A MASSIVE expansion of Southampton port – and the creation of up to 4,000 jobs – moved a big step closer last night under a £1.5 billion deal struck with the Government.

Southampton and south coast rival Portsmouth were offered the chance to join the biggest cities in England in grabbing key powers from Whitehall by signing a joint City Deal.

Powers over tax and spending, welfare-to-work programmes, transport schemes, regeneration projects, business investment and skills training could all be available.

However, there is no direct money, merely greater powers to decide how Government grants are spent, at a time when Southampton City Council has just voted through the worst cuts in its history.

Last night, the city council said the deal – to be signed by July – would push forward:

  • The expansion of Southampton port, creating up to 4,000 jobs.
  • The redevelopment of Royal Pier, creating around 6,000 jobs.
  • The “fast-tracking” of city centre developments, to speed up regeneration and economic development.
  • Investment in the Itchen riverside, to create homes, retail and business opportunities.

City chiefs believe it will also give them stronger negotiating powers with major public sector landowners, helping to unlock key development sites, and greater influence over the running of motorways and trunk roads – and even railways – and over the building of flood defences.

Skills training could also be linked directly to what local businesses need, while council bosses would have greater ability to use their cash reserves, backed by financial guarantees from central Government.

Cllr Richard Williams, Southampton’s Labour leader, told the Daily Echo: “This is the news we have been waiting to hear.

“This represents a genuine opportunity to attract substantial and much-needed investment to our cities and to the region – creating new jobs, new homes and new opportunities.

“Southampton has great potential for substantial and sustainable growth and we can now work towards unlocking that potential.”

Announcing the go-ahead for 20 areas to negotiate with the Government, Deputy Prime Minister Nick Clegg said it would set Southampton and Portsmouth “free from the Whitehall leash”.

He added: “Portsmouth and Southampton want to use their City Deal to drive the growth and diversification of the maritime sector in the area and we are ready to hand powers over to help them do this.

“The deal will be a huge boost to the area – supporting growth in the associated subsectors of transport and logistics, defence and advanced manufacturing, the visitor economy and the complex supply chains linked to research and innovation.

“Negotiators should come in aiming high. This is a once-in-a-generation opportunity to unlock local growth.

“Letting go of power and money doesn’t come naturally to Whitehall – over time, the economic importance of other parts of the country has been devastatingly downplayed.”

The deal will give Portsmouth the opportunity to transform its naval base to meet increased demand for servicing ships, drive forward massive investment in the development of Tipner, creating about 1,600 jobs, and help create the new Northern Quarter shopping, housing and leisure development in the city centre, bringing 2,000 new jobs.