Yesterday, chancellor Rishi Sunak announced a £375 million funding package for UK skills. Catchily named initiatives like Kickstart and Restart saw a boost in funding, from a chancellor who declared himself “committed to building skills”. But while any investment is welcome, there is a fundamental problem with Sunak’s announcement – the fact that central government is making it at all.

The UK is one of the most regionally unequal countries in the developed world, with jobs needs, opportunities and education levels varying hugely from place to place. It seems common sense, therefore, that it should be local areas and their people – and not Whitehall or Westminster – who design the training they want and need. And yet, apart from some small transfers of power over recent years, skills policies and budgets remain stubbornly centralised.

Part of the problem, I would suggest, is that we have never wholeheartedly bought into the devolution agenda. The way in which our institutions are run and funded, the traditional snobbishness about the local, and the tendency to put our faith in Westminster politicians with privileged backgrounds and little experience of grassroots politics, have all tended against it.

Spending review: Chancellor announces new funding for skills

Opinion: Why teachers need a pay rise

Burnham: 'Now is the time to devolve skills policy'

However, the regional inequalities exposed and accentuated by the Covid-19 pandemic, and the tensions it has created between local and national government, have made the question of how to facilitate place-based strategic planning and collaboration even more urgent. The pandemic has laid bare the limitations of the localism agenda of recent years; its fragmented, often half-hearted nature, and the uneven, and frankly unhelpful, distribution of power at different levels of government. The consequence of this, for further education and training, is a system that is top-heavy, often unwieldy, and not sufficiently flexible to respond to changing local circumstances and challenges at community level.

Community-led devolution could transform FE and skills

This needs to change. Research published today by the think tank New Local, supported by FETL, shines a light on devolution’s huge potential to transform further education and skills.

What makes New Local’s vision new and exciting is that it’s about more than a transfer of power from central to local government. Instead, it calls for "community-led" devolution, guided by local partnerships of councils, colleges and communities, who would control budgets and collectively determine what training is on offer.

This is not to say, of course, that the agenda is without challenges. As anyone who has tried to work strategically at a local level will tell you, the devil is often in the tangled detail of implementation. Making community-led devolution work will involve a broad understanding and appreciation of different types of provision – from adult and community learning to higher education, and everything in between. In addition, and perhaps crucially, there needs to be a willingness among different types of institution to work closely together, to be clear about their role and function, and, where necessary, to compromise.

This is achievable, and there are examples of very good practice in this area. Rochdale’s "Citizens' Curriculum" for example, involved the borough council working with people who were unlikely to participate in learning to co-produce a curriculum that met their needs and interests. A cost-benefit analysis of the pilot found that, for every £1 the council invested, it achieved a £2.18 return on investment for the local authority and other organisations such as the NHS, police and Department for Work and Pensions.

As the country comes to terms with the economic fallout of the Covid-19 crisis, while adjusting to the numerous other challenges it faces – from climate change to Brexit – it is critical that local responsiveness is built into our response, and local areas are able to tailor their strategies effectively to the realities on the ground. The case for community-led devolution is strong and persuasive. Getting this right will not be easy, particularly at the level of institutions, but it will not be possible without a genuine redistribution of powers and resources from the centre.

Dame Ruth Silver is president of the Further Education Trust for Leadership