Spiralling inflation threatens to sink the Government's levelling up agenda by pushing up the cost of major building projects, a Cabinet minister has warned.
Greg Clark, the new Levelling Up Secretary, said the next Prime Minister must overrule “ponderous” civil servants and fast-track decision making to beat rising prices.
In his first interview since taking up the role, he told The Daily Telegraph schemes that get “bogged down in bureaucracy and delay” risk becoming “no longer viable”.
Inflation is eating into budgets meaning the incoming PM faces having to raise taxes, increase borrowing or cut spending to deliver on big infrastructure commitments.
Last week the Institute for Fiscal Studies warned rocketing prices are set to wipe out 40 per cent of planned real-term increases to public spending.
Mr Clark, 54, said the next Tory leader must combat rising prices by “cutting through” Whitehall red tape and getting projects approved more quickly.
'Quicken the pace of delivery'
Speaking during a visit to Teesside Freeport, he said: “I will say this to whoever is the incoming Prime Minister – you need to quicken the pace of delivery.
“Not just because people want to see delivery, but with inflation you need to get on and implement things, otherwise the budgets you set aside won’t be adequate.
“A six-month delay could make projects that have been funded no longer viable.
“There’s too much bureaucracy, there’s too much slowness, there’s too much ponderousness in making decisions.”
Mr Clark said the next PM will need to be equally firm with Whitehall mandarins when devising a new cost of living package this autumn.
“You need to act quickly because inflation doesn’t wait for policy makers to determine what to do about it,” he warned the incoming administration.
“The Government is going to need to be quite agile during the autumn and winter when cost pressures crystallise…not to take too long to deliberate and decide what to do.
“You need rapid decision making and to cut through a lot of the process that I think sometimes can hold Whitehall back.”
He said delivering on levelling up and “showing how things can literally change for the better” will be “a deciding factor” in whether the Tories retain power in two years’ time.
“People when they voted Conservative, they accepted they bought into the proposition. But they have the right to see that delivered when the Government presents itself for election.”
Rishi Sunak and Liz Truss have promised to forge ahead with the policy by pouring billions of investment into left-behind areas.
The Foreign Secretary has pledged to reverse November 2021’s decision to scrap the £30 billion Northern Powerhouse rail link between Manchester and Leeds.
She and the former chancellor have vowed to press ahead with a £290 million project to dual the A1 in Northumberland which has been delayed for a year.
Both projects are now likely to cost significantly more than those estimates.
Leader will need to find more money
Mr Clark also warned inflation is eating into the budgets of local councils which face extra demands for front-line services as the cost of living crisis deepens.
He suggested that the next leader of the country will need to find more money to boost their funding and help get struggling families through the winter.
“I am talking to council leaders to inform discussions in the spending review and I will leave some advice for the incoming administration,” he said.
Mr Clark was a shock appointment last month, being promoted to replace Michael Gove who was sacked over his part in the rebellion against the PM.
He previously served in the role under David Cameron but had the whip suspended by Boris Johnson in 2019 for rebelling over a no-deal Brexit.
The Levelling Up Secretary admitted it was a “great surprise” to get the call from the Prime Minister offering him his old job back.
“He thought it was important to have a time of stability, and someone that could run the department and the brief well during the weeks ahead and would I, as he put it, pro bono publico do it?
“Of course I said yes and I’m enjoying it immensely. It might be my political encore but I’m determined to make the most of it."