The West Midlands Combined Authority (WMCA) today (Thursday December 15) welcomed the Government's announcement that the region will be able to retain all business rates generated locally from April 2017.
The seven West Midlands metropolitan councils will form one of six pilot areas nationally to test out the new arrangements in advance of the scheme being introduced for the whole country in a few years' time.
Under the new scheme, the seven councils will no longer receive any Revenue Support Grant from Government, but will keep all business rates generated (instead of only half at the moment).
Other payments to/from Government will be adjusted to achieve a neutral net position. However, the region will be able to benefit from all of the growth in business rates. Some of this growth will be shared with the Combined Authority to help fund its investment programme.
Because this is a pilot, the Government has guaranteed that the region will not be any worse off than it would have been under the existing financing arrangements.
Speaking on behalf of the seven councils, WMCA chair Cllr Bob Sleigh, said: "I welcome this announcement from the Government. It's the next step towards further devolution to the region and gives us a real incentive to work with others, including the Combined Authority, to generate growth in the region.
"If we succeed that will be good for businesses, good for the people they employ, and good for the local authorities in the region.
"We look forward to working with the Government over the next few weeks in sorting out the fine detail of the agreement for the pilot."