Construction projects that have stalled during the recession will be a major beneficiary of a fund that will see up to £50 million injected into the region.
The £500 million Growing Places Fund will be allocated by local enterprise partnerships with Birmingham and Solihull LEP deciding which projects should get a share of a local pot of £14.9 million.
Around £50 million is to be made available across the West Midlands as a whole as part of the scheme, which was launched by chief secretary to the treasury, Danny Alexander, during a visit to Birmingham.
The scheme will see ‘‘revolving funds’’ made available to help projects that can stimulate economic growth and create jobs, with the money eventually paid back when developments are completed and re-invested again locally.
Examples of eligible projects include link roads and access works which might unlock commercial or residential developments and projects which would improve local transport infrastructure and reduce congestion.
The Government says it is keen to get the ball rolling as soon as possible with all £500 million due to be allocated by the end of January.
After meeting civic leaders and council officers from Birmingham and Solihull Mr Alexander said: “The Growing Places Fund is something we are setting half a billion pounds aside for across the country.
“The Greater Birmingham and Solihull LEP will be responsible for £14.9 million and between the various LEPs the West Midlands will get £50 million.
“This is something that can make a difference and is a really good use of public money.
“It’s a small amount that can unlock a bigger development, such as a link road for a development site.”
Mr Alexander said the economic climate meant government intervention to help get the ball rolling was called for.
“By putting public money in we can get a development going,” he said. “The idea is to help the construction industry.
“If you have a housing developer that has a site but can’t pay for a link road this can unblock a stalled development. We can get the money back when the development is built and the house or whatever is sold. We are trying to take half a billion pounds of public money and use it to help the private sector lead the recovery.”
The Liberal Democrat minister said the move was an endorsement of LEPs and their local knowledge.
“LEPs are already making a huge difference to the economy and are much more focused than the old RDAs,” he said. “They can take knowledge and experience and use it to do something money on its own can never do.
“It is up to them to decide over the next couple of months which projects they want to support.”
Mr Alexander toured the area around Birmingham Airport with representatives from Solihull Council, before meeting a delegation from Birmingham City Council in the city.
Speaking about the region as a whole he said: “This is a really strong growth point for the UK. There is real ambition to take the economy forward and we want to support people
“The money will be handed over at the end of January and we can get on with developments in this part of the world.”
Solihull Council leader Ken Meeson said: “Looking at the airport in particular, the road structure round there really does need some improvement to junction six of the M42. It’s about opening up opportunities, not just around the airport, but the area around the M42 corridor, which we in Solihull and the whole of the LEP board see as a priority.”
Mark Barrow, strategic director for development at Birmingham City Council, said: “We are in the process of pulling together a list of key projects across the LEP area that we can bring forward. One of the intentions is that it gets converted into projects as soon as possible next year and we are looking at ‘shovel ready’ schemes.”
Draft proposals for schemes which could benefit in Birmingham and Solihull are expected to be brought before the LEP board on November 24.
Jerry Blackett, chief executive of Birmingham Chamber of Commerce Group (BCCG), welcomed the news, but urged the LEP to also remain focused on the bigger picture.
He said: “This is a very welcome gesture of faith from the Government in LEPs generally and Greater Birmingham and Solihull in particular. However, the LEP must remain focused on a few strategic goals, seeking to maximise its influence over mainstream budgets for things like employment and skills and major transport projects.”