Given the increasingly constrained economic environment we find ourselves in, there was a high degree of nervousness in the North of England about what the Autumn Statement might bring in relation to previous investment commitments.
However, reflecting on the Chancellor’s speech, it feels like it’s mostly a case of business as usual, with previous commitments largely being protected - for the time being, at least. Investment in infrastructure is still seen as an important driver of future economic growth. So it was a relief for many to see funding for Phase 2 of HS2 from Birmingham to Manchester and core Northern Powerhouse Rail (NPR) being protected (albeit the scaled-back version presented in last year’s integrated rail plan). However, there was no mention of Liz Truss’s decision, during her brief spell as prime minister, to re-establish the plans for an NPR link via Bradford, so it’s unclear now if that is on or off the table.
Those northern authorities who spent time and effort over the summer preparing bids for the second round of Levelling Up funding will also be relieved to hear that that funding pot has been protected. However, with infrastructure delivery cost inflationary pressures increasing by the day, it’s unlikely that the original scale of ambition from LUF2 will be fully realised.
It was also reassuring to hear about an ongoing commitment to devolution deals with authorities across the country, including the trailblazer deal with Greater Manchester. Unfortunately, there was no further clarity given in the public statements about whether further devolution of powers and responsibilities will come with significant additional funding; however, it did point to more devolved and multi-year funding settlements in the next spending review in 2024, which I’m sure will be welcomed in principle by those combined authorities who will benefit.
There was some more good news about funding for innovation and research funding, particularly given the challenging environment associated with bidding for European research funding in a post-Brexit era. Funding for the UK’s nine Catapults will be increased by 35% compared to the last five-year funding cycle. However, it’s unclear whether there will be any significant focus on transport research and innovation or efforts to invest in regions outside of London through the wider application of innovation initiatives such as the current future transport zones.
It was disappointing to see only limited reference to the need to reach net zero and the scale of challenges ahead in terms of decarbonising transport, and it remains to be seen what impact the announcement to impose vehicle excise duty on electric vehicles from 2025 will have on the critical transition to a zero-emission road vehicle fleet.
There was also no reference to funding for new bodies, such as Active Travel England, which are at risk of being viewed as pet projects of the Johnson administration and may therefore be vulnerable to cuts identified as part of the “Efficient and Savings Review” referenced in the statement, to “reprioritise spending away from lower-value programmes, and review the effectiveness of public bodies”.
