Billions to be spent on most deprived estates

The Chancellor gave a significant boost to Labour's "heartlands" by pledging more than £3bn in an attempt to bridge the gap between rich and poor across the country.

The Chancellor gave a significant boost to Labour's "heartlands" by pledging more than £3bn in an attempt to bridge the gap between rich and poor across the country.

Gordon Brown promised a war on both child and adult poverty as he unveiled fresh measures to tackle deep-rooted deprivation on council estates and in the inner cities.

A £450m national Children's Fund will be created to protect deprived children and young people at risk of falling prey to drug abuse, crime and truancy.

Increased housing spending will be directed to council estates, with some £1.6bn extra investment by 2004, a rise in real terms of 12 per cent per year. The money will ensure that half a million more homes will be modernised or repaired as part of a 10-year plan to eliminate substandard housing.

A national internet service offering business advice will be created, with business start-ups in areas of high unemployment given a £2,000 boost. More than £400m will be given by 2004 to councils in the most deprived areas of the United Kingdom through a new Neighbourhood Renewal Fund.

Mr Brown devoted a substantial section of his speech to the Government's drive against poverty, pointing out that previous spending was directed to dealing with the consequences of economic and social failure. "For decades, our whole country has been scarred by deep and persistent deprivation and under-achievement in our poorest communities," he said.

"It is time now to invest in tackling the causes of failure, poor school results, poorer standards of health and low levels of economic activity."

Mr Brown stressed that Britain's poorest council estates suffered from unemployment four times the national average and burglary three times the average, while mortality rates were 30 per cent higher.

"These unjustifiable and divisive inequalities cannot be tolerated. Both government and communities must raise their sights, with a new target to raise the poorest areas up and thereby narrow the gap between these areas and the rest of the country," he said.

Government departments will for the first time be given explicit targets for improving life in deprived areas. Local "strategic partnerships" will be set up across the country and a new range of "neighbourhoods statistics" will be compiled to help diagnose, solve and monitor problems.

New minimum standards in school results, public health, law and order and job creation will be set as part of localised public-service agreements with town halls.

The Chancellor said that while the Government had already raised child benefit by 35 per cent to £15.50 a week and introduced the working families tax credit, it was time to step up the "war against child poverty".

The £450m Children's Fund will work with volunteers and staff from charities, community groups and churches to offer one-to-one help to those most at risk. Some £70m of the fund will be allocated to a network of 50 regional and local children's funds.

An extra £315m will be spent on the Sure Start scheme, which aims to improve the life chances of pre-school children. The scheme will be expanded to double the number of programmes to 500 and reach one-third of all poor children under four years old.

In a clear attempt to bridge the north-south divide, England's poorest regions will benefit both from extra housing spending and new money for the Regional Development Agencies. The agencies will have their budgets increased by £500m a year by 2003-04, with local plans for each region. New targets will be set to raise the employment rates of the 30 council districts with the highest jobless rates. Crime in the most deprived areas will be cut so that by 2005 no area will have a domestic burglary rate more than three times the national average.

The housing money will ensure that all social housing meets set standards of "decency" by 2010, with the number of families living in substandard homes falling by one-third by 31 March 2004.