Chancellor Rachel Reeves has delivered Labour’s first Budget since 2010 – which has received a largely positive response from industry.

Reeves said she was “fixing the foundations” of the economy with the Budget, which will raise taxes by £40bn.

She said: “The only way to drive economic growth is to invest, invest, invest. There are no shortcuts. And to deliver that investment we must restore economic stability.”

Providing a boost to public investment of more than £100bn over the next five years, she said investment would be seen across roads, rail, schools and hospitals whilst keeping debt on a downward path.

She also said there would be no change to working people’s payslips as income tax, employee national insurance and VAT stay the same, but businesses and the wealthiest will be asked to pay more.

Industry has been quick to respond to the announcement this afternoon.

Colin Wood, chief executive of AECOM Europe, UK/Ireland and India, said £100bn in capital expenditure will “drive growth across the economy, creating employment opportunities and building a Britain fit for the future”.

“It is clear that the private sector, with our deep skills and expertise, will need to play a central role in ensuring these complex programmes are successfully delivered.

“It remains to be seen, however, how much private investment the National Wealth Fund alone will be able to attract to help finance many of these projects.

“We will need to do more work to fully understand the impact of the significant increase in tax on businesses in our sector and our supply chain, who now face a combination of tax rises and higher wages.”

He added: “The announcement to fund major projects, such as the HS2 extension to Euston station, East West Rail and the Transpennine Route Upgrade, as well as an array of other upgrades and improvements, is a welcome commitment that will provide stability, improve the lives of millions of passengers and stimulate regional economic growth across the country.

“Similarly, we welcome the commitment to increase the road maintenance budget and to invest funding in local transportation such as trams and metro lines.

“A clear pipeline is good for our industry and this commitment to funding gives us confidence to build the necessary skills and invest in innovation to help deliver these projects. We also look forward to working with the devolved regions to accelerate delivery.”

Brian Yates, UK and Ireland managing director at Stantec, said: “It was encouraging to hear the chancellor acknowledge some of the long-term challenges facing the UK’s built environment and commit to programmes and initiatives that help move the needle towards long-term foundational resilience.

“We know we must all keep the key objectives front and centre: from delivering more well-designed homes in communities, boosting regional transport connectivity, and leveraging investment in hydrogen and carbon capture schemes while quickly bringing more renewable energy and storage schemes online to diversify our network. Achieving these goals is vital to the country’s long-term national growth agenda, and policy should continually support this.

“The UK is at a pivotal juncture, full of new opportunities for growth and investment. It was welcome to hear a specific reference to the future of the Crown Works Studio Scheme in Sunderland, a project proudly supported by Hydrock, now Stantec.

“There is a lot to be cheerful about: restated commitments to planning reform, an aspirational industrial strategy, plans for innovative data centres and gigafactories, and new industry bodies to help bolster energy security.

“The country needs to maintain its momentum. Achieving this will require the public and private sectors to work together to drive, leverage, and influence change. As a global facilitator positioned at the heart of these national issues, we always welcome consistency and certainty from government on the direction of travel while we support UK clients in harnessing opportunities.”

Civils contractors welcomed the Budget measures saying they provide a “blueprint” for sustained economic growth.

Director of operations for the Civil Engineering Contractors Association (CECA) Marie-Claude Hemming said: “The infrastructure sector in the UK is primed to deliver on the government’s ambitions to drive growth in the economy.

“While undoubtedly this Budget contains tough measures that are aimed at ameliorating the UK’s constrained economic position, the Chancellor’s decision to alter her fiscal rules to allow investment in infrastructure is one that CECA has called for in recent weeks.

“It is right that the government maintains a strong commitment to controlling day-to-day spending while creating headroom to allow for investment in a long-term infrastructure programme to secure the economic and social wellbeing of UK plc.

“We are particularly pleased to see the chancellor make a commitment to rail upgrades such as the Transpennine upgrade, putting funding in place to link HS2 to Euston, and increased funding for local roads maintenance.

“In addition, plans to roll out carbon capture and storage schemes and new green hydrogen projects will act as a basis for allowing Great British Energy to play fufil its role in transforming Britain into a clean energy superpower.

“This renewed focus on delivering growth and streamlining planning will allow projects to move more quickly to market, allowing our members to serve businesses and communities in all parts of the country by delivering the world-class infrastructure we all rely upon.

“The success of the government’s plans will rely upon unlocking all potential sources of infrastructure finance and working closely with industry to ensure the skills are in place to deliver the planned pipeline of schemes.

“CECA stands ready to work with our members, the government, and the entire supply chain, to ensure that the UK’s infrastructure sector is primed to deliver on this blueprint for growth and build a better future for businesses and communities across the UK.”

David Wells, chief executive of business group Logistics UK, said the chancellor’s decision to freeze fuel duty for a further year was “welcome news” for the logistics sector.

“Nothing moves without logistics: the sector supplies our hospitals, schools, factories, shops and homes with everything they need, everywhere, every day.

“The sector is vital to any plans to stimulate growth across the economy, and this respite is welcome news for a sector already seeing increasing business failures over the last year.

“The sector operates on very narrow margins – often only 2.5% - with fuel representing a large proportion of the weekly operating cost for hauliers.

“Logistics powers every part of the UK’s economy – it is the UK’s system for growth – and today’s announcement should drive confidence in our sector’s ability to deliver for its customers. with confidence.”

Peter Hogg, UK cities director at Arcadis, said: “This was a budget that raised an historic amount of tax in one budget at an eyewatering £40bn.

“So the question has to be what does the nation get in return? Clearly we will have to wait until the Comprehensive Spending Review in the spring for the full picture, but it is clear the chancellor has set out a distinct shift in focus from economic to social infrastructure, with health, education and housing the runaway beneficiaries.

“Economic infrastructure wasn’t completely overlooked of course. Energy transition is seeing some big direct government investment commitments, and there is continuing support for transport projects, particularly in the North - albeit many are existing programmes and we would hope to hear more about news of commitments to Northern Powerhouse Rail, Lower Thames Crossing and the HS2 legacy in the spring.

“The commitment to beginning tunnelling the Old Oak Common to Euston tunnels is a cautious first step, but let’s take the positive. Analysis of the numbers shows that in current terms, capex will be 20% higher at the end of this parliament. While inflation will absorb most of that, there is also a very stiff 2% predicted productivity gain in public spending.

"Overall this is a budget that sees a lot more taxing for relatively little additional capex spending.”

The Institution of Civil Engineers (ICE) interim associate director of policy, David Hawkes, said: “The chancellor’s approach to infrastructure investment as spending that delivers economic, social, and environmental value for the country, versus just being a cost, is welcome. It’s something the ICE has repeatedly called for.

“Other positive measures include modelling the Budget’s impact for 10 years instead of five. Long-term thinking is key to the country achieving its goals. It's also good to see the government highlight the need for private investment and that it will support regional leaders to drive growth in their areas.

“Now the question is, will the investment announced today be enough for the UK to meet its economic, social, and environmental objectives?

“In its forthcoming 10-year infrastructure strategy, the government must present a vision for infrastructure investment, including how projects will be prioritised. Ahead of that, it must also clarify how the new National Infrastructure and Service Transformation Authority (NISTA) will improve delivery.”

Beatrice Barleon, head of policy and public affairs at EngineeringUK, said: “We welcome the chancellor’s commitment to invest in education and skills as a central pillar of the government’s growth agenda, not least through the creation of Skills England and the announcement of a £40m pot to develop new foundation and shorter apprenticeships in key sectors.

“We look forward to continuing to support the government to develop a new Growth and Skills Levy, ensuring an apprenticeships system that provides ample routes into engineering and technology careers for young people.

“The pledges of significant funding uplifts for school budgets and further education colleges will be key to addressing the teacher recruitment crisis, which is particularly acute in STEM subjects. To resolve the teacher workforce crisis in the long-term, this must be accompanied by a similar commitment to teacher retention, such as by reversing short-sighted cuts to subject-specific CPD for STEM teachers.

“Moreover, the announcement of a series of new energy and infrastructure projects, such as green hydrogen plants and carbon capture and storage facilities, underscores the centrality of ensuring an engineering and technology workforce that is fit for the future to achieve the government’s mission of turning the UK into a clean energy superpower.

“Ahead of the publication of the full industrial strategy next spring, we look forward to supporting the government with the development of sector plans for key growth-driving industries, many of which depend heavily upon the supply of skilled engineers and technologists.”

Kate Jennings, Chief Executive Officer of the Association for Consultancy and Engineering and the Environmental Industries Commission, said: “Today’s Budget did not contain many surprises, however, as many of our key asks were recognised, we welcomed the statement. The Chancellor’s announcement of more funding for projects at national, devolved, regional and local levels was a welcome signal for our whole sector. Similarly, the commitment to a stable and longer-term approach to planning and funding to give security and certainty, we hope, will see an end to the disastrous ‘commit, stop, review’ habits that have added the most costly delays to projects like HS2, inevitably fuelling the burden on the public purse.

The continued commitment to moving towards net zero through Great British Energy and funding for 11 hydrogen projects around the UK is encouraging. However, it’s vital, as proved by our One Crisis seminar and featuring in the current round of UN COP campaigns that climate change, nature and biodiversity and pollution control should not siloed. These aspects must be considered throughout the planning and delivery process of every project for the UK to thrive.

We welcome the commitment to increase capital investment including the change to fiscal rules that will unlock private investment. Now this budget, it’s It is crucial that funding is funnelled into a stable pipeline and that even greater clarity is provided in the Spring Infrastructure and Industrial Strategies. Engineering design consultancies play a major role in reducing regional inequalities through infrastructure connectivity and socially valuable placemaking – a key Government mission.

We will continue to support our members who are poised and have the know-how to help Government realise its budget goals for UK sustainable growth and prosperity.”

Click here for a roundup of  key Budget announcements.