Chancellor targets English regions with multibillion investment

English regions including the north and the Midlands will receive a multibillion-pound investment in an effort to reduce the weighting of the economy towards London.

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تاریخ: ۰۲ آذر ۱۳۹۶ - ۱۰:۱۳

Speaking as he announced plans aimed at improving transport links and devolving more power to the regions, Philip Hammond said "far too much of our economic strength is concentrated in our capital city”.

Major proposals intended to address this include:

A £1.7bn fund to improve local transport in cities.

1m new homes between Cambridge and Oxford.

£300m to ensure HS2’s benefits spread through the north of England.

£385m for 5G and fibre broadband networks.

The largest item on a list of spending plans the chancellor promised would "get all parts of the UK firing on all cylinders” is a £1.7bn transforming cities fund (TCF) to spruce up local transport connections.

Half of the money will be shared by six areas with elected mayors – Greater Manchester, Cambridgeshire and Peterborough, Liverpool, the Tees Valley, West of England and the West Midlands – with other cities invited to compete for the rest.

The Treasury said this would fuel "projects which drive productivity by improving connectivity, reducing congestion and utilising new mobility services and technology”.

The TCF will be administered via the expanded nationalproductivity investment fund (NPIF), launched last year to pay for housing, infrastructure, and research and development. The size of the NPIF was increased in the budget from £23bn to £31bn.

The "northern powerhouse” – a scheme launched by Hammond’s predecessor George Osborne in a bid to boost the region’s economy – has been singled out for some of the biggest funding awards.

The largest is a £337m investment in the Tyne and Wear metro system to replace its 40-year-old rolling stock with energy-efficient trains.

The cash injection, via the NPIF, is designed to cut costs and improve service for 38 million passengers a year on a busy route bedevilled by delays and cancelled trains.

Some £300m will go towards ensuring the HS2 high-speed rail project also improves inter-city rail connections by linking to upgraded stations in the north and Midlands.

Ed Thomas, the head of transport at accountancy firm KPMG, said major transport projects "will be seen to go some way to redress the balance” after the controversial cancellation of several regional rail electrification schemes in July.

The north-east was targeted with proposals that could see the "North of Tyne” area get its own mayor in 2019, as part of a devolution deal including £600m of investment over 30 years.

There will also be £5m allocated to the South Tees Development Corporation to take over and redevelop the site of the old Redcar steelworks, which shut down in 2015 as a crisis engulfed the UK steel industry.

The government will look to develop an industrial strategy with the Greater Manchester region, which is also getting one of the biggest slices from the TCF transport pot at £243m.

The "Midlands engine” will also receive funding, partly via a devolution deal for the West Midlands that includes £6m for a housing delivery taskforce and £5m for a construction skills training scheme.

In addition to the Midlands’ £250m share of the TCF transport pot, there will be £4m to ease road congestion and £2m to improve capacity on the Coventry to Leamington rail route.

The East Midlands will be used to pilot a manufacturing zone designed to bolster business investment by easing planning restrictions.

The budget also included a raft of measures aimed at the corridor between Cambridge and Oxford, an area the Treasury said "has the potential to be a globally significant economy”.

The government accepted the National Infrastructure Commission’s belief that 1m new homes must be built in the region by 2050 to maximise its potential, beginning with a housing deal with Oxfordshire to build 100,000 by 2031.

There will also be measures to speed up existing plans to improve road and rail connections between the two university cities.

While transport projects dominated the regional agenda, the budget included several measures aimed at improving connectivity throughout the country, including £160m from the NPIF to develop 5G mobile networks.

"The UK has an opportunity to become a world leader in 5G, which is the next generation of mobile communications,” the Treasury said.

The NPIF will also spend £160m on local full-fibre broadband networks, as well as £35m to improve connectivity on trains, to be tested on the TransPennine route.

At local authority level, councils will be able to tap into a £1bn loan fund to support "high value” infrastructure projects and could also be allowed to retain more of the business rates they collect under a scheme being piloted in London.

Smaller local projects include £98m for a new bridge in Great Yarmouth, Norfolk, and £79m for a link road near St Austell in Cornwall, to support housing development.