At Autumn Budget 2024, the government announced that integrated
settlements will be implemented for Greater Manchester and West
Midlands Combined Authorities at the start of the 2025-26
financial year, and for four further Mayoral Combined Authorities
(MCAs) from 2026-27 – the North East, South Yorkshire, West
Yorkshire and Liverpool City Region.
The arrangements underlying these integrated settlements are set
out in the documents for the Memorandum of
Understanding for the single settlements(MoU). A high-level overview
of this approach is given in the following section. The overall
settlements for Phase 1 of Spending Review 2025 will be set out
shortly.
Further details of the integrated settlement for 2026-27,
including the functional responsibilities, scope, formula and
allocated amounts, will be confirmed at the conclusion of Phase 2
of the Spending Review.
Background
The Memorandum of Understanding (MoU) sets out the underlying
arrangements for the integrated settlements for Greater
Manchester and the West Midlands Combined Authorities. The
MoU will be
reviewed before the end of every Spending Review period to ensure
it remains fit for purpose. Therefore, the MoU will be updated at the
conclusion of Phase 2 of the current Spending Review period.
As set out in the MoU, the functional
responsibilities, scope, allocation mechanisms and quantum of the
integrated settlement will be determined at Spending Reviews.
National funding lines falling under one of the functional
responsibilities will be included in the settlements according to
the process set out in the MoU.
The funds in scope and allocation mechanisms for the 2025-26
Spending Review period will be added to this page in due course.
Integrated Settlements eligibility criteria
The government intends to roll out integrated settlements to
further MCAs. It is important that decisions about which areas
are eligible for this are made in a transparent way. To be
eligible for the integrated settlement, an MCA or Mayoral County
Combined Authorities (MCCA) must meet a
series of objective criteria related to their track record of
financial management. These criteria are that:
- the MCA or
MCCA (or a
predecessor devolved institution) has been in existence, with a
directly elected leader in place, for at least 18 months
- the MCA or
MCCA has a
published Local Assurance Framework in place
- in the last 18 months, the MCA has not been the subject
of a Best Value Notice, a MHCLG commissioned independent review
or a statutory inspection or intervention
- the MCA or
MCCA is
not subject to any ongoing (or implementing recommendations from
an) externally mandated independent review
- there are no material accounting concerns covering the
current or previous financial year which relate to the
MCA or
MCCA's
ability to manage public money
On meeting the above criteria, the government will further
consider the devolved authority's track record of managing major
programmes.
The government applied this process at Autumn Budget 2024 and
confirmed that the North East, Liverpool City Region, West
Yorkshire and South Yorkshire Combined Authorities will be
eligible for the integrated settlement from the start of the
2026-27 financial year.
Further details of the integrated settlement for 2026-27,
including the functional responsibilities, scope, formula and
allocated amounts, will be confirmed at the conclusion of Phase 2
of the Spending Review.
The government will also explore how the integrated settlement
policy could be applied for the Greater London Authority from the
2026-27 financial year onwards, taking into account the capital's
unique devolution arrangements.
Supporting documents
