Mayors will keep share of tax for their cities in Burnham’s devolution push

Mayors will keep a share of taxes collected in the region in a major redistribution of power in England.

Andy Burnham will let mayors keep a slice of income tax and business rates for them to decide how it is spent.

The Prime Minister has said the move is part of his vow to ‘take power out of Westminster and carry it into every postcode in the country’.

The plans will be unveiled in full when Chancellor John Healey

The rate of income tax that the public will pay is not going to the change, the government has stressed.

Burnham hopes the policy will give local leaders more resources to ‘improve public transport, build homes and create jobs’.

He said: I said we’d take power out of Westminster and carry it into every postcode in the country.

‘Today, we make good on that promise.

‘Under our plans, more of the taxes raised in a community will stay in that community.

‘Soon, every local leader will have the power and resources to improve public transport, build homes and create jobs.

‘I know what it’s like to be ignored by politicians in Westminster.

‘I’m not going to make that same mistake now I’m PM.

‘The whole of Government will now pull together behind the people and places that desperately need our support.

‘This is how we’ll bring back hope and bring power home to you.’

Large swathes of England have a mayor in charge, including Greater Manchester, the Liverpool City Region, Cambridgeshire and Peterborough, and South Yorkshire including Rotherham and Sheffield.

The local leaders have powers over issues such as transport, skills and infrastructure planning.

Other regions of the country will soon elect new mayors for the first time, including Greater Essex and Hampshire and the Solent.

The Chancellor said: ‘The people who best understand what skills employers want, what transport an area needs and where investment can make the biggest difference are those who live there.

‘For the first time we’re giving mayors a share of income tax so communities directly benefit when their economy grows – passing power out of Westminster and driving growth in every postcode.

‘This is the way we start to build new hope and advance the working people of this country.’

The Conservative Party warned that Burnham was too fixated on ‘Manchesterism’ and would actually take power out of local areas.

Sir James Cleverly, the shadow local government secretary, said: ‘Andy Burnham is right to want to encourage growth in all communities.

‘But his top-down Manchesterism will lead to higher taxes, with no guarantee of better outcomes for local people.

‘Devolution cannot be imposed from above – it can only work if it’s done in co-operation with local people.

‘But labor’s regionalist approach takes power away from local communities, sidelining local councils and ignoring local identities.

‘What works in Manchester won’t be the same for Essex, Cornwall or Cumbria.’

The Lib Dems warned that devolving tax revenues to mayors would ‘leave behind large swathes of England’ that did not have a mayoral authority.

Lib Dem local government spokeswoman Zoe Franklin said: ‘Councils across England serve millions of people who deserve the same powers and resources as any city region.

‘Devolution cannot become a two-tier system where you only get real powers, and access to extra income tax revenues, if you have a metro mayor.

‘We will analyze the detail carefully when it is published and continue to fight for every community across England to benefit from devolution.’

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