Autumn Statement: Osborne looks for infrastructure boost

Chancellor George Osborne today announced a mix of high and low carbon new infrastructure projects, backed by £5bn of spending that will be delivered through a new wave of spending cuts for Whitehall departments.

As had been widely expected, Osborne used today's Autumn Statement to confirm the bulk of Whitehall Departments will face additional spending cuts of one per cent next year, followed by a further two per cent cut the year after.

The savings will be used to fund a £5bn increase in capital spending targeting a host of road building, health and education, and science programmes, including many research projects with a clean tech element, such as initiatives focused on energy efficient computing, synthetic biology, energy storage, and advanced materials.

A spokesman for the DfT said the department now had access to additional £1bn of capital spending, the bulk of which will be focused on road upgrades, with just £42m earmarked for cycling infrastructure improvement.

The spending, accompanied by the Chancellor's decision to scrap the planned 3p increase in fuel duty for January, prompted accusations from groups that the government was again failing to tackle transport emissions.

But the spokesman insisted all of the schemes are designed to tackle congestion points that lead to higher emissions, and pointed to the Chancellor's trailing of upcoming public transport announcements on extending the London Tube network and confirming plans for a new branch of the proposed High Speed Rail network to West Yorkshire.

Investment will also be made available for IT projects designed to handle very large quantities of data in an energy efficient manner and the creation of new "dedicated R&D facilities to develop and test new grid-scale storage technologies".

In addition to new capital spending, the Treasury provided an update on its broadband rollout plans, which are designed in part to reduce transport emissions by boosting the rural economy and enabling more home working.

The Chancellor confirmed the government has secured state aid clearance for the rollout of rural broadband and announced Brighton and Hove, Cambridge, Coventry, Derby, Oxford, Portsmouth, Salford, York, Aberdeen, Perth, Newport, and Derry/Londonderry had been selected to receive a share of £50m funding to support ultra-fast broadband rollout.

There was also a surprise boost to businesses across the UK as the Chancellor announced corporate tax would be cut by one per cent to 21 per cent from April 2014.