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Localism

I am pleased to inform the House that the Government has agreed a City Deal with local authorities in the Cardiff Capital Region and the Welsh Government. This agreement is another significant step in the Government’s ambition to rebalance the economy and empower our cities as engines of economic and civic renewal.

The Chancellor opened negotiations with Cardiff a year ago, at the March Budget in 2015. The Cardiff Capital Region City Deal is a transformational opportunity and something that both the UK and Welsh Governments and local authorities alike have worked together to deliver.

The City Deal includes:

• £1.2 billion investment in the Cardiff Capital Region’s infrastructure through a 20-year Investment Fund. A key priority for investment will be the delivery of the South East Wales Metro, including the Valley Lines Electrification programme.
• The creation of a non-statutory Regional Transport Authority to co-ordinate transport planning and investment, in partnership with the Welsh Government.
• The development of capabilities in Compound Semiconductor Applications. The UK Government will invest £50 million to establish a new Catapult Centre in Wales. The CCR will also prioritise investment in research and development, and provide support for high value, innovative businesses.
• The Cardiff Capital Region Skills and Employment Board will be created (building on existing arrangements) to ensure skills and employment provision is responsive to the needs of local businesses and communities. The CCR and the Welsh Government will work with Department of Work and Pensions to co-design the future employment support from 2017 for people with a health condition or disability and/or long term unemployed.
• The Welsh Government and the Cardiff Capital Region commit to a new partnership approach to housing development and regeneration. This will ensure the delivery of sustainable communities, through the use and re-use of property and sites.

Both the UK and Welsh Government are contributing £500 million to the CCR Investment Fund respectively. The ten local authorities in the Cardiff Capital Region will contribute a minimum of £120 million over the 20 year period of the Fund. In addition, over £100m from the European Regional Development Fund has been committed to delivering the City Deal.

Over its lifetime, local partners expect the City Deal to deliver up to 25,000 new jobs and leverage an additional £4 billion of private sector investment.

The City Deal will develop stronger and more effective leadership and governance across the region through a Cardiff Capital Region Cabinet, enabling the ten local authority leaders to join up decision making, pool resources, and work closely with business.

The Government welcomes and supports cooperation between businesses and local government. As part of the City Deal, a Cardiff Capital Region Business Organisation will be established to ensure that there is a single voice for business to work with local authority leaders.

This agreement marks the next step in an ongoing process to devolve funding, responsibilities and powers from central and devolved governments to the Cardiff Capital Region. I look forward to continuing to hold discussions with the Capital Region and the Welsh Government in the future, to build upon today’s agreements.

Copies of the agreement will be placed in the House libraries.