Key announcement on North East transport is due today

George Osborne yesterday used his spending review to announce extra transport cash for London but has delayed details of regional spending

Stefan Rousseau/PA Wire Chancellor George Osborne
Chancellor George Osborne
 

The North East finds out today which of its transport concerns the Government will invest in as the capital continues to soak up cash.

While the Chancellor used his Spending Review to announce extra transport cash for London, he delayed until today further details on regional spending.

It is not thought the projects announced today will include new money. Instead the chief secretary to the Treasury will announce which of the £100bn of infrastructure projects lined up in the last Budget will get the go-ahead.

The fund will help “raise our national game” and promote the elusive growth that has plagued the British economy, George Osborne has said.

In his spending review Mr Osborne said the Department for Transport (DfT) would make a 9% saving in day-to-day spending, but receive the largest boost of any department to its capital budget, which rises to £9.5bn in 2015/16.

The Chancellor said the Government would “look at the case for” the £12bn cross-London Crossrail 2 project which is backed by London Mayor Boris Johnson.

Work on the first Crossrail project, running east-west under the capital, is well advanced. A second line would run north-south.

Mr Osborne added: “Successive governments of all colours have put short-term pressures over the long-term needs and refused to commit to capital spending plans that match the horizons of a modern economy. Today we change that. From roads to railways, bridges to broadband, science to schools.”

As a result London mayor Boris Johnson was able to welcome a big boost – a grant of £925m in 2015/16 rising to just over £1bn by 2020/21 on top of enhanced borrowing powers to fund transport in London.

Think tank IPPR North has warned of the continuing danger of pushing the vast majority of transport spending into London and the South East.

Last night director Ed Cox said: “Having cut infrastructure investment in the early part of this Parliament, capital spending announcements are badly needed and long overdue.

“Thursday’s announcements are unlikely to change the north-south divide in transport infrastructure, with £9bn already pledged to Crossrail meaning London looks set to swallow up more than 90% of all regional transport infrastructure investment in the coming decade.”

John Cridland, CBI Director-General, said: “The Government has avoided repeating the mistake it made in the last Spending Round when it cut capital spending far too deeply.

“By locking in investment until 2020, the Chancellor has offered investors greater certainty, but they will need a detailed pipeline to pump their money into projects.”

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