DFM calls for Autumn Statement funding to support key missions
The Chancellor’s Autumn Statement must deliver more funding for public services, net zero and cost of living support instead of cutting taxes, Deputy First Minister Shona Robison has urged.
Ahead of the Scottish Budget next month, the Deputy First Minister called for the Chancellor to provide a funding settlement to support the Scottish Government’s key missions of equality, opportunity and community.
Ms Robison, who is also Finance Secretary, is urging the Chancellor to:
increase the Scottish Government’s capital budget in line with inflation to help deliver vital infrastructure
deliver additional funding across the UK to fund public services and fair public sector pay awards
commit to increasing working-age benefits in line with inflation next year
legislate for an essentials guarantee giving basic necessities to those who need them most
prioritise investment in net zero, including funding for offshore wind projects in Scotland
The Deputy First Minister said: “The UK faces a combination of low growth and high interest rates. The Autumn Statement must learn the lessons from last year’s ‘mini budget’ – it must not compound these problems with ill-timed tax breaks which would place even greater pressure on the public finances.
“The Scottish Government is using the levers available to us to support people through this difficult time. However, it is important that the UK Government uses its full range of reserved powers to address these challenges. With many families continuing to struggle with the cost of living, the Chancellor must not use this statement to cut benefits.
“The Autumn Statement provides an important opportunity for the UK Government to support us to deliver the investment and services that Scotland needs, to demonstrate its commitment to net zero, and to help people and businesses with the economic challenges they face.”
Aye, I’m sure Jeremy Hunt will be hanging on to her every word! -Ed.
£381 million funding scheme to deliver thousands of public charge points across the country opens for applications.
Chancellor opens UK’s largest electric vehicle charging site in Birmingham in major boost to Britain’s electric charging infrastructure.
EV drivers in the West Midlands set to benefit from the 180 charge point hub, becoming the largest electric vehicle charging site in the UK.
A new electric vehicle charging hub – big enough to charge 180 cars simultaneously – has been opened by the Chancellor Jeremy Hunt in Birmingham yesterday (Thursday 7 September). It marks a significant boost for Britain’s electric car charging network, becoming the largest electric vehicle charging site in the UK.
The Gigahub™, located at the city’s NEC Campus, is the largest-ever private investment in a UK electric vehicle project to date. The project has been developed by a three-way collaboration between the NEC, EV Network and bp pulse, and is now operated by bp pulse. It is funded by a record £8 million from its investment partner, Zood Infrastructure Limited. The site will provide 30 super-fast, 300kw DC charging bays and a further 150, 7KW a/c charging bays – one of the largest amounts of super-fast chargers in one location in the UK.
The site is strategically positioned to become a major transport hub for the future – located in the heart of the UK motorway network, including the M42, M46 and A45 and the new HS2 interchange station.
The site supports the Government’s electric vehicle infrastructure strategy and commitment to decarbonising transport, backed with more than £2 billion to support the transition to zero emission vehicles including accelerating the rollout of chargepoint infrastructure.
As part of that, Government and industry have so far supported the installation of over 45,500 publicly available electric vehicle charging devices, including more than 8,600 rapid devices. The public charging network is growing quickly – public charging devices have more than tripled in four years from 10,300 devices in January 2019 to over 45,500 in August 2023.
The number of public chargepoints rose by 38% over the last year, and as a recent report from the National Infrastructure Commission points out, if charge point deployment grows at around 30% per year the 300,000 expectation will be met.
Today the Chancellor has also announced that several local authorities across England can apply for the first round of the Government’s £343 million Local Electric Vehicle Infrastructure (LEVI) Capital Fund, with the West Midlands Combined Authority among the authorities eligible to apply this year.
The LEVI fund will ensure the transition to electric vehicles takes place in every part of the country by supporting tens of thousands of local chargepoints, especially for those without access to off-street parking.
Local authorities will receive LEVI funding in two groups, with the first able to apply for their allocated funding from today, to be distributed this financial year. The second group can apply for their funding next financial year.
The Chancellor of the Exchequer, Jeremy Hunt, said:“This is the biggest private investment in electric charging in the UK and is a huge vote of confidence in Britain’s role as a leader in green industries.
“The ground-breaking site will be a major transport hub for the future and marks a significant step in our rollout of electric vehicle charging infrastructure across the country”.
Decarbonisation Minister Jesse Norman said:“Electric vehicles will play a crucial role in helping the UK to decarbonise transport and reach net zero.
“Today’s measures will deliver tens of thousands of chargepoints across the country, boosting the economy and creating skilled jobs.”
Paul Thandi CBE, DL Chairman of NEC Group, said: “We are proud to contribute to the UK Government’s Electric Vehicle Infrastructure Strategy. Working in collaboration with EVN and bp pulse, the opening of our EV charging hub provides NEC Campus customers, commuters, and those working for local regional or national businesses, a reliable and convenient way to recharge and support a lower carbon travel future.
“This strategic collaboration and initiative strengthen our destination offer, demonstrate our commitment to reducing the impact our business practices and our Masterplan credentials have on the environment, and ultimately supports a reduction in carbon emissions.”
Akira Kirton, vice president of bp pulse UK, said: “The transition to electric vehicles is evolving at pace which is why bp pulse is focussed on accelerating the development of the UK’s EV infrastructure, delivering the right charging speeds, in the right locations and investing up to £1 billion to do so.
“This new, nationally significant bp pulse Gigahub™ at the heart of the UK’s road network, is another great example of our strategy in action.
“We plan to roll out hundreds of hubs this decade in places EV drivers needs them – urban areas, on trunk roads and motorways and at destinations such as restaurants, retail parks and hotels.”
Alexander Walsh, Senior Managing Director at Blackstone, said: “The opening of the UK’s largest EV charging hub at the NEC is a significant step forward as more drivers across the UK move to electric vehicles, with sites like this playing an important role in supporting the UK’s energy transition.
“Blackstone has been invested in the NEC since 2018, and this development demonstrates the positive impact private investment can have in driving innovation and creating green jobs, and we’re proud to be backing the industries of the future in the West Midlands and beyond that are helping build a more sustainable future.”
Reza Shaybani, CEO, and co-founder of the EV Network, said: “The launch of one of Europe’s largest ultra-fast Gigahub™ is a massive game changer for EVN and a huge step forward for UK electric vehicle fast charging.
“The EVN team responding to the public demand for more – charging and we are responding with hundreds of millions of pounds of new investment and the very latest technology.
“EVN has already built dozens of sites across the UK, but the successful completion of this new project launches us onto a much more ambitious growth path, as the leading business in our sector with a range of exciting new partners.
“The NEC was a perfect location that is not only geographically key, but of national significance, to support the EV charging landscape. EVN secured 6.5MVA grid connection, to support the entire infrastructure. The strategic placement and impressive scale of this charging hub within the UK’s transport infrastructure offers reassuring support to drivers journeying between cities.
“Our long-term relationship with both the NEC Group and bp pulse ensures this is not just an investment for the site’s visitors but a transformative step towards bolstering the entire EV charging infrastructure of the UK.
“At EVN we are excited to invest £100M in EV Infrastructure projects this year, and we aim to invest a further £300M equity by 2025.”
Alongside this, UK Research and Innovation has announced that Innovate UK has awarded £5.8m of funding to 12 projects through the Driving the Electric Revolution Challenge Fund. Winning projects include work on best practice in automation and robotics to produce EV chargers, and the scale-up of the assembly manufacturing processes for a rare earth-free permanent magnet generator – allowing us to produce electric machines without using rare earth elements.
Whilst he was in the region, the Chancellor also convened a roundtable with green industries SMEs based in and around the West-Midlands, including leading green electric vehicle, energy and manufacturing companies as part of his ongoing engagement with his five key growth sectors: life sciences, advanced manufacturing, green industries, digital and technology and creative industries.
Chancellor outlines reforms to boost pensions and increase investment in British businesses
the ‘Mansion House Reforms’ could unlock an additional £75 billion for high growth businesses, while reforms to defined contribution pension schemes will increase a typical earner’s pension pot by 12% over the course of a career
comprehensive reforms will increase pension pots by as much as £16,000
The reforms will also unlock up to £75 billion of additional investment from defined contribution and local government pensions, supporting the Prime Minister’s priority of growing the economy, and delivering tangible benefits to pensions savers.
The United Kingdom has the largest pension market in Europe, worth over £2.5 trillion. Over the past ten years Automatic Enrolment has helped an extra ten million people save for their futures, with £115 billion saved in 2021, but how this money is invested is limiting returns for savers. Comparable Australian schemes invest ten times more in private markets than UK schemes, reaping the rewards that UK savers are missing out on.
To level the playing field, the Chancellor and the Lord Mayor have supported an agreement between nine of the UK’s largest Defined Contribution pension providers, committing them to the objective of allocating 5% of assets in their default funds to unlisted equities by 2030. These providers represent over £400 billion in assets and the majority of the UK’s Defined Contribution workplace pensions market.
This could unlock up to £50 billion of investment in high growth companies by 2030 if all UK Defined Contribution pension schemes follow suit.
More effective investments by defined contribution pension schemes will also increase savers’ pension pots by up to 12%, or as much as £16,000 for an average earner.
Chancellor of the Exchequer Jeremy Hunt said:“British pensioners should benefit from British business success. By unlocking investment, we will boost retirement income by over £1,000 a year for typical earner over the course of their career.
“This also means more investment in our most promising companies, driving growth in the UK.”
Secretary of State for Work and Pensions Mel Stride said:“British workers should have the confidence that their pension savings are working as hard as they are.
“Our reforms will benefit savers and society – unlocking investment into pioneering UK businesses, growing the economy, and helping the record number of people in this country saving into a pension to achieve the retirement they want.”
The Chancellor’s Mansion House Reforms will also deliver better returns for savers through a new Value for Money Framework which will make clear that investment decisions made by pension firms should be based on overall long-term returns and not simply costs. Pension schemes which are not achieving the best possible outcome for their members will be wound up into larger, better performing schemes.
Analysis shows that over a five-year period there can be as much as 46% difference between the best and worst performing pension schemes. This means that a saver with a pot of £10,000 could have notionally lost £5,000 over a 5-year period from being in a lowest performing scheme.
The Mansion House Reforms will be guided by the Chancellor’s three golden rules: to secure the best possible outcome for pension savers; to always prioritise a strong and diversified gilt market as we seek to deliver an evolutionary, rather than revolutionary, change in our pensions market; and to strengthen the UK’s position as a leading financial centre to create wealth and fund public services.
To ensure that the money unlocked by these reforms is invested quickly and effectively, the Chancellor has asked the British Business Bank to explore the case for government to play a greater role in establishing investment vehicles, drawing upon the BBB’s skills and expertise.
This will complement the £250 million of support that government has made available through the Long-term Investment for Technology and Science (LIFTS) initiative to incentivise new industry-led investment vehicles.
The government will also encourage the establishment of new Collective Defined Contribution funds which can invest more effectively by pooling assets as well as launch a call for evidence to explore how we can support pension trustees to improve their skills, overcome cultural barriers and realise the best outcomes for their pension schemes and subsequently their members.
Defined Benefit pensions
For the Local Government Pension Schemes a consultation will be launched on setting an ambition to double existing investments in private equity to 10%, which could unlock £25 billion by 2030. The consultation proposes a deadline of March 2025 for all Local Government Pension Scheme funds to transfer their assets into LGPS pools and setting a direction that each pool should exceed £50 billion of assets.
To improve outcomes for savers in a highly fragmented market, with over 5,000 Defined Benefit Schemes, the government will set out its plans on introducing a permanent superfund regulatory regime to provide sponsoring employers and trustees with a new way of managing Defined Benefit liabilities.
A new call for evidence will also launch tomorrow on the possible role of the Pension Protection Fund and the part Defined Benefit schemes could play in productive investment whilst securing members’ interests and protecting the sound functioning and effectiveness of the gilt market.
Capital Markets
The UK has the largest stock market in Europe and one of the deepest in the world – the London Stock Exchange had the most Initial Public Offerings (IPOs) outside of the US in 2021.
A comprehensive set of reforms will help attract the fastest growing companies in the world to grow and list in the UK. Prospectuses will be simplified, another milestone of Lord Hill’s UK Listing Review, replacing the EU’s outdated regime.
Firm’s prospectuses for investors will be easier to produce, more accessible and understandable, saving companies time and money and attracting more firms to do business in the UK.
Protectionist rules inherited from our time in the EU will be abolished. The Share Trading Obligation and Double Volume Cap have held back UK businesses and will be removed so firms can access the best and most liquid markets anywhere in the world.
The government has also accepted all of Rachel Kent’s Research Review published today, paving the way for a new ‘Research Platform’ that will provide a one-stop-shop for firms looking for research experts. It also sets the path for potentially removing the unbundling rules – an inherited EU law that requires brokers to charge a separate fee for research.
The Chancellor will set out plans to establish an entirely new kind of stock market that allows private companies to access capital markets without floating on a stock exchange. This ‘Intermittent Trading Venue’ would be a world first and will help firms grow and boost the UK economy. It will be complemented by a move to make shares fully digital rather than written on paper, saving businesses time and money.
This builds on the Chancellor’s Edinburgh Reforms and Solvency II reforms which will unlock over £100 billion of productive investment from insurance firms across the UK over a decade.
Seizing the opportunities of the future
To ensure the continued success of the UK’s world-leading financial services sector, firms must be ready to innovate faster, with regulators willing to support them as they do.
Following the Financial Services and Markets Act 2023 passing into law, the government has announced that it is commencing repeal of almost 100 pieces of unnecessary retained EU law for financial services, further simplifying the UK’s regulatory rulebook.
The government launched an independent review into the future of payments – led by Joe Garner, former Chief Executive Officer of Nationwide Building Society – to help deliver the next generation of world class retail payments, including looking at mobile payments.
The government also welcomes a report suggesting ways to move to fully digital shares, scrapping outdated paper-based shares. This will make markets more efficient and modernize how people own shares.
Further information
The Mansion House Compact members are: Aviva; Scottish Widows; L&G; Aegon; Phoenix; Nest; Smart Pension; M&G; Mercer.
The package of reforms announced yesterday could help increase pension pots for an average earner who starts saving at 18 by 12% over their career – over £1,000 more a year in retirement – all whilst supporting UK economy, businesses, and employment.
Analysis shows a difference in returns between schemes over a 5-year period of up to 46% in some cases. This means that a saver with a pot of £10,000 could have notionally lost £5,000 over a 5-year period from being in a lowest performing scheme.
Reaction to the Chancellor’s Mansion House Reforms
Jamie Dimon, Chairman & CEO, JPMorgan Chase said:“Great financial centers stay competitive by responding to the market and evolving through the kinds of important iterations that the Chancellor has announced.
“It’s also good to see the U.K. preparing for the industries of tomorrow considering the great promise of life sciences and A.I. as cornerstones of the economy in the years to come.”
Sir Jon Symonds CBE, Chair, GSK said:“I welcome these important reforms which will further strengthen the UK capital markets and support economic growth.
“The changes will help increase investment returns for pension savers through improved access to all asset classes including in high growth sectors, and ensure the UK’s most innovative companies are better supported by UK capital to stay in this country as they scale to maturity.”
Brent Hoberman, Executive Chairman & Co-Founder, Founders Forum, Founders Factory said:“The planned pension reforms will enable for capital to be productively invested in funds and scaleup companies in the UK.
“This should be welcome news to the UK industries of the future, their ability to attract more capital will create more national champions and generate growth, jobs and increased tax revenue.
“The reforms will enable the UK to build on the positive momentum in these key parts of the economy drive further synergies between it’s world class financial institutions and entrepreneurial base.”
C. S. Venkatakrishnan, Group Chief Executive, Barclays said:“The UK has needed a bold, forward-looking policy agenda and industrial strategy to grow the economy.
“These Mansion House Reforms are an important step in the right direction in mobilising private capital to support growth and innovation.”
Irene Graham OBE, CEO, ScaleUp Institute said:“The package of measures announced by the Chancellor today are very much welcomed by the ScaleUp Institute.
“They contain significant and innovative solutions which will help to enable easier and simpler access to capital markets and patient growth capital. These new initiatives, coupled with the reforms already underway, will support and fuel the global ambitions of our scaleups, and high-potential scaling businesses, across all sectors and all areas of the UK.”
Miles Celic, Chief Executive Officer, TheCityUK, said: ““The competitiveness and attractiveness of any successful international financial centre must, by definition, always be a work in progress. The Chancellor is right to be ambitious in building on the UK’s successes and recognising that we can’t afford to be complacent.
“The Mansion House Reforms are ambitious, pragmatic and necessary. They will underpin the UK industry’s future success. Most importantly, their main beneficiaries will be the British people, who will gain from greater investments in growing businesses, revitalising communities and improving retirements.”
Chris Hulatt, Co-Founder, Octopus Group said: ““We welcome government’s efforts to make the UK a more attractive place to start a business, and support measures that provide additional opportunities for private companies to raise capital.
“Finding new ways for the most skilled and talented entrepreneurs to access capital as they build businesses is fundamental to helping the UK maintain its place as the best place to start, build and scale a business.”
Noel Quinn, Group Chief Executive, HSBC said:“I welcome the strong and comprehensive package of measures announced by the Chancellor in his Mansion House speech.
“Unlocking equity to support companies in innovative high-growth sectors such as technology and life sciences is vital to the future growth of the UK economy.”
Lord Mayor, Nicholas Lyons said: ““These reforms and the Mansion House Compact mark a historic turning point that will accomplish the dual aim of securing a brighter future for retirees and channelling billions into our economy.
“I’m proud to have convened key industry players to make this commitment to unlock £50bn in capital by the end of the decade which will improve returns for pension savers and support firms to grow, stay and list in the UK.”
Tim Orton, Chief Investment Officer, Aegon UK said: ““Aegon UK is proud to be a founder signatory of the Mansion House Compact which will help deliver better long-term outcomes for our customers.
“We are committed to ensuring our customers can access and share in the growth and success of innovative companies we invest in. We will use our scale and expertise to develop investment solutions seeking to improve the retirement outcomes of the millions of members of the defined contribution pension schemes we support. The Compact will also create opportunities that help deliver our climate targets as we progress towards net zero.”
Sir Nigel Wilson, Group CEO, Legal & General said:“As the UK’s largest manager of money for pension clients, L&G is pleased to support the ambition set by the Compact.
“Increasing investment in science, technology and infrastructure will support better returns for the tens of millions saving for their retirement, as well as stimulate much needed long-term growth for the UK economy.”
Mark Fawcett, CEO, Nest Invest said:““For many years now, illiquid assets have been integral to diversified DC pension schemes around the world.
” It’s been a key driver behind Nest setting up our own private market mandates to ensure our members aren’t missing out. Nest will continue to increase our investment in unlisted equities, helping our 12 million members benefit from the strong returns these types of deals can typically offer.”
Ruston Smith, Chair, Smart said: ““Smart Pension is committed to securing better outcomes for long-term savers. Giving UK savers access to higher net returns by investing in unlisted equities, including innovative, high-growth UK companies as part of a well diversified portfolio, will deliver these outcomes over time.
“We are pleased to be a signatory of the Mansion House Compact and, as a successful British fintech, we are proud to be supporting the country’s technology sector, helping home-grown start-ups and scale-ups to flourish and thrive.”
Scottish Widows, CEO, Chirantan Barua said: ““The industry needs to modernise the investment options available to customers.
“With the right consumer protections in place, the proposals announced today could make a huge difference to our customers and the wider UK economy. I’m proud that Scottish Widows is a founding signatory of the Mansion House Compact.”
Phil Parkinson, Investments and Retirement Leader, Mercer said:“Mercer supports proposals that lead to improved pension scheme member outcomes.
“As a global investment solutions provider, we see first-hand the value that illiquid asset allocations can bring to investors’ portfolios from a risk and a return perspective and are in favour of initiatives designed to unlock this asset class for DC members.”
Edward Braham, Chair, M&G said:“Patient capital put to work in companies or projects over multiple decades is essential to support economic growth and importantly, capture value for people’s pensions as they save for their retirement.
“M&G’s heritage is in investing in private markets, whether it is through infrastructure, real estate or innovative companies with purpose. We are democratising access to private markets through the Prudential With Profits Fund, and are supportive of DC pension reforms that encourage more investment of this kind that has potential to result in positive outcomes for savers.”
Mike Eakins, Chief Investment Officer, Phoenix Group said:““We are proud to sign the Compact, which is an important step to allow UK long-term savers to invest in a more diversified portfolio, giving them access to the potential returns of a broader range of assets, in line with their international counterparts.
“Currently, only 9% of UK pension funds are invested in alternative assets as compared to 23% in other major pensions markets. With the right regulatory environment, Phoenix Group could invest up to £40 billion in sustainable and/or productive assets to support economic growth, levelling up and the climate change agenda whilst also keeping policyholder protection at its core.”
Tomorrow (10 July) Jeremy Hunt will outline how he will unlock capital for high-growth businesses and boost outcomes for pension savers, guided by ‘three golden rules’.
Chancellor to use first Mansion House speech to set out how Britain’s financial services sector will support the Prime Minister’s priority to grow the economy.
Measures will mean that more investment is available for high-growth businesses, which are key to creating good jobs, opening up opportunity and contributing millions in tax receipts.
Chancellor Jeremy Hunt will deliver his first Mansion House address tomorrow (10 July) setting out how Britain’s financial services will support the drive for long-term sustainable growth across the country.
In front of an audience of CEOs and leaders from the sector in the City of London, the Chancellor will set out his “Mansion House Reforms” to drive the Prime Minister’s priority to grow the economy by making the UK the most innovative and competitive financial centre in the world.
The financial and related professional services industry employs over 2.5 million people – something Hunt will describe as starting from a “position of strength” – and generates more than £100 billion in tax revenue, paying for half the cost of running the NHS.
He will also hail the importance of the traditionally “nimble” and “agile” sector for Government’s vision of Britain as a science superpower and the world’s next Silicon Valley.
The Chancellor is expected to say: ““I want to lay out plans to enable our financial services sector to increase returns for pensioners, improve outcomes for investors and unlock capital for our growth businesses.”
The reforms will not only help create jobs and increase tax revenues – which ultimately helps to fund vital public services – but will also lead to better returns for pension savers in the long term.
The Mansion House Reforms will be guided by the Chancellor’s three golden rules. He is expected to say: ““Firstly everything we do we will seek to secure the best possible outcomes for pension savers, with any changes to investment structures putting their needs first and foremost.
“Secondly we will always prioritise a strong and diversified gilt market. It will be an evolutionary not revolutionary change to our pensions market. Those who invest in our gilts are helping to fund vital public services and any changes must recognise the vital role they play.
“The third golden rule is that the decisions we take must always strengthen and never compromise the UK’s competitive position as a leading financial centre able to fund, through the wealth it creates, our precious public services.”
Hunt is expected to announce a wide-ranging package of measures that build upon the Edinburgh Reforms announced in December last year and deliver upon the vision that the Prime Minister himself set out at Mansion House in 2021 – with a smarter rulebook tailored for Britain’s needs.
On the economic headwinds facing the UK economy, the Chancellor will say that there can be “no sustainable growth without first eliminating the inflation that deters investment and erodes consumer confidence” and promise that the government will continue to honour its “responsibilities to those struggling the most” in the face of inflation.
David Livingstone, Citi’s Chief Executive Officer (Europe, Middle East and Africa) said:“Citi strongly supports a UK strategy focussing on growth and improving competitiveness.
“A government plan to reform the pension system to emphasise net returns would be key to the collective prosperity of all the country’s pensioners, while also creating a higher growth, more productive, and innovative economy.
“Based on Citi’s experience working with investors and pension funds around the world, consolidating funds often increases efficiency and improves access to global, diversified investment opportunities, which would be immensely beneficial to the UK, home to the second-largest pool of long-term capital in the world.”
Hannah Gurga, Director General, ABI said:“We share the Government’s ambition to make pension money work as hard as possible to deliver better returns for savers and the UK economy.
“A long-term strategy with savers at its heart and working with the sector are key to delivering on this ambition. We and our members look forward to working closely with Government as it fleshes out its plans over the summer.”
Dr Dan Mahony, Government Life Sciences Investment Envoy and Chair of the UK BioIndustry Association (BIA), said:“The unlocking of pension fund assets for investment into the UK life sciences sector will enable everyone saving for their retirement to benefit financially from Britain’s world-leading strength in drug discovery and development, whilst supercharging business growth and accelerating medical progress.
“We have great science and great people, now they will be supported by greater capital from the UK, adding to what the sector is already attracting from overseas investors.
“More domestic investors championing our growing companies will help them to put down deeper roots here, producing more jobs and benefits for the UK economy.”
Chris Cummings, Chief Executive, the Investment Association said:“The Chancellor’s comments recognise that investment must be at the heart our economy – providing for the financial futures of UK households through pensions that deliver good returns, even in the most challenging economic times, and powering growth by investing in British businesses.
“The recognition of the central role of long term investment is the foundation of successful policy.
“With the right regulatory framework, pension schemes will be able to invest productively and sustainably, unlocking further investment for innovative growth companies, and improving returns for savers by broadening investment options. In tandem with reforms to the listings regime, this will help the UK to become a more globally attractive place for companies to list, invest and do business.
“Achieving this new economic dynamism will require the government to bring together regulators, policymakers, and businesses, to create a forward-looking and internationally competitive investment framework, based on a stable, long term policy approach.
“This will also improve the gilt market, ensuring UK government debt remains attractive to domestic and international investors.
“Delivering these outcomes will require us to strike the right balance between risk and reward and between protection and innovation. Investment managers stand ready to play our part.”
As part of the government’s plan to halve inflation this year, the Chancellor chaired a roundtable with CEOs from the Competition and Market Authority (CMA), Financial Conduct Authority (FCA), Ofcom, Ofgem and Ofwat.
Jeremy Hunt made clear his expectation that regulators work at pace to guarantee markets are working properly. With wholesale energy prices and other input costs now beginning to fall – the Chancellor also wants to ensure consumers benefit from these reduced costs.
During this current period of high inflation and interest rates, this also includes ensuring higher interest rates are passed on to savers.
Chancellor of the Exchequer Jeremy Hunt said: “I am pleased we’ve secured agreement with the regulators to act urgently in areas where consumers need most support to ensure they are treated fairly.
“We are working hard to halve inflation this year and return to the 2 percent target. Businesses must play their part too and I will keep a watchful eye on the progress they make.”
The Chancellor also agreed a new action plan with the regulators to support consumers, particularly the most vulnerable:
FCA have agreed to:
Deliver better deals for savers by driving competition, including reporting by the end of July on how the savings market is supporting savers to benefit from higher interest rates. The Government fully supports the FCA’s review and the new Consumer Duty gives them stronger powers to take action if necessary.
Require the largest banks and building societies as part of this to explain the pace and extent of their pass through of interest rates, and how they are proactively supporting savers to switch to high interest rate products.
CMA have agreed to:
Deliver a better deal for motorists by publishing their review of the road fuel market, which examines profit margins in supermarkets and other fuel retailers, on Monday. This will include the impacts on vulnerable consumers.
Help shoppers pay fair prices by bringing forward their update of competition and unit pricing in the grocery sector to earlier in July and laying out next steps. This will include further scrutinising the food supply chain as well as measures to make it easier for consumers to make the best choices.
Following affordability pressures in the housing market, provide an update on their housebuilding market study and work in the rented accommodation sector in August.
Actively scrutinise markets where cost-of-living pressures are growing and launch work in at least two new areas the CMA considers in need of further investigation. It will also update on key developments in its ongoing crackdown on misleading consumer practices.
Ofcom have agreed to:
Take action to push suppliers who have yet to introduce social tariffs (discount deals for vulnerable customers) to offer them in the broadband and mobile markets, as well as waive fees for any customers who want to switch providers to access a social tariff.
Push suppliers to take immediate steps to raise awareness of existing social tariffs and drive consumer take-up. Ofcom will work with government and other relevant bodies to support industry efforts.
Publish a report on its current review of in-contract prices to ensure consumers are sufficiently aware of what they are signing up to by the end of the year. This will consider whether Ofcom’s rules need to be strengthened. Ofcom will also publish an update on its full range of work to support consumers in July.
Ofwat have agreed to:
Crack down on water companies not going far enough to support customers to pay their bills, access help and repay debts. This will include assessing water company compliance with Ofwat’s Paying Fair Guidelines, and where companies’ approaches are found to be insufficient, setting out clear actions for improvement in July. Next year, Ofwat will also set out clear and binding license conditions for every water company on how to treat their customers, including customers in vulnerable circumstances.
Hold water companies to account over delivering existing social tariffs for those unable to pay water bills, as well as allowing consumers to apply for payment holidays and offering support to those on low-incomes.
Ensure targeted support for vulnerable customers by improving data sharing, such as those struggling with bills (along with Ofgem).
Ofgem have agreed to:
Ensure all suppliers are passing falling prices onto consumers, keeping the price cap formula under review to ensure that it mirrors the costs facing suppliers. The new lower cap from 1 July will reduce a typical annual household energy bill by £426.
Strengthen protections and support for the vulnerable by mandating the Code of Practice on prepayment meters and ensuring that suppliers are able to offer Additional Support Credit (ASC) to PPM customers in need. Both are subject to Ofgem consultations launched today.
Take action against suppliers that have over-charged business customers and publish its review of the non-domestic market this Summer.
Scrutinise supplier finances as the sector begins to move from loss making back into profit. The regulator and government moved quickly to stem losses and protect consumers when prices were rising sharply and expects suppliers to act responsibly and in the interests of their customers as prices fall and profits return. This includes ensuring they deliver good service standards and support the most vulnerable customers. Those who are not yet meeting new capital requirements should retain profits rather than pay out dividends.
Regulators agreed to provide regular updates to the Treasury on their progress and that a follow up meeting would be held later this Summer. The FCA, Ofcom, Ofwat and Ofgem will also publish a joint statement to set shared expectations on treatment of customers in financial difficulties.
As part of wider discussions with the Governor in the context of high food inflation, the Bank of England is reviewing CMA data and meeting with the food sector, with analysis included in the August Monetary Policy Report and/or the minutes of the August meeting.
The meeting with regulators on what more they can do to support people through a period of high inflation comes while the government continues with its plan to halve inflation this year and support the Bank of England in taking difficult decisions to return to the 2 per cent target.
Commitments from regulators to make sure consumers are not being exploited build on one of the largest cost-of-living support packages in Europe which has been rolled out to help the most vulnerable, worth £3,300 per household on average over this year and last.
This includes paying half of a typical household energy, direct cost of living payments to the most vulnerable and increases to benefits, state pensions and the National Living Wage of around 10 per cent.
The CEOs attending were:
Ofcom (telecommunications) – Dame Melanie Dawes
Ofgem (energy) – Jonathan Brearley
Ofwat (water) – David Black
Competition and Market Authority (CMA) (competition/consumer) – Sarah Cardell
· Government’s £150 Disability Cost of Living payments paid from today (Tuesday 20 June)
· Payments will be made automatically over two-week period between 20 June and 4 July 2023
· Anyone in receipt of certain disability benefits on 1 April 2023 is entitled and will receive the payment
· One-off disability cash forms part of wider support package worth up to £1,350 for the most vulnerable
More than six million disabled people across the UK are set to receive a £150 Disability Cost of Living Payment from today.
The one-off payments, issued by the Department for Work and Pensions throughout a two-week window, will help disabled people with the extra costs they face.
It comes as part of a wider package of Cost of Living support worth up to £1,350 to the most vulnerable households, underlining the Government’s commitment to supporting these those most in need.
The Government is also working hard to ease cost of living pressures by working towards the goal of halving inflation, which will lay the foundation for the long-term growth needed to improve living standards for everyone.
Secretary of State for Work and Pensions, Mel Stride MP, said: “We recognise that some of the most vulnerable UK households continue to face cost of living pressures, in particular those who are disabled.
“Our commitment to halving inflation and ultimately getting it back to the 2% target will relieve a lot of financial pressure for us all, but this extra support will help over six million disabled people right now as we work towards that goal.”
The Chancellor of the Exchequer, Jeremy Hunt MP, said: “The additional costs faced by disabled people mean inflation is particularly challenging, which is why halving it this year and getting back to the Bank of England’s 2% target is our priority.
“The £150 we’re sending disabled people over the next two weeks is part of a major cost-of-living support package worth just under £100 billion, providing some peace of mind to the most vulnerable in society.”
Minister for Disabled People, Health and Work, Tom Pursglove MP, said: “We understand the additional financial pressures disabled people are facing, which is why we are putting another £150 in their pockets from today.
“This is on top of further cost of living payments for low-income benefit claimants, as we’re committed to providing support where it is needed most.”
As the payment is made automatically, those eligible for the support do not need to take any action. The payment reference on bank statements will appear as the individual’s National Insurance number followed by “DWP COL”.
The full list of benefit recipients that qualify for the Disability Cost of Living Payment between 20 June and 4 July are those who receive any of the following:
A small number of payments will be made after 4 July, where claimants were still awaiting confirmation of their eligibility or entitlement to qualifying disability benefits on 1 April.
This new payment is in addition to the £150 Disability Cost of Living Payment that was paid last September. Pensioners will also receive a further £300 payment later this year and people on eligible means-tested benefits will be paid up to two more Cost of Living payments through to next Spring totalling £900.
The Chancellor will meet with food manufacturers on Tuesday to discuss the cost of food and explore ways to ease pressure on households
He is also due to meet the Competition and Markets Authority about their investigations into the fuel and grocery markets
Government will look at reforms around unit pricing, to make it easier for consumers to compare the prices for similar products
The Chancellor will meet with food manufacturers today (Tuesday 23 May) to raise concerns about the high price of food in the UK and discuss measures the government can take with industry to ease the pressure on households.
Building on engagement between the Chief Secretary to the Treasury and the UK’s biggest supermarkets earlier this month, the Chancellor will ask food manufacturers to do what they can to support consumers.
As crucial players in the supply chain to supermarkets, this follow up meeting with food manufacturers will help ministers better understand the challenges firms are grappling with as inflated prices continue to plague the economy. The food and drink manufacturing sector is the largest in the UK, accounting for nearly 20% of total UK manufacturing and employing almost half a million people across the country.
On the same day, the Chancellor will meet with the independent Competitions and Markets Authority (CMA) to discuss the scope of their investigations into road fuel and groceries markets, including the possible action they could take if they are dissatisfied with the level of competition in the sector which could be allowing higher prices to prevail.
The government wants it to be easier for consumers to compare the prices of products, and the CMA is currently reviewing the use of unit pricing both in-store and online in the groceries sector. The government will consider updating pricing rules, including by strengthening the Price Marking Order 2004 (Retained EU Law), after the CMA review has concluded.
While rising food prices in the UK are in line with the EU average and headline inflation fell by 0.3 per cent last month, food inflation grew to 19.2 per cent. Food inflation disproportionately affects low-income households, who spend more of their income on food and are less able to swap what they would usually buy for cheaper alternatives.
Chancellor of the Exchequer, Jeremy Hunt, said: “High food prices are proving stubborn so we need to understand what’s driving that.
“That’s why I’m asking industry to work with us as we halve inflation, to help ease the pressure on household budgets.”
Chief Executive of the Food and Drink Federation, Karen Betts said: “We are looking forward to discussing the multiple drivers of food price inflation with the Chancellor, which have caused the fastest acceleration of food prices in a generation.
“Despite manufacturers’ best efforts in recent months to absorb rising costs in their margins, these have been both persistent and broad-based – from ingredients to energy and labour – making price rises unavoidable.
“We believe food and drink price inflation is close to its peak, and food and drink manufacturers will continue to work hard to keep prices as low as possible, conscious of the pressure on hard-pressed households.
“Government can help too, for example by urgently reviewing upcoming packaging recycling regulations to make them more efficient, by working with us to address labour and skills shortages, and by keeping to a minimum the labelling changes required of companies as a result of the recent agreement with the EU on the movement of food and drink to Northern Ireland.”
The government says it has acted decisively to help struggling households with rising prices, pledging to halve inflation this year and taking action to bring down bills for families. This includes introducing the Energy Profits Levy on oil and gas companies to pay almost half of a typical household’s energy bills, freezing fuel duty and taking difficult decisions on government spending to make sure we do not fuel inflation further.
One of the most generous support packages in Europe has also been rolled out, worth £3,300 per household on average over this year and last. Benefits and state pensions have been increased by over 10 per cent, up to £1,350 in direct cash payments are being made to millions of vulnerable households and record uplifts in the National Living Wage mean someone who is currently out of work and takes a full-time job will be over £7,500 better off.
Extra support has been put in place to help the most vulnerable with high food prices, including the £2.5 billion Household Support Fund which provides local authorities with money to support their communities with the cost of essentials, the £200 million Holiday Activities and Food Programme which supports children on Free School Meals with a nutritious meal during the holidays and an expansion of Free School Meals to all 5-7 year-olds.
The Prime Minister and Farming Secretary brought together representatives from across the UK food supply chain last week, where they outlined a range of measures to help strengthen the long-term resilience and sustainability of the sector and put farmers at the heart of plans to grow the economy.
Chancellor sets out next stage of the Government’s plan to halve inflation, grow the economy and reduce debt.
Building on the stability he gained from Autumn Statement, Jeremy Hunt will set out next steps to drive economic growth across the UK.
Plan will help ease the cost of living, remove barriers into work to boost incomes, drive business investment, and support new, high-growth industries of the future.
Chancellor of the Exchequer Jeremy Hunt will unveil the next phase of the Government’s plan to halve inflation, grow the economy and reduce debt in his Spring Budget today.
In his first Budget speech as Chancellor, Jeremy Hunt is expected to build on the stability gained at the Autumn Statement, with new measures to support families and businesses with the cost of living, before setting out an agenda to grow the UK economy.
The Chancellor of the Exchequer, Jeremy Hunt is expected to say:“In the Autumn we took difficult decisions to deliver stability and sound money. Today, we deliver the next part of our plan: a Budget for growth.
“Not just growth from emerging out of a downturn. But long term, sustainable, healthy growth that pays for our NHS and schools, finds good jobs for young people, provides a safety net for older people … all whilst making our country one of the most prosperous in the world.
“Today I deliver that by removing the obstacles that stop businesses investing; tackling the labour shortages that stop them recruiting; breaking down the barriers that stop people working and harnessing British ingenuity to make us a science and tech superpower.”
The Government is already protecting struggling families with one-off payments worth £94 billion. After a decade of reforms, people on low incomes can now earn £1,000 a month without paying tax or national insurance thanks to rises in tax thresholds. This has helped to lift two million people out of absolute poverty, after housing costs, including 400,000 pensioners and 500,000 children.
The Chancellor is expected to announce fairness reforms to energy bills, bringing the bills of families on prepayment meters in line with average direct debit energy bill under the Energy Price Guarantee. This will enable four million families to save £45 a year on their energy bills from July.
He will also announce his plan to go even further with and ambition to get hundreds of thousands more people into work. Support will focus on disabled people and those with long-term health conditions, parents, the over 50s, and people on Universal Credit. The changes are also expected to encourage benefit claimants to move into work or increase their hours with increased sanctions enforcement and Work Coach support, and childcare costs on Universal Credit to be paid up front.
The Chancellor is also expected to reject the narrative of decline, champion the successes the UK has achieved over the past decade, with a promise to build on the country’s competitive advantages to spread wealth and opportunity everywhere.
UK BUDGET MUST REVERSE TORY COST OF LIVING CRISIS
TOMMY SHEPPARD MP AND DEIDRE BROCK MP: SLASH ENERGY BILLS AND PUT MONEY BACK IN PEOPLE’S POCKETS
The SNP has said “the number one priority for the UK budget must be to put money back into people’s pockets” – warning the Tories can’t continue to hammer household incomes.
Ahead of today’s budget, Tommy Sheppard MP and Deidre Brock MP have urged Jeremy Hunt to deliver a comprehensive package to boost household incomes and economic growth. The MPs for Edinburgh East and Edinburgh North & Leith have challenged the Chancellor to deliver the SNP’s five-point plan:
Saving families £1400 on energy bills – by cutting the Energy Price Guarantee to £2000 and maintaining the £400 Energy Bill Support Scheme to the summer.
Raising public sector pay and benefits by CPI – putting money into the pockets of millions of workers and delivering Barnett consequentials for Scottish spending.
Scrapping Tory plans to raise the pension age to 68 and reinstating the Triple Lock – so no one must struggle in old age.
Re-joining the European Single Market – to boost economic growth and halt the multi-billion pound long-term damage being caused by Brexit.
Investing in green growth – by competing with EU and US subsidies to attract green investment.
In addition to the headroom identified by the IFS, and the billions of pounds saved as a result of the falling wholesale price of gas, the SNP is calling for the Chancellor to scrap non-dom tax status, tax share buy backs, and expand the windfall tax, which would raise billions more to fund cost of living support for ordinary households.
Commenting, Edinburgh East MP, Tommy Sheppard said: “The number one priority for the UK budget must be to put money back into people’s pockets – and reverse this Tory-made cost of living crisis.
“Scotland is a wealthy, energy-rich country but families are being fleeced by Westminster. By refusing to act, the Tories are showing why Scotland needs independence, so we can escape Westminster control, re-join the EU, and build a fair and prosperous economy.
“Families are sick to the back teeth of being ripped off by the Tory government. Instead of hammering household incomes, the Chancellor must save families £1,400 by slashing energy bills and deliver a comprehensive package of support.
“The SNP’s five-point plan would reduce bills, raise incomes and boost economic growth, at a time when many families are struggling to get by. With energy companies making record profits and the wholesale price of gas falling, there is no excuse for failing to act.”
Edinburgh North & Leith MP, Deidre Brock, added: “The SNP Scottish Government is doing everything it can with limited fiscal powers, including delivering the Scottish Child Payment, higher energy bill support, and higher public sector pay.
“The UK government must finally step up to the plate and use its reserved powers to introduce a Real Living Wage and raise public sector pay and benefits by CPI. In doing so, it would raise the incomes of millions of workers and deliver Barnett consequentials which would benefit Edinburgh and Scotland.
“This UK Budget is all about choices. Instead of making families in Edinburgh pay for Westminster failure, the Tories must fund support by scrapping non-dom tax status, expanding the windfall tax and taxing share buy backs, which would raise billions.
“And if we are serious about delivering economic growth and reversing decline, the UK government must re-join the European single market and properly invest in green energy.
“Scotland is suffering the consequences of Westminster control. The Tories trashed the economy with Brexit, austerity cuts and thirteen years of mismanagement. And with the pro-Brexit Labour Party becoming a pound-shop Tory tribute act, it’s clear independence is the only way for Scotland to secure the real change we need.”
Budget predictions – Bank of Scotland
Chris Lawrie, area director for Scotland at Bank of Scotland, said: “Business confidence in Scotland rose in recent months and, after business rates were frozen in a bid to help smaller businesses in the Scottish Budget, firms will be looking to the Chancellor to continue supporting long-term, sustainable growth and encourage higher levels of productivity.
“Growing the economy is key and the Budget is an opportunity to bring further stability and encourage investment in future growth. The Chancellor could show that he can help meet these ambitions by increasing capital allowances and providing the greater certainty and support businesses need to invest in a more high-tech, low-carbon economy.”
The Chancellor set to announce 12 Investment Zones to drive business investment and level up, each backed with £80 million.
Investment for roll out of Levelling up Partnerships, helping to regenerate places across England.
£100 million to be shared across Glasgow, Greater Manchester and the West Midlands supporting them to become globally competitive centres for research and innovation
The Chancellor will supercharge growth at the Spring Budget tomorrow (Wednesday 15 March), as he is expected to announce a plan for 12 high-growth Investment Zones and a pioneering new approach to accelerate research and development in the UK’s most budding industries.
Jeremy Hunt is expected to announce plans to enter discussions with places to host 12 high growth Investment Zones, each backed with £80 million over five years including generous tax incentives, bringing opportunity into areas which have traditionally underperformed economically.
Investment Zones will be clustered around research Institutions such as universities and will be focused on driving growth in one of the UK’s key sectors: Technology, Creative industries, Life Sciences, Advanced Manufacturing and the Green sector.
As well as for tax reliefs, funding can be used to improve skills, provide specialist business support, improve the planning system, or for local infrastructure.
Chancellor of the Exchequer Jeremy Hunt said:“True levelling up must be about local wealth creation and local decision-making to unblock obstacles to regeneration.
“From unleashing opportunity through new Investment Zones, to a new approach to accelerating R&D in city regions, we are delivering on our key priority to supercharge growth across the country”.
Levelling Up Secretary Michael Gove said:“Levelling up means backing local growth across the UK, driving innovation to attract investment and putting power into the hands of local communities so they can reach their full potential.
“Our new investment zones and Levelling Up Partnerships will deliver more jobs, better services and more opportunities for local people.”
Science, Innovation and Technology Secretary Michelle Donelan said: “This government has made clear its aim for the United Kingdom to be transformed into a scientific and technologic superpower, not only pushing our country forward, but the whole world.
“Cutting-edge innovation starts at a local level. That’s why these plans to invest £100 million into 26 groundbreaking projects in Glasgow, Greater Manchester and the West Midlands are so important, supporting them to become the future centres of research and innovation in the United Kingdom.”
Eight places in England have been shortlisted to host Investment Zones, with the intention to agree plans with local partners by the end of the year. This complements and builds on the government’s existing Freeport programme, which deliver investment on specific sites benefitting from tax and customs incentives, key to driving productivity and growth.
The eight places are those covered by:
The proposed East Midlands Mayoral Combined County Authority
Greater Manchester Mayoral Combined Authority
Liverpool City Region Mayoral Combined Authority
The proposed North East Mayoral Combined Authority
South Yorkshire Mayoral Combined Authority
Tees Valley Mayoral Combined Authority
West Midlands Mayoral Combined Authority
West Yorkshire Mayoral Combined Authority
The government is also working closely with the devolved administrations to establish how Investment Zones in Scotland, Wales and Northern Ireland will be delivered, which will account for the four final locations.
These Investment Zones will drive growth in five key sectors: life sciences, creative industries, digital technology, advanced manufacturing, and green industries.
The Chancellor is also expected to provide investment for the roll out of Levelling up Partnerships across England, helping to regenerate places in need of levelling up.
The programme will involve ‘deep dives’ carried out by a partnership of local councils, MPs business and civic leaders to gather a holistic picture of a place and its unique challenges and opportunities, and identify cross-Government interventions to unblock obstacles to regeneration.
It builds on the success of initial trials in Grimsby, which saw cross-government working to help avoid the effective closure of the town’s fish processing sector, and in Blackpool which unlocked a change of use of a central government building that was holding up a £100 million regeneration plan. The Government will work closely with the Devolved Administrations and local government to explore potential options in Scotland, Wales, and Northern Ireland.
The Chancellor is also set to accelerate the growth of high-potential innovation clusters in Glasgow, Greater Manchester and West Midlands with £100 million of investment in 26 transformative R&D projects.
The Innovation Accelerators programme is a new approach to supporting these city regions to become major, globally competitive centres for research and innovation and will support levelling up. The projects will attract private investment to develop the technologies of tomorrow, creating new jobs, and boosting regional economic growth.
Through the programme, local leaders are empowered to harness innovation in support of regional economic growth through a pioneering a new model of R&D decision-making. Working closely with Innovate UK, partnerships between local government, business and R&D institutions in the three city regions have led on selecting the 26 projects. This includes:
A University of Birmingham-led project to accelerate new health and medical technologies,
The Manchester Turing Innovation Hub linking business to cutting edge AI research and technologies to help enhance their productivity
A net zero project led by University of Strathclyde to accelerate the adoption of automated ultrasonic inspection during welding and additive manufacturing.
Tracy Brabin, Mayor of West Yorkshire, said:“West Yorkshire has a strong and thriving economy, and I’m pleased the Government has recognised the strength of our innovation by choosing to work with us to deliver an investment zone.
“It will provide further opportunities for people across the region, as well as our world leading higher educational facilities, building on our expertise in digital, technology, and health and life sciences.
“I look forward to working with government to develop the investment zone policy, unlocking our potential and ensuring our local economy thrives for years to come.”
Ben Houchen, Mayor of Tees Valley, said: “The introduction of an Investment Zone in the Tees Valley would be a huge boost to our plans to level up and redevelop our town centres.
“We have just established two Mayoral Development Corporations which will give us the powers to bring about real change to our town centres. The addition of an Investment Zone would help turbo-charge these plans and accelerate our vison.
“Investment and jobs are the fundamentals of levelling up and this would represent a further delivery on the promise the Government made to rebalance the economy of this country. We have been working for some time on Investment Zones, and I am incredibly supportive of this proposal.”
Andy Street, Mayor of the West Midlands, said:“Our Plan for Growth is central to how we drive forward our regional economic recovery as we bounce back from the temporary setback inflicted by the pandemic. The right mix of devolved powers and investment incentives will help turn that plan into action.
“That’s why this Investment Zones announcement is very welcome news – supporting our efforts to attract new businesses, create high quality jobs and supercharge our economy.
“Investment Zones will make a valuable contribution towards enhancing prosperity for residents right across our region and I look forward to working with local leaders to decide how we best take advantage of this exciting opportunity.”
Oliver Coppard, Mayor of South Yorkshire, said:“South Yorkshire’s steel and energy powered the world into the first industrial revolution, and we know we have the potential to lead the world into the next one.
“We’re home to businesses and institutions working at the forefront of advanced manufacturing, health sciences and green technology. We’re not just imagining a better future, we’re already making it.
“Investment Zones give us the chance to do even more, so I’m pleased South Yorkshire has been recognised as one of the regions able to make the most of that opportunity. I’m looking forward to working with government to design how that works so we can build a bigger, better economy here in South Yorkshire.”
CHANCELLOR’S “reset” to clean up the UK’s domestic energy supply and secure long term energy security, while delivering up to 50,000 highly skilled jobs is expected next week
£20 billion will transform carbon capture in Britain, helping create up to 50,000 highly skilled jobs.
Chancellor to confirm the next steps for Great British Nuclear as competition to deliver small modular nuclear reactors opens this year.
Plan will set the path for the UK’s clean energy supply and secure the UK’s long term energy security and help deliver one of the government’s five promises to grow our economy.
At next Wednesday’s Spring Budget (15th March) the Chancellor, Jeremy Hunt, will set out an unprecedented investment in domestic carbon capture and low carbon energy. Recognising the urgency of the UK’s clean energy revolution, he will commit to spades in the ground on these projects from next year.
No one country has yet captured the carbon capture market. The UK has enough carbon capture capacity to store over a century and half of national annual CO2 emissions, making it one of the most attractive carbon capture markets on earth, creating high-paid jobs of the future across the UK and growing our economy through new cutting-edge industries. Carbon capture will support the UK’s industrial transition to cleaner, greener processes and technology.
An unprecedented £20 billion in investment over the next 20 years will drive forward projects that aim to store 20-30 million tonnes of CO2 a year by 2030, equal to the emissions from 10-15 million cars helping us meet our carbon capture targets as part of our national net zero targets.
The Chancellor will also announce plans to boost nuclear power generation through Great British Nuclear, launching a competition for this country’s first Small Modular Nuclear Reactors, revolutionising how nuclear projects are delivered in the UK.
Chancellor of the Exchequer, Jeremy Hunt said: “Without Government support, the average household energy bill would have hit almost £4,300 this year, which is why we stepped in to save a typical household £1,300 on their energy bills this winter.
“We don’t want to see high bills like this again, it’s time for a clean energy reset. That is why we are fully committing to nuclear power in the UK, backing a new generation of small modular reactors, and investing tens of billions in clean energy through carbon capture.
“This plan will help drive energy bills down for households across the country and improve our energy security whilst delivering on one of our five promises to grow the economy.”
Energy Security Secretary, Grant Shapps said: “Putin’s illegal invasion of Ukraine has demonstrated to the world the vital importance of increasing our energy security and independence – powering more of Britain from Britain and shielding ourselves from the volatile fossil fuels market.
“Already a global leader in offshore wind power, we now want to do the same for the UK’s nuclear and carbon capture industries, which in turn will help cut the wholesale electricity prices to amongst the lowest in Europe.
“Today’s funding will play an integral role in delivering that, helping us further towards our net zero targets and creating green jobs across the country.”
Small Modular Reactors are emerging technology, and no country has yet to deploy one. To ensure the UK steals the march, the Small Nuclear Reactors competition is expected to attract the best designs from both domestic and international manufacturers with winners announced rapidly. The government will also match a proportion of private investment as part of this to ensure designs are ready to be deployed as soon as possible in the UK.
The government is already investing £210 million into the Rolls-Royce SMR project, matched by private sector funding. Rolls’ Royce reactor design is currently being assessed by safety regulator, the Office for Nuclear Regulation.
Great British Nuclear will streamline and coordinate the delivery of new nuclear power plants to meet the country’s ambition of up to 24 Gigawatts of nuclear power by 2050.
The government body will select sites for potential nuclear projects, removing costs, uncertainty, and bureaucratic barriers for manufacturers as they develop their proposals. To support future sites for nuclear development, the Government will also be consulting on a new approach to nuclear site selection later this year.
There will also be a laser focus on how to attract more investment into the sector, with the Chancellor confirming that nuclear power generation will be classed as “environmentally sustainable” under the green taxonomy regime, subject to consultation, encouraging significant private investment. Last year, the Chancellor confirmed reforms to EU-derived Solvency II regulation, which will unlock £100bn of private investment into infrastructure and clean energy over a decade.
We’ve already invested a historic £700 million stake in Sizewell C – our first investment in a nuclear project for 35 years – to provide reliable, low-carbon, power to the equivalent of 6 million homes for over 50 years. This will shore up UK energy security and create 10,000 skilled jobs, while we also continue to bring Hinkley Point C to completion, the first new nuclear power station in a generation.
We have already committed £1 billion to develop four CCUS hubs in the UK by 2030, but with today’s funding, we are providing industry with the certainty required to deploy CCUS at pace and at scale.
This is all part of our plans to transform our homegrown energy supply, investing in renewables and nuclear power, and maximising North Sea oil and gas production as we transition to net zero. All of which crucially brings skilled jobs, prosperity, and growth as we build a cleaner, greener, more secure economy.
Stakeholder reaction:
Andrew Storer, Chief Executive Officer, Nuclear Advanced Manufacturing Research Centre said: “I strongly welcome today’s announcement and the government’s commitment to establish Great British Nuclear to drive delivery of a programme of new nuclear power.
“Business needs the confidence that this will bring to invest in building industrial capability across the UK. The Nuclear AMRC will ensure that companies have access to the innovative manufacturing capability, resilient supply chains and skills needed to ensure the timely and cost-effective delivery of new nuclear power.
“This is an essential part of our future energy system and a great opportunity to drive jobs, skills development and growth across the UK as shown in our leading role in establishing the recently launched Rolls-Royce Nuclear Skills Academy. Our facilities in Rotherham and Warrington and a new technical facility in Derby will enable us to bring advanced manufacturing capability to support the Great British Nuclear mission in the heart of UK industry”.
Tom Greatrex, Chief Executive, the Nuclear Industry Association, said: “This is a huge step forward for UK energy security and UK jobs. Green labelling nuclear will drive crucial investment into projects large and small. Setting up GBN with the powers to select sites for projects will make nuclear deployment more efficient and give the supply chain a clear pipeline to work from.
“The SMR competition should put us back in the global race and create opportunities for UK technology and others to bring jobs and investment to the UK and win export orders in a massive market worldwide.
“We look forward to seeing details of funding for GBN and of the SMR competition in the Budget, as well as confirmation of our ambitions for fleet deployment of large and small scale reactors to make us a clean energy powerhouse of the 21st century.
“More nuclear cuts gas imports, cuts carbon and creates good jobs for communities all across this country.”
Dr Nina Skorupska CBE FEI, Chief Executive of the REA (The Association for Renewable Energy and Clean Technology) said: “Government’s commitment to advancing carbon capture and storage is a long awaited and welcome step forward. It is particularly essential that today’s announcements deliver a route to market for bioenergy with carbon capture and storage, at a range of scales.
“Combining this technology with low carbon bioenergy production, which uses biomass and waste feedstocks, produces real-world carbon removals from the atmosphere that are critical to achieving net zero, after having realised emission reductions.
“This support will help to reaffirm the UK’s global position as leaders in this innovative technology, and see it built at commercial scale. Crucially it will help in attracting new investment, which in turn will lead to thousands of jobs and the growth of the UK’s Green economy.”
