Chancellor John Healey to overhaul Treasury rules to steer investment beyond London
Chancellor John Healey is set to announce changes to Treasury rules aimed at directing investment away from London and towards regional economies, ahead of a major economic speech.
Chancellor John Healey is preparing to dismantle what has been described as the Treasury's internal 'rule book' in a bid to redirect investment away from London and towards regional economies across the country. The move, which is expected to be detailed in a major economic speech on Monday, signals a significant shift in how Whitehall approaches capital spending and economic development.
The planned overhaul is designed to challenge the historical concentration of public and private investment in the capital. By altering the criteria and processes used to evaluate spending decisions, the Treasury aims to make it easier for projects outside the South East to secure funding. The changes are intended to support the government's broader devolution agenda, giving local leaders more control over economic priorities in their areas.
According to reports, Mr Healey believes the existing framework has too often favoured large-scale projects in London at the expense of regions that could benefit more from targeted investment. The new approach is expected to place greater emphasis on regional growth potential and strategic need, rather than relying on established metrics that tend to favour already-prosperous areas.
The announcement comes ahead of a key address on the economy, where the Chancellor is likely to frame the changes as part of a wider effort to boost productivity and spread opportunity more evenly. The speech is expected to outline how the Treasury will work with combined authorities and mayors to deliver infrastructure, transport, and skills projects that have been previously stalled or overlooked.
Observers note that the move represents a notable departure from conventional Treasury practice, which has often been criticised for its centralised approach to fiscal decision-making. By loosening the grip of departmental rules, the government hopes to unlock investment that can support long-term growth in areas that have lagged behind the capital in economic performance.
The policy is also seen as a response to growing political pressure to address regional inequality. With devolution deals already agreed in several parts of England, the Treasury's new stance could accelerate the transfer of funding powers to local leaders. This would allow regions to pursue bespoke strategies tailored to their own industrial strengths and labour markets.
While full details of the rule changes have yet to be published, the Chancellor's intervention is expected to be welcomed by business groups and local authorities outside London. They have long argued that the current system creates a bias towards the capital, making it harder for northern and midland cities to compete for investment on equal terms.
The speech on Monday will be closely watched for specifics on how the new framework will operate in practice, including whether it will involve changes to the Green Book, the Treasury's official guide for appraising projects. Any revision to that guidance could have far-reaching implications for how future transport links, research hubs, and regeneration schemes are funded across the UK.
