LONDON?The U.K. government said Sunday that it plans to spend £ 1.3 billion ($1.6 billion) on improving Britain's roads as part of a wider multibillion-pound infrastructure-investment program, which will be unveiled by Treasury chief Philip Hammond in the week ahead.
The Autumn Statement on Wednesday will be the government's?and Mr. Hammond's?first major fiscal-policy announcement and economic update since Britons voted in a referendum in June to withdraw from the European Union, a move that many predicted would damage Britain's economy.
The Treasury said Mr. Hammond, who became Chancellor of the Exchequer following the EU plebiscite, will set out a new fiscal framework on Wednesday which would give the government the flexibility to respond to changing economic conditions and the need to invest in the productive capacity of the economy.
The new investment in Britain's roads is part of an effort to prioritize government spending that can have an immediate economic impact, the Treasury said in a statement. The money will be targeted at small projects that will relieve congestion and upgrade the existing road network. Congestion is estimated to cost U.K. households more than £ 13 billion every year, it said.
Mr. Hammond warned last month that the British economy could face some turbulence as the country charts its exit from the EU and has already abandoned his predecessor's target of achieving a budget surplus in the current parliament. He has said the government will continue to shrink the size of the U.K.'s budget deficit while also investing in infrastructure to boost productivity and long-term economic growth.
Concerns about the impact of leaving the EU have weakened the pound and raised fears that companies will stop investing or could shift their operations to continental Europe if Britain doesn't strike a favorable deal on its future ties to the bloc.
The latest official data show the U.K. economy grew a stronger-than-expected 0.5% in the third quarter compared with the second, an annualized rate of 2%, but economists caution that a slowdown may lie ahead because of the country's planned exit from the EU.
Write to Nicholas Winning at firstname.lastname@example.org
(END) Dow Jones Newswires
November 20, 2016 20:35 ET (01:35 GMT)
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