£400m To Fund Small Firms Highlighted In Speech

The  Chancellor announced his commitment to supporting the Northern Powerhouse with the announcement of a £400m local investment fund to support the growth of SMEs.

In a series of announcements, George Osborne said that it will spend £13bn on transport in the North over this Parliament including  £150m to introduce a smart and integrated ticketing across local transport and rail services in the North.

Other transport announcements included a commitment to commencing the electrifying of the Trans-Pennine line in the region and a  £7m fund to support new air routes promoting domestic and international connectivity and stimulating jobs.

To back science-based and innovative companies in the North the government said it would provide £250m for small modular reactor development and wider nuclear R&D, creating opportunities for the North’s centres of nuclear excellence in Sheffield City Region, Greater Manchester and Cumbria, as well as the nuclear research base across the UK. This builds on £25m of UK funding for a Joint Research and Innovation Centre with China, to be based in the North West.

The headline grabbing Northern Powerhouse Investment Fund will invest over £400m in smaller businesses and will be  subject to European funding arrangements. Together with a separate fund in the North East this, it will make over £500m available across the Northern Powerhouse.

Other announcements included a doubling of the size of the Enterprise Zones programme in the Northern Powerhouse, creating seven new zones. This means that over a third of all new Enterprise Zones announced in this Spending Review will be in the North.

Expert Opinion

“It was good to hear that the Northern Powerhouse is still high on George Osborne’s agenda, but I expect for those businesses which think the Northern Powerhouse concept amounts to nothing but political spin, the Chancellor said little to persuaded them otherwise.

“Our recent report with Cebr suggests that the gap between London and the Northern Powerhouse region will widen by 27% in the next 10 years and our report called for a number of new policies to be considered so that the Government can get its wealth spreading agenda back on track. Further devolution, real investment in road and rail along with more enterprise zones were some of the areas highlighted in the report and it was good to hear that they are on the Government’s agenda. Businesses will now want to see action and crucially meaningful investment in infrastructure.”
Roy Beckett - Partner