Prime Minister Sets Out ‘Ambitious’ Economic Recovery Plan

Business Round-Up – 29 June 2020
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Prime Minister Sets Out ‘Ambitious’ Economic Recovery Plan

Boris Johnson

Boris Johnson has said now is the time to be “ambitious” about the UK’s future, as he set out a post-coronavirus recovery plan.

The PM vowed to “use this moment” to fix longstanding economic problems and promised a £5bn “new deal” to build homes and infrastructure.

Plans set out in the Tory election manifesto would be speeded up and “intensified,” he added.

Labour and the CBI said he was not focusing enough on saving jobs. Labour leader Sir Keir Starmer said there was “not much of a deal and not much that’s new”.

Chancellor Rishi Sunak later confirmed he would deliver an economic update on 8 July “setting out the next stage in our plan to secure the recovery”.

The PM’s speech came as new figures showed the UK economy shrank faster than at any time since 1979 between January and March.

In a wide-ranging speech in Dudley, in the West Midlands, Mr Johnson vowed to “build, build, build” to soften the “economic aftershock” of coronavirus.

Infrastructure projects in England would be “accelerated” and there would be an investment in new academy schools, green buses and new broadband, the PM added.

Projects in the £5bn investment plan include:

  • £1.5bn for hospital maintenance and building, eradicating mental health dormitories and improving A&E capacity – the government said this is “new” money in addition to £1.1bn in its Spring Budget;
  • £100m for 29 road projects including bridge repairs in Sandwell and improving the A15 in the Humber region – this money had already been announced;
  • Over £1bn for new school buildings, as announced on Monday – this cash comes from the government’s existing infrastructure plan; and
  • £12bn to help build 180,000 new affordable homes for ownership and rent over the next eight years – brings together three pots of money already announced by previous Tory governments and Mr Johnson’s administration.

Other projects announced in the government’s Spring Budget, which will now be accelerated, include:

  • £83m for maintenance of prisons and youth offender facilities, and £60m for temporary prison places;
  • £900m for “shovel ready” local projects in England this year and in 2021;
  • £500,000 – £1m for each area in the town’s fund to spend on improvements to parks, high street and transport.

Commenting on the Prime Minister’s speech for a ‘New Deal for Britain’, Dr Liz Cameron, Chief Executive of the Scottish Chambers of Commerce, said:

“The Scottish Chambers of Commerce agree that we must not let this crisis go to waste. Plans to rebuild our economy must be backed with both intent, collaboration and investment of a scale not seen since the last century.

“The Prime Minister set out a compelling case for investing in infrastructure and we urge both the Scottish and UK Government’s to work together to put shovel-ready projects on the table and deliver investment to ensure the economy is supported in the immediate, medium and long term.

“Boosting consumer confidence by announcing VAT cuts, providing further job security by extending the furlough scheme for the hardest-hit sectors and providing guaranteed opportunities for our young people are just some of the immediate steps both Governments should collaborate on and deliver for business.

“The Scottish Government must ensure all consequential funding is allocated towards rehabilitating the economy and creating jobs.”

You can view the full PM Speech via this link.

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