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England cities to be offered more control over budgets

Twenty towns and cities in England are to be offered more spending control in areas such as planning and transport.

The government earlier this year gave Birmingham, Manchester, Sheffield and five other authorities the right to spend tax receipts from local firms.

Cambridge, Hull, Coventry, Plymouth and Sunderland are among the areas that could now gain similar powers.

Deputy Prime Minister Nick Clegg is set to announce the latest round of City Deals later.

Mr Clegg is expected to say the country needs "a stronger, more resilient economy, built on the backs of industrious and independent cities".

And he will say the old policy of spending City of London tax receipts on infrastructure projects across England was the wrong approach.

"You can't revive the regions just through handouts from Whitehall," Mr Clegg will say.

"Certainly not now when the Treasury's coffers are bare. And even if we did have lots of money, the previous approach was fundamentally flawed.

"Revenues from the financial services sector were recycled round the rest of the country through the long arm of the state, creating the illusion of strong, national growth.

"Jobs were created but in an unbalanced way, over-relying on the public sector, funded by tax receipts from the City of London."

The 20 towns, cities and regions involved in the latest bids will be invited to set out the powers they need to drive local growth.

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

The other cities involved in the initial "City Deals" were Bristol, Leeds, Liverpool, Newcastle and Nottingham.

Agreements reached with the government saw the eight cities gain control over areas including infrastructure projects, transport and job training budgets.