Thomas Bridge 02 January 2014

Cities should 'share' proceeds of growth, think tank says

Cities should share proceeds of growth, think tank says image

City budgets should reflect local successes and ‘share’ the proceeds of employment growth with the Treasury, a think tank has said.

With government spending on economic development continuing to favour London and the South East, council leaders in Manchester, Liverpool, the North East, South Yorkshire and West Yorkshire must ‘speak with a single voice’ to help rebalance the economy – according to IPPR North.

Cities across England should be entitled to claim ‘cashback’ from the Treasury for introducing measures that successfully boost local employment, the Rebalancing the books report claims.

Arguing town halls need to find a ‘Boris of the North’ to promote investment, the think tank said top priority infrastructure schemes had to be identified on a similar scale to London’s Crossrail.

IPPR North said the five combined authorities in existence in the North by 2015 should be well placed to take on greater powers over council tax and business rates, alongside place-based budgets ‘carved out’ of central departments.

Director of IPPR North, Ed Cox, said: ‘The prime minister used to talk about the public “sharing in the proceeds of growth” and that’s the same logic he should apply to cities in the North of England.

‘Cities which have the greatest potential for growth also have the worst poverty and unemployment. An “earnback deal” would provide an even greater incentive to invest in employment schemes which will not only finance growth, but will also help relieve poverty.’

Communities secretary Eric Pickles has said this year’s funding settlement ‘tried to be fair to every part of the country’, with decentralisation of local government finance putting councils ‘in the driving seat’.

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