Andy Burnham, the Prime Minister and Labour Party member, has confirmed a significant reform in income tax distribution that will benefit households across the country. In an official statement, Mr Burnham announced that mayors will receive a share of income tax revenues, aiming to improve services and quality of life in “every postcode”.
The announcement, set to be launched on Friday by the Makerfield MP, marks what Mr Burnham describes as the “biggest” transfer of power from Westminster in a generation. The reform includes giving mayors authority to retain a portion of income tax and business rate revenues within their areas.
This change is designed to ensure that communities reap direct benefits when their local economies expand, providing new powers especially for areas still progressing towards full devolution. Mr Burnham emphasised the significance of the move, stating, “I said we’d take power out of Westminster and carry it into every postcode in the country. Today, we make good on that promise.”
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He continued: “Under our plans, more of the taxes raised in a community will stay in that community. Soon, every local leader will have the power and resources to improve public transport, build homes and create jobs.”
Reflecting on his past experiences, Mr Burnham added, “I know what it’s like to be ignored by politicians in Westminster. I’m not going to make that same mistake now I’m PM. The whole of government will now pull together behind the people and places that desperately need our support. This is how we’ll bring back hope and bring power home to you.”
Chancellor of the Exchequer John Healey MP reinforced the announcement by highlighting the importance of local knowledge in economic development: “The people who best understand what skills employers want, what transport an area needs and where investment can make the biggest difference are those who live there.”
“For the first time, we’re giving Mayors a share of income tax so communities directly benefit when their economy grows - passing power out of Westminster and driving growth in every postcode. This is the way we start to build new hope and advance the working people of this country,” Mr Healey said.
The changes are scheduled to come into effect from next spring. Secretary of State for Housing, Communities and Local Government Angela Rayner described this initiative as transformative: “This is the first step in our plan to rewire this country and build a better future, where power is no longer hoarded in Westminster but is put back in the hands of local people – where it belongs.”
She added, “Our devolution revolution is about bringing an end to the begging-bowl culture of the past, and instead making sure our local leaders have the tools they need to drive the change that communities have been crying out for.”
Ms Rayner concluded, “We need every region to be firing on all cylinders if we want good growth in every postcode, and we will do everything in our power to make that a reality.”