How spending cuts hit construction – full details

Grant Prior 13 years ago
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Chancellor George Osborne vowed to protect as much infrastructure investment as possible today as he declared war on bureaucratic waste and welfare spending in a bid to cut the country’s deficit.

Osborne listed a host of transport schemes which will still go ahead as he outlined £83bn of cuts across departments in the Comprehensive Spending Review.

But investment at a local level will still be decimated as capital spending by local authorities is set to fall by 30% over the next four years as their funding is slashed.

Further details of transport plans which will escape the axe will be outlined by Secretary of State Philip Hammond next week as his department cuts capital spending by 11% over the next four years as administration costs fall 33%.

Osborne said £10bn would still  go into funding national and local road networks, and public transport schemes in Britain’s major cities.

Projects going ahead will include widening the remaining section of the A11 to provide a continuous dual carriageway link between Norwich and the M11;  improving the junction between the M4 and M5 and easing congestion on the M1 between junctions 28 and 31

Work on the Mersey Gateway Bridge will also go ahead plus work to improve the A23 Handcross to Warninglid and the introduction of a managed motorway scheme between junctions 25 to 30 of the M62.

Hammond said: “Whilst we have had to make some difficult choices, I am confident that our focus on the long term will ensure that we can continue to build a transport system that supports economic growth and reduces carbon.

“We have secured investment to allow us to go ahead with important projects such as high speed rail, support for ultra-low carbon cars and major road building and public transport programmes.”

Funding for social housing has been slashed but Osborne believes 150,000 new homes will be built during the spending period funded by higher rents for tenants.

He also vowed to continue with the Decent Homes Initiative by spending £2bn during the period.

New prison building plans have been shelved but Osborne said £1.3bn will be spent over the next four years to maintain and refurbish existing buildings.

Health spending has been protected and new hospital building plans will continue at the Royal Oldham, St Helier and West Cumberland.

Spending on school maintenance and refurbishment work will be £15.8bn to improve 600 schools in the wake of the BSF programme being scrapped which will result in a 60% drop in capital spending in real terms by 2015-15.

The average cuts to each department will be 19% – lower than the widely anticipated 25%

Alan Johnson MP, Labour’s Shadow Chancellor, has criticised the coalition’s Comprehensive Spending Review as a huge gamble from a government with no plan for growth and jobs.

He said: “Today is the day that an abstract debate about spreadsheets and numbers turns into stark reality for people’s jobs and services. Their pensions, their prospects, their homes and their families.

“It is our firm belief that the rush to cut the deficit endangers the recovery and reduces the prospects for employment in the short term, and prosperity in the longer term.”

    Spending review

Cuts over four years

  • £83bn cut in spending
  • 490,000 public sector job cuts
  • Extra £2bn capital spend, reversing some cuts in June Budget
  • Council budgets cut 7.1% annually or 27% over 4 years
  • NHS budget protected (cap spend down 17%)
  • Transport budget cut 21% (cap spend down 11%)
  • CLG Communities budget slashed 51% (capital spend down 74%)
  • Home Office cut 23%, police numbers protected (cap spend -49%)
  • MoD 8% savings (cap spend -7.5%)
  • Education down 3.4% (cap spend -60%)
  • Energy cuts 18%, decommissioning budget up (cap spend up 41%)
  • Defra cut 29%, flood defence spending ringfenced (cap spend down 34%)
  • Cap on rail fares to rise
  • Construction cuts

  • 63% cut in annual social housing budget to £1.1bn
  • Council rents to rise to 80% of market rate to build 150,000 council homes over four years
  • 1500-place Runwell prison in Essex axed
  • Safe

  • Crossrail
  • £600m for London Underground upgrade
  • Second Mersey Crossing
  • Funding held for St Helier, West Cumberland, Royal Oldham hospitals
  • Boost to apprenticeships
  • £1bn for pilot carbon capture and storage
  • £200m to develop port sites for wind farms
  • Green investment bank go-ahead with £1bn
  • Widening the A11 to dual carriageway between Norwich and the M11
  • Improving the junction between the M4 and M5
  • Easing congestion on the M1 between junctions 28 and 31
  • Extending the route and increasing capacity on the Midland Metro
  • Constructing a new suspension bridge over the River Mersey
  • Upgrades to the Tyne and Wear Metro
  • £220m for cancer  research building in London
  • £69m for Diamond Synchrotron extension
  • £14bn of funding to Network Rail to support maintenance and investment, including major improvements to the East Coast Mainline, station upgrades at Birmingham New Street and network improvements in Yorkshire, around Manchester and the Barry to Cardiff corridor;

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