Chancellor sounds welcome boost to infrastructure

Chancellor Phillip Hammond has sounded a welcome boost to infrastructure in the UK. In his speech to the Conservative Party Conference in Birmingham today, Hammond said the government will no longer target a budget surplus by the end of this parliament, and instead focus on economic growth through investment. Housing and transport will be the focus of the new spending plans, he said.

Hammond also stated that government will guarantee support for all projects that secure European Union funding before the UK's exit from the EU in two and a half years' time. Previously the guarantee had been extended only to projects that already have EU funding.

Productivity has to be increased, he added. "It's a decades old problem too long swept under the carpet, too focused on London and the South East. This is why we are pushing on with our devolution plans.

"If we are going to see wealth growth distributed more evenly across the country, we must do more for making houses affordable for young people. Quite simply we must build more homes." A £3bn fund to support SMEs in the housing market has been announced and a further £2bn will target house building on public land he said.

On infrastructure, Hammond said: "Today I recommit to putting the National Infrastructure Commission at the heart of our plans." He restated a commitment to transport investment, to be made clear in the government's autumn statement, while also promising more to come on innovation and skills to boost economic growth and productivity.

He also said that the government will push on with the Northern Powerhouse initiative, but with other regions as well, including the Midlands. "We will do more with the West Midlands and the Midlands Engine. We have reached a tipping point with devolution plans and our economy will be better for it," Hammond said.

Responding to Hammond's speech today, ACE chief executive Nelson Ogunshakin welcomed signals of government getting a grip on economic strategy and its renewed commitment to the NIC – dropped from legislation last month. "It is also encouraging to hear of continuity with the Northern Powerhouse, the Midlands Engine, and with devolution and investment in infrastructure and innovation in general. But the devil is in the detail. We look forward to seeing how it all pans out when he hear the detail of the Chancellor's spending plans in his autumn statement."