Andy Burnham is preparing to reveal proposals that would grant mayors in England a portion of income tax and business rates for the first time, marking a significant devolution overhaul. The former Mayor of Greater Manchester and current Prime Minister highlighted that this initiative would enable local leaders to retain a portion of the funds collected from their constituents for reinvestment in their communities. This move is being touted as the most substantial transfer of authority and funding from Westminster in many years.
While the government clarified that the income tax rate for taxpayers would not be directly impacted by the reforms, specific details such as the extent of income tax retention for local leaders will be outlined in the forthcoming Budget by the new Chancellor, John Healey. Prior to the official announcement scheduled for Friday, Burnham expressed his commitment to decentralizing power from Westminster and ensuring that more taxes raised within a community remain within that community for development purposes.
He emphasized the potential for local leaders to leverage these resources to enhance public transportation, construct housing, and stimulate job creation. Burnham vowed to avoid the neglect experienced by communities under central government’s oversight and pledged to prioritize supporting regions in need. He illustrated the government’s unified approach in providing assistance to communities in need and reiterated the commitment to empowering localities.
Healey echoed Burnham’s sentiments by underlining the importance of local insights in determining the requirements for skills, transportation, and strategic investments. This shift towards granting mayors a share of income tax revenue aims to align local economic growth with direct community benefits, thereby decentralizing authority from Westminster and promoting prosperity across all regions.
Former Chancellor Rachel Reeves also hinted at the Treasury’s exploration of granting regional mayors control over a portion of national taxes previously allocated by the central government. Additionally, under the coordination of the new No10 North, local leaders will gain increased control over essential services like housing, transportation, and skills development. This expanded authority will encompass overseeing rail and bus services, expediting the construction of local trams and metros, and facilitating the enhancement of regional infrastructure.
Angela Rayner, the Secretary of State for Housing, Communities, and Local Government, emphasized the government’s ambition to shift away from the dependency on central funding towards equipping local leaders with the necessary tools to drive transformative change within their communities. The overarching goal of this devolution revolution is to empower localities and foster the long-awaited progress desired by communities.
