Published: Thursday, 8th October 2015
The Government has agreed a new devolution deal with civic leaders from South Yorkshire which will mean a new directly-elected mayor.
The move, involving the Sheffield City Region, was hailed by Chancellor Osborne as “the most fundamental shake-up of local government for a generation.”
Sheffield City Region is one of 38 towns, cities, counties and regions which submitted ambitious proposals to Westminster to take control of how public money is spent in their area.
As part of the deal, a Sheffield City Region Mayor will be elected for the first time in 2017 by voters across South Yorkshire.
The Mayor will oversee a range of powers devolved from government including responsibility over transport budgets; franchised bus services and strategic planning while the deal also includes additional devolved powers for the area’s Combined Authority.
This includes a new gain share deal within an envelope of £30m a year for 30 years, giving Sheffield the power to use new funding to boost local growth and invest in local manufacturing and innovation.
The deal for the Sheffield City Region requires support from each of the local councils within the Sheffield City Region and is subject to a programme of consultation and engagement with residents and businesses over the coming months.
In a separate but related initiative Osborne announced that councils are to retain all locally raised business rates by the end of the decade. Under radical local government finance reforms outlined by the chancellor, the Government is also calling time on the distribution of core grant from Whitehall to town halls.
Under these proposals, authorities will be able to keep all the business rates that they collect from local businesses, meaning that power over £26bn of revenue from business rates will effectively be devolved.
The uniform national business rate will be abolished, although only to allow all authorities the power to cut rates. Cities that choose to move to systems of combined authorities with directly elected city-wide mayors will be able to increase rates for specific infrastructure projects, up to a cap, likely to be set at 2p on the rate.