LGA: green light for devo bids would yield £80bn

21 Sep 15

Backing for the 38 devolution proposals submitted to government earlier this month would unlock at least £80bn of economic growth, a report from the Local Government Association has claimed today.

The LGA said the bids made by councils on September 4 would give areas outside London and the south east the powers they needed to close widening economic gaps across the country.

Poor skills, low quality infrastructure and a lack of housing were stifling productivity across the country despite growth in the economy. The LGA highlighted research from the Core Cities group that – compared to the average of the UK’s 10 largest cities – productivity per person is 88% higher in Munich, 42% higher in Rotterdam and 26% higher in Barcelona.

Handing greater power to local areas as set out in the deals would allow local leaders to improve transport links and business support and close skills gaps, LGA chair Gary Porter said.

Among the areas where the economy could be boosted was devolution of education and training helping to tackle a skills gap that is estimated to cost almost £500bn in lost growth and tax by 2022, he added.

“Decades of centralised control over funding for local growth have failed to produce a more balanced economy. It is time to spend smarter on infrastructure to get maximum value from every public pound. This starts with a much more effective and efficient approach to investing in local growth.

“Local leaders know their local economies best and hold the key to removing the obstacles limiting the productivity of businesses and holding back local growth. We need the Spending Review to hand us the fairer funding and powers to unleash the full potential of local businesses and economies.”

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