Integrated settlements for Mayoral Combined Authorities
Details of the integrated settlements for Mayoral Combined Authorities.
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.