Rt Hon George Osborne MP
Chancellor of the Exchequer
HM Treasury,
Horse Guards Road,
London,SW1A 2HQ
Thursday 21st March 2013
Dear Chancellor,
Implementing the Heseltine Review
The Core Cities Cabinet met in Newcastle today and discussed both your budget and the Heseltine Review.
We met in January with the Prime Minister, Deputy Prime Minister and Minister for Cities to support
Government proposals for HS2 and used that opportunity to set out the contribution that the Core Cities can
make to the recovery, rebalancing and growth of the economy. Core Cities’ wider urban areas already
deliver 27% of the national economic output, more than London, and have significant further economic
capacity.
The Prime Minister recognised this potential and supported Core Cities’ ambition to unlock it.
We strongly support the implementation of the Heseltine Review and the detailed response published in
‘The Greater Birmingham Project: The Path to Local Growth’.
Following on from City Deals 1, and given their economic scale, the Core Cities are ideally positioned to
work with Government to implement key elements of the Heseltine Review as part of a longer term
programme of devolution for growth. We do however think that this should be based on indicative sums and
negotiated quality thresholds, recognising the different needs and opportunities across Core Cities, rather
than competitive bidding.
Substantial, cross-government single investment pots for each city, alongside longer periods of budget
certainty, are key to achieving this. We recognise your personal support for this approach and want to work
with Government departments to help achieve this in preparation for the next spending round. The broadest
and largest possible pots will give cities the best opportunity to contribute to the national growth strategy.
The Office for Budget Responsibility’s national growth forecast now stands at 0.6%. This forecast takes the
view that growth is a zero sum game, which not only would we challenge but would expect Government to
challenge too, as it would imply falsely that economic growth outside London and the South East could only
be at their expense. Implementing the Heseltine Review in Core Cities will not only help to rebalance the
economy in the long term, but also raise the productivity of our cities in the short term, providing an
opportunity to exceed the OBR forecasts.
We welcome the statement in Government’s response to the Heseltine Review (paragraph 2.56)
acknowledging the point we have previously made regarding the links between sustainable funding for local
public services and the growth agenda. Core Cities want to work closely with you to progress reforms
including Community Budgets and the integration of health and social care.
To enable the above, Core City Mayors and Leaders each lead on a portfolio in relevant areas: housing;
transport; skills and labour market; low carbon; finance and investment; growth; and public sector reform. At
our meeting we agreed a set of priorities for action, many of which are underpinned by more flexible and
consolidated finance.
In your budget statement you made reference to the need to free up our great cities and to let them flourish.
We ask to meet with you to discuss how our cities can work with Government to do precisely that, to
implement the Heseltine Review to greatest effect, and ultimately, go further.
Yours sincerely,
Core Cities Cabinet
Councillor Sir Albert Bore
Mayor George Ferguson
Leader, Birmingham City Council
Mayor, Bristol City Council
Councillor Keith Wakefield
Mayor Joe Anderson
Leader, Leeds City Council
Mayor, Liverpool City Council
Councillor Sir Richard Leese
Councillor Nick Forbes
Leader, Manchester City Council
Leader, Newcastle City Council
Councillor Jon Collins
Councillor Julie Dore
Leader, Nottingham City Council
Leader, Sheffield City Council
CC
Rt Hon Nick Clegg MP, Deputy Prime Minister
Rt Hon Greg Clark MP, Minister for Cities and Financial Secretary to the Treasury