‘Europe’s Silicon Valley’ at heart of government’s growth plans, Rachel Reeves to announce

Published

7 months ago

January 29, 2025

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Rachel Reeves will unveil Labour’s plans to grow the UK economy on Wednesday, warning it “will not come without a fight”.

The chancellor is expected to announce a raft of measures including developing Oxford and Cambridge – which she says has the “potential to be Europe’s Silicon Valley” – building nine new reservoirs and the redevelopment of Old Trafford.

The speech is considered a key moment for a chancellor who has struggled with sluggish economic headwinds since her first budget last autumn.

Politics latest: Follow the chancellor’s speech on Wednesday morning

Despite intense speculation, the government has not yet announced whether they will back a third runway at Heathrow, or further developments at other airports.

In a speech on Wednesday, Ms Reeves will confirm:

• Support for the Oxford-Cambridge Growth Corridor – also known as the Oxbridge Arc – that was scrapped by the Conservatives in 2022. The government points to a report claiming the development, including transport, business growth, and housing, could add £78bn to the UK economy by 2035;

• An agreement that allows water companies to spend £7.9bn to build nine new reservoirs, with two planned for Somerset and then one each in Lincolnshire, Hampshire, Cambridgeshire, Oxfordshire, Suffolk, Kent and West Midlands. A new reservoir hasn’t been opened in the UK since 1992;

• The government will back the redevelopment of Manchester United’s Old Trafford stadium and its surrounding area, alongside plans to change the way projects are appraised and evaluated, in order to “support decisions on public investment across the country, including outside London and the southeast”;

• Confirmation of a new approach to the National Wealth Fund and Office for Investment to get regional development happening faster.

Very little of this is new… or growth-friendly

Ed Conway

Economics and data editor

@EdConwaySky

Don’t, whatever you do, call it a “relaunch”.

When the chancellor stands up and delivers her much-anticipated speech on Wednesday – with all sorts of exciting schemes for new infrastructure and growth-friendly reforms – she will cast it as part of the new government’s long-standing economic strategy.

Regardless of whether you believe that this is all business-as-usual, it’s hard to escape the fact that the backdrop to the chancellor’s growth speech is, to say the least, challenging. The economy has flatlined at best (possibly even shrunk) since Labour took power. Business and consumer confidence have dipped. Not all of this is down to the miserable messaging emanating from Downing Street since July, but some of it is.

Still, whether or not this constitutes a change, most businesses would welcome the chancellor’s enthusiasm for business-friendly reforms.

But it’s not everything. What about the fact that the UK has the highest energy costs in the developed world? What about the fact that these costs are likely to be pushed higher by net zero policies (even if they eventually come down)? What about the fact that tax levels are about to hit the highest level in history, or that government debt levels are now rising even faster than previously expected.

Read the analysis in full here

A commitment to growth

Ms Reeves will use these plans as demonstrations of the government’s commitment to “growth”.

The chancellor is set to say in her speech: “Low growth is not our destiny. But growth will not come without a fight. Without a government that is on the side of working people. Willing to take the right decisions now to change our country’s course for the better.

“That’s what our Plan for Change is about. That is what drives me as chancellor. And it is what I’m determined to deliver.”

In its election campaign last year, Labour pledged to increase building in the UK – both housing and infrastructure.

These pledges are essential to the government’s plans to grow the economy, which has continued to struggle since Ms Reeves’ budget.

A key date for the chancellor is 26 March, when the Office for Budget Responsibility will provide its latest forecast, an indicator of whether they think the government’s plans will work.

A lack of growth could lead to Ms Reeves having to cut budgets further or raise taxes.

As part of the government’s plans to grow the economy and build, Sir Keir Starmer has vowed to “take on” people who oppose building near where they live, who are known as Nimbys – which stands for Not In My Backyard.

The Oxbridge arc

The chancellor will also announce that the Environment Agency has dropped its opposition to 4,500 houses around Cambridge after working with the regulator and local authorities.

The prime minister was clear last week that he also wants to see fewer legal challenges to planning applications.

Other developments in that region that are getting government backing include more funding for East-West Rail, with new services between Oxford and Milton Keynes, and upgrades to the roads linking Milton Keynes and Cambridge.

Ms Reeves will also say a new East Coast Mainline Station at Tempsford – between Cambridge and Milton Keynes – will be supported.

Sir Patrick Vallance, a science minister who came to prominence during COVID as the government’s chief scientific adviser, will be made the Oxford-Cambridge growth corridor champion.

Ms Reeves is set to say: “Just 66 miles apart, these cities are home to two of the best universities in the world, two of the most intensive innovation clusters in the world, and the area is a hub for globally renowned science and technology firms in life sciences, manufacturing, and AI.

“It has the potential to be Europe’s Silicon Valley. The home of British innovation.”

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She will point out there is no direct commuter link between the two sites and a lack of affordable housing in the area.

The chancellor will say the industrial strategy will look to “take advantage” of the area’s “unique strengths and potential”.

Mel Stride, the shadow chancellor, claimed the “biggest barriers to growth” in the UK are Ms Reeves and Sir Keir, and their “job-destroying budget”.

He branded the ideas “hastily cobbled together”, saying they will not help businesses.

UK

Reform took advantage of the PM’s holiday – and it’s clear he’s now changed strategy

Published

2 hours ago

September 2, 2025

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Reform took advantage of the PM's holiday - and it's clear he's now changed strategy

Immigration was the first thing on the government’s agenda to kick off the first week back from recess, and they wanted you to know it.

The home secretary gave an update to the House, announcing a shakeup of family reunion rules for asylum seekers, even before some backbenchers had made it back to parliament from their break.

Facing criticism for being on the back foot after a summer of protest outside asylum hotels, they were keen to defend their record and get back on track – but is it too late?

It’s a clear nod to the political void Reform UK has seized on while the prime minister has been on holiday.

Last week, Nigel Farage unveiled his party’s mass deportation policy – though the issue of women and children still seems to be worked out.

But perhaps none of that matters as voters overwhelmingly believe Reform cares about this issue – and as Chris Philp, the shadow home secretary, pointed out on Monday, voters have lost confidence in the government somewhat to solve what many see as an immigration crisis on their doorstep.

So it’s clear the strategy has changed from the government.

Gone are the bold slogans of “smashing the gangs” and instead, detail and policy was given on Monday. It was nothing new, but more substance on what the government has done and where they want to move to. Even controversially, reassessing their relationship with the European Convention on Human Rights (ECHR).

The biggest update though, was on their one-in-one-out policy agreement with France, which will now set to start returns later this month.

It’s finally hit home for the government that the public want proof not just rhetoric, and they want to know crucially when they will start to see change.

But the fightback, the reset, whatever the government wants to call it, will only make a difference once that finally starts to work.

UK

Police ask for help with unsolved murder more than 50 years ago

Published

2 hours ago

September 2, 2025

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Police ask for help with unsolved murder more than 50 years ago

Police are asking for help with an unsolved case, 52 years after the murder of a schoolboy in Belfast.

Brian McDermott was 10 when he disappeared from Ormeau Park on Sunday 2 September 1973. His remains were recovered from the River Lagan almost a week later.

Detectives from the Police Service of Northern Ireland’s Legacy Investigation Branch have given a timeline of events as part of their appeal.

Brian left his home on Well Street in the lower Woodstock Road area of east Belfast at around 12.30pm and failed to return for his Sunday dinner.

Detectives said he was last seen playing alone in the playground between 1pm and 3pm that afternoon.

His remains were recovered in the water, close to the Belfast Boat Club.

A PSNI spokesperson said: “We are acutely aware of the pain and suffering that Brian’s family continue to feel, and our thoughts very much remain with the family at this time.

“Despite the passage of time, this murder case has never been closed and I am hopeful that someone may be able to provide information, no matter how small, which may open a new line of inquiry, or add a new dimension to information already available.

“It is also possible that someone who did not volunteer information at the time may be willing to speak with police now. Legacy Investigation Branch Detectives will consider all investigative opportunities as part of the review into Brian’s murder.”

UK

Premier League flexes its financial muscle in record-breaking transfer window

Published

2 hours ago

September 2, 2025

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Premier League flexes its financial muscle in record-breaking transfer window

The transfer window was a show of strength in a record-breaking summer across the Premier League.

The totaliser crept over £3bn in spending, with more than half of it flowing among the 20 clubs rather than having a redistributing effect across Europe.

The start of new Premier League TV deals – the biggest individual source of income being from Sky News’ parent company Comcast – provides certainty for the next four years, while rival leagues can struggle to sell rights.

And the feared threat from Saudi Arabia has not materialised. It is an attractive and lucrative destination for some players, but not yet the ultimate destination.

But the kingdom has still influenced this transfer window.

Let’s start with Newcastle, four years into their ownership by the Saudi sovereign wealth fund.

Having secured a return to the Champions League, bringing UEFA riches, this was the summer to grow rather than lose talent to rivals.

But the Premier League’s pecking order became clear when Alexander Isak pushed for a move to Liverpool and rejected bids that did not deter his ambitions.

Player power won out.

The 25-year-old striker was able to withdraw himself from the squad, miss the opening three matches of the season, and put out a statement claiming promises had been broken by the Magpies.

Liverpool ‘loading up on talent’

And so he held on until deadline day, biding his time, sitting it out, and standing firm. Newcastle folded, accepting £125m – £20m lower than their apparent valuation.

Breaking the British record fee was Liverpool’s American ownership flexing financial muscle like never before.

The Premier League champions allowed manager Arne Slot to build from a position of strength.

This was the second time they broke the record in this window after bringing in another forward, Florian Wirtz, in a £116m deal.

More than £400m in reinforcements arrived at Anfield in a matter of weeks.

Former Liverpool managing director Christian Purslow told Sky Sports: “Liverpool are making hay while the sun shines, going for it. Really loading up on talent.

“Other clubs should be fearful and respectful of the way [Fenway Sports Group] are running their club.”

The Isak deal weakened their Champions League rivals from the North East after banking £57m from another club owned by the Public Investment Fund when Darwin Nunez was offloaded to Saudi.

And PIF funded Chelsea’s summer spending spree in less obvious ways.

The Blues did negotiate a £44m package with PIF-backed Al Nassr deal for Joao Felix, recouping the fee paid just a year earlier.

But then there was the £90m prize money collected for winning the new FIFA Club World Cup – a competition bankrolled by PIF subsidiaries.

Where does this leave Newcastle? Still spending around £250m.

Players and Liverpool couldn’t get all their way this summer, with Marc Guehi forced to stay at Crystal Palace after the FA Cup winners failed to secure a replacement for the England centre-back.

The late drama was just the latest of the summer transfer window’s twists and turns.

Both Arsenal and Manchester United also spent more than £200m each. The Gunners spent big in pursuit of a title that’s eluded them since 2004, while the Red Devils are just trying to get back into the Champions League.

It added up to a new record total outlay that comfortably eclipsed the previous Premier League record of £2.46bn from 2023.

The £3bn is more than the rest of Europe combined, showing both where the power is in world football and why the Premier League is the one the world wants to watch.