East Mids to profit from CSR with transport creation
Nottingham is set to benefit from the creation of two new tram lines. In his Comprehensive Spending Review (CSR), Chancellor George Osborne outlined plans for lines two and three of the city’s tram network.
Leader of Nottingham City Council Councillor Jon Collins says: "This is very good news for Nottingham. We have worked hard to argue the case for two more tram lines because the benefits to Nottingham and the surrounding area are so great that it would be foolish not to pursue with the proposals. I'm pleased that the government has clearly recognised this and the strength of our proposals.
"This go-ahead means the extended tram network can now play its key part in shaping the future prosperity of this city, helping Nottingham to weather the current economic storm and come out the other side stronger and more resilient. The city will be even more attractive to employers as a place to locate, bringing more jobs and creating more wealth for our citizens."
The Chancellor also committed funding to the A46 to improve the road between Newark and Widmerpool, and to the M1. Osborne said that funds would be put aside to replace a viaduct carrying the M6 over the M1.
Despite good news for the region’s transport systems, the CSR axe was wielded over Whitehall.
Graham Bushby, at Baker Tilly Recovery and Restructuring, said that “few East Midlands businesses will escape the ripple effect of the CSR cuts”.
He added: “Taking billions of pounds of spending out of the UK economy will affect the supply chain, from the top down to the consumer and back up again.
“Those who anticipate and act quickly to address the implications of the cuts are likely to be the fittest in the battle for survival and longer term prosperity.”
Nationally, few government department escaped the cuts.
Osborne's speech began with the revelation that the UK is currently paying £43bn each year in debt interest alone. Despite this, he confirmed that total government expenditure – capital and current – would rise to £702bn next year and £740bn in 2014/15.
This will be balanced by major efficiency savings expected from most departments. He confirmed that 490,000 public sector jobs will be lost in the next four years, which he said was "unavoidable when the country has run out of money".
However, Osborne also said the private sector has created 178,000 jobs in the last three months, reiterating his belief that stimulating growth will protect the UK against lost public sector jobs.
The average cut to departmental budgets was set at 19 per cent, lower than both the 25 per cent the government predicted in March and the 20 per cent proposed by the replaced Labour government.
The Department for Business, Innovation and Skills is facing a 7.1 per cent cut in its budget, well below this average. Osborne promised to "prioritise those areas of public spending most likely to create growth".
The Regional Growth Fund will be held at £1bn over two years, which was widely expected, but there will also be an additional third year funding of almost £0.5bn. Osborne also announced that the science budget would be protected at £4.6bn a year.
A 50 per cent increase in apprenticeships spending was also unveiled, which the Chancellor claimed will create an additional 75,000 new placed by 2014/15.
Other areas where major expenditure was promised to stimulate growth was the green investment bank, a £1bn initiative created by the previous government, which Osborne said will continue.
Offshore wind projects and port development will benefit from £200m investment, while £30bn will be invested in the UK's transport infrastructure.
The voluntary and charity sectors, which had been bracing themselves to take up the slack if social care projects fell under the axe, were promised a £100m one-year transition fund.
