Chancellor Sajid Javid to pledge extra £2bn for key Brexit projects

The chancellor is set to announce an additional £2bn of Brexit funding for government departments when he sets out public spending and investment plans later.

Sajid Javid will use the 12-month spending round to confirm that £2bn pledged for 2019/20 will continue into 2020/21 – to be spent on projects linked to Brexit delivery after the UK leaves the EU.

It will include funding for the Home Office to support Border Force capability and money for the Department for Business, Energy and Industrial Strategy to explore developing the UK’s own global navigation satellite system.

The announcement brings the total spent on planning for and delivering Brexit since the 2016 referendum to more than £8.3bn.

Mr Javid said: “This new funding will ensure that departments can grasp the opportunities created by Brexit after we leave on 31 October.”

Shadow chancellor John McDonnell urged Mr Javid to rule out tax cuts ahead of the spending round.

He said: “I am staggered that the bankers are lobbying Javid for tax cuts and deregulation.

“Obviously with Johnson as Prime Minister, they know they have a friend willing to line their pockets.

“I am calling on Sajid Javid to send them packing and to prevent them getting their noses in the trough.”

The spending round will cover day-to-day department budgets for 2020/21, rather than a three-year period first mooted by the previous government, as the UK prepares to leave the EU on October 31.

It comes just hours after Boris Johnson announced he will attempt to trigger a general election after MPs – including 21 rebels from within his own party – inflicted a stinging defeat on him.

Members trying to avoid a no-deal Brexit next month won a dramatic vote to seize control of the parliamentary agenda, paving the way for a delay in leaving the EU.

A full spending review is scheduled to take place in 2020.

Analysing the review, Sky News economics editor Ed Conway writes:

At any other point in history a spending review of the kind Sajid Javid is due to unveil today would count as a major moment.

This, after all, is the moment the government formally ends austerity, showering its departments with the cash they have been deprived of for so many years. It is the moment the longest period of spending restraint in the post-war period came to an end.

And it is the first big opportunity for this new government to lay out its economic priorities since coming into office.

But, as we all know, the spending review is likely to be overshadowed by the drama playing out in Parliament, and by the bigger question facing the UK economy: what is happening in Brexit?

And because no-one knows the answer to that question, the default plan – to lay out government spending for three years – has been replaced with a less ambitious aim: to establish spending totals for one year: 2020/21.

So for all the sound and fury from the Chancellor today, the reality is that the Spending Review will not be a major vision statement, but a short term effort to keep government going.

And for many who have waited for this day – the end of austerity – for some time, that will come as a disappointment.

Back before 2010 spending reviews were all about laying out policies to get government working better.

They were about setting targets for departments to improve schools or overhaul the prisons system. But in 2010 that changed: under George Osborne spending reviews were simply about cutting spending.

So this was supposed to be a return to those old days when spending reviews were all about how best money could be spent.

But instead, with a possible election looming and with big question marks over how long this government will be in place, the event will probably look instead a bit more like a mini-manifesto.

All the same, it is worth dwelling on how much things have changed in only a few months. Not long ago, for all her pledges to bring the period of austerity to an end, the Treasury remained committed to reducing the deficit and only targeted increases in spending.

Now the government looks likely to push through the biggest spending increases since the Gordon Brown era, without much in the way of new checks on whether that cash is being spent successfully.

(c) Sky News 2019: Chancellor Sajid Javid to pledge extra £2bn for key Brexit projects