BIG developments in Sheffield like the proposed new Ikea store will benefit from changes designed to boost Britain’s biggest cities outside London.
Deputy Prime Minister and Hallam MP Nick Clegg is chairing the cabinet committee which aims to implement the changes to make it easier for councils to borrow money for infrastructure improvements to boost economic growth.
Mr Clegg told The Star Sheffield would also be helped by being able to keep all of its business rates.
He said the aim is to allow the council to fund its own projects to help businesses develop. These could include road improvements and preparatory work for industrial sites, which currently have to wait for Government grants or loans.
The change would help companies like Ikea to build their new store in the city, or expansion of the Advanced Manufacturing Park at Waverley.
Money could also be spent on other schemes to help businesses such as creating apprenticeships.
Mr Clegg conceded that reducing controls on council borrowing was a ‘risk’ - due to examples such as the World Student Games, which left the council burdened by a huge debt that will take many more years to repay.
Mr Clegg, whose committee is overseeing the work of the Government’s newly-appointed Cities Minister Greg Clark, said: “We are making these changes because for too long cities like Sheffield have been dependent on Government subsidies without being able to carve an economic future of their own.
“We want to change that and make sure cities become real power-houses of growth - and to do this they need to be set free. Cities are going to be able to keep their own business rates, currently paid to the Government and then handed back divided around the country according to a set formula, which will reward areas for economic success.
“Once we pass legislation, Sheffield will be able to borrow money more easily to enable major new developments, instead of having to wait for Government handouts. Borrowing is currently allowed but subject to tight restrictions, such as when the council borrowed funding to progress the Sevenstone retail quarter.”
Mr Clegg said: “There is a risk allowing councils to make this borrowing but it is worth taking to help provide extra jobs and progress major developments. Cities are important because they account for 60pc of Britain’s economic output. We can’t carry on with a cap-in-hand relationship.”
Mr Clegg said his committee will work with the council and businesses through Sheffield City Region Local Enterprise Partnership to ask what further measures could help.
n The Star Opinion: P8