Business looks to Osborne for action

ELECTRIFICATION of the transpennine rail network will be among the measures championed by the Chancellor today as he tries to kickstart the UK economy.

Mr Osborne is also due to use the Autumn Statement to set out the Government’s thinking on the future of the Humber Bridge which could see a significant proportion of its debts cleared allowing for lower tolls.

The measures are part of a wider package of infrastructure spending worth £30bn the Chancellor will announce, funded in large part by finding ways of encouraging pension funds to invest in roads and other major project although at least £5bn will come from the public purse.

Prime Minister David Cameron yesterday confirmed the rail elecrification plan saying it had the potential to bring “huge economic benefits” to the areas it serves.

Mr Osborne will today also flesh out more details of his £40bn plans for “credit easing” schemes which he hopes increase access to finance for small businesses.

The Government has also been working on proposals for an enterprise zone-style initiative aimed at promoting growth in rural areas through targeted tax breaks and broadband provision.

He will be speaking in the House of Commons just hours after the latest data from the Office for Budget Responsibility and the day before thousands of public sector workers strike over pensions.

The extensive advanced briefing of the contents of the Autumn Statement has prompted speculation that the Chancellor is facing a significant deterioration in the outlook for the UK economy.

The OBR is expected to downgrade its forecasts for UK GDP both for this year and next and increase its estimates of the number of public sector jobs that will have to be lost to meet Government spending targets.

Business groups have largely supported the Government’s plans to cut the deficit in public sector spending but a prolonged period of negative data on the economy has seen an increase in calls for Ministers to better focus their spending plans on growing the economy.

Ideas put forward by business include signalling a cut in corporation tax to 15% by 2020 and abolition of the 50p income tax rate.

TheBusinessDesk.com will be reporting on the Autumn Statement throughout the day and sending the key points in an email to registered users within minutes of the Chancellor’s speech.

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