Weekly Policy Update – 20 to 26 March 2025
Stay informed with the latest policy developments from the London Chamber of Commerce and Industry. Here’s a brief summary of the key highlights:
Spring Statement 2025:
Chancellor Rachel Reeves emphasized the Government’s commitment to securing Britain’s future despite global uncertainties. The Spring Statement outlined a restored budget surplus and improved fiscal forecasts, with net financial debt projected to decline over the coming years.
- Increased Capital Spending & Economic Stability:
Capital spending is set to rise by an average of £2 billion annually compared to the autumn Budget. With recent interest rate cuts and falling inflation, the government aims to establish a stable platform to support economic growth. - Planning, Growth, and Housing:
Reforms in the Planning and Infrastructure Bill are expected to add £15.1 billion to the British economy over the next decade. The Chancellor reaffirmed the commitment to building 1.5 million new homes in England, with enhanced growth forecasts for the coming years. - Protecting Working People & Efficiency Savings:
The Government plans to generate an extra £1 billion by tackling tax avoidance and improving welfare reforms, alongside efficiency savings driven by AI investments and voluntary redundancy schemes. - Defence Investment:
Defence spending is set to rise, with a new £2.2 billion allocation aimed at boosting the UK’s defence industry, innovation, and supporting military families. - Reducing Spending Costs:
The Chancellor has pledged to cut Government running costs by 15% by the end of the decade, targeting back-office roles to save over £2 billion annually without increasing taxes. - Financial Sector Updates:
The Bank of England has launched its 2025 Capital Stress Test for major banks under a scenario of global economic shocks. Additionally, the FCA is streamlining regulations by cutting over 100 pages of red tape. - Infrastructure & Employment:
The Government has approved development consent for the Lower Thames Crossing, marking the first new Thames crossing in over 60 years. Meanwhile, the latest ONS data shows a stable employment rate of around 75% across the UK. - Bridging the Digital Divide in Education:
The Department for Education has initiated a consultation on narrowing the digital divide in schools, backed by a £45 million investment to upgrade technology infrastructure.
Sources: London Chamber of Commerce and Industry Weekly Policy Update 27MAR25