Business and council leaders will go through a “Dragons’ Den” style grilling to test whether their bids for government cash stand up to scrutiny, Cities Minister Greg Clark said.
They are bidding for a share of the Local Growth Fund, a £2 billion a year pot of money on offer from the Treasury for projects which will create jobs and economic growth.
Proposals have been drawn up by local enterprise partnerships (LEPs), which represent councils and businesses, including the Greater Birmingham LEP, Black Country LEP and Coventry and Warwickshire LEP.
They will submit their final proposals, known as Strategic Economic Plans, by the end of March. Mr Clark and colleagues will then decide which bids to support and which to reject, following detailed discussions with LEP leaders.
But in an interview with the Birmingham Post, Mr Clark warned that if bids weren’t good enough or didn’t stand up to scrutiny, the Government would simply keep the cash.
Mr Clark, a Conservative Minister in the Cabinet Office, is responsible for a range of Government initiatives designed to create jobs and economic growth in the English regions.
He said: “It’s £2 billion a year that has been allocated to this. The deadline is March 31. Between March 31 and the middle of July we will be negotiating with them to create what I hope is going to be a transformation of the relationship between central government and these places.”
He added: “They will be cross examined as to how much of an impact their proposals are going to make.”
The final decision on each bid will be made by the Government’s Local Growth Committee, which is chaired by Nick Clegg, the Deputy Prime Minister, and includes George Osborne, the Chancellor, as well as Business Secretary Vince Cable and Local Government Secretary Eric Pickles.
But Mr Clark said: “When it comes to the decisions, I will advise the Local Growth Committee on which I think are the strongest ones.
“It is deliberately competitive. It’s not an allocation you get based on your population.
“It’s about how convincing your bids are.
“The alternative is that the money is held centrally and administered on their behalf. If they can’t make a convincing case that it should be spent locally then it will be held nationally. At the end of the day, money has been taken from other departments based on the hypothesis that it can be better spent locally but if what they put forward in any particular place suggests that they can’t then it won’t be devolved.”
The Greater Birmingham LEP bid includes plans to regenerate the city centre around a planned high speed rail station, as well as the area around junction six of the M42 where a second station will be built.
The Black Country LEP plan focuses on support for the aerospace, automotive and construction sectors.
The Coventry and Warwickshire LEP plan focuses on support for advanced manufacturing and engineering.
Mr Clark also said that a future Conservative government could encourage England’s biggest cities to think again about whether to have a mayor.
Referendums were held in 10 cities including Coventry and Birmingham in 2012 but only one, Bristol, decided to create a mayor. Votes were also due to take place in Liverpool and Leicester, but both local councils chose to move to a mayoral system before the ballot.
Mr Clark revealed that Conservatives wanted to create mayors without a vote – and then give local voters the chance to return to a traditional system with a council leader if they wanted.
But this had been rejected by Liberal Democrats in the Coalition Government, he said.
He told the Birmingham Post: “I think mayors are demonstrability good for cities not just here but throughout the world.”
The Government could not force mayors on areas but the success of Liverpool’s Mayor Joe Anderson could encourage other cities to follow suit, he said.
“One of the reasons there was some benefit to going through that process is that you do have a couple of cities, Liverpool and Bristol in particular, that are showing what can be done.
“They will be studied carefully and as a government we should be open to making these things happen where there is an appetite for it.”
But Liberal Democrats in the Government had blocked attempts to introduce mayors without a referendum, he said.
“We didn’t have a majority. There was a disagreement between the coalition parties.
“The Liberal Democrats for longstanding reasons were kind of sceptical of the idea of local powers residing in a single person.
“We were enthusiastic about it. The Coalition agreement said there had to be a referendum.
“So we did what we agreed to, and that seemed at the time to be a compromise between two polar opposite points of view.”