The Chancellor, Philip Hammond, is expected to pledge £400m of public funds to extend the UK’s “full-fibre” broadband network in the Autumn Statement on Wednesday.
This will form part a new Digital Infrastructure Fund for the telecoms industry, with the public money to be matched by private investment.
The Treasury believes the funding will help at least two million more homes and business get full-fibre broadband, regarded as the future of high speed telecoms.
Also in the Autumn Statement Mr Hammond Government is also expected to confirm £1.3bn of additional capital spending to upgrade Britain’s road network.
This will be made up of £1.1bn on local schemes and £220m on easing the pressure on “pinch points”.
There is expected to be £27m to fund an expressway between Oxford and Cambridge via Milton Keynes.
In her speech to the CBI on Tuesday Theresa May announced an extra £2bn for UK Research and Development funding by the end of the Parliament, which she said would “help put post-Brexit Britain at the cutting edge of science and tech”.
But the overall economic and fiscal backdrop to the Autumn Statement is expected to be bleak.
Analysts expect the Office for Budget Responsibility to downgrade the UK’s growth forecast for 2017 to around 1.2-1.4 per cent and to increase its borrowing forecast over the next five years by as much as £100bn relative to the March Budget due to a slowdown in the economy.
Soon after taking office Theresa May abandoned George Osborne’s pledge to run an absolute budget surplus by 2019-20.
But the Chancellor is not expected to roll back his predecessor’s £12bn squeeze on the working age benefit bill by 2020, despite Ms May’s pledge to help the “just about managing” classes, or “JAMs”.
And the expected increase in inflation over the next two years, due to the sharp depreciation of the pound since the Brexit vote, threatens to make the planned freeze on tax credits even more painful for millions of working families.
Some analysts expect inflation to hit 4 per cent next year, up from 0.9 per cent today.
Yet there are expected to be some measures from the Chancellor to help the JAMs possibly including a cancellation of a planned 2p per litre increase on fuel duty next April, more help with childcare costs, or a reduction in air passenger duty.
What experts have said about Brexit
What experts have said about Brexit
1/11 Chancellor of the Exchequer Philip Hammond
The Chancellor claims London can still be a world financial hub despite Brexit “One of Britain’s great strengths is the ability to offer and aggregate all of the services the global financial services industry needs” “This has not changed as a result of the EU referendum and I will do everything I can to ensure the City of London retains its position as the world’s leading international financial centre.”
2/11 Yanis Varoufakis
Greece's former finance minister compared the UK relations with the EU bloc with a well-known song by the Eagles: “You can check out any time you like, as the Hotel California song says, but you can't really leave. The proof is Theresa May has not even dared to trigger Article 50. It's like Harrison Ford going into Indiana Jones' castle and the path behind him fragmenting. You can get in, but getting out is not at all clear”
3/11 Michael O’Leary
Ryanair boss says UK will be ‘screwed’ by EU in Brexit trade deals: “I have no faith in the politicians in London going on about how ‘the world will want to trade with us’. The world will want to screw you – that's what happens in trade talks,” he said. “They have no interest in giving the UK a deal on trade”
4/11 Tim Martin
JD Wetherspoon's chairman has said claims that the UK would see serious economic consequences from a Brexit vote were "lurid" and wrong: “We were told it would be Armageddon from the OECD, from the IMF, David Cameron, the chancellor and President Obama who were predicting locusts in the fields and tidal waves in the North Sea"
5/11 Mark Carney
Governor of Bank of England is 'serene' about Bank of England's Brexit stance: “I am absolutely serene about the … judgments made both by the MPC and the FPC”
6/11 Christine Lagarde
IMF chief urges quick Brexit to reduce economic uncertainty: “We want to see clarity sooner rather than later because we think that a lack of clarity feeds uncertainty, which itself undermines investment appetites and decision making”
7/11 Inga Beale
Lloyd’s chief executive says Brexit is a major issue: "Clearly the UK's referendum on its EU membership is a major issue for us to deal with and we are now focusing our attention on having in place the plans that will ensure Lloyd's continues trading across Europe”
8/11 Colm Kelleher
President of US bank Morgan Stanley says City of London ‘will suffer’ as result of the EU referendum: “I do believe, and I said prior to the referendum, that the City of London will suffer as result of Brexit. The issue is how much”
9/11 Richard Branson
Virgin founder believes we've lost a THIRD of our value because of Brexit and cancelled a deal worth 3,000 jobs: We're not any worse than anybody else, but I suspect we've lost a third of our value which is dreadful for people in the workplace.' He continued: "We were about to do a very big deal, we cancelled that deal, that would have involved 3,000 jobs, and that’s happening all over the country"
10/11 Barack Obama
US President believes Britain was wrong to vote to leave the EU: "It is absolutely true that I believed pre-Brexit vote and continue to believe post-Brexit vote that the world benefited enormously from the United Kingdom's participation in the EU. We are fully supportive of a process that is as little disruptive as possible so that people around the world can continue to benefit from economic growth"
11/11 Kristin Forbes
American economist and an external member of the Monetary Policy Committee of the Bank of England argues that the economy had been “less stormy than many expected” following the shock referendum result: “For now…the economy is experiencing some chop, but no tsunami. The adverse winds could quickly pick up – and merit a stronger policy response. But recently they have shifted to a more favourable direction”
On broadband infrastructure, BT has been heavily criticised by rivals such as Sky and Virgin for underinvesting in the country’s fibre network in recent years.
The network is owned and maintained by BT but all private broadband providers have to use it.
Only 2 per cent of the country’s premises have full-fibre connections and critics say BT has been more interested in maximising the financial returns of its older copper network.
In July Ofcom announced it would force BT to establish its Openreach arm – which maintains the UK’s broadband infrastructure – as a legally separate company within the group in order to improve performance on broadband investment.Reuse content