Mayors with new devolution deals are complaining that targets dictated by Whitehall are limiting their local flexibility, according to a report by the national spending watchdog. Seven mayor-led combined authorities now have integrated settlements, or “single pot”, deals that give “greater funding flexibility” to address local needs. The deals mean that the combined authorities are handed a single multi-year funding pot running from this financial year to 2028-29, with spending organised into six “themes” such as skills and employment support. This replaces a system of grants for specific funding streams, such as the adult skills fund and skills bootcamps, that are ring-fenced and renewed annually. But according to the National Audit Office (NAO), agreement about what targets mayors should work towards was delayed until March this year due to a “tension” between mayors and government departments that previously controlled the funding. In a report ‘Devolution in England: funding and accountability’, the watchdog said mayors felt the targets, set out in pre-agreed “outcome frameworks”, were too strongly shaped by national priorities, contained too many output measures, and were “limiting their ability to reflect local need”. Mayors told the watchdog some departments were “initially reluctant to flex” on the number of targets, with the Department for Work and Pensions demanding specific outcomes, and the Department for Transport initially proposing 44 separate indicators. Some mayors told the NAO they felt government departments treated them as “delivery arms of central government”. But one department told the spending watchdog their approach was “deliberate” and aimed at managing delivery risk due to mayors proposing targets that “lacked a clear logic or baseline”. Defending their approach, government departments told the NAO that the targets were a necessary part of accountability to ministers and Parliament, which ultimately approves all public spending. But performance reporting burdens on mayors are currently “greater than initially envisaged” in the English Devolution white paper, which promised to replace “top-down micromanagement” of local leaders with “locally accountable autonomy”, the watchdog concluded. Due to the tensions, the NAO said negotiations leading up to March were “protracted and resource intensive” and called on mayors, government departments and the Ministry for Housing, Local Government, and Communities, to ensure targets in future deals are “proportionate” and reflect the minimum assurance needed. It also called on the government to strengthen local scrutiny arrangements, minimise the amount of performance information departments ask for, and to agree outcomes frameworks in a “timely manner”. Reports from combined authorities show that outcome frameworks were supposed to have been agreed by January this year, but slipped until mid-March, shortly before the start of the new financial year. In an update in March, South Yorkshire Combined Authority said the delays were due to demands from the Department for Transport and “relatively late” inclusion of targets linked to the government’s construction skills package, which is overseen by the Department for Education and Department for Work and Pensions. It added that the targets only reflect funding streams in the integrated settlement, rather than “everything we care about in South Yorkshire”. What are the targets? Skills-related targets agreed by West Yorkshire include numbers of residents enrolling on education courses, starting a supported employment programme, or completing an industry placement. While some annual targets such as numbers of learners progressing to a level 3 qualification for the first time have “baseline” figures, several do not. The Greater London Authority has agreed to a target of 33,200 adults being trained to progress in or towards key sectors over three years, against a baseline of 13,000 in 2023-24. Combined authorities are held to account for their performance by “programme boards” of government officials who meet with mayoral teams every six months to discuss progress. The English Devolution and Community Empowerment Act, which received royal assent in April, will also give extra scrutiny powers to committees of local councillors from April next year. This includes the power to carry out thematic inquiries, to require key people from a combined authority to attend meetings and answer questions, and a duty to assess value for money of decisions mayors take. The West Midlands Combined Authority, which has a trailblazer integrated settlement which launched in 2025-26, a year earlier than most areas, has already set up a new local scrutiny committee. At its first meeting yesterday, officials told reported that three out of ten outcomes were rated ‘amber’, with the remaining seven rated ‘green’. Its target of increasing the number of residents receiving level 3 qualifications was rated amber, as only 9,812 learners started a such a programme against a target of 14,200. Gareth Thomas, a skills policy consultant, said: “The use of nationally set targets does support management of allocations across the country, as well as national statistical analysis and statistical publications, however it does potentially restrain the impact budgets can have locally. “For example, if we want to compare the performance of England (or the UK) to other OECD countries we need a common measure. “National measures and headlines are important for national statements and political headlines. This may also have something to do with why we still have such measures.” He added that some of the adult skills related targets related to enrolments and achievements appeared to be based on DfE “thinking” and could evolve following skills policy moving to the DWP and Andy Burnham becoming prime minister.