My Lords, we discussed this issue very thoroughly in Committee, as the noble Lord, Lord McKenzie, said. I welcome the general support for the initiative. City deals are about bespoke solutions to unlocking local growth and trialling different and innovative approaches. They offer a real opportunity to drive growth across the country. The first eight cities have estimated that their deals will create 175,000 jobs over the next 20 years and 37,000 new apprenticeships.
Following the success of wave one, we opened up city deals to another 20 areas, to which the noble Lord, Lord McKenzie, has already alluded. They have submitted their initial proposals and we are working closely with these areas. However, it would not be appropriate or effective or represent value for money to roll these out to all local authorities in the same format. I have already said that these are bespoke solutions for each area.
Although city deals are not the solution everywhere, the Government recognise the importance of effective devolution. We have a strong record of commitment to a localist agenda and are working with authorities to provide the powers and support they need. Therefore, where it would make sense to make local models developed in city deals more widely available, as I have previously said, we will certainly do so.
We are giving local authorities much greater control over their own local budgets. An estimated 70% of the income will be raised locally, compared with 56% under the current formula grant system. From next April, councils will retain nearly £11 billion of business rates. This was recently initiated. I know that many noble Lords from across the Chamber have been involved in local government and that this is something for which, through their own experience in local government, they have campaigned long and hard. That is now happening. In addition, the Government intend to devolve a greater proportion of future growth-related spending based on the recommendations in my noble friend Lord Heseltine’s recent review.
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The Government provided an initial response to my noble friend’s recommendations in the Autumn Statement in December 2012. This response set a direction for the devolution of government spending to local areas on the basis of strategic plans developed by local enterprise partnerships, through creating a single funding pot for local areas from April 2015. As set out in the initial response, the Government intend to publish their formal response to my noble friend Lord Heseltine’s report this spring. I assure noble Lords that we will not judge spring by the weather. If we did, we would certainly still be in winter. I thought that I would clarify any climactic challenges that noble Lords might raise.
This single funding pot may include local transport, housing, schemes to get people back into work, skills and any additional local growth funding. I reiterate that I welcome the support for the city deals. I hope noble Lords will understand that, for the reasons given, we cannot accept the amendment.