Prime Minister Andy Burnham has unveiled plans to create a dedicated growth policy unit based in Manchester, marking an effort to reduce the Treasury’s traditional dominance over economic strategy. The initiative, to be overseen by cabinet member Louise Haigh, draws inspiration from Harold Wilson’s Department for Economic Affairs, a historical attempt to inject longer-term thinking into British economic policymaking. Burnham argues that the Treasury’s dual responsibility for both growth and fiscal control has created institutional constraints, stating that placing growth leadership in No 10 would provide the necessary authority to address systemic blockages across government.
The new department’s strategy centers on devolving economic powers to regional metro mayors, enabling better coordination of fragmented growth-related policies spanning housing, education, planning, and related areas. Burnham’s chancellor, John Healey, previously worked on regional development agencies during the Blair-Brown government, suggesting both leaders share a strong commitment to decentralized economic development. Several policy experts view the coordination potential positively, comparing the approach to how the Office for Climate Change successfully aligned environmental policy across departments. However, critics note that the Treasury will retain control over taxation and spending, potentially limiting the effectiveness of a growth-focused counterweight.
Skepticism remains among some observers about whether the initiative can succeed. Former Conservative Treasury official David Gauke contends that the Treasury’s inherent power over finances makes it inevitable as the dominant economic force, and questions whether a Manchester-based office with limited access to the Prime Minister can meaningfully push pro-growth policies. The Treasury has confirmed the new unit will focus specifically on local growth and devolution rather than challenging overall economic strategy, and has contributed a small number of staff members.
As the new department becomes established, analysts highlight unresolved questions about how conflicts between No 10 and the Treasury will be handled. Experts suggest the success of Burnham’s approach may depend less on institutional restructuring and more on ensuring improved collaboration among key economic decision-makers, including the Treasury, Bank of England, and Office for Budget Responsibility.
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