Councils told to work together more closely

Councils have been challenged to prove they can work together with the promise of more power and financial freedom.

The government has announced plans to create two pilot “city regions” with responsibility for issues such as transport, housing and job creation.

At the moment, councils are largely forced to follow instructions from London, or to sit back and watch regional bodies tackle the big issues.

But to win the new powers, neighbouring authorities will need to form voluntary agreements allowing them to make decisions together.

In the West Midlands, this would probably mean Birmingham working closely with neighbouring authorities in the Black Country and elsewhere.

There is already a body known as Birmingham, Coventry and the Black Country City Region, which includes Birmingham, Coventry, Dudley, Sandwell, Solihull, Telford, Walsall and Wolverhampton councils. However, it serves mainly as a platform for council leaders to hold discussions with each other.

Birmingham City Council has launched a campaign demanding far more control over city services, including a role in policing and health services.

But it has also said that some decisions, such as transport and economic development policies, would need to be made on a city region level.

Plans to devolve power to city regions were included in the Pre-Budget Report published by chancellor Alistair Darling, this week.

To be considered as one of the two pilot areas, councils will need to draw up joint proposals showing they are ready to work in partnership.

Local government minister John Healey said: “Every community, town, city and region needs to play its part in dealing with the current economic climate and also prepare for economic growth in the future.”

Ministers also announced plans to give councils more powers to help fight the recession, including the creation of boards of local authority leaders in each region.

These will replace unelected regional assemblies, which are set to be abolished, and will help regional development agencies such as Advantage West Midlands draw up economic strategies.

Councils will have a new legal duty to report on economic circumstances and challenges in their areas. This will help ensure investment in economic development is better targeted and based on a clear understanding of their economic needs, according to the government.

Wolverhampton MP Pat McFadden (Lab, Wolverhampton South-east), minister for employment relations and postal affairs, said: “It is essential that in implementing this review we focus on what business needs to survive and thrive.

“We have responded to calls from business for a streamlined system of regional economic plans to create better conditions for business success. The reforms will allow RDAs (Regional Development Agencies) to work more closely with local councils and give them a sharper focus on promoting investment and growth in the regions.”