1 December 2015 Last updated at 09:29 GMT
This would give local communities more power and control over things like transport and business rates, but it would also involve the election of a Mayor.
BBC Look North's political editor Len Tingle takes a look at the future for Yorkshire and how this could work.
In his spending review last Wednesday, the Chancellor of the Exchequer, George Osborne, talked about "the devolution revolution" in which some of the big decisions about where money is spent are made locally instead of centrally.