Mayor welcomes guaranteed share of tax take for the North East
North East Mayor Kim McGuinness has welcomed Government plans which would allow her to keep a share of the taxes collected in the area.
New Prime Minister Andy Burnham says that by letting mayors keep a slice of income tax and business rates, he will “make good” on his pledge to “take power out of Westminster and carry it into every postcode in the country”.
Mr Burnham, the former mayor of Greater Manchester, said the policy would be designed so that every local leader would have the power and resources to improve public transport, build homes and create jobs.
The rate of income tax which billpayers face will not change as a result of the reforms, according to the Government and would include an ‘equalisation’ system, so areas where less tax is collected continue to receive financial support.
Details of the reforms are expected to be announced in the autumn budget.
Ms McGuinness said: “This is what taking back control really looks like and what we’ve been fighting for, for the people of the North East.
“For decades, whenever the North wanted something, it had to go to London, cap in hand to beg a civil servant or a Government minister to back us.
“We’re changing the North East for good, and much greater financial freedom is the first step."
She added: “This means we can do more to support hard-pressed families through things like cheaper Mayor’s Fares and childcare grants, grow the Metro and rail network, build more council homes and open youth clubs to give young people the opportunities they deserve regardless of their background.
"We can step up and market the North East to the world as a visitor destination and a place to invest, creating new jobs as we do so by helping our people and businesses thrive and grow.”
She added: “The days of asking Whitehall’s permission are over. We can now just get on with the job and improve the lives of people here in the North East, now and for generations to come.”
The Local Government Association (LGA) has also welcomed the move.
LGA chair, Cllr Eamonn O’Brien, said: “We have long called for greater fiscal devolution, and this announcement is a positive step towards realising that ambition.
“Councils, strategic authorities and government should work together to ensure genuine devolution gives local areas the fiscal powers, tools, and capacity to shape their own futures, including a sustainable financial model for local government.
“Successive devolution agreements have shown that when local leaders are treated as equal partners trusted with real powers, communities thrive.”
Mr Burnham said: “Under our plans, more of the taxes raised in a community will stay in that community.
“Soon, every local leader will have the power and resources to improve public transport, build homes and create jobs.
“I know what it’s like to be ignored by politicians in Westminster and I’m not going to make that same mistake now I’m PM.”