No new freeports in Budget despite No 10 announcing five more would be built

Rachel Reeves will not announce any new freeports in the Budget, despite a Downing Street press release on Friday saying five more would be unveiled.

The Chancellor will instead confirm funding for “next steps” for some of the existing sites, which will receive official clearance to have customs facilities within their boundaries, it is understood.

Ms Reeves will also approve plans for a separate “investment zone” in the East Midlands that were put forward by the previous Tory government.

Government sources said there had been a “total cock-up with the comms” arising from the conflation of freeports themselves and the multiple customs facilities contained within them.

Seven of the UK’s 12 freeports have a number of customs zones that allow them certain benefits, such as only paying tariffs on finished products when they are placed on the market and receiving tax breaks on hiring new staff.

Government officials earlier said that a further five sites would receive clearance to have such facilities open within their boundaries under Labour’s plans.

However, in a clarification on Sunday evening, Downing Street sources said instead that the announcement would cover three freeports, across which five customs zones would be opened.

Humber freeport and Inverness and Cromarty Firth freeport will each gain a customs facility, while three more facilities will be introduced at the Liverpool site, taking its total to six, they said.

The Financial Times, which broke the story, reported the announcement had caused confusion among port executives and local mayors who had no warning of the plans outlined in the press release.

A Treasury spokesperson said the Government was committed “to ensuring the custom benefits remain on offer”.

The Tories accused Labour of a “humiliating U-turn” which would damage business confidence in the UK.

“This Labour Government is once again in chaos and disarray,” a Conservative Party spokesman said.

On Friday, Number 10 had said: “Ahead of the first Labour Budget in 15 years, the Prime Minister has today confirmed that the Chancellor will announce a new investment zone in the East Midlands and five new freeports as part of the Government’s package of measures to fix the foundations and rebuild the country.”

During his visit to Samoa, Sir Keir Starmer was asked about the commitment and whether announcing five new freeports was an acknowledgement that the Conservative approach had been successful.

The Prime Minister replied: “Freeports were introduced by the last government, and what we did was to look at them. I didn’t want to take the sort of ideological view that just because they were introduced by the last government, we would sort of stand them down.

“We looked at them, they are working well, I think they can work better. So rather than stand them down, we’re going to go with it, but we’re going to make some improvements so they work even better.”