Cities are where it's at

A city deal could mean huge public investment in Cardiff

Forget the counties and the shires, any self-respecting economic development policy has to have the word city in it somewhere to give it a sense of dynamism.

So we already have city regions, which is an attempt to make the most of the growth of places such as Cardiff and Swansea.

And we now have city deals, which has become the method of choice of the UK government to get money out of London, and into the nations and regions.

When I interviewed David Cameron on Wales Today last week, I asked our newly-elected prime minister what he had planned for Wales over the next five years and the answer was a potential city deal for Cardiff.

Sketchy

Until this point the details have been sketchy. There have been talks between Westminster and Cardiff council, with limited Welsh government involvement so far.

The idea is that the UK government would join with the council in providing funding for infrastructure projects such as a south Wales metro, which is the plan to improve bus and rail services in and and out of Cardiff.

The problem is that the council has to find £50m worth of savings next year and, in the light of this, a recent report said: "Current aspirations in relation to initiatives such as City Deal and New County Hall may therefore prove unaffordable or place additional pressures on revenue budgets."

The council leader Phil Bale wants to plough on but doesn't do so from a position of strength, having faced a vote of no-confidence and two challenges to his leadership in recent months.

Glasgow

At some stage the Welsh government is going to be invited to the party, but were it to step in and cover Cardiff council's share of the cost it might struggle to justify that to all of the other cash-strapped councils.

The Glasgow-model provides a template. It was worth £1.13bn with £500m being found by the UK and Scottish governments and the local authority has been able to borrow £130m for the rest.

It's early days but this is clearly going to test budgets at a time when they're going to come under huge strain after the budget in July.