Directly elected city mayors could save taxpayers billions of pounds if they used their powers to rationalise citywide spending by public and private bodies, a major new report into the role of elected mayors suggests.

The report also says the government should consider giving mayors wider powers over transport, welfare and skills – something that might require the government to accept that these powers need to extend over a region, and not just a city.

The report prepared by the Warwick commission is based on interviews with over 40 mayors, staff and senior council figures in the UK, Canada, Australia, New Zealand and the US.

The report does not formally back the concept of city mayors, arguing instead that they will be most appropriate in cities that have lacked visible effective leadership. It also calls for a recall option if residents feel the mayor is not up to the job.

The government is holding 10 referendums in England's major cities to see if they wish to switch from the current council model to a directly elected mayor on the model of London. Birmingham is seen as the city most likely to vote yes, but Liverpool has decided to go direct to mayoral elections without holding a referendum.

Liam Byrne, one of three high-profile Labour candidates for mayor in Birmingham, detailed on Sunday five powers he said should be handed to a city mayor.

Ahead of talks on Monday with Lord Heseltine, the government's regional growth adviser, Byrne called for mayoral powers to raise funds from local businesses to reinvest in the city and powers to improve schools. He also wants a regional transport commission, with integrated powers like Transport for London, to unlock Birmingham airport's potential as Britain's fourth hub airport; access to Skills Funding Agency budgets, to help boost apprenticeships and gear spending to the needs of local employers; and an entitlement to keep savings from housing benefit delivered by getting people back to work, to put towards building new homes.

Byrne said: "Everything I learned in Birmingham tells me we can move faster with stronger powers to get things done. Frankly we haven't got a moment to lose. This government doesn't understand the 'fierce urgency of now' and quite simply we need to take back control of our own destiny.

"The government has promised much on new powers – but delivered little. It's time for David Cameron to put his money where his mouth is."

The cities minister, Greg Clark, has not yet set out the powers of mayors, saying it will be a matter for negotiation with each city.

The Warwick report suggests "savings from realising the benefits of a more holistic approach to the public spend in our large cities could amount to billions of pounds". It adds: "For this reason mayors must not be shy of using their mandate across the range of public and private bodies."

It says: "Mayors are more likely to be effective, both in supporting the economy and making effective decisions for local citizens, if they are responsible for functioning economic areas."

The commission's research indicates that "there is no point in electing a mayor whose remit does not cover the necessarily boundary-spanning regions that could foster economic growth".

It also suggests the nature of the relationships between mayors and local economic partnerships, and elected police commissioners need to be clarified.

The commission is chaired by Professor Wyn Grant, professor of politics at the University of Warwick.

Boris Johnson is 2-7 favourite to be re-elected as London mayor next month, but independent candidate Siobhan Benita has attracted so much betting support that she is now third favourite. "On all known form, Ms Benita has no chance of winning the mayoral election," said William Hill's spokesman Graham Sharpe, "but we have taken bets for her from all over the country." He said: "Mindful of the recent shock byelection win for George Galloway when he was backed from 33-1 to 3-1 and won, we are taking no chances." The bookmaker now puts her at 20-1 to be elected.



Captcha image