Clegg extends cities’ spending powers

Liverpool and Manchester are among eight cities to benefit from new spending powers announced by Deputy Prime Minister Nick Clegg.

England's largest cities are being offered what the government called "a menu of transformative new powers" as part of new City Deals.

The deals, to be steered by each city's Local Enterprise Partnerships, include the following benefits:

  • Pooled funding in one capital pot instead of separate pots for roads, housing etc.
  • Freedom to set lower business rates for companies in certain sectors if agreed
  • New City Apprenticeship Hubs to do administration and paperwork needed for apprenticeships, so that employers don't have to
  • "Power over infrastructure – unlocking investments to improve transport, housing, broadband. Currently transport projects can be delayed because cities have to jump through numerous Whitehall hoops. The Government wants to hand over the decision making to cities so they can press on with projects that will make the biggest difference. And the Government will want to look at ways of increasing local accountability for local public transport, building on models like Transport for London."
  • Greater control over regeneration funding and responsibilities, taking on functions and spending currently held by the Homes & Communities Agency
  • Cities can bid for a share in a £100m pot to spend on broadband infrastructure

Individual deals with each city are scheduled to be agreed before the Budget in 2012.

Clegg said: "Cities are the engines of economic growth. Whitehall should not be like an overbearing parent, throwing money at cities but refusing to let them stand on their own two feet. So we will have a bonfire of Whitehall controls to empower our cities to go for growth.

"We need our cities to be economic, social and cultural magnets – places people aspire to live. Firstly, cities will have greater freedom to invest in growth. Secondly, having power over transport, housing, broadband. Finally, the power to boost skills and jobs.

"Our cities have been straining at Whitehall's leash. They now have a once in a generation opportunity. I urge them to seize it and make it count."

Sir Richard Leese, leader of Manchester City Council and vice chairman of the Greater Manchester Combined Authority, said: "We welcome the opportunity to create a bespoke deal for Greater Manchester to drive jobs and growth through the transfer of responsibility from central government to local areas. Our clear strategy, strong civic and business leadership and track record of delivery makes Greater Manchester exceptionally well placed to do this working with our partner agencies locally and with government."

Mike Blackburn, director of BT and chairman of the Greater Manchester Local Enterprise Partnership, said: "We welcome the announcement by the Department for Communities and Local Government. Manchester is the economic powerhouse of the north and a 'city deal' will help create the right environment for businesses in the region to prosper. The private sector in Manchester has a great track record of working with the public sector to grow the local economy. It is important that decisions surrounding this activity can be made quickly by people 'on the ground' that know the issues concerned."

Clegg said the menu of options as part of the deal is not exhaustive and is intended to raise debate and stimulate debate to do things differently.

The eight Core Cities are Birmingham, Bristol, Leeds, Liverpool, Newcastle, Nottingham, Manchester and Sheffield.

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