Greater Manchester is set to gain significant new powers over its future as mayors, including Bev Craig, are poised to retain a larger share of business rates, giving regions more control over how the money is spent. The move, announced by the government earlier this year, is scheduled to roll out from spring 2027.
Funding Major Projects Locally
Mayor of Greater Manchester Bev Craig said the change could allow the region to fund major infrastructure projects, such as tram extensions, independently, without going "cap in hand" to Westminster. She explained that retained business rates over a long period would provide certainty for borrowing.
Craig said: "The previous mayor and combined authority leaders talked about the ability of the tram to go to Stockport, talked about tram-train in the northeast of the region, all of that is work that is underway, but did not have a funding stream assigned to it, so would have to wait until a funding stream became available."
She added: "Retained business rates over a long period of time would let me be able to say, 'okay, I've got certainty for the next 20 years against this level of growth. I can therefore borrow to take the tram-train to Heywood'. It lets you do quite simple things but doesn't actually cost the public purse any money because it's where money is moved differently."
Past Reliance on Government Funding
Major infrastructure projects in Greater Manchester have often depended on government funding, requiring a business case convincing enough for Westminster to release cash. This was the case for the Stockport Metrolink expansion, which reached a point in 2024 when former mayor Andy Burnham was explaining "delays" to the business case. Funding for the tram extension to Stockport was finally confirmed by former Chancellor Rachel Reeves last year.
Craig said the plans to give mayors more control over business rates spending would give Greater Manchester "the ability to set [its] own path" for the future. Speaking on what she is looking for in the budget on Wednesday, she said: "What I'm looking for [in the budget] from GM is a commitment around devolution on a number of things, that power, resource, but also the ability to set our own path [being] handed more down in the budget."
Regeneration and Think Tank Support
Craig explained that retaining local business rates could help major regeneration projects around Greater Manchester keep moving forward. She cited Atom Valley, where the biggest challenge is infrastructure investment and a motorway junction, saying the region could borrow against retained business rates to build its own junction rather than waiting for a strategic highways review.
Manchester-based think tank IPPR North said retained business rates could bring major benefits across Greater Manchester. A spokesperson said: "The real prize of fiscal devolution is enabling regional leaders to borrow to deliver the infrastructure their economies need. Giving mayors a greater share of business rates to borrow against could help address the underinvestment and delays that have held back growth, in Greater Manchester but also across the rest of the North."
The spokesperson added: "We want to see regions like Greater Manchester gain more financial independence from Whitehall, including through income tax devolution, so that mayors don't have to await permission before making game changing decisions for their region. For GM, that might look like an underground metro system or regenerated high streets in its surrounding towns and communities. So IPPR North supports this shift from the government, but caution that some places can raise much more from business rates than others. As fiscal devolution develops, government must get equalisation right by continuing to support areas with weaker tax bases through grants and redistribution. Every area needs the means to invest if we want growth in every postcode."
