In his latest move to secure a new, expanded devolution deal for the North East, North of Tyne Mayor Jamie Driscoll has written to Chancellor Rishi Sunak proposing a payroll tax on new jobs created to plough back into more of the same.
Under his proposed Earnback deal, outlined to Northern Agenda today, North of Tyne and other mayoral combined authorities (MCAs) would keep the first year’s payroll raxes and benefits saved and half the second year’s resulting from the new jobs they create to reinvest in more job creation.
Driscoll has been pushing the Earnback scheme and other revenue-raising powers for metro mayors, including a regional wealth tax and land value uplift, since at least last year, as reported here on October 25.
He told today’s Northern Agenda that the idea would bring the North East almost £40m for job creation:
‘It’s a good deal for UK plc, and a good deal for the North of Tyne,’ he said. ‘It solves a political problem caused by devolution to the English regions – the question of accountability. I am not asking for more funding – I am asking for payment by results.
‘Under this proposal, MCAs are directly rewarded for leveraging private sector investment into job creation. No one has to pay more tax. The mechanism enables MCAs to invest with ambition, knowing there is an income stream to repay success.’