MANCHESTER, England (Reuters) – Britain’s finance minister Jeremy Hunt announced on Monday he would create 12 “investment zones” in England to spur the regional economy outside London, a scaled-back version of a policy announced under former prime minister Liz Truss.
Ahead of Hunt’s annual budget on Wednesday, the finance ministry said each of the zones will be backed by 80 million pounds spread over five years that can be directed towards tax relief for businesses, training and infrastructure.
Hunt also announced 100 million pounds ($122 million) of funds to be shared across Glasgow, Manchester and part of central England to improve their research and development centres.
Hunt looks set to keep his grip on public finances in the budget, holding off on any big tax cuts or spending increases until the next election comes closer into view.
“True levelling up must be about local wealth creation and local decision-making to unblock obstacles to regeneration,” Hunt said in a statement.
“From unleashing opportunity through new Investment Zones, to a new approach to accelerating R&D in city regions, we are delivering on our key priority to supercharge growth across the country.”
Hunt’s predecessor Kwasi Kwarteng had previously announced investment zones – a key policy of the short-lived Truss government – that would have offered much larger tax relief for businesses but at a larger cost for the government.
Truss’s spending plans – and the promise to fund them out of future economic growth – triggered a sell-off in British assets that ultimately ruined her premiership and ushered in Rishi Sunak as her replacement.
The finance ministry said it was working closely with the devolved governments of Scotland, Wales and Northern Ireland to establish how investment zones would be delivered in those places.
($1 = 0.8222 pounds)
(Reporting by Andy Bruce; editing by Michael Holden)
