Cam sets out £5bn Whitehall raid
David Cameron has said the Government will use tomorrow's Autumn statement to clamp down on "unnecessary spending" so it can channel the cash elsewhere.
It emerged today that Whitehall departments will be raided in order to fund £5bn of capital spending on transport, skills, schools and science.
The Chancellor is set to announce that government departments, excluding Health, Education, and DfID, will see their resource budgets reduced by an additional 1% next year, and 2% in 2014-15.
The Prime Minister said: "Government departments aren’t actually spending up their budgets so I think we can say to them ‘you know, you’ve got to cut back some spending, including some unnecessary spending’.
"And let’s put that back into things that will make a difference in our country and in our economy – more roads, more school buildings, more infrastructure to make our economy work better."
A Treasury spokesperson said: “We are committed to resolving today’s problems, but also prospering for tomorrow’s challenges by investing in our future and equipping Britain for the global race.”
The Treasury estimates that the plan could raise around £5bn for capital spending, including spending £1bn on 100 new free schools and academies.
Mr Osborne will also launch a revamped Private Finance Initiative aimed at boosting investment in a range of projects.
The Chancellor will announce a programme called PF2, to replace the original scheme. The new scheme will offer taxpayers much better value for money, Mr Osborne will say.
John Longworth, the director general of the British Chambers of Commerce, welcomed the plan, saying the UK economy needs "massive infrastructure investment".
"If PF2 is the Chancellor’s answer to de-risking private investment in infrastructure development that will be a good thing," he said.
"We have called for new ways of financing infrastructure because we believe massive infrastructure investment is so important to the UK and also for business confidence."