North East mayor Kim McGuinness has urged the Government to give her the powers to keep bus fares affordable, open more youth clubs and help young people find jobs. Ms McGuinness has made the pleas in a letter to Chancellor John Healey ahead of next month's Budget.
Fiscal devolution measures expected
The Government has previously indicated that the Budget on October 26 will include measures on “fiscal devolution”, giving regional leaders like Ms McGuinness more control over taxes raised in their areas. The measures were first announced by then Chancellor Rachel Reeves but her successor is also thought to be keen on the plans.
Ms McGuinness has formally written to Mr Healey setting out the region's priorities for the coming year. In the letter she makes the case for greater devolution to the region and investment that can help her improve public services and tackle the cost of living.
Chancellor faces difficult task
The plea comes as the Chancellor is widely thought to be facing a difficult task as borrowing costs mount for the Government, giving him less room to meet many of new Prime Minister Andy Burnham's hopes to turn around the country's fortunes. Ms McGuinness will be hoping that her argument that regional mayors are best placed to bring economic growth will win favour in the Treasury.
Her letter calls for proposals to support housebuilding, strengthen local government finances and invest in major transport projects, including the Leamside rail line. She also wants to boost the region's green energy sector, attract inward investment and create a new £500 million North East Growth Fund.
Mayor sets out priorities
Ms McGuinness said: “My immediate priorities are clear. First, we need to improve local transport so people can get around on a world-class public transport network that is affordable, integrated and easier to use.
“Second, every young person deserves the best opportunities in life. That means giving the North East greater control over skills and post-16 education, investing in apprenticeships and creating great jobs. It also means proper investment in support for young people in every community, including local youth provision, so that every young person has the chance to succeed.
“Third, we need fiscal devolution so that more of the wealth created in the North East stays in the North East and can be reinvested locally. Any new settlement must be fair and give our region the resources it needs to succeed and grow.
“Alongside investment in jobs, housing and growth, these changes would help us build a stronger, fairer region. My message to the Chancellor and Prime Minister is simple: back the North East with the right funding and investment, trust us to deliver, and give us the tools to unlock the opportunity and pride our communities deserve.”
Andy Burnham has said his Government has to get the balance of taxation right in next month's Budget after Labour's first two years in office hiked the burden to a record high. The Prime Minister said his administration had to be “conscious of the extent to which we have raised revenue” in the budgets while Rachel Reeves was chancellor.
John Healey will deliver his first Budget as Chancellor on October 28 with the nation's finances hit by the economic consequences of the Iran war. The war has pushed up inflation and increased the Government's borrowing costs, contributing to a likely reduction in the amount of headroom available to Mr Healey against the spending and debt rules he inherited from Ms Reeves.
