George Osborne's £30bn Infrastructure Plan
Chancellor George Osborne is to set out plans for an ambitious £30 billion investment programme in Britain's infrastructure as he tries to breathe new life into the stalled economy.
The decade-long programme is intended to lever in £20 billion of private investment from pension funds to finance the development of roads, railways and the high-speed broadband network.
The Government has now signed a memorandum of understanding with pension funds on the creation of the new "investment platform" - to be owned by the funds - to channel the money into infrastructure projects.
Full details of the Government's updated infrastructure plan will be announced by Mr Osborne when he delivers his autumn statement on the economy on Tuesday in the House of Commons.
He told BBC One's The Andrew Marr Show: "British pension funds have not been investing the savings of British people in British infrastructure. Now we are hopefully going to change that. We have signed an agreement with the big pension funds that will see them investing British savings in British infrastructure, building an economy based now on savings and investment rather than on debt."
Public funding for the programme will come in two blocs - the first £5 billion will cover the current spending review period to 2014-15 and will include investment to rebuild the country's crumbling classrooms.
It is understood that the Chancellor will say that it does not add to the Government's existing public spending envelop and that the money will come from savings to other areas of the budget. The remaining £5 billion will be allocated to long-term investment projects for the next spending review period starting in 2015-16.
The Chancellor will set out his plans against the backdrop of a worsening economic outlook, with the Office for Budget Responsibility expect to downgrade its official growth forecast for this year for a second time to around 1%.
Mr Osborne insists that he he still sticking to his original "plan A" strategy to tackle Britain's debt mountain.
However, former chancellor Alistair Darling said: "Plan A is slowly but surely being left behind. Whatever you want to call the new plan, it's different to the one he set out in June 2010 - that particular Rubicon has been crossed."