BIRMINGHAM, England (Reuters) - The British government must keep a lid on day-to-day spending but there is a case for targeted, high-value infrastructure investment following June’s vote to leave the European Union, finance minister Philip Hammond said on Monday.
Hammond is due to tell the ruling Conservative Party’s annual conference in Birmingham later that while budgetary discipline remains crucial for the country, there is also a need to invest in building a fairer economy.
“There is a distinction in my mind between investing in the things that will make Britain’s economy more efficient in the future, make transport systems work better, communications systems work better and simply spending more on our day-to-day process of government,” he told BBC Radio.
“We need to keep the lid on day-to-day spending, we need to make government more streamlined and efficient but I do think there is a case that we should look at very carefully for targeted, high-value investment in our economic infrastructure.”
Hammond said there was anecdotal evidence that businesses were postponing investment decisions due to uncertainty following the Brexit vote, and that if the government was not ready to intervene it would impact jobs and growth.
Reporting by William James, writing by Kylie MacLellan; editing by Kate Holton