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Big infrastructure projects spared the Treasury axe

Hunt also said the “core network” of the Northern Powerhouse Rail project and the East West Rail scheme will go ahead as planned alongside construction of a £20bn nuclear power station at Sizewell C in Suffolk.

Plans for the second round of the Levelling Up Fund were also confirmed, with at least £1.7bn to be allocated to priority local infrastructure projects around the UK before the end of the year.

The announcements will soothe nerves across the industry as contractors braced for possible infrastructure cuts.

Hunt said capital spending cuts were often seen as an “easy option” and added “but doing so limits not our budgets, but our future” as he confirmed the Treasury will not be “cutting a penny” from the UK’s capital budgets over the next two years.

He committed to maintaining the current level of capital spending in cash terms meaning previous planned rises are frozen to 2024/25 but said it would still amount to £600bn investment over the next five years.

The Government officially abandoned the Truss Government’s plan to fast-track 138 mainly road projects, saying it would accelerate delivery of projects across its portfolio rather than focus on the list flagged up in the previous Growth Plan.

Hunt also dropped the previous flagship Investment Zone plan, halting the present bidding process in its tracks.

Instead, the Government aims to will shift the focus to University cities and towns to create a smaller number of knowledge-intensive growth clusters, leveraging local research strengths.

The first of these areas will be announced by the Department for Levelling up, Housing and Communities in the coming months.

To reinforce the Government’s commitments to carbon reduction made at last year’s COP26 climate conference, the Chancellor made a new commitment of more than £6bn from 2025 to extend energy efficiency retrofit programmes.

He also announced a new Energy Efficiency Taskforce that would drive plans to cut energy use of buildings by 15% by 2030.