![\"Andy](\"https:\/\/dailybusinessgroup.co.uk\/wp-content\/uploads\/2026\/06\/Andy-Burnham-taking-the-oath-as-MP.png\")
Andy Burnham will set out plans for greater devolution in England next week which will put pressure on the Scottish government to maintain and improve its performance and competitiveness.<\/p>\n
Mr Burnham, who is expected to become prime minister next month, will announce the devolution of powers and money from central government to England\u2019s regions.<\/p>\n
His aim is to rebalance the economy from the south to the north of England. Creating more powerful and financially stronger regions led by newly-elected mayors will also present a bigger challenge to Scotland, not least in the scramble for inward investment. <\/p>\n
The English regions will also have greater powers over housing and education. Some infrastructure spending will be diverted to local decision makers with mayors and combined authorities likely to oversee a bigger allocation of money from the UK government.<\/p>\n
He proposes a a \u201cNo10 of the North\u201d\u00a0which will provide greater focus for this part of the UK as an attractive location for investors. <\/p>\n
He is also likely to push ahead on devolving some areas of tax revenue to local government. Combined authorities would keep all of any increase in business rates that they generate in order to attract investment into their areas. <\/p>\n
The plans could be extended to income tax so that a proportion of any additional tax revenue generated could be spent locally.<\/p>\n
Greater Manchester, which has more devolved powers than any other part of England, has had an average annual economic growth rate of 3.1% since 2015, more than double the national average of 1.5%. <\/p>\n
It has outperformed, not only other parts of England, but also Scotland on a number of measures despite having fewer powers than Holyrood.<\/p>\n
While Scotland performed better in attracting foreign direct investment than the English regions for the eleventh consecutive year, an increase in the powers and tax-friendly appeal of those regions will make it more challenging for Scotland to maintain that status. <\/p>\n
Recent data from EY also shows a growing competitiveness for FDI. Scotland saw a fall for the second consecutive year, down by 20%in 2025 to 108 projects, from 135 in 2024. <\/p>\n
This was a sharper decline than the year before and resulted in Scotland posting its lowest total foir annual projects since 2020.<\/p>\n
Mr Burnham shares the view that Britain isn\u2019t working to the benefit of all because of the imbalance towards the south and believes that the failure of the north is also a constraint on the potential of London and the south east.<\/p>\n
His proposed changes will be easier to apply because of existing moves to reorganise local government around strategic authorities \u2013 mainly run by a directly elected mayor.<\/p>\n
There is also talk of hiving off part of the Treasury with a new department dedicated to economic growth which would have a remit to ensure a greater spread of public investment.<\/p>\n
Chancellor Rachel Reeves has been criticised for focusing much of her infrastructure plans around the south east, boosting the Oxford-Cambridge corridor and investing in airports and rail projects in the region. <\/p>\n
Mr Burnham is thought to be keen on reigniting the abandoned plan for the northern link of the HS2 project.<\/p>\n
His thoughts on Scotland remain largely unknown but he is said to favour a stronger commitment to oil & gas which would put him at odds with Energy Security Secretary Ed Miliband who has pushed the net zero strategy and is among three contenders to replace Rachel Reeves in Number 11.<\/p>\n
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