Cities from the successful first wave of deals in July secured groundbreaking powers including the ability to ‘earn back’ tax from the Treasury, devolved transport budgets and control of the skills budget for their cities.

City Deals are a key part of the Government’s objectives of rebalancing the economy and boosting private sector growth representing a genuine transaction between cities and government, with ‘asks’ and ‘offers’ from both sides.

The government has made it clear that City Deal proposals from local authorities will need to be ambitious, attract public and private sector resources and demonstrate strong leadership in the local area involving business and the Third Sector.

The cities with the strongest outline propositions will be invited to negotiate a [City] Deal with the Government. The so-called “Wave Two” cities listed below will be asked to submit their initial proposals by 15th January 2013 but there will be an element of competition and not all cities will be awarded a deal. Each city and their Local Enterprise Partnership [LEP] will be invited to put forward a proposal to address a significant local economic issue which requires a transformative response that is not currently possible through existing interventions. City Deals are expected to be agreed by November 2013.

Cities’ bids will need to: 

• contain proposals for stronger governance across their functional economic area, so that decisions necessary for the growth of the area as a whole can be taken quickly and effectively;
• contain proposals for harnessing significantly greater private sector input, expertise and resources;
• demonstrate strong political commitment and readiness to put resources into delivering the deal;
• present proposals that are consistent with the need to drive efficiency in the use of public money in the area, doing more with less, in pursuit of our medium term goal to eliminate the deficit; 
• propose reforms for their area which represent the leading edge of the Government’s general economic strategy – to reduce regulation, create well functioning markets, promote an enabling environment for business and boost private sector growth and investment.

These individual proposals will be in addition to a ‘core package’, consisting of measures that will devolve significant powers and functions to all cities that go on to negotiate a deal with Government. The Government will work with cities to develop this package over the next five months.

Today’s announcement named fourteen largest cities and their functional economic areas including:

• the Black Country;
• Bournemouth;
• Brighton and Hove;
• Greater Cambridge;
• Coventry and Warwickshire;
• Hull and Humber;
• Ipswich;
• Leicester and Leicestershire;
• Milton Keynes;
• Greater Norwich;
• Oxford;
• Reading;
• Plymouth;
• Preston and Lancashire;
• Southampton and Portsmouth;
• Southend;
• Stoke and Staffordshire;
• Sunderland and the North East;
• Swindon and Wiltshire;
• Tees Valley.

Brighton & Hove’s functional economic area does not have boundaries set in stone but certainly includes Lewes, Newhaven, Burgess Hill, Shoreham, and other parts of Adur.