The Government today announced the award of 14 ‘community budget’ pilots for 2012 -ten more than the four originally planned – to give councils and communities greater powers to control their budgets and pool resources.

Whitehall hopes to save billions of pounds through the funding schemes, claiming this approach has the potential to save up to 20% of spending in some areas.

The project also aims to improve service delivery by utilising local expertise. Councils will create joint teams with local partners, aided by government officials and the Local Government Association, and establish devolved budget proposals and decision-making structures for locally run operations. A Challenge and Learning Network will also be set up to share best practice with other areas.

Announcing the initiative this morning deputy prime minister Nick Clegg said: ‘Community budgets will give professionals the clout to control how money is spent in their communities.

‘They will put local authorities in the driving seat to deliver better services, cut red tape and save millions of pounds of taxpayers’ money.’

Four ‘showcase areas’ - Cheshire West and Chester, Greater Manchester, West London and Essex - have been chosen to run ‘whole place’ community budgets focusing on ‘ways to create local growth and reduce dependency on the state’.

Cheshire West and Chester aim to pool a single budget of between £3-4bn from over 150 local services, Greater Manchester aims to join up local investment to help create 50,000 jobs in the next four years and Essex will pull together a single set of objectives for their £10.4bn public services budget to create savings and improve delivery.

In West London, Hammersmith & Fulham, Kensington & Chelsea, and Westminster councils have put together the ‘Tri Government guarantee’ - an ambitious package of targets they hope to achieve using community budgets scheme, including making sure every young person under 25 has a job or is in training or education.

And 10 ‘neighbourhood level’ areas will run smaller scale community budgets that give residents a ‘micro-level’ say over local service delivery; Cowgate, Kenton Bar and Montague in Newcastle; White City, Kingston, Poplar, Queens Park in London; Ilfracombe in North Devon; Bradford Trident; Sherwood in Tunbridge Wells; Haverhill and Castle Vale, Shard End and Balsall Heath in Birmingham.

Communities secretary Eric Pickles said: ‘We need a gear change that makes ‘silo control’ obsolete and starts a local service revolution that puts people at the heart of spending decisions and saves money.’