combined authority is established.
Long term security of the funding offer – a concern that the economic
improvement fund could be withdrawn by Government.
A separate Isle of Wight deal – the Isle of Wight should be considered
the same as Cornwall and offered its own devolution deal (although it is
to be noted that Cornwall was not offered an economic improvement
fund)
No involvement from Hampshire – a view that, given Hampshire’s size
and capacity, any deal would benefit from its involvement.
Too complicated for the average person to follow/understand – simply
too much information to take account of and too many variables to
assess in order to come to a reasonable and balanced judgement.
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 •

•

Social benefits Vs business benefits – a view that the proposed outputs
of a devolution deal were largely business focussed and took no
account of dealing with current social challenges, for example the
increasing demand for adult social care.
Impact of the IW elections – timing of any agreement – could the
arrangements be overturned following the election in May 2017.

4.15. At Appendix 6 is a list of the consultation activity (outside of the online
process) that was specifically held on the Isle of Wight. The issues raised at
these sessions have been fed into the full detailed response dealt with in
appendix 4.
4.16. We have also engaged very specifically with the Parish and Town Council’s on
the Island, and again those who responded through the formal consultation
process have had their responses included on Appendix 4 – but attached at
Appendix 7 is a full list of the Parish and Town Council’s on the Island and
their responses.
5.

Amendments to review and scheme

5.1. There is clear support in the consultation results (see section 4) to the
principle of working together across the three authorities, devolving powers
from central government and having a Directly Elected Mayor as part of the
governance arrangements. Accordingly, the Executive is asked to approve this
review and its conclusion.
5.2. It is worth noting that in quantitative terms, the consultation received high
levels of approval with over 70% of respondents favouring devolution, the
three authorities working together and the areas of activity for devolution
(supporting businesses to grow, skills and employment, housing and
infrastructure, and transport) and 58% of respondents agreed with the
principle of devolving power to a Combined Authority with an elected mayor.
5.3. As stated in section 4, respondents were also given the chance to give
qualitative comments and this was supplemented by discussions at public
meetings and free standing responses that were received. All of this is
included in the report at Appendix 3. It is worth noting that these comments, by
their nature, reflect a minority view with many respondents silent through their
completion of the questionnaire. However they do reflect themes which have
been considered as part of the option appraisal of the Governance Review
and in the development of the Scheme. They included:
•
•
•

Providing clarity about the different functions of the Mayor and the
Combined Authority - this has been made much more clear in the
scheme
No need for additional layer of bureaucracy - the scheme makes clear
that the aim would be for the three Statutory Officer posts to be filled by
existing post holders
Providing clarity about extent of the powers of the Combined Authority,
and over the respective powers and roles of the Mayor and the
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 •

Combined Authority and how decisions will be made - the scheme has
been reviewed to ensure that it is as clear as possible
Providing clarity on the relevant geographical areas upon which the
Combined Authority will focus its work and the relationship of third-party
non-constituent authorities and co-optees to the constituent authorities
and mayor - the scheme is clear that the area of the combined authority
is the three unitary authorities and also makes clear the role of the nonconstituent authorities in the Combined Authority

5.4. Other consultation proposals could either be picked up in future devolution
deal negotiations (such as other areas of work to devolve like health or the
emergency services) or are at odds with the quantitative results and the draft
devolution deal with government (such as no need for an elected mayor).
5.5. The proposals contained in the Review and original draft Scheme have been
incorporated into the finalised Scheme, with amendments made for the
purposes of drafting clarity (such as, for example, making it clear that the
Mayoral Combined Authority should have a power to borrow for any purpose
related to its functions, and clearly describing the respective roles of Mayor
and Combined Authority), as a result of consultation feedback (examples
given in 5.3 above) and the importance of providing clarity as to governance
arrangements, and the exercise of functions.
6.

Reasons for recommendations

6.1. The core test, that is:
Would the establishment of a combined authority be likely to improve
the exercise of the powers and functions described in the Review and
its accompanying documents (in this instance, the Scheme) in relation
to the areas of the proposed combined authority,
is demonstrably satisfied by the findings and conclusions described in the
Review (as informed by the responses to the consultation). The Review is
attached as Appendix 1.
6.2. The Review includes an analysis of the area to be covered by the Solent
Combined Authority. It confirmed that the three unitary authorities are a clear
economic area and together make an internationally recognised economic
hub. The review recognises that the economic and communications interdependencies between the cities and the Isle of Wight are critical to continued
economic success. The review also recognised the role that the area of the
three authorities play in terms of the marine and maritime sector and the high
education research with the three universities based in their area.
6.3. The Review looked at the existing governance arrangements and identified
that the exercise of the relevant economic development, transport and
regeneration functions in relation to the combined area described above, as
well as the individual local authority areas, was being impeded by a lack of
connectivity in decision-making, strategy and delivery, in the functional areas
of economic development, regeneration, and transport. It considered
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 alternative options for the better performance of those functions, in the local
authority areas of Portsmouth, Southampton and Isle of Wight, and the
combined area, regarding:
•
•
•

The exercise of statutory functions relating to economic development,
regeneration and transport in the area;
The effectiveness and efficiency of transport; and
The economic conditions in the area.

6.4. The alternative options considered were examined, including remaining with
the status quo, establishing a joint committee, establishing an economic
prosperity board and establishing a mayoral combined authority. It concluded
that the mayoral combined authority was the best option. This was consistent
with the consultation results.
6.5. The Scheme encompasses the proposals contained within the Review, and its
accompanying draft scheme. In response to feedback received as a result of
the consultation exercise, the description of the governance arrangements,
voting rights, respective role of Mayor and Combined Authority, and powers,
have been developed.
6.6. The council has a priority, expressed in the corporate plan 2015 to 2017, of,
“ensuring that all resources available to the Island are used in the most
effective way in achieving the Island’s priorities”. One of the actions contained
in this priority is to work with partners with a view to achieving, “better
outcomes for the Island’s community and which can mitigate the potentially
damaging impacts of the significant challenges that the council faces. Within
its corporate (2015-17) plan objective to, ‘support growth in the economy,
making the island a better place and keeping it safe’, the council has an
approved action to, “Actively engage in discussions about the creation of a
new combined authority for economic development and integrated transport to
ensure the Island’s best interests are represented in any models which may
emerge in response to the devolution agenda”. This paper brings together the
current position in respects of these discussions.
6.7. The recommendations in this report allow a proposal to be made to the
Secretary of State for him to make a decision about whether to progress the
setting up of the Solent Combined Authority.
7.

Equality impact assessment (EIA)

7.1. The council as a public body is required to meet its statutory obligations under
the Equality Act 2010 to have due regard to eliminate unlawful discrimination,
promote equal opportunities between people from different groups and to
foster good relations between people who share a protected characteristic and
people who do not share it. The protected characteristics are: age, disability,
gender reassignment, marriage and civil partnership, pregnancy and maternity,
race, religion or belief, sex and sexual orientation.
7.2. At this stage the decision sought is to publish and submit a scheme for a
combined authority to the Secretary of State. Any proposed combined
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 authority will not directly provide services to the community (as it will be a
strategic body). However an equality impact (and safety) assessment has
been undertaken and this shows that there will be no direct impact on those
with protected characteristics. Should there be a proposed change in any
actual service delivery as a consequence of the establishment of a combined
authority further Equality Impact Assessment will be undertaken at that time.
7.3. However by establishing a formal strategic body that aims to better co-ordinate
the provision of services like housing and transport across the area, it is
considered that this will make it easier to ensure that the concerns and issues
of those with protected characteristics are taken into account when
determining strategies and approaches.
8.

Legal Implications/City Solicitor comments

8.1. The Local Democracy, Economic Development and Construction Act 2009
prescribes the process and legal tests preparatory to the publication of a
scheme by the Council, and then the making of an order by the Secretary of
State.
8.2. The first stage is to examine the Review. Where it is concluded that the
creation of a combined authority would be likely to improve the exercise of the
powers and functions described in the Review and its accompanying
documents (in this instance, the Scheme) in relation to the local authority
areas of the proposed combined authority, the authorities concerned may
prepare and publish a scheme for the establishment of that authority.
8.3. Having concluded that the exercise of the powers and functions would be
improved, and prepared and published a scheme, the local authorities invite
the Secretary of State to exercise his/her power to make an order to establish
the combined authority.
8.4. In exercising his/her power, the Secretary of State must have regard to the
Scheme, and where a consultation has been carried out in relation to the
proposals contained in the Scheme, then the Secretary of State is not required
to carry out a public consultation, so long as he considers that the any
previous public consultation is sufficient. Accordingly, therefore, the Secretary
of State will consider the proposals and consider what consultation steps may
be required.
8.5. The Secretary of State has various order-making powers under the Act. As
well as making an order to establish the combined authority (to which all the
constituent councils must consent), the Secretary of State may by order make
provision (amongst other matters) for how the costs of the combined authority
are to be met by the constituent councils, for there to be an elected mayor for
the area of the combined authority and for certain functions to be exercisable
only by the mayor, and for functions to be conferred upon the combined
authority in the areas of transport, local authority functions, and other public
authority functions. The combined authority may exercise functions instead of,
concurrently with or jointly with other bodies.
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 9.

Director of Finance comments

9.1. Should a combined authority deal be announced in response to a submission,
then it is expected that this would be accompanied by £30m per annum to
support the delivery of homes, enabling infrastructure and economic growth
across the region. There is a spectrum of ways that the additional £30m per
annum can be leveraged for both housing and economic growth. At one end
of the spectrum, the £30m can be used as direct funding for economic growth
and housing schemes and allocated on a broadly annual (or short term basis).
At the other end of the spectrum, the combined authority could use the whole
£30m to finance up to £500m of borrowing to inject a significant capital
investment into the area.
9.2. Furthermore, wise investment of the £30m-£500m would be expected to
generate economic growth and therefore additional business rates to be used
to both invest in further growth and support public services. A modest 1%
increase in business rate growth will generate an additional £2.1m across the
area. The £30m cannot be used as revenue funding to support the delivery of
the council’s services; it can only be used to the combined authority in the
delivery of its responsibilities.
9.3. Additionally, a combined authority deal may provide the opportunity to retain
100% of Business Rates in advance of the National Scheme to be introduced
in 2020. This provides the prospect of retaining 100% of any uplift in Business
Rates growth in the future which can be re-invested in both further growth
opportunities and sustaining public services. This will sharpen the incentive for
the combined authority to:
9.3.1. directly contribute to growth through efficient investments; and
9.3.2. indirectly create the conditions for growth
9.4. Under the 100% Business Rates proposal, sustaining high quality public
services will be directly linked to economic growth and therefore economic
prosperity of the region. The move to 100% Business Rate retention should
create better conditions for growth and greater opportunity for sustainable
public services.
APPENDICES ATTACHED
Appendix 1 – the Governance Review
Appendix 2 – the revised Scheme
Appendix 3 – report on the outcome of the consultation
Appendix 4 – letters of support
Appendix 5 – the Equality (and Safety) Impact Assessment

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 Appendix 6 – list of the consultation activity held on the Isle of Wight
Appendix 7 – responses from IW Town and Parish Councils

Contact Point: Chris Mathews, Strategic Manager for Organisational Change and
Corporate Governance,  821000 e-mail chris.mathews@iow.gov.uk
JOHN METCALFE
Chief Executive

JONATHAN BACON (CLLR)
The Leader and Executive Member for Resources,
Organisational Change and Children’s Services

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