The Department’s arrangements for working with local government do not appear sufficient to manage the trade-offs it will need to make on funding and scope. The Department has agreements in place with individual local areas and is working with local leaders in sub-regional groups to develop plans, build consensus and provide transparency on trade-offs and decisions. These groups do not make decisions on the programme, but they can make recommendations to Ministers. While HM Treasury is confident the arrangements are working well currently, we are concerned the system will not hold when it needs to make difficult trade-off decisions on scope and funding that affect different local areas disproportionately. For example, without the injection of sufficient local funds, an enhanced scope to increase local benefits in Manchester could be at the expense of benefits in another local area. Much appears to be resting on the Northern Growth Envoy’s ability to mediate between local areas and central government, but this is a new and untested role. recommendation The Department should set out the principles by which it will work with local government and confirm by when it will update us on the arrangements in place.