We haven’t forgotten about you, Clegg tells rest of Britain

Nick Clegg will insist the coalition remains focused on spreading economic prosperity beyond the south-east, in a speech in London later.

The deputy prime minister is championing the coalition's "quiet revolution" in shifting power away from Whitehall in his Mansion House address this evening.

Clegg will blame a "historical anomaly" for the concentration of economic prosperity on the south-east of England, which he will argue contrasts with other countries.

Germany, the US and India all have economic powerhouses away from their capitals, he will point out.

Clegg will argue the British Empire had benefited from its northern cities being "the giants of the industrial revolution" before the "political failures of the past" led to the decline of the north of England.

"One of the most important antidotes to economic centralisation is political decentralisation: dispersing the power and freedom cities and towns need to flourish," he is expected to say.

"Investment from central government is crucial – that is absolutely true.

"But we have also learned the limitations of well-meaning handouts from Whitehall… The other side of this has to be freedom; autonomy; control. Empowering our cities and towns to innovate, to drive their own growth."

The government has been keen to encourage local authorities to take a broader view by pushing for the establishment of funding deals covering entire cities and the creation of directly elected mayors.

"Just because our big cities have voted to reject having mayors, they haven't voted against having greater freedom," Clegg will add.

"So the coalition is giving it to them. You may not have noticed: it’s a kind of quiet, British revolution. But by 2015, as a result of our reforms, every part of Britain will feel more empowered than in 2010."

These efforts have not stopped influential MPs in the Commons from pointing out the structural relationship between Whitehall and councils remains hopelessly one-sided.

The communities and local government committee argued more power and resources need to be devolved from central to local government in order to make the modern role of councillors more effective.

A report from the political and constitutional reform committee published last month went further, calling for a dramatic shift in the "balance of power" by transferring autonomy to cities and the regions.