January 3, 2013 6:12 pm

Greater Birmingham moves towards devolution

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Lord Heseltine has backed a scheme that could lead to Greater Birmingham becoming the test bed for his plan to strip Whitehall of up to £58bn of business support funding and place it in local hands.

The former Tory deputy prime minister visited Birmingham on Thursday to launch a three-month project to review how the city region would handle a big devolution of funding and powers to stimulate economic growth.

The 79-year-old peer recommended in November that 59 funding sources be put into a single “pot” to be bid for by England’s 39 local enterprise partnerships (Leps), which are public-private bodies. The money, spread over four years, would include budgets for skills, housing, infrastructure and employment support.

George Osborne, the chancellor, has backed the proposal but a battle is looming over how much cash Whitehall departments would give up.

Andy Street, managing director of John Lewis and chairman of Greater Birmingham and Solihull Lep, volunteered his region as a test case. Over the next three months the review will examine how the region would use the powers, which could lead to a pilot scheme.

“In my report I found too many people look to London and think something should happen there,” Lord Heseltine said. “The big shift I’ve been trying to advocate is Britain’s provinces should play a much bigger role in determining their own destiny. It will not change things overnight but in the longer term it puts the dynamic into the hands of local people.”

Mr Street said he expected the review to “provide a model which could also be applied in other Leps, and as such it is supported by government”.

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