The announcement to offer the deal was made by Chancellor Jeremy Hunt as part of today’s Autumn Statement.
If given approval, the proposed deal will transfer new money and powers from central government to a newly created Combined County Authority.
For the past six months, leaders from Lancashire County Council, Blackburn with Darwen Council and Blackpool Council have been working together to progress a devolution deal for the area.
The proposed deal would give local leaders extra powers to tackle key priorities such as better public transport, boosting economic prosperity and improving employment and skills.
It would also give Lancashire a stronger voice on the regional and national stage, ensuring the county does not miss out on vital funding and opportunities.
The intention is to ensure Lancashire is able to become the very best place possible to live, work, visit, study and invest.
Importantly, while a new Combined County Authority would be created, the deal would not require a change to the established county, borough or district councils across the area, and there would be no requirement for an elected mayor, nor the power to precept over and above the normal Council Tax ask.
Secretary of State for Levelling Up, Housing and Communities Michael Gove MP said: “I am delighted to agree this Level 2 devolution deal with Lancashire, which will bring more funding and powers out of Whitehall into the hands of communities in Lancashire.
“Lancashire has a long tradition of innovation and entrepreneurship, which this deal will build on to unlock the economic potential of the whole area.”
Councillor Phillippa Williamson, Leader of Lancashire County Council, said: “The announcement by the Government today is amazing news, and shows the faith the Secretary of State Michael Gove and Levelling Up Minister Jacob Young have in our plans.
“Alongside my fellow leaders, I truly believe the time is now for a devolution deal for Lancashire.
“We want to ensure our residents benefit from a boost in funding as well as extra powers to tackle the issues that matter most to the people of Lancashire.
“This proposed deal would help us to drive regeneration in our town and city centres, support new jobs in growing industries such as low carbon technologies, cyber security and energy, and make sure we have the right skills to take advantage of these opportunities.
“It would also enable greater co-ordination of our collective expertise, priorities and investment in our transport infrastructure to ensure that it meets the needs of people across the region.
“This announcement is a hugely significant milestone in our devolution journey and signifies a really crucial step forward.”
Councillor Phil Riley, Leader of Blackburn with Darwen Council, said: “It’s a real triumph for everyone involved to have finally made a start on the devolution of powers to Lancashire after many false starts.
“This will give Lancashire a voice both nationally and, in the North West, allowing the region to start to compete on an even playing field with our neighbours in Manchester and Liverpool.
“We will always be ambitious – the residents of Blackburn with Darwen rightly expect that from their council – and we want to use the new devolved powers to make sure nobody gets left behind in our two towns and across Lancashire.
“This deal won’t change people’s lives overnight but it’s a really positive step in the right direction and, hopefully, the beginning of a story where more powers can be devolved from Westminster to Lancashire.
“At their best, councils are a force for good and we look forward to using our local knowledge to make sure any investment has the biggest and most positive impact for our residents.”
Councillor Lynn Williams, Leader of Blackpool Council, said: “The people of Blackpool and Lancashire deserve to benefit from devolution. For too long we have watched neighbouring areas benefit, whilst our county has missed out.
“I am pleased that we can now take this next step forward in securing a deal that will provide tangible benefits and lasting change for our residents and businesses.
“By giving Lancashire more control over its own destiny, we can prioritise resource and investment so that it truly meets our needs.
“As the Government has made clear, devolution is a long-term process and this is a positive start. It is my hope that this deal will give us a platform to secure more powers and resource for our communities into the future.”
The deal proposal will now be discussed by members of each constituent council at a series of council meetings. If all the councils agree, a public consultation will then be held so residents and businesses can have their say on the deal proposal. Each council will then consider the findings of the consultation before the final proposal is submitted to Government for Parliamentary approval next year.