George Osborne has revealed full details of the Treasury's Comprehensive Spending Review, which will means billions of pounds in public sector spending cuts over the next four years.
鈥淭oday is the day Britain steps back from the brink,鈥� said the Chancellor, as he began outlining the review this lunchtime.
At first glance, it does not look as painful for construction as many had feared. Capital spending will actually increase by 拢2bn to 拢51bn, compared to the last budget, subsequently dropping to 拢49bn, 拢46bn, and 拢47bn over the remaining years of the parliament.
Contractors who operate in transport and education can feel happy with the outcome, less so those who rely on social housing. The key points of the review are as follows.
Transport
Transport will receive some 拢30bn of capital spending over the four year CSR period, a real terms drop of 11%.
The Chancellor confirmed many major schemes would go ahead, including Crossrail. Those he listed 鈥� which he said was not the final list 鈥� were:
- M62 expansion
- Rail platform improvements across UK
- 拢500m for Tyne & Wear Metro
- Rail electrification between Liverpool, Manchester, Preston and Blackpool
- New suspension bridge over the Mersey at Runcorn
- M1 and A46 to be upgraded in the Midlands
- Investment in the Midlands Metro
- M4 and M5 improvements in the South West.
- A new transport scheme for Weymouth
- A11 to Norwich to be upgraded
- M25 will be widened in key areas
- A3 Hindhead improvements to go ahead
- 鈥淜ey鈥� Tube lines to be upgraded
- Crossrail to go ahead
However, .
Education
Education's capital budget will fall from 拢7.6bn in 2011/12 to 拢3.3bn from 2012/13, rising slightly 拢3.4bn by 2014/15. This represents a 60% fall in spending over the four-year period.
However, 拢15.8bn will be spent refurbishing and improving schools over four years, with聽600 new schools to be built.
Energy
The Department of Energy and Climate Change will see it's annual budget rise to 拢2.7bn by 2014/15, a real terms rise of 41%.
The Green Investment Bank will be created, supported by 拢1bn of funding, and "much more" from the private sector, said Osborne. 拢200m will be invested in offshore wind.
拢1bn will be invested in creating a carbon capture and storage demonstration plant. 拢860m of funding will be spent on the Renewable Heat Incentive, to be introduced from 2011/12.
Capital spending on nuclear decommissioning will increase over the next four years.
Healthcare
Overall, healthcare spending will rise to 拢114bn from 拢104bn within four years, above inflation, with new hospital schemes such as St Helier in Surrey going ahead.
Scotland and Wales will receive the same proportional increase in health funding as in England.
However, capital spending on healthcare schemes will fall by 17%.
Housing
The Department for Communities and Local Government's capital budget will shrink by almost three quarters, falling from 拢6.9bn this year to 拢2bn by 2014/15.
Social housing capital spending will total 拢4.4bn over the next four years, providing up to 150,000 new affordable homes during that period.
Osborne also promised reform to the planning system which will 鈥渞educe the burden on house builders鈥�.
Justice
The Ministry of Justice's budget will be cut by 6% a year, to 拢7bn by 2014/15, but it's capital spend will be chopped in half, dropping from 拢600m a year to just 拢300m by the end of the four-year period.
Plans for a new 1,500-capacity prison will be deferred, and 3,000 fewer prisoners will be locked up.
Defence
Defence capital spending will increase from 拢8.6bn in the current financial year to 拢8.9bn in 2011/12, 拢9.1bn in 2012/13, and 拢9.2bn in 2013/14, before falling to 拢8.7bn in 2014/15.
Across the full period, this represents a fall of 8.7% in real terms.
Cuts include聽.
Other key points
Local government revenue grants will no longer be ringfenced from April next year, but central funding for councils will be cut by 26% over the parliament.
The number of apprentices supported by government will rise to 75,000 a year, a 50% increase.
- The full is available on the HM Treasury website
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