Chancellor to say UK economy 'turning a corner' despite debt concerns

Image source, Getty ImagesByFaisal Islam, Economics editor and Ella KiplingPublished4 hours agoThe chancellor is set to give an upbeat view of the state of the UK economy ahead of next month's Budget, building on a recent uptick in consumer and business confidence.

In a speech on Monday, John Healey will talk of a "new story" of the economy not just turning a corner, but being resilient, optimistic and "ready to seize the opportunities of new technologies and ideas".

Healey is facing pressures ahead of his first Budget, including concerns about government borrowing costs and inflationary impacts of the Iran war.

The Conservatives said Healey's plans would "do little to comfort hard-working families and businesses".

The £150m fund is part of a wider plan to generate more economic growth around the UK.

Healey will detail plans to use public investment to "unlock private investment, to support our innovation economy, and to create the new jobs their areas need".

The fund, from money already allocated to the British Business Bank, will provide investments of between £5m and £15m to the "most innovative and fast-growing firms".

It is expected to back university spin-outs and other "ambitious businesses" across the north.

Describing a country "turning the corner", the chancellor is expected to say: "The prime minister laid out a clear diagnosis of what has gone wrong in the past. The solution is a fundamental shift that starts with putting power in the right places.

Recent ructions in government debt markets have made constrained public finances worse, with the Treasury needing to fill possible multi-billion pound gaps caused by rising borrowing costs, and the need to fund higher defence spending.

As he prepares to deliver his Budget on 28 October, the chancellor says he is as committed to balancing the books as his predecessor.

But the tone matters, and to get high saving consumers spending, and cautious businesses investing, Downing Street wants to point to sunnier times ahead for now, more than the prospect of tough Budgetary medicine.