Its State of the Nation report on devolution stated that councils should be grouped as combined authorities, charged with planning regional pipelines of projects and with wider powers to raise money and organise skills training to deliver them.
Combined authorities have been set up in the major conurbations, where groups of councils jointly exercise devolved powers including, in most cases, over transport and infrastructure.
But their financial powers are limited and progress in the rest of England has been riven by disputes over boundaries.
The ICE said: “Realising the growth through infrastructure agenda of devolution will require improved skills provision: there is little point in planning new railways or power stations if there is not a trained workforce to build them.”
While most devolution deals have included local control over skills policy for people aged over 19, central government has clung on to age 16-19 provision, seeing this as part of drive to encourage academies and free schools.
The report said the effectiveness of tying together skilled labour and infrastructure plans “would be further improved by also transferring powers over skills for 16-19 year olds”.
Devolution proposals should be based around devising regional pipelines of confirmed infrastructure projects, giving the industry confidence in its future workload and allowing it, alongside local and central governments, to invest in the training needed, the report said.
Some procurement policies had become excessively local in focus “to the extent that a start-up in a neighbouring district is constrained from growing” and regional infrastructure pipelines could help smaller firms to grow, the ICE said.
The report also called for an end to restrictions on how combined authorities can raise and borrow money from the private sector to enable them to spend more rapidly on infrastructure projects.
Most devolution proposals – whether successful or not – have strongly emphasised economic growth, but the ICE said they should also set out how they would improve environmental sustainability and quality of life, so as to generate more public support for devolution.
Outside the conurbations, most devolution bids have foundered on local opposition to the insistence of chancellor George Osborne that an elected mayor must be created to be accountable for the use of devolved powers.
A poll for the ICE showed only 33 per cent of people thought devolution should be contingent on an elected mayoralty, with the report stating that leadership arrangements should be flexible and suited to each area.
ICE vice-president Adrian Coy said: “It is right that infrastructure investment is the driving force behind Government’s plans to rebalance the economy, and we hope to see ongoing commitment to the devolution agenda during the EU exit negotiations, so momentum is not lost.
“Looking forwards, combined authorities must now take the helm and deliver these benefits locally. This will be no mean feat, but with the right frameworks, investment and skills in place they can succeed.”
