British finance minister Rachel Reeves said today that the UK government supported the construction of a long-delayed new runway at London's Heathrow Airport as she sought to show she could deliver on her promises of speeding up economic growth.
Reeves, who is under pressure to address investors' concerns about Britain's economy after a bond market selloff this month, listed plans for new wind farms and reservoirs and a "growth corridor" between the university cities of Oxford and Cambridge.
Announcing the government's backing for a third runway at Heathrow, Europe's busiest airport, Reeves said past delays cast doubt over the seriousness of Britain's attractiveness to investors and stood in the way of opening new export markets.
"We cannot duck the decision any longer," Reeves said in a speech at a Siemens Healthineers manufacturing plant near Oxford.
Reeves said the UK government would remove barriers to delivering 16 gigawatts of offshore wind as well as investments by a state fund of £65m in an electric car vehicle charging network and £28m in a mining operation in the south west of England.
She also said Britain would seek to reset its trade ties with the European Union which have been strained by Brexit and build on its relationship with the US under new President Donald Trump.
Britain's business minister will soon visit India to restart talks on a trade deal, Reeves added.
Reeves and Prime Minister Keir Starmer promised voters before last July's election that they would turn Britain into the fastest-growing Group of Seven (G7) economy.
But since their Labour Party took power, the economy has lost momentum, with many employers blaming Reeves' first budget plan which included a big increase in the tax burden on businesses.
A surge in global government borrowing costs earlier this month ahead of Trump's inauguration as US President - which hit the UK particularly hard - only increased the pressure on Reeves to get the economy moving again.
We need your consent to load this rte-player contentWe use rte-player to manage extra content that can set cookies on your device and collect data about your activity. Please review their details and accept them to load the content.Manage Preferences
Reeves used her speech today to say that home-building and new transport links between Oxford and Cambridge would help to create "Europe's Silicon Valley".
She pointed to nearly £8 billion of investment over five years by water companies, including the building of nine reservoirs as an example of faster investment in Britain.
"Low growth is not our destiny. But growth will not come without a fight," she said.
Starmer and his top officials have previously said they will not allow opponents of infrastructure and big construction projects to use the planning system to block development.
Upbeat tone
Switching to a more upbeat tone after being criticised last year for focusing too much on the problems inherited by Labour, Reeves said Britain's strengths - with its history, language and legal system - mean it can compete in the global economy.
"For too long, we have accepted low expectations, accepted stagnation and accepted the risk of decline. We can do so much better," she said.
The Bank of England has forecast that Britain's economy did not grow at all in the second half of 2024. The bank said in November it expected growth of 1.5% in 2025, largely due to higher government spending.
Morgan Stanley, Goldman Sachs and JP Morgan have more recently forecast growth of under 1% this year, although the International Monetary Fund has said Britain will outpace its even more sluggish European peers.
Starmer and Reeves yesterday unveiled plans to allow corporate pension surpluses that are worth around £160 billion to be released and reinvested. Last week, the UK government announced a new approach to promote regional economic growth.
