Finance minister wants to boost economic growth with development zones
London The British Finance Minister Jeremy Hunt wants to boost growth in times of tight budgets with targeted structural aid. In his budget speech, which is expected for midday, the conservative head of department speaks of a “budget for growth”, as can be seen from excerpts from the manuscript. For this purpose, special economic development zones are to be identified in the country.
In addition, Hunt wants to alleviate the shortage of staff in the labor market by creating better framework conditions for childcare. Since Hunt is committed to reducing the mountain of debt of 2.5 trillion pounds (around 2.8 trillion euros), there is not much room for maneuver in budget planning.
The former prime minister’s unfunded tax cut plans Liz Truss and her finance minister, Kwasi Kwarteng, had led to turbulence on the capital markets and a fall in the British pound in the autumn. Truss had to take her hat off after around six weeks at the end of October. Her successor Rishi Sunak has embarked on a course of consolidation.
Against this background, Hunt has already rejected calls from Conservative MPs for large tax cuts. Instead, he wants to focus on patching weaknesses in the economy. The Economy in the EU drop-out country is lagging behind other leading industrialized countries: Great Britain is the only country in the G7 group where the economy has not yet returned to pre-corona levels.
According to the newspaper “Guardian”, Hunt wants to promote the free use of daycare centers in England with billions. UK childcare is one of the most expensive in the world, according to the Organization for Economic Co-operation and Development (OECD). The government will cover the costs to make it easier for parents with small children to participate in the labor market.
Investment zones are designed to stimulate the economy
Another starting point for boosting growth is the establishment of so-called investment zones, with which twelve English areas outside London should each receive 80 million pounds for economic development: This aid, stretched over a period of five years, is intended to give companies tax breaks or else to invest in education and transport routes.
In view of the high cost of living on the island, with an inflation rate of more than ten percent recently, it is also expected that Hunt will extend the fuel tax freeze. Hunt faces a strike by doctors, teachers and other public sector workers Wednesday demanding higher wages in one of the largest coordinated strikes in decades.