Rachel Reeves will on Monday detail the results of an audit of the country’s finances, setting out plans to start filling a £20bn black hole she says her party has discovered since arriving in government. The chancellor will insist the true state of Labour’s economic inheritance was “covered up” by her predecessors, necessitating unexpectedly difficult decisions now.
Reeves is expected to announce delays to certain infrastructure projects, as well as measures to cut spending elsewhere in Whitehall. Labour insiders insist infrastructure remains a huge priority for the government, but it will face criticism that Britain’s long-term economic growth outcomes were dependent on such schemes.
The Guardian understands Reeves’s Commons statement will not mark the end of the review process on the government’s hunt for cuts but will set out the first projects to be axed or curtailed.
The A27 Arundel bypass
Before the general election, Labour had committed to fund the fixing of an extra 1m potholes across England each year. They said this would be paid for by deferring the A27 Arundel bypass in West Sussex. It was hoped the scheme would increase capacity on the road and reduce congestion, but Labour described it as “poor value for money”.
The last government pushed the project back to at least 2025, citing environmental issues. Campaign groups including the Sussex Wildlife Trust had opposed its construction, saying it would cause irreversible environmental damage and raise damaging carbon emissions. It is understood the project could now be delayed indefinitely.
Plans to restore 45 railway lines
In the 2019 Tory manifesto, Boris Johnson vowed to restore railway lines and stations that had been shut down as part of the infamous Beeching cuts in the mid-1960s. The following year, he earmarked £500m for the project, called the Restoring Your Railway programme, which was expected to reopen 44 rail lines that had successful bids. Only one line has been reinstated since 2020; the Dartmoor line between Exeter and Okehampton, which reopened in November 2021.
A government update in 2022 said 23 schemes were being funded and 13 were being developed further – these could now be scaled back. Several other lines, including the Dartmoor line, the Camp Hill line between Birmingham New Street and Kings Norton, and the Northumberland line, are under construction and have either been opened or are due to be opened this year and next.
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The Stonehenge tunnel
The chancellor is expected to scrap plans to spend £1.7bn on a tunnel alongside Stonehenge and eight miles of dual carriageway past the monument, on a stretch of the road from Amesbury to Berwick Down in Wiltshire.
National Highways has previously said its plan for the tunnel would remove the sight and sound of traffic passing the 5,000-year-old site and cut journey times.
The road project has proved highly controversial and is tied up in legal action, as campaigners including Save Stonehenge World Heritage Site attempt to stop it going ahead. They argue that the tunnel would permanently disfigure a unique and globally important landscape.
Unesco officials have recommended adding the stone circle and the area around it to the world heritage danger list because of concerns that the tunnel would “compromise the integrity” of one of the Earth’s great prehistoric sites.
The Tories’ 40 new hospitals programme
Last week the health secretary, Wes Streeting, said it was “painfully clear” that the Conservatives’ flagship £20bn new hospital programme, launched by Johnson, would not be deliverable by 2030.
The project was initially to deliver 40 new hospitals – to replace old buildings, in one case dating back to the 1840s – by the end of the decade. But last year the National Audit Office produced a damning report, finding that of the 32 projects announced in 2020 just 11 qualified as “whole new hospitals” and the scheme was failing to deliver value for money. Ministers were forced to admit the project would not be delivered until after 2030.
Streeting said: “I want to see the new hospital programme completed but I am not prepared to offer people false hope about how soon they will benefit from the facilities they deserve.”
It is understood the scheme will be paused in Monday’s statement.
