Lift-off for growth

Working people and businesses across Britain will benefit from a government going “further and faster” to kickstart economic growth, commented the Chancellor Rachel Reeves, while speaking to an audience of business chiefs at Siemens in North Oxfordshire.

The Chancellor set out the government’s latest set of reforms to kickstart economic growth and drive up living standards across the UK by driving investment, getting Britain building and tackling regulatory barriers. This included the announcement that the government supports and is inviting proposals for a third runway at Heathrow.

The Chancellor confirmed that the government will move at speed to review the Airports National Policy Statement (ANPS). This provides the basis for decision making on granting development consent for a new runway at Heathrow, to ensure that any scheme is delivered in line with our legal, environmental and climate obligations.

In her speech, Chancellor of the Exchequer Rachel Reeves said: “I have always been clear that a third runway at Heathrow would unlock further growth, boost investment, increase exports, and make the UK more open and more connected as part of our Plan for Change.

“And now the case is stronger than ever because our reforms to the economy – like speeding up our planning system, and our strengthened plans to modernise UK airspace – mean the delivery of this project is set up for success.

“So I can confirm today that this Government supports a third runway at Heathrow and is inviting proposals to be brought forward by the summer.”

As well as creating over 100,000 jobs in the local area and many more indirectly, research published by Frontier Economics finds that 60% of the economic boost from a third runway would be felt by areas outside of London and the South East – putting more money in the pockets of working people across the UK through lower fares and greater choice for passengers as part of our Plan for Change.

The Chancellor also announced that a new partnership between global logistics giant Prologis and East Midlands Airport to build a new advanced manufacturing park within the East Midlands Freeport zone to unlock £1 billion of investment and 2,000 jobs.

In further recognition that the Government’s clean energy superpower mission is helping to drive the UK’s economic growth mission, Reeves announced that the government will designate new Marine Protected Areas to enable offshore wind, whilst protecting our marine environment. In doing so, barriers to 16 gigawatts of offshore wind will be unblocked – as much electricity as was produced by all gas power plants in 2024 – and up to £30 billion of private investment in homegrown clean power will be unlocked, creating thousands of good clean energy jobs in the offshore wind sector in areas like East Anglia and Yorkshire.

A new approach to the Oxford-Cambridge Growth Corridor – a centre of innovation which could become Europe’s answer to Silicon Valley – will be spearheaded by Sir Patrick Vallance as a Ministerial Champion. The economic potential of this region will be unlocked through leveraging the strengths it boasts in sectors across Britain’s new modern Industrial Strategy, from life sciences and tech to advanced manufacturing.

Justin Sullivan, President of RICS, said: “Rachel Reeves is correcting the course of Labour’s growth journey. The tough decisions have been made; now it’s time to press ahead with much-needed reforms.

“Since the Budget confidence amongst companies in the built environment has tailed off spelling bad news for housing and infrastructure delivery – particularly among SMEs, the backbone of construction supply chains, whose ability to borrow, grow and deliver disproportionately relies on sentiment across the economy. These have combined to undermine the positive impact of changes to the National Planning Policy Framework, announced in December. But Rachel Reeves’ speech today will help reset the mood.

“By streamlining decisions on critical infrastructure projects and slashing red tape, policymakers should achieve their ultimate aim of economic growth by capturing the potential of high-growth, knowledge-intensive ecosystems like the Oxford-Cambridge Arc.

“While Reeves is focusing on the biggest, most newsworthy projects – like the East-West Rail link – her department must work with MHCLG and local councils to realise the strategic benefit of improving more local, smaller scale infrastructure projects – like local road networks, water utilities, and public transport links. Part of this focus must be on addressing the skills crisis that affects every corner of the built environment.”

Nick Pettit, Senior Partner, Bidwells, said: “The Oxford-Cambridge region is the beating heart of British innovation. That the Chancellor sees its potential is not only a significant validation of its critical importance to UK GDP, but a vindication of the tireless efforts made to promote its potential.

“Investors we work with have the choice to deploy capital globally. Despite obstacles to planning, or with procurement, they select the OxCam region over its alternatives. That is because there are few countries that can claim to have a knowledge cluster quite so unique. One that we should be proud of, but also one that is from today the centrepiece of the Government’s growth agenda.”

Artem Korolev, CEO, Mission Street, said: “The Government’s commitment to put the Oxford-Cambridge Arc back on the table is, we hope, a forerunner to concrete policy. A holistic strategy that spans the wider arc region is critical to capitalising on the research excellence in Oxford and Cambridge with a critical mass of businesses, investment, homes and infrastructure capable of competing with the world’s leading ecosystems.”

Andy Williams, Chair, Oxford-Cambridge Supercluster Board, said: “This announcement is a significant milestone in the Supercluster Board’s ongoing mission to nurture and cultivate the talent in the OxCam region. Our members, which include some of the world’s largest investors, see extraordinary potential and in this commitment it is abundantly clear that the Government does, too. We look forward to working with the Department for Science, Innovation and Technology to bring about monumental change in how we further develop the OxCam economy, enriching UK GDP and the public purse in the process.”

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