SHEFFIEld has today been named as one of eight UK cities chosen to become ‘economic powerhouses’ with a range of extra powers and local control over business development, transport and housing.
In an exclusive interview with The Star, Deputy Prime Minister and Hallam MP Nick Clegg said under the radical plans Sheffield would be able to keep all £180 million of the business rates it collects each year, instead of handing them to the Government.
The city will have a ‘dedicated pot’ of additional funding set aside to pump into major infrastructure improvements - instead of having to bid to Government agencies for cash for each project.
Possible schemes already identified include extensions to Supertram, building a new link road beneath junction 34 of the M1 and council and private housing projects.
Mr Clegg also announced £10 million for Sheffield to fund improvements to broadband internet to help businesses, while an ‘apprenticeship hub’ will be created linking businesses and educational institutions.
Mr Clegg told The Star of the plans ahead of a national announcement to be made at Leeds City Hall this morning.
He revealed Sheffield is being chosen for a ‘dramatic shift in power from Whitehall’ along with Birmingham, Bristol, Leeds, Liverpool, Manchester, Newcastle and Nottingham.
Mr Clegg’s ‘city deals’ will see the government offer greater freedom and autonomy.
In return, cities must guarantee to provide ‘adequate leadership and accountability’, ‘improve efficiency’, and be ‘innovative’.
He said: “We are not going to be able to re-balance the economy until our big cities outside the South East are able to act as power houses for economic growth.
“The changes I am announcing will give cities the freedom to do big, innovative things to create jobs and prosperity.
“It will be the biggest devolution of power towards major cities including Sheffield for years.”
Mr Clegg said city firms will be able to bid for funding from a further £1 billion to be allocated to business development projects from the Regional Growth Fund.
Some £1.4 billion has been allocated so far across the country with local beneficiaries including Forgemasters and Sheffield University’s Advanced Manufacturing Research Centre.
Sheffield Council chief executive, John Mothersole, said he and council chiefs from the seven other authorities would meet today to discuss how the changes will be implemented.
He said: “The biggest improvement will be that having local control of finances speeds up decision making and means improvements can be made more quickly.
“This will be the biggest change for several decades.”
Mr Mothersole said councils had not been able to keep business rates for 30 years.
Sheffield currently receives £240 million back from the Government from business rates - £60 million more than it pays in - but Mr Mothersole said he had been promised the Government would make up the difference so the city does not lose out.
As Sheffield’s economy grows, it is hoped rates collected will increase and all the extra revenue retained locally.