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| Version 1 | Version 2 |
|---|---|
| Government axes £2bn of projects | Government axes £2bn of projects |
| (30 minutes later) | |
| Danny Alexander is in charge of spending cuts | Danny Alexander is in charge of spending cuts |
| The coalition government has cancelled 12 projects totalling £2bn agreed to by the previous Labour government since the start of 2010. | The coalition government has cancelled 12 projects totalling £2bn agreed to by the previous Labour government since the start of 2010. |
| These include an £80m loan to Sheffield Forgemasters and new programmes for the young unemployed, Chief Secretary to the Treasury Danny Alexander told MPs. | These include an £80m loan to Sheffield Forgemasters and new programmes for the young unemployed, Chief Secretary to the Treasury Danny Alexander told MPs. |
| Mr Alexander said the last government committed to "spend money it simply did not have". | Mr Alexander said the last government committed to "spend money it simply did not have". |
| But Labour minister Liam Byrne said his statement was an "abject humiliation". | But Labour minister Liam Byrne said his statement was an "abject humiliation". |
| Mr Alexander said Mr Byrne, his predecessor as chief secretary, had gone on a "pre-election spending spree in the full knowledge that the government had long since run out of money". | Mr Alexander said Mr Byrne, his predecessor as chief secretary, had gone on a "pre-election spending spree in the full knowledge that the government had long since run out of money". |
| He said projects have been cancelled where they were not affordable, did not represent good value for money, or where they did not reflect the new government's priorities. | He said projects have been cancelled where they were not affordable, did not represent good value for money, or where they did not reflect the new government's priorities. |
| 'No money' | |
| He told MPs: "We are determined to tackle the unprecedented budget deficit and bad financial management we have seen over the past decade, but are equally determined to do this in a way that is fair and responsible. | He told MPs: "We are determined to tackle the unprecedented budget deficit and bad financial management we have seen over the past decade, but are equally determined to do this in a way that is fair and responsible. |
| "As a result of the poor decisions made by the previous government, I have taken the decision to cancel certain projects that do not represent good value for money, and suspend others pending full consideration in the spending review. | |
| "We have also found another spending black-hole in the previous government's plans - projects had been approved with no money in place to pay for them. | "We have also found another spending black-hole in the previous government's plans - projects had been approved with no money in place to pay for them. |
| "I am determined to deal with this problem head-on and ensure we never see this kind of irresponsible financial planning in government again" | "I am determined to deal with this problem head-on and ensure we never see this kind of irresponsible financial planning in government again" |
| In an angry response, Mr Byrne said Mr Alexander's statement "smashed the coalition's claim that Labour spent unwisely". | |
| "In five minutes, he has reversed three years of Liberal Democrat policy of which he was the principal architect. What an abject humiliation," he told MPs. | "In five minutes, he has reversed three years of Liberal Democrat policy of which he was the principal architect. What an abject humiliation," he told MPs. |
| 'Crucial military equipment' | |
| Mr Alexander said a further 12 projects with a value of £8.5bn approved since January would be suspended or referred for consideration by the spending review process over the coming months. | Mr Alexander said a further 12 projects with a value of £8.5bn approved since January would be suspended or referred for consideration by the spending review process over the coming months. |
| They included the health research support service, the Kent Thameside strategic transport programme and the libraries' modernisation programme. | They included the health research support service, the Kent Thameside strategic transport programme and the libraries' modernisation programme. |
| "Any other new major hospital schemes will be assessed in the context of the spending review to ensure they are affordable and represent the highest possible value for money," said Mr Alexander. | "Any other new major hospital schemes will be assessed in the context of the spending review to ensure they are affordable and represent the highest possible value for money," said Mr Alexander. |
| He said the government had acted to confirm approval of a number of projects including funding for essential medicines in case of a flu pandemic, some hospital projects, support for post offices and spending on "crucial military equipment" in Afghanistan. | |
| Sheffield Forgemasters was told in March it would receive the loan to build a world-leading 15,000 tonne press to supply specialist components for the nuclear industry. | Sheffield Forgemasters was told in March it would receive the loan to build a world-leading 15,000 tonne press to supply specialist components for the nuclear industry. |
| The loan aimed to create up to 180 jobs in the city and help the firm to bid for contracts on the next generation of nuclear power stations. | The loan aimed to create up to 180 jobs in the city and help the firm to bid for contracts on the next generation of nuclear power stations. |
| The announcement that the £80m loan would be axed was met by cries of "shame" from Labour MPs. | The announcement that the £80m loan would be axed was met by cries of "shame" from Labour MPs. |
| Forgemasters Chief Executive Graham Honeyman said it was "a huge disappointment to all at the company," but it would now focus on other elements in its development. | |
| 'Over-committed' | |
| Deputy Prime Minister Nick Clegg, a Sheffield MP, said in a statement that he regretted the government "cannot afford to support its expansion" but added "the truth is that this loan was promised by the outgoing Labour government as a calculated ploy to win support in Sheffield just ahead of the election". | |
| A string of North-East Labour MPs attacked Mr Alexander in the Commons over the decision to cancel a project at North Tees hospital, accusing the Tories and Lib Dems of tearing up their manifesto commitment to protect front line health spending. | |
| Mr Alexander told them he understood the decision would be "very disappointing to those who have worked on the project" but it had not met value for money criteria. | |
| He was also attacked for scrapping the Future Jobs Fund and the planned extension to a scheme guaranteeing work or training for the young unemployed. He said it would be replaced by a more effective scheme next year. | |
| Mr Alexander said the government had also inherited a large number of school building projects approved in recent months as part of the Building Schools for the Future (BSF) programme where spending has been "over-committed" and may have to be cut back. An announcement from the schools secretary is expected shortly. | |
| The chief secretary also announced an urgent review of inherited spending commitments for 2010-11, where funding was reliant on underspending. | |
| The Treasury said it was "unrealistic to expect underspending would have occurred on a scale necessary to fund all these commitments". As a result, at least £1bn of spending commitments will have to be cancelled. | |
| The full list of projects cancelled: | The full list of projects cancelled: |
| Stonehenge Visitor Centre: £25m | Stonehenge Visitor Centre: £25m |
| Local Authority Leader Boards: £16m | Local Authority Leader Boards: £16m |
| Sheffield Forgemasters International Limited: £80m | Sheffield Forgemasters International Limited: £80m |
| Rollout of the Future Jobs Fund: £290m | Rollout of the Future Jobs Fund: £290m |
| Six month offer recruitment subsidies: £30m | Six month offer recruitment subsidies: £30m |
| Extension of Young Person's Guarantee to 2011/12: £450m | Extension of Young Person's Guarantee to 2011/12: £450m |
| Two year Jobseeker's Guarantee: £515m | Two year Jobseeker's Guarantee: £515m |
| Active Challenge Routes - Walk England: £2m | Active Challenge Routes - Walk England: £2m |
| County Sports Partnerships : £6m | County Sports Partnerships : £6m |
| North Tees and Hartlepool hospital: £450m | North Tees and Hartlepool hospital: £450m |
| Local Authority Business Growth Initiative: £50m | Local Authority Business Growth Initiative: £50m |
| Outukumpu: £13m | Outukumpu: £13m |
| List of projects suspended: | List of projects suspended: |
| Libraries Modernisation Programme: £12m | Libraries Modernisation Programme: £12m |
| Sheffield Retail Quarter: £12m | Sheffield Retail Quarter: £12m |
| Kent Thameside Strategic Transport Programme: £23m | Kent Thameside Strategic Transport Programme: £23m |
| University Enterprise Capital Fund: £25m | University Enterprise Capital Fund: £25m |
| Newton Scholarships: £25m | Newton Scholarships: £25m |
| Health Research Support Initiative: £73m | Health Research Support Initiative: £73m |
| Leeds Holt Park Well-being Centre: £50m | Leeds Holt Park Well-being Centre: £50m |
| Birmingham Magistrates Court: £94m | Birmingham Magistrates Court: £94m |
| Successor Deterrent Extension to Concept Phase Long Lead Items: £66m | Successor Deterrent Extension to Concept Phase Long Lead Items: £66m |
| Search and Rescue Helicopters: £4.6bn (Successor Deterrent Extension to Concept Phase Long Lead Items will be reviewed as part of the broader Trident value for money review, which will report in the coming weeks. Search and Rescue Helicopters will be reviewed as a matter of urgency) | Search and Rescue Helicopters: £4.6bn (Successor Deterrent Extension to Concept Phase Long Lead Items will be reviewed as part of the broader Trident value for money review, which will report in the coming weeks. Search and Rescue Helicopters will be reviewed as a matter of urgency) |
| A14 Road: £1.1bn | A14 Road: £1.1bn |
| Are you involved with one of the projects concerned? What are your views on the cuts? You can send us your comments using the form below: | Are you involved with one of the projects concerned? What are your views on the cuts? You can send us your comments using the form below: |