CHANCELLOR George Osborne is expected this week to open up billions of pounds in Whitehall spending to regions such as the North East.
Speculation is mounting that Mr Osborne will use his Budget to back Lord Heseltine’s major report calling for cities and region’s to be handed control of large sections of Government spending.
Such a change would allow the seven North East local authorities to come together and have a say over job creation, decisions currently made behind closed doors in London.
Councils from Northumberland to Durham are teaming up to try and secure as much investment as possible while competing for funds against the likes of Manchester, Leeds and Birmingham.
The move is thought to be needed to reverse the problems caused by a decision to scrap quangos such as the £200m-a-year One North East and the Government’s own regional office.
Hopes of Budget day good news for the regions was last night welcomed by Lord Shipley, the former Newcastle council leader now advising the Government on city regeneration.
“This is a golden opportunity for the Chancellor to adopt Lord Heseltine’s No Stone Unturned report,” he said.
“He has provided a broad summary of the problems caused by Whitehall trying to do everything in England. It can’t possibly take on everything fully.”
Lord Shipley said he was delighted by news that the North East’s seven local authorities have asked Government to pass legislation needed to let them form a legally-binding combined authority sharing responsibility over transport and jobs. Those councils rushed out news of their plans on Friday to prepare for any possible Budget announcements.
His support comes as the region’s businesses continue to lobby for further help to boost the economy.
Officials at the North East Chamber of Commerce have sent the Treasury a wish- list, including the backing of Heseltine’s call for more say over Whitehall funds.
That list includes continued investment in roads such as the A1 and A19, support for firms looking to export and a three-year freeze on business rates.
Chamber chief executive James Ramsbotham said: “The Autumn Statement finally provided something for the region to hang our hats on with the significant motorway upgrade and extension of capital allowances. We want this Budget to build on that – our employment figures, export performance and the fact business optimism in 2012 was higher than it has been since the recession began is a clear demonstration that the North East is ready for the recovery.
“With many predicting an unprecedented triple-dip recession, the Chancellor must take this opportunity to be bold and back businesses in the North East to deliver more for the UK.”
Pressure continues to mount on the Chancellor to reverse his austerity plans this Wednesday. Liberal Democrat Business Secretary Vince Cable has suggested that borrowing more to fund capital spending could boost the economy.
But speaking yesterday, Mr Osborne said: “In the end, this country has got to pay its way, we can’t just keep on thinking the answer to our problem is more borrowing.”
