GEORGE Osborne will this afternoon announce the government’s spending plans for 2015-16 – with Lord Heseltine’s ambitious proposals for boosting regional growth likely to be a prominent casualty.
The chancellor will tell the Commons how he will shave £11.5bn from unprotected Whitehall budgets, equivalent to an average cut of around eight per cent for each affected department.
As a result Michael Heseltine’s much-trailed call to hand direct control over a large proportion of government funding to the regions could instead become a growth fund worth less than £5bn.
There will, however, be increased infrastructure investment with details of the funded schemes due to be announced tomorrow by Treasury chief secretary Danny Alexander.
Business groups called on the government to pursue short-term measures to boost growth, with the CBI wanting action on improving roads and building houses. “We need quick and decisive action on the big decisions that will move projects from blueprints to building,” said director general John Cridland.