Did you know
– that Core Cities’ urban areas deliver 27% of the English economy, more than London, and are home to 16 million people?
Leeds is one of these core cities.
And Leeds Labour Leader, Keith Wakefield, has been at the forefront of attempts to get recognition of the economic potential of the Core cities – and of the steps that are necessary to realize that.
He is a member of the Core Cities Cabinet – which recently sent a letter to the Chancellor of the Exchequer, George Osborne, calling for the devolution of property taxes to the UK’s big cities.
Why have they called for this devolution?
Because it is essential if cities like Leeds are to unlock their economic potential.
The aim of the Core Cities is to outperform the national economy, and become financially self-sustaining. Independent forecasts demonstrate this could mean an additional £222 billion and 1.3 million jobs for the country by 2030.
But in order to do this, they need a local tax base, and control over it. According to the OECD, the level of taxes managed at the local or regional level is over 5 times greater across the OECD on average than it is in the UK.
Core Cities in the UK underperform economically by international standards. This is because, currently, cities only retain about 5% of the total tax base raised in them which is damaging their economic potential.
The call for devolution of property taxes will not bring UK cities to anything like parity here. Although it would more than double the taxes cities retain locally, it is only a rise from 5% to 12% and still leaves the UK trailing behind the international competition.
But it would be a start.
The devolution of property taxes would increase the amount of tax retained in our cities to 12%, including council tax, and give them the freedom to grow and compete globally.
Specifically, the money generated from the devolution of property taxes would be used on projects that benefit cities such as improved transport networks and upgrading business infrastructure.
In September 2013, London and the Core Cities officially launched the ‘City Centred’ campaign which calls for the devolution of financial powers to our cities, with property taxes being the primary focus.
Councillor Keith Wakefield, said:
“If we are to secure sustainable long-term growth as a nation, we must rebalance our economy. To do that, cities like ours need the power, freedom and resources to deliver on key regional priorities. Retaining a greater proportion of locally generated revenue could enable us to invest in the infrastructure projects we know will make the biggest difference to people living in our area – improving links to employment opportunities and opening up new markets for businesses.
“The evidence already proves that where we are given the powers and resources to act locally, we have the potential to deliver vastly improved outcomes. Most recently, local projects to tackle youth employment through the Devolved Youth Contract have consistently outperformed national schemes such as the Government’s Work Programme. We need the Government to now come good on its promises of greater devolution. This letter to the Chancellor sets out one of a number of ways we can continue that process.”
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