A CITY region in Scotland's central belt could be created to rival the economic strength of London if new powers for Holyrood are further devolved to local communities, Labour leadership contender Jim Murphy has claimed.
A CITY region in Scotland's central belt could be created to rival the economic strength of London if new powers for Holyrood are further devolved to local communities, Labour leadership contender Jim Murphy has claimed.
The East Renfrewshire MP, setting out his plans for "devo max within Scotland", said Glasgow and Edinburgh could use new powers to co-operate to invest in jobs, innovation and raise productivity.
In a pitch for final votes before the new Scottish Labour leader is announced next Saturday, Mr Murphy said that city deals similar to the £1.13 billion agreement for Glasgow should follow for other regions, while local authorities should also be free to create their own welfare policies.
He said Scotland had fallen behind the rest of the UK in recognising the potential of city regions, citing the example of the Greater Manchester Combined Authority which has brought together 10 local authorities to collaborate on economic growth.
However Neil Findlay, who is also battling for the Labour leadership along with MSP Sarah Boyack, criticised Mr Murphy for advocating increased powers for councils at the same time as backing a continued council tax freeze.
Mr Murphy said: "Scotland needs economic plans that recognise the comparative advantages that our cities enjoy, from Aberdeen's energy and engineering expertise, Dundee's excellence in life sciences, to Edinburgh and Glasgow's academic and financial sector strength. As the Edinburgh Government gains more power it can either hold on to it or pass it on so our cities and regions can flourish."
Mr Murphy added that he was keen to move away from a "one size fits all" welfare state and that local authorities and coalitions including health boards and charities should be able to introduce their own initiatives, using cash raised from a 50p top rate of tax and any underspend from the Scottish Welfare Fund.
Despite organisations including the Scottish Trades Union Congress expressing disappointment with the package of welfare powers being devolved to Scotland under the Smith Commission agreement, Mr Murphy said that it represented a "really good deal".
Mr Findlay said he had outlined his support for stronger local government throughout the campaign, but that it was incompatible with continuing the council tax freeze.
Sources close to Mr Findlay said that they now believed the Labour leadership race was on a "knife edge" and claimed that the campaign behind the former teacher, already the favoured candidate among unions, was becoming increasingly confident of victory.
Lothian MSP Mr Findlay said: "If Jim has come round to my idea of stronger local government that??s great, but he can??t support stronger local government and a council tax freeze at the same time, it??s impossible.??
The Institute of Economic Affairs said that it supported giving more powers to councils, but that "welfare spending cannot be devolved without the taxation necessary to fund it being devolved too".
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