Ruth Kelly hints at further devolution of power to local government over funding and planning decisions

Secretary of state for communities and local government Ruth Kelly has hinted that the upcoming Local Government White Paper will include wide ranging plans for devolution of central government.

Speaking at the British Property Federation's (BPF) Labour Conference fringe meeting entitled 'Cities Question Time', Kelly admitted that the government had performed poorly when faced with allocating funds and making decisions in Britain's major cities.

She said that London's transport restructuring, which was paid for by borrowing against increased fare revenue, was proof that cities were able to deal with large scale funding themselves.

Kelly pointed to the government's call to Britain's eight biggest cities to present detailed business plans outlining what economic barriers and key issues they face, and what the government could do to help.

"Local leaders will be key to local success," she said. "The more powers they ask for, the more we must look for accountability. Cities have been held back by not being able to take decisions that would help their citizens."

The upcoming White Paper will give councils an idea of the increased powers they would receive if they conformed with accountability requirements. Kelly stated that the long awaited White Paper would be released in "a matter of weeks not months".

Kelly denied that in terms of planning economic concerns had dominated social and environmental needs. She said that the government was making a concerted effort to speed up the planning process and that this could be aided if government involvement was reduced.

Liz Pearce, chief executive of the BPF, who hosted the event, said: "There's been a fundamental unbalancing of central and local government for far too long. We need a framework with absolute clarity for taking forward regional investment and regeneration."