Labour MP Gisela Stuart Calls for England Devolution on Birmingham Bankruptcy Fears

The Labour MP for Edgbaston, Birmingham Gisela Stuart has called the devolution of England as cities across the UK, like her constituency, risks bankruptcy due to the lack of control over taxation and revenue.

Speaking at the Cities 2030 forum in London, Labour and Conservative politicians aligned in agreeing that decision-making should be decentralised, with local MPs, mayors and council members given more political room for manoeuvre.

The Labour MP for Edgbaston, Birmingham Gisela Stuart said that with no power to move council tax boundaries or seek independent streams of revenue, Birmingham will be bankrupt in 16 months.

She suggested that cities be permitted to keep a portion of VAT or to charge a local property tax, the proceeds of which would stay in the city kitty.

Meanwhile, Kit Malthouse, the Conservative deputy mayor of London, bemoaned the fact that London is only allowed to keep £1bn (€1.2bn, $1.7bn) of the £16bn in tax revenue generated within its boundaries.

He called for greater financial and regulatory autonomy in the capital.

He said: "The Mayor of London can be overruled on a property decision by a man in a suit in Bristol. That seems insane to me. The mayor should be allowed to decide what's build and what isn't built."

Stuart urged other English cities to accept the need for elected mayors, a proposal which was defeated at the ballot box in 2012, saying: "Running cities should get the status it deserves."

She quoted Sir Winston Churchill's praise of a predecessor of her electoral seat Joseph Chamberlain when she said "Manchester and Birmingham should be making the weather", and that the only city-based politicians in recent times to have done so are Ken Livingstone and Boris Johnston.

Stuart said that job creation initiatives in regional cities should be specifically designed for those areas which need them.

She cited the example of Deutsche Bank, which opened an office in Birmingham last year, bringing 1,000 new jobs to the city.

However Stuart claims that many of those employed commute from the suburbs or other parts of the Midlands and said the focus should be on bringing employment to areas such as Ladywood and Hodgehill, two of the most deprived areas in England.

The pair's argument was given some credence in a later speech by Lord Heseltine, who in his 'No Stone Unturned' report, authored for the incumbent government, had urged greater regional autonomy in the form of Local Enterprise Partnerships.

Lord Heseltine said that how these are managed should form a crucial part of each of the major political parties' election manifestos.