British Government Updates
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A tunnel between Scotland and Northern Ireland and a scheme to support unemployed people to start their own businesses have fallen victim to a repression while the Treasury is struggling with self-imposed public spending.
Boris Johnson’s plan to build ‘the world’s dumbest tunnel’ connecting Scotland and Northern Ireland, costing an estimated £ 15 billion, is described as ‘dead’ by government officials informed about spending negotiations ahead of Rishi Sunak ‘s budget next month.
The chancellor gave cabinet colleagues until Monday night to finalize their public spending offers and warned them that he ‘wants to put public finances on a sustainable path in the medium term’.
The other early victim of the Treasury collapse is the New Enterprise Allowance, a program that was started to great fanfare by David Cameron a decade ago. Since its inception in 2011, it has allocated more than £ 1,000 each to around 250,000 people.
However, Therese Coffey, secretary of labor and pensions, recommended that it be scrapped as part of her submission to the treasury, officials said.
One minister said the decision was part of an effort to focus resources on the most efficient schemes. But the timing of the plan will raise questions as the government prepares to end its Covid-19 expiration scheme.
Sunak’s spending review will determine the landscape of the public sector until the next election, with schools, courts, local councils and transport urgently asking for more cash after the Covid crisis.
The chancellor raised taxes by £ 12 billion last week to fund extra spending on health and social care. This could mean more cash for other departments that feared the NHS would “swallow” scarce resources.
But Sunak said last week that there would be no extra money available for other departments over the total expenditure filled in during the March budget.
He argued that departmental spending would rise at an annual rate of 4 percent more than inflation, “the biggest real terms of overall departmental spending for any parliament this century”, Sunak wrote to his fellow ministers.
The only problem in reviewing the issues was that departments could persuade the Treasury to stand up for specific Covid-19 issues. Sunak warned that this will only be considered in exceptional cases, where reform and efficiency are not sufficient to fund essential activities.
The spending review will provide a hammer blow to Johnson’s plan to build a 21-mile bridge or tunnel from Scotland to Northern Ireland. One government official said: “It’s dead – for now ‘.
Johnson saw the tunnel as a way to connect the constituent parts of the United Kingdom and was particularly keen to connect Northern Ireland with Great Britain following the upheavals caused by his Brexit policy.
One official said the idea is ‘ahead of its time’ and that a tunnel could become viable in the future of driverless cars. Current technology requires a ‘very long’ rail tunnel, which requires a shallow slope.
However, Dominic Cummings, Johnson’s former chief adviser, said in July: “The prime minister’s only agenda is to buy more trains, buy more buses, have more bicycles and build the world’s dumbest tunnel to Ireland.”
Johnson ordered a review of the “union link” by Sir Peter Hendy, chairman of Network Rail, which will report on priority schemes before the end of the October 27 budget review review.
Hendy commissioned a feasibility study on the possible link between Northern Ireland; a bridge would have to cross the stormy North Channel, while a tunnel would have to pass through a warhead in Beaufort’s Dyke.
A government spokesman did not want to say whether the link between Northern Ireland would survive the spending review, but that ‘improving connectivity in the UK and improving transport infrastructure is at the heart of our’ enlarged ‘agenda’.
Meanwhile, Steffan Ball, chief economist at the UK at Goldman Sachs and a former adviser to Philip Hammond when the chancellor said the fiscal forecasts could offer more space this October, and that could make the chancellor more generous with the treasury – expenses.
Ball said he expects Johnson and the chancellor to ‘benefit from this space’ as they have both the political incentive and the parliamentary support to make significant progress on the ‘comparison’ agenda ‘.