Andy Burnham has announced that regional mayors will receive a share of income tax revenues for the first time.

The PM is also set to launched the biggest transfer of power from Westminster in a generation, giving communities greater control over the decisions that shape jobs, transport, housing and public services in their area.

The idea is that when local areas create new jobs, they will keep more of the rewards.

Areas without a mayor will also be supported to establish strategic authorities and gain greater control over local priorities.

The new plans are slated to come into effect from next spring and further details will be set out at the budget.

Prime Minister Andy Burnham said: "I said we’d take power out of Westminster and carry it into every postcode in the country. Today, we make good on that promise.

"Under our plans, more of the taxes raised in a community will stay in that community. Soon, every local leader will have the power and resources to improve public transport, build homes and create jobs.

"I know what it’s like to be ignored by politicians in Westminster. I’m not going to make that same mistake now I’m PM.

"The whole of government will now pull together behind the people and places that desperately need our support. This is how we’ll bring back hope and bring power home to you."

Chancellor of the Exchequer, John Healey MP said: "The people who best understand what skills employers want, what transport an area needs and where investment can make the biggest difference are those who live there.

"For the first time we’re giving Mayors a share of income tax so communities directly benefit when their economy grows - passing power out of Westminster and driving growth in every postcode.

"This is the way we start to build new hope and advance the working people of this country."