Watch Chancellor John Healey’s speech
The Chancellor will set out his plans to grow the economy through an “active” state in his first major speech.
John Healey plans to tell an “optimistic story” about Britain in his first major speech in the role, echoing the prime minister’s upbeat tone of “bringing back hope”.
It comes amid a challenging economic backdrop ahead of Healey’s first budget on 28 October, with government borrowing costs rising and the inflationary impact of the conflict in Iran.
Healey is set to unveil a £150 million fund for fast-growing northern firms, with offers of investments between £5 million and £15 million to help innovative companies across the North of England.
The British Business Bank will commit up to this new fund “to get behind the most innovative and fast-growing firms”, the Chancellor will say.
“This is not sentimentality, it’s supply side economics.”
The money is already allocated to the government bank and the Treasury hopes the specific fund will draw in additional private investment to create opportunity.
The Chancellor also plans to set out investment across the UK, tasking the British Business Bank and National Wealth Fund to do more to support investment and innovation across the UK.
The National Wealth Fund has agreed strategic partnerships with mayoral authorities in South Yorkshire, Liverpool City Region and the North East, as well as Cardiff Capital Region.
The Treasury said that this move will give local leaders direct access to the fund’s investment expertise to help develop infrastructure projects.
Speaking at a manufacturing site, the Chancellor is expected to say: “The Prime Minister laid out a clear diagnosis of what has gone wrong in the past. The solution is a fundamental shift that starts with putting power in the right places.
“The next chapter of Britain’s growth story will be written in more places.”
He will say that No 10 North was set up as “a strong, strategic centre wired to enable local leaders and their ambitions” by “removing obstacles” and red tape.
“I want to see wealth creation in this country. I want to see businesses make a profit,” the Chancellor will say.
“And to create the conditions for that we need an active, accountable state at all levels to remove blockages and create the conditions for more investment.”
Healey will say that boosting growth must go hand-in-hand with maintaining fiscal discipline, particularly at a time of global uncertainty, and he previously promised to stick to the fiscal rules of his predecessor Rachel Reeves.
The Chancellor will say that growth will help Britain navigate that turmoil with “an optimistic story – one of resilience, pride, huge latent potential”.
“A country turning a corner. A country whose people, businesses and communities are ready to seize the opportunity of new technologies and new ideas.”
Economists have warned that Healey may need to raise taxes or cut departmental spending to protect the fiscal buffer built up by Reeves at her last budget.
The Conservatives have described the trail of Healey’s speech as a “policy-light word salad”.
Shadow Chancellor Andrew Griffith said: “It will do little to comfort hard-working families and businesses across the country who are worried about more tax rises or the fact that government borrowing rates are near a 28-year high.
“Commitments to reduce red tape are welcome but given this Government’s track record with its Employment Rights Act and other anti-business measures, people will rightly question their sincerity.
“We are facing serious threats from Russia and Iran on our doorstep, as well as threats to the Falkland Islands. Yet the Chancellor, the man who resigned over defence spending, seemingly does not want to mention our Armed Forces or how we will reach 3% of GDP on defence.”
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