The chancellor’s economic programme contains much the City should welcome

Andrew Parmley
The chancellor is no stranger to the City (Source: Getty)

The chancellor stepped up to the despatch box last week to make his most important speech since taking office in July.

Where previously the Autumn Statement was an important political date on the calendar for UK media, it had gone largely unnoticed by the European press. This year, however, was different.

Philip Hammond’s address was being watched by the press across the continent. With the rest of the bloc braced for the beginning of the UK’s negotiations – anticipated in March next year – any snippet of information that might be gleaned from the Prime Minister’s right-hand man would be treasured.

But, as has been the case so far, government remained tight-lipped on the matter. In fact Brexit was only mentioned in terms of how much was being held in reserves.

Read more: Hammond fell for the discredited groupthink that Brexit is bad for growth

There were some announcements, however, of huge significance to the City.

The first was regarding the capital’s affordable housing problem, which partly undermines our position as a leading global city. Too many Londoners have trouble finding affordable and suitable housing, which will, unless we take action, drive workers away from London and into the arms of Europe’s other financial centres.

The Housing White Paper and a promise to unlock more land to build on were a good start, but no more than that. So Hammond’s announcement that the government will increase the amount of affordable housing in the capital, with a £3.15bn fund to build 90,000 homes over the next five years, was extremely welcome.

As someone who was born in Manchester and raised in Blackpool, and as an ambassador for a financial and professional services sector that employs 1.4m people outside London, I was also pleased that the chancellor acknowledged the growth of a whole range of UK regions.

As I told the Prime Minister at the Lord Mayor’s Banquet a fortnight ago, it is absolutely vital that government engages with these areas – not just London or even the big cities – in order to better understand how it can stimulate jobs and economic growth. Devolution is one way to do this: it will help empower individual regions to take decisions relevant to them, and will also give London more control over how we support the entire UK economy.

Read more: London must shake off its complacency if it's to thrive post-Brexit

Another area of interest was infrastructure. Ambitious local and national infrastructure developments will be crucial to increasing UK productivity, which currently lags far behind frontrunners such as the US and Germany.

While we welcome the chancellor’s plans to invest more in areas such as transport and broadband connectivity, business will want to see exactly how this investment will improve turnover and trade links with our international partners. The National Productivity Investment Fund is a good move, but again, a quick return is vital.

Overall, I think the Autumn Statement was positive. The new chancellor – himself no stranger to the City – recognises the need for a stable economy, and his expenditure plan reflected that. Now, however, despite the setbacks that Brexit might induce, we look forward to his commitments bearing fruit.

City A.M.'s opinion pages are a place for thought-provoking views and debate. These views are not necessarily shared by City A.M.

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