Ministers have predicted Birmingham will be first in line for a share of billions of pounds in funding for housing, transport and training.

George Osborne, the Chancellor, has announced he is backing proposals to axe a range of schemes administered by Whitehall and hand the money directly to local councils and business leaders instead.

Birmingham, Solihull and neighbouring towns and districts are likely to be the first to receive the cash.

The plans, which are designed to boost the economy and create jobs, have been drawn up by Conservative peer Lord Heseltine.

He wants the Government to cancel a range of national policies which cost taxpayers £70 billion over four years, and hand the money to Local Enterprise Partnerships (LEPs) instead.

Mr Osborne has announced he has accepted the recommendation - although the final sum of money to be allocated won’t be announced until June and may be less than £70 billion.

Birmingham and neighbouring towns are likely to be the first to benefit because Lord Heseltine has also been working on a local plan alongside the Greater Birmingham and Solihull LEP.

This involves city council leader Sir Albert Bore (Lab) and councillors from other parties, Birmingham Chamber of Commerce Group and other senior business figures such as the Midlands chairman of consultants KPMG and the Principal of Birmingham Metropolitan College.

Treasury Minister Greg Clark, the Minister for Cities, said: “The fact that business and civic leaders – of all the main political parties - have come together to make solid proposals is a real achievement.

“It puts the region in pole position as the Government is poised to act on the recommendations of Lord Heseltine’s national report to empower local economies with powers and resources to create jobs and growth.”

The local plan includes measures to improve road and public transport infrastructure near Birmingham Airport, which will also be the site of a new high speed rail station, to provide better training and apprenticeships, to help residents and businesses make their properties more energy efficient and to reduce unemployment and poverty in the poorest neighbourhoods.

Once the Government makes the new funding available, the plan will be formally submitted as a bid for cash.

Any region will be able to bid but “Greater Birmingham” will have an advantage over other areas because its plan is already written - and personally approved by Lord Heseltine.

Meanwhile, Birmingham City Council has been handed a £60 million pot to help change the face of part of the city centre.

The money will go towards the £500 million scheme to build offices, shops and public spaces at Paradise Circus, creating 12,000 jobs.

Work is expected to begin next year, after Birmingham Central Library closes this summer, with completion in 2017.

The cash was awarded by the Greater Birmingham and Solihull LEP.

The Partnership will recoup the cash through increased business rates, expected to raise £180 million from the development over the next 25 years.

City Council leader Sir Albert Bore said: “This is the first time this type of innovative structure and funding package has been used in England and Wales to deliver regeneration.

“It has been made possible because Paradise Circus is included in the enterprise zone and facilitated by the close working relationship between the city council, developer Argent and the LEP.”

The business case for the project and approval of the funding will be considered by the council’s cabinet on Monday.

Argent spokesman Rob Groves said: “If approved, this will be a significant milestone in the delivery of a truly transformational proposal for the city.

“After many years of planning, consultation and preparation, the decision would make the delivery of the first phase of the Paradise Circus redevelopment very much a reality.”

The final stumbling block standing in the way of the redevelopment of Paradise Circus was removed two years ago when the Government refused a request to block the demolition of the 1970s Central Library.

Heritage Minister John Penrose granted a certificate of immunity from listing the building, giving the city council and Argent five years to push forward with transforming the eight-acre site.