Rachel Reeves vows to fight for economic growth
The Chancellor will declare that “growth won’t come without a fight” as she unveils her plan to turnaround Britain’s ailing economy with billions of pounds of investment and new infrastructure projects.
Reeves will pledge an £80bn boom to the economy from a new Oxford-Cambridge Growth Corridor in a move that comes after the pensions industry cautiously welcomed her plans to unlock up to £160bn for investment.
Speaking in Oxfordshire on Wednesday, she will champion the UK’s “huge potential… [at] the forefront of some of the most exciting developments in the world, like artificial intelligence (AI) and life sciences” and confirm the UK’s first AI growth zone in Culham, Oxfordshire.
The Chancellor will insist that “Britain is a country of huge potential” as she aims to strike a more optimistic tone amid dire economic data, a backlash to the October Budget and with consumer and corporate confidence plummeting.
Reeves will say that “for too long, that potential has been held back… low growth is not our destiny…but growth will not come without a fight.”
She will unveil plans for the Oxford-Cambridge Growth Corridor, claiming it could add up to £78bn to the UK economy by 2035, according to Public First researchers, and link the two cities – just 66 miles apart – slashing current rail travel times of two and a half hours.
Intended to supercharge UK science and technology growth, she will announce plans for some 4,500 new homes in Cambridge; £7.9bn in water company investment; funding for a planned East-West railway linking Oxford with Cambridge, and upgrading the A428; prioritising a new cancer research hospital in Cambridge; a new Oxford growth commission; and the appointment of Sir Patrick Vallance as the government’s growth corridor champion.
Reeves will also welcome Cambridge University’s plans for a new large scale innovation hub, and laud the “huge economic potential for our nation’s growth prospects” of linking the two cities in what she will argue is the government’s industrial strategy in action.
She will add: “Just 66 miles apart these cities are home to two of the best universities in the world, two of the most intensive innovation clusters in the world and the area is a hub for globally renowned science and technology firms in life sciences, manufacturing, and AI.
“It has the potential to be Europe’s Silicon Valley.”
Steve Bates, CEO of the UK Bioindustry Association, said the announcements would benefit the “vibrant growth sector” and its “exceptional ability to attract global investment”.
He added: Delivering the infrastructure needed to support the growth at pace – especially in the Oxford Cambridge growth corridor – is key to the success of our sector.
Sir Patrick said the UK had “all the ingredients to replicate the success of Silicon Valley or the Boston Cluster” but has long “been constrained by short termism and a lack of direction” and that the announcements represented “an end to that defeatism”.
It comes after Reeves last week set the National Wealth Fund and Office for Investment on course to spur on regional growth across the UK – and today will announce backing for the redevelopment of Old Trafford and a review of HMT’s guidance on how to appraise projects.
Mel Stride, shadow Chancellor, said: “The biggest barriers to growth in this country are Rachel Reeves, Keir Starmer and their job destroying Budget.”
He added: “Hastily cobbled together announcements of growth in the 2030s will do nothing to help the businesses cutting jobs right now.”
And Liberal Democrat Treasury spokesperson Daisy Cooper added: “Trying to boost growth without fixing our trading relationship with Europe is like driving with the handbrake on.”