CBI warns spending review must not target Crossrail

The CBI is calling on government to guarantee that Crossrail and work upgrading London’s Underground continues after next month’s Spending Review.

In a submission to the Treasury today, the business group said that as government limits spending it should prioritise areas that foster the economies ability to grow and and has outlined a number of proposals.

The government has said that it will make £32bn of annual spending cuts by 2014/15. However, while the CBI agrees that spending must be limited to avoid major tax rises that would damage the UK economy and undermine competitiveness, it says protect funding in areas that foster economic growth must be protected.

It adds that the government must prioritse investment in infrastructure as well as research and development and education and training. Inparticualr it highlights the importance of investing in transport infrastructure as this offers high returns and will play a crucial role in boosting domestic and international trade.

This includes Crossrail and upgrades to London’s Underground as well as maintaining existing transport infrastructure and returning public sector capital investment to 2.25% of GDP.

The CBI says savings can be made by subjecting all public sector transport projects to rigorous value for money assessments and by attracting more private sector funding and by reducing concessionary fares and the number of Highways Agency contracts.

John Cridland, CBI deputy director general, said: “Cutting spending means tough choices. We think that the need for economic growth, not the noise of the loudest voice, should determine where cuts are made. The Government must improve the efficiency of public services and focus the limited public money available on areas that do most to galvanise growth.”