The Chamberlain News

£8bn West Midlands metro mayor devolution deal gets Government approval

West Midlands council leaders have finally reached a metro mayor devolution agreement with the Government which they say is worth £8 billion over 30 years and will create 500,000 new jobs.

After more than two months of tense negotiations with the Treasury and Chancellor George Osborne, the seven metropolitan authorities and the region’s three local enterprise partnerships are recommending approval of the country’s biggest devolution deal to date.

It is dependent on the West Midlands Combined Authority being overseen by a directly elected mayor and a cabinet of council leaders, and the deal must be approved by each of the councils – Birmingham, Coventry, Solihull, Wolverhampton, Walsall, Dudley and Sandwell.

However, a press statement issued by WMCA does not say whether the mayor will have powers to raise a council tax and business rates levy, which council leaders wanted Mr Osborne to approve.

The statement describes the agreement as “the first step” towards:

• Local control of investment plans and funds for West Midlands’ priorities of transport and land reclamation for housing and employment.
• Local control of adult skills provision.
• A local employment service.
• The development of new devolved approaches to mental health, troubled individuals and youth justice services.
• Control over a more integrated local public transport system and influence over strategic road network planning.
• A devolved business support and inward investment system.
• An integrated locally led approach to public sector land and property – One Public Estate.

The package is based on a £1.2 billion Government contribution over 30 years.

WMCA’s summary document of the deal can be downloaded here.

The Government has agreed to an annual payment of £36.5m over thirty years to support local borrowing of over £1bn.  In addition it has approved funding of £97 million for an extension of the metro tram system from Birmingham city centre to Adderley Park.

The proposed agreement with government will see WMCA responsible for an investment package worth more than £4 billion to deliver the HS2 growth strategy, with the potential to add £14 billion to the area’s economy as well as the creation of around 100,000 related jobs.

This will support the delivery of the metro extensions to Brierley Hill and HS2 interchange, as well as the UK Central infrastructure package and improving connectivity to Coventry.

The deal will also see devolved funding and responsibility for administering the 19+ adult skills budget and business support programmes, as well as a £200 million land remediation fund that will allow brownfield land to be brought back in to use for housing and employment.

This is on top of a planned £50m Business Innovation Centre for the West Midlands.

The WMCA will also bring forward a housing investment fund to support the development of new homes and a locally funded £1bn Collective Investment Vehicle to help companies invest and grow in the region.

The transformation of public services also features in the deal with government.  It has committed to working alongside the WMCA in co-designing approaches to improving the life chances of troubled individuals and to designating the region as a pilot area for its review of the Youth Justice system.

Shadow WMCA chair Bob Sleigh, the Conservative leader of Solihull Council, said:

This is an historic moment for the West Midlands.  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.

We are committed to building on our strengths, including our exports and our inward investment, and to working towards increasing the £80 billion that the region currently contributes to the UK economy.

This proposed deal, which must be agreed by each individual authority, allows us to keep more of the income that we generate and to re-invest it across the region, without the need to refer back to government.

WMCA vice chair Cllr Darren Cooper, the leader of Sandwell Council, said:

We have been clear all along that we would push for the best deal we could get for the West Midlands and we have achieved that.

However, this is only the start of our devolution story.  The key issues here are very simple.  By working together we believe we can create a vibrant, successful and sustainable region where people want to live and invest.

More and better jobs, improved transport and good quality housing are at the heart of this deal and by moving decision making out of Whitehall directly to the West Midlands we can and we will make a real difference.

Jonathan Browning, Chair of the Coventry and Warwickshire LEP, said:

This proposed devolution agreement is exciting and unique.  Our local authorities have recognised that the private sector has a huge part to play in this devolution agenda

The three LEPs in the Black Country, Birmingham and Solihull and Coventry and Warwickshire have worked successfully together for the past few years and now we will be able to deliver even more as part of the biggest combined authority in the country.

We know that scale matters and with a population of over four million people we are incredibly well placed to compete internationally for investment as we look to accelerate a manufacturing renaissance for the region.