The Chancellor of the Exchequer, Rachel Reeves, delivered a speech last week outlining the government’s latest plans for driving economic growth.

The strategy largely focuses on development projects around Oxford and Cambridge, as well as progressing plans for a third runway at Heathrow. Below are some of the key highlights from the speech.

Oxford and Cambridge Growth Corridor

The Chancellor emphasised the potential for economic growth in the area between Oxford and Cambridge, suggesting it could become Europe’s answer to Silicon Valley. However, slow transport links and a shortage of affordable housing have been identified as barriers to realising this potential.

To address these issues, improvements to rail transport via East-West Rail were announced, alongside plans to establish Tempsford as a mainline station. Road upgrades between Milton Keynes and Cambridge are also planned to enhance travel times.

A new Cambridge Cancer Research Hospital is being prioritised, while proposals for a new Fens Reservoir (to serve Cambridge) and the South East Strategic Reservoir (near Oxford) were confirmed.

The Chancellor also revealed that the Environment Agency has withdrawn its objections to a new development in Cambridge, paving the way for 4,500 new homes, along with schools and business premises.

In addition, an AI Growth Zone in Culham aims to speed up planning approvals for the rapid construction of data centres. Meanwhile, Cambridge University is developing a flagship innovation hub in central Cambridge to attract investment and foster an innovation-led community.

Third Runway at Heathrow

Although a third runway has been previously approved, efforts are now ramping up to make it a reality. The government is inviting proposals by the summer and will then proceed with a full assessment through the Airport National Policy Statement.

The Chancellor reported that the additional runway could boost GDP by 0.43% and create 100,000 new jobs.

Other Key Developments

  • Trade – The government will continue strengthening trade ties with the United States, the EU, and fast-growing economies, including China and India.
  • Employment System Reforms – The Secretary of State for Work and Pensions will outline welfare system reforms before the Spring Statement, while an Immigration White Paper will introduce proposals to lower net migration while ensuring visa routes remain open for highly skilled individuals.
  • Pensions System Reforms – A final post-consultation report on the creation of larger, consolidated pension funds will be released in the spring.
  • Regulatory System – Following discussions with the heads of major regulators, an action plan will be published in March on making regulations more agile and responsive to businesses.
  • Planning Reforms – The upcoming Planning and Infrastructure Bill will ease environmental requirements on developers contributing to the nature restoration fund. The Bill will also simplify the development of nuclear power stations, trainlines, and windfarms.
  • Investment – The National Wealth Fund will continue investing, with recent commitments to Connected Kerb and Cornish Metals. A refreshed Carbon Budget Delivery Plan is expected later this year, as the government views Net Zero as an economic opportunity.

Infrastructure – Offshore windfarms in East Anglia and Yorkshire are under consideration, while the government is working with the private sector on delivering a Lower Thames Crossing to improve connectivity. Other discussions covered potential developments at Old Trafford, South Yorkshire Airport, and East Midlands Airport. Plans for the Wrexham and Flintshire Investment Zone are also progressing, while unlocking land around stations in Manchester and Leeds is seen as a promising route for improving infrastructure.

The Chancellor of the Exchequer, Rachel Reeves, delivered a speech last week outlining the government’s latest plans for driving economic growth.

The strategy largely focuses on development projects around Oxford and Cambridge, as well as progressing plans for a third runway at Heathrow. Below are some of the key highlights from the speech.

Oxford and Cambridge Growth Corridor

The Chancellor emphasised the potential for economic growth in the area between Oxford and Cambridge, suggesting it could become Europe’s answer to Silicon Valley. However, slow transport links and a shortage of affordable housing have been identified as barriers to realising this potential.

To address these issues, improvements to rail transport via East-West Rail were announced, alongside plans to establish Tempsford as a mainline station. Road upgrades between Milton Keynes and Cambridge are also planned to enhance travel times.

A new Cambridge Cancer Research Hospital is being prioritised, while proposals for a new Fens Reservoir (to serve Cambridge) and the South East Strategic Reservoir (near Oxford) were confirmed.

The Chancellor also revealed that the Environment Agency has withdrawn its objections to a new development in Cambridge, paving the way for 4,500 new homes, along with schools and business premises.

In addition, an AI Growth Zone in Culham aims to speed up planning approvals for the rapid construction of data centres. Meanwhile, Cambridge University is developing a flagship innovation hub in central Cambridge to attract investment and foster an innovation-led community.

Third Runway at Heathrow

Although a third runway has been previously approved, efforts are now ramping up to make it a reality. The government is inviting proposals by the summer and will then proceed with a full assessment through the Airport National Policy Statement.

The Chancellor reported that the additional runway could boost GDP by 0.43% and create 100,000 new jobs.

Other Key Developments

  • Trade – The government will continue strengthening trade ties with the United States, the EU, and fast-growing economies, including China and India.
  • Employment System Reforms – The Secretary of State for Work and Pensions will outline welfare system reforms before the Spring Statement, while an Immigration White Paper will introduce proposals to lower net migration while ensuring visa routes remain open for highly skilled individuals.
  • Pensions System Reforms – A final post-consultation report on the creation of larger, consolidated pension funds will be released in the spring.
  • Regulatory System – Following discussions with the heads of major regulators, an action plan will be published in March on making regulations more agile and responsive to businesses.
  • Planning Reforms – The upcoming Planning and Infrastructure Bill will ease environmental requirements on developers contributing to the nature restoration fund. The Bill will also simplify the development of nuclear power stations, trainlines, and windfarms.
  • Investment – The National Wealth Fund will continue investing, with recent commitments to Connected Kerb and Cornish Metals. A refreshed Carbon Budget Delivery Plan is expected later this year, as the government views Net Zero as an economic opportunity.
  • Infrastructure – Offshore windfarms in East Anglia and Yorkshire are under consideration, while the government is working with the private sector on delivering a Lower Thames Crossing to improve connectivity. Other discussions covered potential developments at Old Trafford, South Yorkshire Airport, and East Midlands Airport. Plans for the Wrexham and Flintshire Investment Zone are also progressing, while unlocking land around stations in Manchester and Leeds is seen as a promising route for improving infrastructure.