UK regions to be handed powers to boost growth

Nick Clegg, the Deputy Prime Minister, was expected to announce the so-called “city deals” on Monday night during a speech in which he was due to attack a focus on a London-centric economy that has allowed other great cities to “wither”, reports The Telegraph.

Areas including Sunderland, the Black Country, Brighton and Hove and Leicester will be given greater independence from Whitehall as the Government looks to devolve power from London to the regions. They will be given more control over spending in areas such as training and skills, roads and planning in return for showing that they have a robust blueprint for local growth.

In his first Mansion House speech to the City as Deputy Prime Minister, Mr Clegg was due to say: “Rather than London laying down the law, cities have the right to do things their way.

“Letting go of power and money doesn’t come naturally to Whitehall. Over time, the economic importance of other parts of the country has been devastatingly downplayed, as the economic elite have narrowed the debate towards a London-centric view.

“Rather than let our industries and communities wither, we need to free up cities outside of London that have their own unique selling points.” He said the UK could gain £41bn a year if other cities and regions could close an “output gap” with the capital.

“It is in everyone’s interests – not least London’s itself – if that potential is now tapped. There can, and must, be more than one jewel in our crown,” he said.

Eight cities were given the first city deals last July. They allow more spending control in areas such as planning and transport, giving local authorities the right to spend tax receipts from local businesses.

The increased “localisation” drive follows Lord Heseltine’s review on industrial strategy, which calls for £49bn to be moved from central government to the English regions to help local leaders and businesses.
Lord Heseltine is said to be optimistic that his message has got through. He told the Policy Exchange think tank last week that “change is in the air”.

The CBI welcomed the new city deals. It said that they give cities “real powers and resources which, if implemented well, help to regenerate local economies, stimulating private investment and growth”.