Greater Manchester’s decision to appoint an elected mayor from 2017 was “the most exciting development in civic leadership for a generation according to the Chancellor George Osborne as he delivered his budget this afternoon.
He announced that Greater Manchester along with Cheshire East will enter into a pilot for full retention of business rates growth from 1 April 2015.
The Chancellor added that over the last year, “the north grew faster than the south. We are seeing a truly national recovery. And where is employment growing fastest? The North West.”
The decision that Greater Manchester would keep 100 per cent of its business rates was welcomed in civic quarters.
Under current arrangements 50 per cent of business rates growth income is retained locally and 50 per cent returned to central government.
Lord Peter Smith, Chair of Greater Manchester Combined Authority, said: “We have long made the case that capturing the benefits of growth is a key part of our ambition to secure fiscal devolution for Greater Manchester.
“Stimulating growth, and helping our residents benefit from it, is already a key priority for GMCA. This announcement means we will be able to keep more of the proceeds of growth within the area – rather than handing them over to central government – and reinvest them in measures designed to encourage further growth here.
“It will be a virtuous circle and we can only gain and not lose funding through this new arrangement.
“This is another significant step in the right direction and is another example of Greater Manchester being at the heart of innovation. It comes on top of November’s groundbreaking devolution deal and last month’s agreement to devolve the health and social care to Greater Manchester. We hope this latest announcement will be the first step to full business rates devolution as we continue our journey towards a financially self-sustaining Greater Manchester.”
Also announced as part of the budget were plans to invest £11m in creating technology hubs in Manchester, Leeds and Sheffield.
The sites will offer co-working space, meeting spaces and educational resources to entrepreneurs working in the digital sector.
