The Chancellor has today delivered his Spring Statement. Against the background of continued uncertainty around the UK’s departure from the EU, what will probably be seen as the main message of the Statement is that the Chancellor’s so-called ‘war chest’ of around £26.6bn is earmarked for preparations for a ‘no-deal Brexit.’
If the possibility of a ‘no deal’ exit is removed with the EU’s agreement, it will free up a significant amount of money to be spent in areas such as healthcare and education. However, as our last update noted, ‘no deal’ remains very much a possibility, in spite of this week’s parliamentary vote.
If a Brexit deal is agreed, the Chancellor has committed to a full, three-year spending review before Parliament’s summer recess, ahead of the next budget.
We look at a few other key announcements from the Statement below.
Housing & construction
The Government has made up to £3bn available to housing associations in England, through the Affordable Homes Guarantee Scheme, to support delivery of around 30,000 affordable homes.
In addition, £717m is earmarked for constructing 37,000 homes in London, the Oxford-Cambridge Arc and Cheshire.
The Chancellor also said that a National Infrastructure Strategy will be published along with the Autumn Budget.
For more on the implications of the Statement for the construction industry, see the latest Construction Online update.
Local areas
Alongside the above-mentioned areas for housing development, the Statement announces up to £260m for the Borderlands region, which comprises which comprises Dumfries and Galloway, the Scottish Borders, Northumberland, Cumbria and Carlisle City. There will also be £60m of investment in ten cities and local areas across England, from the ‘Transforming Cities Fund.’
Technology & innovation
While the major news in terms of technology may be around the Government’s planned reviews of digital advertising and the dominance of ‘tech giants’, there were announcements in other areas too, with over £200m earmarked for science and innovation projects. Major funding has been granted for state-of-the-art laser technology projects in Oxfordshire, genomics research and industry in Cambridge, and £79m for a supercomputer to be developed in Edinburgh.
Skills & jobs
The last Budget included updates to apprenticeship reforms. These mean that, from 1st April, employers will see the co-investment rate they pay reduced from 10% to 5%, while levy-paying employers are “able to share more levy funds across their supply chains”, with the maximum amount rising from 10% to 25%.
The Chancellor also reiterated that the previously-announced £37bn National Productivity Investment Fund, covering areas such as roads, the rail network and full-fibre networks, will help boost productivity.
Sustainability & environment
Sustainability and efficiency are one of the major areas of focus in the Statement, with the Chancellor pledging to increase the amount of ‘green gas’ in the National Grid. Additionally, from 2025, all new homes will be ‘future-proofed’ with low carbon heating, as opposed to fossil fuel-based heating systems.
The Statement also announced a ‘call for evidence’ specifically focusing on the benefits of energy efficiency and carbon reduction for SMEs. The results of this will lead to SME-specific investment commitments.
