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Cities sign new devolution deals

Liverpool and the West Midlands have this week become the fifth and sixth city regions to sign up to new devolution deals

New local powers over transport, housing, skills and business support are set to be handed to Liverpool and the West Midlands following the agreement of new devolution deals this week.

As required by Chancellor George Osborne the city regions must now elect Mayors who will chair newly created regional combined authorities – a model pioneered in Greater Manchester which signed the first devolution deal in November 2014 and this has been followed by Sheffield, the North East and Tees Valley.

“Crucially, the investment included in the deals, will help local leaders to undertake ambitious infrastructure projects, such as developing the new deep water port in Liverpool, or extending metro connections in Birmingham. Having a Mayor will also ensure that these regions are well placed to acquire more powers and funding from the Government in the future,” said Alexandra Jones, chief executive of the think tank Centre for Cities.  “However, these deals will only go ahead if the Government’s Cities and Local Government Bill is successfully passed through Parliament in the next few months. It’s now vital that MPs from all parties constructively engage with the Bill – if it isn’t passed, the West Midlands and Merseyside, as well as other places across the country, will miss out on the benefits and opportunities that devolution offers.”

"These deals will only go ahead if the Government’s Cities and Local Government Bill is successfully passed through Parliament in the next few months,"

Alexandra Jones, chief executive,

Centre for Cities

The Cities and Local Government Bill makes provision for the election of Mayors and the transfer of additional powers to combined authorities. It is currently at Committee stage in the House of Commons.

In the West Midlands the announcement came with the promise of a new £36.5M per year growth fund over the 30 year deal, which would support borrowing of £1bn. “We have moved incredibly quickly to create the partnership between the seven metropolitan councils and our three LEPs and we are delighted the government has recognised this and has rewarded our ambition with the biggest investment package in the country,” said Councillor Bob Sleigh, Chair of the Shadow Board of the West Midlands Combined Authority.

Liverpool will receive a £30M per year as part of the deal which is to be directed into the Liverpool City Region Single Investment Fund, aimed at unlocking the economic potential of the River Mersey and Superport as well as maximising opportunities from HS2. “I believe that it is the best deal we can secure at this time for the benefit of the Liverpool City Region,” said Councillor Phil Davies, chair of the Liverpool City Region Combined Authority.

Multi-year budget settlements for transport in the devolved city regions are expected to be set out in the Comprehensive Spending Review later this month. The Mayors will also have power over bus services, and planning policy for housing. In the West Midlands the Mayor will also receive powers over key local authority road networks. Powers to the new combined authorities include control of the investment funding allocations, skills funding, employment support and other business initiatives.

“We have moved incredibly quickly to create the partnership between the seven metropolitan councils and our three LEPs."

Councillor Bob Sleigh, chair, 

Shadow Board of the West Midlands Combined Authority.

In the West Midlands this includes supporting the HS2 growth strategy and funding the Curzon Street Enterprise Zone extension as well as committing to funding the metro extension to Eastside, subject to business case, to support the first part of the HS2 growth strategy, and supports the work of the WMCA to develop a delivery plan, encompassing the Metro extensions from Curzon to Interchange and from Brierley Hill, in order to realise the full benefits of HS2

In Liverpool the combined authority will also have powers to work more effectively with UK Trade and Investment to boost trade and support more international events. “This revolutionary deal cements the area’s position as a gateway to the north, from North Wales all the way to Newcastle, and gives local people control over their own affairs for the first time,” said George Osborne announcing the deal. “In becoming the fifth northern city region to take on these new powers, the momentum of the Northern Powerhouse is now simply unstoppable and I want to thank the Council leaders for working together to come to an agreement which will give Liverpool City Region a powerful new voice in national life.”

Further powers may be agreed over time and included in future legislation. Mayoral elections are expected in 2017.

If you would like to contact Bernadette Ballantyne about this, or any other story, please email bernadette.ballantyne@infrastructure-intelligence.com:2016-1.