Balls commits labour to multi-billion Yorkshire devolution deal

GEORGE OSBORNE last night faced an attempt to outflank him on his Northern Powerhouse campaign as the shadow chancellor committed Labour to handing Leeds, Sheffield and other key cities their own multi-billion pound devolution packages.

Shadow Chancellor Ed Balls at Hilton Doubletree where he delivered a speech on the economy and took questions from the audience on the first day of the new financial year. 6 April 2015. Picture Bruce Rollinson

Ed Balls told The Yorkshire Post he will end a situation in which Greater Manchester became the only part of England to see substantial devolution after five years of coalition Government. Manchester was reward with new powers after its 12 council leaders opted to work under a directly elected city-region mayor.

Mr Balls said Labour will today unveil details of a £30bn devolution offer designed to end a situation in which major spending decisions are taken “by Michael Heseltine or a Whitehall official” rather than those who know what is happening in Leeds or other cities.

Sign up to our daily newsletter

The i newsletter cut through the noise

The deal, which is designed to address wider concerns that Scotland is benefiting as English regions stall, will come without the insistence that councils introduce new bureaucracies around elected mayors.

One of the first moves Mr Balls will offer the likes of Leeds and Sheffield, he said, is the ability to keep any increase in business rates generated as a result of local job creation efforts, a power the chancellor handed to Manchester and Cambridge only in his March Budget.

Labour’s leadership is thought to have had a behind the scenes falling out with its Manchester council leaders over the support Mr Osborne has found across the Pennines.

In West Yorkshire city leaders were urged by Mr Balls to stick to their guns and reject an elected mayor. The result was what the Morley and Outwood Labour candidate yesterday described as a “second class deal for Leeds and others” in the Budget.

Mr Balls said: “It was wrong for George Osborne to pretend he was trying to devolve powers, but make it conditional on Westminster imposing elected mayors.

“Manchester chose to agree to it, but it is not what anyone wants in West Yorkshire.

“We had referendums to reject elected mayors just a few years ago. What George Osborne has done instead, because we would not agree to an elected mayor in Yorkshire, has been to impose second class deals on cities such as Leeds.

“I think it is really unfair to businesses and taxpayers in Leeds, just as it is in Sheffield where they also had a second class deal. The idea that you can only have local accountability for say bus regulation if you agree to George Osborne’s plans for elected mayors is total nonsense, and deeply unfair.”

As Labour prepares to unveil a devolution promise today, Mr Balls said: “We will go further on devolution for Leeds, for Yorkshire, for combined authorities in our region. We will go further than the Manchester deal and we will do so without any requirement for an elected mayor. We do need to have proper accountability but it is for copuncils to work out their accountability arrangements.”