Leaders of British Tier 2 cities met in London in late November at the Core Cities Summit to lobby for more governing powers for their municipalities. Greater decentralisation is crucial to better address the needs of local communities, as well as compete for investments. That is according to participants of the summit, which was organised by the Core Cities Group, a partnership of eight of the largest urban areas outside of London.
The Tier 2 city leaders – from Birmingham, Bristol, Leeds, Liverpool, Manchester, Newcastle, Nottingham and Sheffield – put forward their Growth Prospectus; a set of proposals aimed at accelerating the speed of economic development across the UK. The proposals emphasise improving internet infrastructure, delivering more efficient and cheaper energy, strengthening transport networks, and boosting skills and jobs.
The prospectus also calls for “setting cities free” in terms of their decision-making capabilities. “The government has too much say in how cities control their own affairs, which is bureaucratic, wastes time and money, and gets poor results,” says the prospectus.
More control by municipalities of their fiscal affairs was outlined at the conference as one of the main ways to accelerate growth in British cities. According to the Core Cities Group, in the UK only 5% of taxes are directly controlled by cities. In comparison, US cities hold 7.5 times more tax locally than the UK and Canada holds 10 times more.
“Support of the development of the Core Cities... will help balance the UK economy and help to ensure that the benefits of growth are not just felt in London and the south-east,” said Jon Collins, leader of Nottingham City Council. “The amount of the finances that cities control in this country is very small. That makes it very difficult for us to successfully compete on a global stage,” added Richard Leese, leader of Manchester City Council.
Between 2003 and 2012, the UK was on a firm lead in terms of FDI inflows to Europe and was the third most popular destination for crossborder investments worldwide after the US and China, according to greenfield investment monitor fDi Markets. However, London accounted for more than a third of all new projects launched in the UK and quarter of the total $120.8bn attracted in that period. Manchester, the second most popular location for FDI in the UK, attracted 10 times fewer new projects and 29 times less capital expenditure.