Glasgow City Region Economy

Gordon McKee Excerpts

Tuesday 2nd June 2026 Westminster Hall

[Martin Rhodes]

I thank the hon. Member for that intervention. I agree and will go on in my speech to talk about how the work of the city deals needs to be developed further. Those structures and activities need to be built on to ensure we get the most from that initial interest to develop it further.

The Glasgow city region economy has seen real investment from the UK Labour Government but much more can be done. With greater devolved powers over areas such as infrastructure, skills, investment and public health, the region will be better placed to shape solutions around the needs of its communities. That would not be devolution for the sake of it. Greater local autonomy can help reduce inequality, improve health outcomes and create new jobs and opportunities across the region.

As the city region is right now, I welcome the significant investment that the UK Labour Government are already delivering. The new local growth fund, combined with the Pride in Place programmes, is set to deliver nearly £94 million in investment over the next three years. The combination of those funds delivers long-term infrastructure and renewal. That approach will help the Glasgow city region to invest in long-term renewal, an ambition that needs to be matched by sustained adequate local government funding from the Scottish Government.

This UK Labour Government have delivered the largest spending review settlement in the history of the Scottish Parliament, which amounted to £50 billion in last year’s settlement. That is in stark contrast to the Scottish Government, which instead of passing that funding increase to local government, continued to enforce cuts to communities. From 2013 to 2026, Glasgow city council alone has seen a £1.5 billion loss in Scottish Government funding. Those cuts to local government funding have left councils across the region overstretched and focused on struggling to deliver core services, with little left over for the long-term investment the city region needs.

[Gordon McKee (Glasgow South) (Lab)]

My hon. Friend is making an excellent speech and an important contribution. We have seen in other UK cities the difference that city region mayors can make, whether in Manchester or in Liverpool and whether on bus franchising or attracting investment. Does he agree that one of the things Glasgow needs is greater devolution from Holyrood to our city to help to attract investment?

[Martin Rhodes]

Yes, I agree that we need devolution of power from Holyrood. One of the ironies of the devolution period in Scotland is that although powers have been devolved from the UK to Scotland, power has been hoarded in the Scottish Parliament and Scottish Government and not devolved to local government and local communities.

The UK Labour Government’s investment is not a substitute for sound local government funding. It is targeted, strategic funding designed to deliver the transformational projects that drive growth, create better jobs and build more prosperous communities. That investment reflects real ambition for the city region and is a fundamentally different offer to the Scottish Government’s short-sighted approach.

While the Scottish Government neglect the Glasgow city region, this Labour Government have been representing its interests in our trade abroad. The £10 billion defence deal with Norway has secured thousands of jobs at shipyards on the Clyde while also supporting many small and medium-sized UK and Scottish businesses in the supply chain. This Labour Government are supporting skilled jobs and opportunities in our city region communities that need them.

The UK Government are not supporting only traditional industries such as shipbuilding; they are also supporting the region’s future technology industries. I recently visited the University of Glasgow-based Responsible Electronics and Circular Technologies programme, which was established in my constituency in 2024 with more than £6 million of UK Government funding. REACT brings together industry and academia to design sustainable solutions for the electronics sector. Projects like that create high skilled jobs, strengthen supply chains and ensure that Glasgow city region remains at the forefront of future industrial development.

With that dynamic and growing economy in the region, it is clear why devolving power and funding to the city region would help industry, businesses and communities. It would allow policies to be better shaped to serve communities where these investments are happening. Already, the Glasgow city region cabinet, a unique governance structure established to oversee the Glasgow city deal that brings together the leaders of the local authorities, helps to deliver these types of regional programmes. However, that governance structure was created for a particular purpose: to oversee a significant but limited city deal programme. It needs to be transformed to meet the new reality and the ambition of the region shown by recent UK Government investment.

Since being elected, I have met with businesses, public transport providers and campaigners, and representatives from the city region to discuss this issue. All of them acknowledge that the Glasgow city region as a metropolitan area needs a regional structure to deliver aligned region-wide policies. That would allow the Glasgow city region to tailor its policies to the needs of our communities. However, devolution must be about outcomes, not simply structures. Any transfer of power must come with clear accountability, strong governance and a focus on what matters to our communities: reducing poverty, improving health outcomes and creating good jobs.

As the city region develops, there will also need to be stronger democratic accountability around the decisions being made. What matters most, however, is that power is placed closer to the communities affected by those decisions. That means better systems to identify the barriers keeping communities in poverty and regional solutions to break down those barriers. That stands in contrast to years in which powers have sat concentrated in Holyrood, with little meaningful transfer to the city region. The Glasgow city region is reaching an important moment in its development. There is now a growing recognition that city regions such as ours are best placed to shape solutions to the challenges and opportunities facing our communities.

Importantly, that work is being matched by growing investment and institutional confidence. The city region now oversees a portfolio of more than £2 billion and is working with partners, including the National Wealth Fund, to shape the next stage of the region’s development. If we get this right, the Glasgow city region can play an even greater role in the Scottish and UK economies while delivering practical improvements in people’s lives: better transport, stronger local economies, good jobs and healthier communities. In the meantime, there is so much to be proud of. World-leading universities, high-skilled jobs and art, culture and sport make it one of the UK’s greatest city regions. It deserves the support it needs to tackle the challenges it faces and deliver real change for the communities of the Glasgow city region.

As for the future, regional devolution for the metropolitan areas of Manchester, Liverpool and the west midlands is proof that greater city region devolution can work. The foundations for governance are already in place in the Glasgow city region, and the UK Labour Government have shown, through significant investment and their partnership with the city region body, that they understand that empowering the Glasgow city region will help it succeed further, economically and culturally. The hugely beneficial impact of UK-funded initiatives such as the local growth fund, the Pride in Place programme, the Norway defence deal and the city deal—

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[The Parliamentary Under-Secretary of State for Scotland (Kirsty McNeill)]

It is a real pleasure to serve under your chairmanship, Ms Jardine. I warmly congratulate my hon. Friend the Member for Glasgow North (Martin Rhodes) on securing this vital debate, and on everything he does to represent one of the greatest parts of one of the world’s finest cities. Whether through the revival and modernisation of heavy industries such as shipbuilding on our beloved Clyde, or future-facing industries like satellites and life sciences, this region is truly stepping forward to lead globally.

The Glasgow city region’s importance to the Scottish and UK economies cannot be overstated—the region is quite simply a powerhouse. It encompasses some of Scotland’s most vibrant local authorities, thousands of distinct enterprises and more than 1 million workers. With more than £870 million invested into the region by the UK Government over 10 years, its future is looking even brighter, but to empower this region to reach its full potential we simply have to do things differently. To do that, we are actively moving away from the short-term, fragmented funded priorities that have held us back in the past. Instead, we are taking a targeted, long-term approach that puts power back where it belongs: in the hands of communities and regional leaders who know their streets and economies best.

I want to share exactly how we are working to supercharge the Glasgow city region, secure high-quality jobs and restore pride in local places. I will begin by highlighting the immense success of the £1 billion Glasgow city region deal, which has delivered foundational benefits through its first decade. That 20-year agreement stands as one of the largest such deals in the whole UK. With more than half a billion pounds of investment from the UK Government, it is set to deliver up to 29,000 jobs over its lifetime.

To date, the deal’s infrastructure programme has completely reshaped the local landscape, delivering iconic new connections across the Clyde. It has also breathed life into the city’s most important public spaces, including the Canal and North Gateway project, which has been transformational for communities in my hon. Friend’s constituency, creating better connections to the city centre and upgrading their public spaces. Further, that deal has leveraged over £800 million in additional private and commercial investment since its inception in 2014, showcasing how effective Government investment can unlock wider commitments to build towards a brighter and more ambitious future.

However, we will not stop there. We will be building on those foundations with the new £140 million Scottish local growth fund launched in January 2026. It is specifically designed to support areas that contain some of the lowest living standards to boost productivity and improve access to better-paid work. The Glasgow city region economic partnership is set to receive the single largest allocation in Scotland from the local growth fund: £60.9 million over the next three years.

The Glasgow city region is an excellent example of a region that knows exactly how to deliver true regional change, as exemplified through the success of the deal programme to date. At the same time, we understand that economic growth cannot be measured just on a balance sheet; as my hon. Friend said, it must be felt on the high street and on the doorstep. That is why we have introduced new hyper-local community funds that will empower local people to shape the future of their neighbourhoods.

Through the Pride in Place programme and the Pride in Place impact fund, we are directly supporting the most in-need communities. Through those programmes, the Glasgow city region is receiving a total of £146 million to support communities across the city region to thrive. Funding is going to places in Glasgow city, North Lanarkshire, South Lanarkshire, Inverclyde and West Dunbartonshire. Of course, one of those places is the Springburn and Sighthill neighbourhood, which includes my hon. Friend’s constituents in Cowlairs and Port Dundas, and I cannot wait to see what priorities the community chooses to support in that area. We all know that the most enduring purpose of Labour Governments is to redistribute power. That is why we are putting decisions about such funding back into the hands of local people who know the places they love the best.

Moving from the hyper-local to the national ambition, the UK Government are delivering a 10-year industrial strategy that is set to back Scotland’s strengths, unlock investment and deliver lasting economic growth. The Glasgow city region is key to this work, with many of the eight growth sectors in our strategy already forming the backbone of this regional economy—from advanced manufacturing and life sciences to defence and financial services.

To back up that transformational strategy with real funding, we are investing up to £500 million across the UK into new local innovation partnerships aimed at growing high-potential innovation clusters. Because of the Glasgow city region’s huge innovation potential, we have allocated £50 million to the region, building directly on the success of the Glasgow innovation accelerator pilot, which this Government backed with another £10 million to the region.

We will not stop there when it comes to equipping the region with the tools needed to be a truly modern economy. Its residents must have the skills and opportunities they need to chase the jobs of the future, as AI is put to work to transform communities and livelihoods. That is why Lanarkshire will host a new AI growth zone, backed by £8.2 billion of private investment and £5 million of direct UK Government investment, creating over 3,000 jobs and driving growth in line with the objectives of our industrial strategy.

Simultaneously, our investment zone programme is driving regional economic growth and regeneration, targeting the high potential of the Glasgow city region’s advanced manufacturing sector. Working in partnership with the Scottish Government and local leaders, we will provide up to £160 million of funding for this investment zone over the next decade, which is expected to generate around £300 million of initial private sector investment and support up to 10,000 jobs in the region.

We must also continue to support the industries that helped to make this region great. That is why this Government have provided bespoke support to Inverclyde in the form of £20 million for the Inchgreen dry dock redevelopment, which will drive new maritime and defence industry opportunities into Inverclyde, and support the people living there to gain the skills they need to do this important work.

Of course, we do not just want investment coming in, but Glasgow’s unique strengths to be exported out to the global market. That is why I am delighted to be joining Glasgow chambers of commerce on an upcoming trade mission to China as they return to the Shanghai international technology fair. We are determined to champion this region’s world-renowned strengths in technology, life sciences and advanced manufacturing to encourage export opportunities and create jobs.

Closer to home, the strategic partnership between the National Wealth Fund and the Glasgow city region represents a colossal opportunity for the region. In Scotland, the National Wealth Fund has directly invested nearly £2 billion, mobilising over £3.5 billion of private investment into projects that will create or support upwards of 9,000 jobs. The creation of partnerships, both internationally and at home, between the private and public sectors will unlock further private investment and drive growth. Together, that will leave the region best placed to navigate the challenges and financing barriers faced in delivering critical infrastructure improvements and developments. Such UK Government interventions are exactly the kind of long-term commitment that we believe is required to drive true growth.

Crucially, building a truly dynamic economy is also about ensuring that the power to spend and to direct investment is with those who know the unique needs and opportunities of their area the best. As my hon. Friend the Member for Glasgow North said, for too long we have watched the centralisation of decision making at Holyrood pull powers away from local communities and regional leaders across Scotland. That stands—I am sorry to say—in stark contrast to the UK Government’s ambitious regional devolution agenda south of the border, which seeks to expand the economic success story of Manchester to more parts of the country.

The 2025 report on regional economic growth by economist Professor Sir Anton Muscatelli asked whether we should consider a “realignment of powers” for Scotland. Similarly, the leader of Glasgow city council, Susan Aitken, has called for a

“rapid devolution of the powers”.

I hear the call from my hon. Friend the Member for Glasgow North, and from my hon. Friend the Member for Glasgow South (Gordon McKee), for devolution, not for the sake of it but because it will drive greater local autonomy that will in turn aid the reduction of inequality, the improvement of health outcomes and the creation of new jobs and opportunities across the region. This is the debate about the future of localism that Scotland needs now.

[Gordon McKee]

The Minister is making an excellent speech. In the conversations that she has had with the Scottish Government, have they ever articulated a reason and an argument for not devolving that power to Glasgow? That devolution is what my constituents want. We can see from cities such as Manchester and Liverpool that it would benefit our city.

[Kirsty McNeill]

My hon. Friend will know that that is felt right across the city region, and across other city regions in Scotland. The Scottish Government seem simply addicted to the centralisation of and hoarding of power. We have made an argument to the people of Scotland that has been incredibly well-received: they live in places that they know and love best, and they want the people they elect locally to have greater power. We are in ongoing dialogue with the Scottish Government but their driving political imperative is nation building, not place shaping. That stands in sharp contrast to the approach of this Labour Government, which is to put power in the hands of communities to change the places that they know and love so well. Scotland needs proper devolution inside Scotland, not just to it. My hon. Friend the Member for Glasgow South will find no greater champion of that local power agenda than me.

We should at all times be guided by the fundamental principle that powers over local services and projects are often best exercised as close as humanly possible to the people whose daily lives they affect. The Scottish people need all levels of their Government to work together to make their lives and communities better. Strong, effective councils and empowered regional voices are key to a prosperous Scotland. We are fully committed to working alongside our local partners in the months and years ahead to deliver that better future for the Glasgow city region and beyond.

Before I close, I want to reassure the hon. Member for Strangford (Jim Shannon) that I am in ongoing dialogue with Northern Ireland Office Ministers about how we can take lessons from the city deal programme and scale them UK-wide. My hon. Friend the Member for West Dunbartonshire (Douglas McAllister) made a very important point about the strategic sites right along the Clyde. I happily visited one such site in his constituency with him. We are fully appraised of the opportunities right along the river.

I thank the hon. Member for Glasgow North for securing this debate and thank all hon. Members who have spoken. The UK Government’s investment of over £870 million into the Glasgow city region over the next 10 years, combined with empowering local spending decisions, has already delivered a truly transformational impact that can be felt in every corner of the region, but this UK Government do not look backwards. Instead we continue to focus on progressing delivery and achieving the economic growth outcomes that will make sure that the Glasgow city region, Scotland, and the UK as a whole can thrive.

To deliver more we must seize all opportunities. That includes having a meaningful conversation on the future of regional devolution, because together we still have so much more to gain. Let us seize this moment, look to the future and continue to deliver for the Glasgow city region.

Question put and agreed to.

Oral Answers to Questions

Gordon McKee Excerpts

Wednesday 4th September 2024 Commons Chamber

[Torcuil Crichton (Na h-Eileanan an Iar) (Lab)]

7. What steps he is taking to support the energy industry in Scotland.

[Gordon McKee (Glasgow South) (Lab)]

9. What steps he is taking to support the energy industry in Scotland.

[Richard Baker (Glenrothes and Mid Fife) (Lab)]

10. What steps he is taking to support the energy industry in Scotland.

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[Ian Murray]

I thank my hon. Friend for that question, and congratulate him on winning the Western Isles. He is Mr Western Isles, and he will be a champion for those islands.

The Government will continue to engage with Harland & Wolff, local MPs and the Scottish Government to monitor the situation and support a resolution that provides long-term certainty for the yards and workforces across the whole UK, with all four yards across the UK being treated as one. The Under-Secretary of State for Scotland, my hon. Friend the Member for Midlothian (Kirsty McNeill), recently visited the Arnish yard. I have visited the Methil yard twice—once before the election and once during the election—and I have regular meetings with the Deputy First Minister on this issue and hope to meet her again in the coming weeks. We will do all we can to protect these yards.

[Gordon McKee]

Having spent many years working for my right hon. Friend when he was on the Opposition Benches, may I welcome him to his position as Secretary of State for Scotland? The creation of GB Energy will support 50,000 new jobs across Scotland. It will deliver lower household bills and help us meet our net zero obligations. Given that Glasgow already has a fantastic renewables industry, may I ask what work he has done with his Cabinet colleagues to ensure that GB Energy supports jobs in Glasgow?

[Ian Murray]

I congratulate my hon. Friend on winning his seat in Glasgow South. His question is much better than any that he ever wrote for me.

My right hon. Friend the Secretary of State for Energy Security and Net Zero is due to make an announcement on the location of GB Energy very soon. I regret that, in the interim, I can say no more than that, although I am sure that my hon. Friend’s words of encouragement in respect of Glasgow will not have escaped the attention of my Cabinet colleagues. I can announce exclusively to the House today, Mr Speaker, that GB Energy will be headquartered in Scotland.