Regional Growth

Lindsay Hoyle Excerpts

Wednesday 4th June 2025 Commons Chamber

[The Chief Secretary to the Treasury (Darren Jones)]

With permission, I shall update the House on the Government’s work to boost growth across the United Kingdom.

As the Prime Minister set out in the plan for change, economic growth is the No. 1 mission of this Government. It is key to achieving the Government’s goals: higher wages for working people; delivering economic and national security; and investing in our public services. We are already making progress. The most recent figures show that the United Kingdom was the fastest growing economy of any G7 country in the first quarter of the year and that real wages have risen more since July 2024 than over the first 10 years of the previous Conservative Government. But we are keenly aware that this progress must be widely felt in every part of the country. As such, our plan for regional growth will be hardwired into the spending review and infrastructure strategy, which will be set out in more detail in the coming weeks. This investment will be targeted squarely at the renewal of Britain and fixed on the priorities of working people, delivering on the promise of change and improving lives and communities across the country.

This morning, the Chancellor set out her next steps for nationwide growth in a series of speeches across the north and the midlands, and I am pleased to update the House on those announcements now. A key part of the Government’s growth mission is the view that growth relies on dynamic, interconnected city regions, creating clusters of activity where people can get around, communicate, share ideas, commute, find good work, and earn wages that flow back into strong local economies. As most Members know, the majority of our city regions have poor public transport systems, holding back growth and improvements to air quality and making it harder to get around. Stronger transport links are therefore crucial. They create opportunities for individuals to access a wider pool of jobs, for employers to access a wider labour market, and for businesses to expand the market for their goods and services.

If we were to increase the productivity of our largest city regions outside London just to match the national average, it would grow the economy by £86 billion. So I am pleased to say that this Government are making the biggest investment in intra-city transport connectivity that this country has ever seen. The spending review will allocate funding for ambitious local transport programmes across England, including the new transport for city regions fund launched by the Government today. This will give nine city region mayors a share of £15.6 billion in long-term transport for city region settlements running until 2032. The benefits and opportunities will be felt in the cities and towns across these combined authorities and by those who commute to work from outside those city regions.

The previous Government said that they would do some of this but, as was always the case, they never put the money aside to pay for it. As a result of our reforms to the fiscal rules and decisions to increase investment in the 2024 autumn Budget, this Labour Government are delivering.

The funding announced today will mean that the Mayor of West Yorkshire can now fully commit to delivering the West Yorkshire mass transit system, which will be fully integrated with cycling, walking, bus and rail, making journeys quicker, more accessible and more reliable across the region. The Mayor of the West Midlands can extend the metro from Birmingham city centre to the new sports quarter, unlocking more than £3 billion of private investment, and bringing benefits and opportunities to those living in the constituency of my right hon. Friend the Member for Birmingham Ladywood (Shabana Mahmood) and all who travel there.

It will mean that the Mayor of Greater Manchester can grow and transform the Metrolink tram network, building new tram stocks in Bury, Manchester and Oldham, which will help drive up living standards for the constituents of my hon. Friends the Members for Bury North (Mr Frith), for Bury South (Christian Wakeford) and for Oldham East and Saddleworth (Debbie Abrahams), and for others in the north-west region. The Mayor of the Liverpool city region can deliver three new rapid bus routes linking up the city centre, John Lennon airport, the new Everton stadium on Bramley-Moore dock, and new homes built on the Central Docks redevelopment and Anfield.

The Mayor of the North East will now be able to extend the Tyne and Wear Metro, linking Washington with Newcastle and Sunderland, connecting those living in the constituency of my hon. Friend the Member for Washington and Gateshead South (Mrs Hodgson) to new jobs and opportunities. I pay particular tribute to my hon. Friend, who has campaigned for this project for years and years, and it is now being delivered by a Labour Government.

This investment will also mean that the Mayor of South Yorkshire can renew the existing and now publicly owned Supertram network with track replacements, overhead line maintenance, and rolling stock renewal, yielding a fleet of new vehicles by 2032, linking jobs and homes in Sheffield and the constituency of my hon. Friend the Member for Rotherham (Sarah Champion).

We are backing the Mayor of the West of England’s plans for mass transit development across the region, with improved rail infrastructure to help unlock more services between Brabazon and Bristol city centre, meaning shorter journey times to Bristol Temple Meads across the wider area and providing greater opportunities for those in the constituency of my hon. Friend the Member for Filton and Bradley Stoke (Claire Hazelgrove) and—declaring my own interest—in my own.

After years of the Mayor of Tees Valley trying to persuade his Conservative colleagues to fund these important projects, I am delighted to confirm today that this Labour Government are now backing the region to invest in, for example, the Middlesborough station in the constituency of my hon. Friend the Member for Middlesbrough and Thornaby East (Andy McDonald), unblocking local networks and increasing capacity on local lines. I pay particular thanks to my hon. Friends the Members in the Teesside region who have lobbied hard to see this investment in their region—now being delivered by a Labour Government.

The Mayor of the East Midlands can now forge the Trent Arc, linking Derby and Nottingham to create tens of thousands of new jobs and homes, connecting Infinity Park investment zone and the east midlands freeport with sites including Ratcliffe-on-Soar clean energy and advanced manufacturing and east midlands intermodal park—home of Toyota in the region—along the Trent Arc corridor.

This funding is substantial, marking a 2.4 times real-terms increase in spending on city region connectivity, funding the priorities that matter to hard-working people across the country. These announcements were only made possible today because at the autumn Budget 2024 the Chancellor took the necessary action to reform the fiscal rules to improve stability after years of chaos from the Conservative party, and to unlock investment. This means the Government can now provide greater investment in Britain’s economic revival as, for the first time, the Treasury takes account of the value of financial assets and not just the costs of investment. That has enabled us to increase investment by over £113 billion more than the previous Conservative Government, while keeping debt on a sustainable path—only made possible by the credibility of our fiscal rules, which require day-to-day spending to be funded with revenue.

It is more important than ever to have a robust fiscal framework. I am pleased to note that the Office for Budget Responsibility confirmed at the spring statement that the Government will meet their stability and investment rules two years ahead of schedule. In addition to her announcements today regarding transport for city region settlements, the Chancellor will set out further detail on this allocation of additional funding at next week’s spending review.

In January, the Chancellor announced a review of the Green Book, the Government guidance on appraising options for investment. Since then, we have consulted extensively with stakeholders from across the country, considering potential problems with the Green Book guidance itself and how the guidance is being applied in practice. I thank and pay tribute to many hon. Members across the House for engaging on this important issue.

We will publish the full conclusions of the review next week. It will mark a new approach to Government decision making that puts an end to siloed Whitehall thinking and takes account of the reinforcing economic effects of infrastructure, housing, skills and jobs to ensure that investment takes place in every part of the country.

These announcements reflect just a fraction of our plans to supercharge growth across the United Kingdom. We are focused on investing across all parts of the country to boost prosperity and deliver the change the British people voted for at last year’s election, and there is more to come. The spending review, which we will publish next week, will set out in further detail how an active Government will continue to deliver growth, empowering all regions and nations of the UK to reach their full potential and making working people across the country better off, no matter where they choose to live and work.

Unlike the Conservatives, who will tell us that they would have delivered on their false promises after 14 years of failing to do so, this Labour Government, in our first year in office, are delivering: a country that people will see is being set up for success that they can take part in. That is the change we promised, and that is the change this Labour Government are delivering. I commend this statement to the House.

[Mr Speaker]

I think you missed a couple of railway stations out of your statement, Minister, but not to worry. I call the shadow Chief Secretary to the Treasury.

--- Later in debate ---

[Darren Jones]

I am pleased to see the shadow Chief Secretary to the Treasury back in his place today; I always enjoy our exchanges. I welcome the fact that he supports our plans and sees the good value in them. I will respond to one particular question, and then answer the rest in the round: all the Green Book details will be published next week at the spending review, so we will be able to share them with him and the House at that time.

The shadow Chief Secretary said that we were imitating the Conservative party’s promise to level up the country, but I think the British people voted and gave their verdict on the Conservatives’ success in delivering that at the last election. Whereas their version of levelling up was a set of false promises, this Labour Government are delivering real change.

The shadow Chief Secretary—rightly, given his role—asked how we will fund the announcements we have made today. As I explained in my statement to the House, it is because of the Chancellor’s decisions to amend the fiscal rules and invest in Britain, instead of continuing with decline, that we have been able to do so.

The shadow Chief Secretary and the Conservative party have not said what they would do differently. They were against the change in the fiscal rules, against our increasing of taxes on the wealthiest people at the Budget and against every single measure we have taken to be able to pay for today’s announcements. Whether it is the Conservatives, Reform or any other party, they need to recognise that the Conservatives’ false promises led to their decline and their unfunded promises are disrespectful to the British people, and that this Labour Government promised change at the election and we are delivering it. These are fully funded promises, unlike the unfunded promises of the Conservatives, which posed a risk to the economy and a risk to family finances. The sooner the Conservatives learn from their lessons, apologise to the British people, and come forward with some serious proposals, the better for the debate in this House.

[Mr Speaker]

I call the Chair of the Treasury Committee.

[Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

I warmly welcome this investment in Britain, and I hope that the Treasury will be fully evaluating the impact of this vital transport infrastructure on growth in regions, which we know has always lagged, except for in London and the south-east. Although these figures are fully funded now, with all the global shocks we are seeing, it is important that we are aware that there could be additional costs on some of the raw materials being used, and any delay obviously adds costs too. Will the Chief Secretary tell the House the Government’s plans if costs do go higher—will the figures be fully funded regardless, or will they have to go back to the drawing board if there are challenges?

[Darren Jones]

My hon. Friend the Chair of the Treasury Committee rightly alludes to the fact that the Chancellor’s speech today makes the case for this Government investing in every part of the country and ensuring that growth is felt widely. My hon. Friend asks me about the supply chain and costs for building infrastructure. The House will know that Britain has unfortunately become a country where most of our infrastructure projects go over time and over budget as a failure of poor industrial and infrastructure policy and erratic decision making over many, many years. Alongside the spending review, we will be publishing the infrastructure strategy, at a slightly later stage, and that will answer many of my hon. Friend’s questions on Government policy, recognising the problem she has raised and the solutions that will be set out to support the supply chain to be able to deliver for Britain.

[Mr Speaker]

I call the Liberal Democrat spokesperson.

[Daisy Cooper (St Albans) (LD)]

We Liberal Democrats believe that when the economy is growing, every nation, every region and every person should feel and see the benefits, so we are pleased to see investment in public transport and public infrastructure, but I must ask the Minister: where is the plan and the money for rural areas? He will remember that, at the Budget, we Liberal Democrats supported and welcomed the Government’s changes to the fiscal rules that allowed for borrowing and more productive investment, and we are delighted to see that one of the beneficiaries of today’s announcement is the Metrolink to Stockport, which is a testimony to the hard work of the Liberal Democrats, who have been campaigning on this for far longer than the mayor and the combined authority have even existed. From Shropshire to the south-west, from Cumbria to Cornwall, and from Norfolk to Newton Abbot, rural areas once again feel as if they have been forgotten. Will the Government therefore bring forward a rural growth strategy?

May I also ask the Minister about Wales? We know that HS2 and the Oxford-Cambridge line have been designated England-Wales lines, as opposed to England-only lines. Can he explain to the people of Wales why that has happened and why they are set to lose out on Barnett consequentials?

There is one big piece missing from the puzzle. Many of us rightminded people want to see investment in infrastructure, but if we want to build stuff, we need skilled people to build it. Will the Government now fix the apprenticeship levy so that it can be spent on skills and training? When will the Government produce their skills strategy? Why has Skills England been set up as an executive agency of the Department for Education rather than having employers at its heart, as was promised? And why are the Government scrapping the level 7 apprenticeship when we know that it supports social mobility, including into engineering? We welcome this investment into transport infrastructure, but that transport infrastructure will not build itself; we need the people skilled to do it.