Tech hubs clustered around universities in England will benefit from almost £1bn in extra funding as part of a range of measures in the budget on Wednesday to boost business investment in the regions.
The chancellor will make the pledge to create 12 investment zones in eight areas “to drive business investment and level up” the country, each backed with £80m of government funding.
Jeremy Hunt will say that the zones will form the cornerstone of his efforts to “supercharge growth” to accelerate research and development in the “most budding industries”.
Eight existing and proposed combined authority areas across England have been shortlisted to host the zones, with the intention to agree plans with the combined authority mayors, individual local authorities and business groups by the end of the year.
Last September the former chancellor Kwasi Kwarteng said he wanted a national network of investment zones to be the springboard for business investment in the regions.
When he took over last October, Hunt said he would implement the policy “in a way that learns the lessons of when similar models have been tried in the past and we will make sure they are successful”.
The precise rules governing investment zones have not yet been confirmed but Hunt has set aside the funds to cover five years rather than the 10 years most developers hoped for.
The Institute for Government said a reduction in national insurance contributions for employers, a cut in business rates and more generous capital allowances on the purchase of new machinery and equipment are also likely to be part of the package of incentives.
Looser planning rules inside the zones are expected to mean it will be easier to build commercial buildings and houses on the land, putting the government on a collision course with environmental charities that have argued the zones will damage the natural biodiversity in the areas affected.
Wildlife charities including the Woodland Trust have said the loosening of regulations could put nature in peril, as many could be in green belt land on the edge of cities that currently protect fragile ecosystems from development.
Hunt said he wanted to support research institutions clustered around universities covering the life sciences, advanced manufacturing, creative industries, the tech sector and the development of green jobs.
He said: “True levelling up must be about local wealth creation and local decision-making to unblock obstacles to regeneration.
“From unleashing opportunity through new investment zones, to a new approach to accelerating R&D in city regions, we are delivering on our key priority to supercharge growth across the country.”
The zones will be located in the proposed East Midlands Mayoral Combined County Authority, Greater Manchester Mayoral Combined Authority, Liverpool City Region Mayoral Combined Authority, the proposed North East Mayoral Combined Authority, South Yorkshire Mayoral Combined Authority, Tees Valley Mayoral Combined Authority, West Midlands Mayoral Combined Authority, and the West Yorkshire Mayoral Combined Authority.
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Tech hubs near England’s universities to benefit from almost £1bn in extra funding
