Chancellor Rachel Reeves puts solving housing crisis at heart of spending plans. There are also hopes she will find the money needed to lift the two child benefit cap.
Hopes high for more transport cash for West Midlands after trams boost announced by Rachel Reeves, Chancellor, last week. She is pictured with, L-R, Richard Parker, Tom Wagner, Shabana Mahmood.(Image: Nick Wilkinson/Birmingham Live)
Chancellor Rachel Reeves is to put a £39 billion affordable housing blueprint at the heart of a multi-year spending review that aims to tackle some of the West Midlands’ biggest challenges.
She is also being tipped to put more money into the region’s creaking transport infrastructure and boost the NHS, schools and defence spending, while squeezing day-to-day spending in a £113 billion range of initiatives.
There are fears that creaking local government might face a further squeeze, which would be particularly unwelcome for financially distressed councils like Birmingham.
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But charities and campaigners on child poverty are hoping Reeves has found the money needed to end the two child benefit cap that is blighting the lives of thousands of hard-up local families.
Our Child Poverty Emergency project called for it to be scrapped for the sake of the excess of larger families in Birmingham, with the Resolution Foundation warning that 4.8 million kids will be in poverty by 2029 without urgent action.
Locally, the region has already been assured of a £2.4 billion transport bonanza, some of it to pay for the first phase of a new Metro tram line to east Birmingham and north Solihull. Reeves was in Birmingham last week to unveil that headline-grabbing proposal.
But signs are that the Treasury is also planning to commit to the long-awaited £1.75 billion Midland Rail Hub project by putting in the £123m previously promised to complete the full business case for faster, better and more frequent connections out of Birmingham.
And an immediate ‘phase one’ priority scheme – to fully reopen Kings Norton train station platforms as part of improvements to the cross-city rail line – is also rumoured to be getting the go ahead, after strong lobbying by local MPs Laurence Turner and Al Carns.
It would be a fillip for the beleaguered project which has been stuck in the planning stage for years. Reeves is also expected to extend the nationwide £3 price cap on single bus trips to 2027.
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But it’s the housing promise that is being hailed as the breakthrough, deemed enough to turbocharge the Government’s commitment on building 1.5 million homes.
In a statement ahead of the review, the Treasury described the £39bn earmarked for affordable homes over 10 years as “the biggest boost to social and affordable housing investment in a generation”.
West Midlands mayor Richard Parker agreed, hailing it as ‘exactly what I’ve been calling for’.
“People across the West Midlands have been stuck on waiting lists, priced out of communities or left in poor quality tempofaray housing for too long. This announcement is fantastic, it’s a big step in the right direction.”
How big West Midlands’ share will be is as yet uncertain but Parker said he would be making his case to get his hands on a large chunk of the funds.
Reeves’ promise of new roads, railways, public transport and green energy projects for the Midlands is intended to raise regional growth rates and improve job prospects in left-behind areas.
But it comes at a cost, with London expected to see reduced spending that has been described by its mayor Sadiq Khan as “incredibly short-sighted”.
Reeves’ spending review is the result of months of intense haggling between the Treasury and cabinet ministers for their departments and is seen as a pivotal moment.
Schools are also getting a £4.5 billion spending boost, though in part that’s to carry out reforms designed to get more children with special needs into mainstream schools.
She will also announce £86bn for research and development over four years.
Full details of the capital spending plan will be set out in a 10-year infrastructure strategy next week, but the chancellor has already indicated big investments in urban transport, nuclear power and artificial intelligence.
The Chancellor will take to the despatch box in the Commons at 12.30pm, after Prime Minister’s Questions. She will set out how much each department has been allocated. Some are expected to face painful cuts.
Ministers have been locked in fraught negotiations for months over their budgets, and even today we were hearing of final deals being done over smaller schemes.