Yorkshire’s big cities should be given sweeping powers over taxes and spending currently controlled in Whitehall in the next five years, according to a new report.
It calls for cities to be able to retain local income tax receipts, have full control of property taxes and be responsible for all public spending in areas such as local transport and housing by 2020.
Cities should be given much greater freedom to borrow and reap the financial rewards of their investments and in the longer term set their own income tax rates, it says.
The report by thinktank ResPublica also warns that if cities are to take on major powers they will also need to change the way they are run and that directly-elected ‘metro mayors’ should be considered.
It has been published today to coincide with a summit of the UK’s biggest cities outside London, including Leeds and Sheffield, where they will step up their calls for the control over major powers and spending to be moved from Whitehall to a local level.
They will argue large scale devolution is needed to realise all the major parties’ ambitions to rebalance the economy away from the South East. The summit comes just days after Chancellor George Osborne said he hoped to end the deadlock over discussions with West Yorkshire council leaders over a devolution deal and have an agreement in place in time for the Budget in mid-March.
Leeds City Council leader Keith Wakefield, who will be at the summit in Glasgow, said: “In order to get the economy to rebalance and be a northern powerhouse, devolution is absolutely vital.
“Joining up with other cities has given us a powerful voice and we want to make sure we get the best devolution deal in the country.
“We will be extremely disappointed if he is not being as ambitious as we are.”
Efforts to devolve powers from Whitehall have become a process of haggling between local and national government as well as between different parts of the coalition with the Chancellor insisting areas taking more control over their own affairs should have elected mayors and Deputy Prime Minister Nick Clegg arguing there should be no preconditions. The ResPublica report calls for devolution to be taken out of political hands and put under the control of a new “Devolution Agency”.
It suggests devolution to cities could help create an extra 1.3 million jobs over the next 15 years. Report author and director of ResPublica Phillip Blond said: “If we do this correctly the benefits to the public purse will be in the billions of pounds.”
At their summit in Glasgow today, the Core Cities group, including Sheffield and Leeds, will launch a “Modern Charter for Local Freedom” modelled on Magna Carta.
In the year the 800th anniversary of Magna Carta is celebrated, the new charter sets out the powers they say they need to grow their economies.
Core Cities chairman Sir Richard Leese, the leader of Manchester City Council, said: “We believe it is only by devolving powers to cities and their regions that the UK can succeed on a global stage.
“What is good enough for the UK’s nations should be good enough for our cities. We are proposing a revolutionary shift in power from our remote parliaments to local people who know their places best. This is a low-risk, high impact strategy to secure a bolder, better national future that will create jobs, improve lives and renew our democracy.”