Spending Review: Business welcomes pay crackdown Mr Osborne said that annual incremental pay increases - so called "progression pay" - in the civil service would be axed in 2015 and said he planned to remove automatic pay rises for time served in NHS, prisons and police. The armed forces will be excluded from the changes. Progression pay can at best be described as antiquated; at worst, it's deeply unfair to other parts of the public sector who don't get it and to the private sector who have to pay for it. The CBI called the move "tough but necessary." Business groups cautiously welcomed other moves outlined by Mr Osborne. Mr Longworth said: "Businesses will be encouraged by ... important investments in areas like transport, science, education, innovation and defence procurement, which are of great importance to companies of all sizes." The EEF, the manufacturers" body, said: "These overall numbers come as no surprise and, given the government's approach to this review, the settlement is as good as can be expected. Crucially, the government has prioritised spending in the areas that will deliver a greater growth dividend. Heseltine's call for £49bn fund met with £2bn England's regions are to receive £2bn a year to support local growth as part of a drive to devolve spending powers from central government. The funding will go to a "Single Local Growth Fund" that is taken from existing Whitehall funds. It will allow 39 Local Enterprise Partnerships, the new bodies charged with being the "engines of regional growth," to bid for funding from a single pot. The measure was called for by former deputy prime minister Lord Heseltine last year. He said LEPs should be given more responsibilities and funding to allow them to drive a shift of power to local businesses and communities and away from central government - ultimately rebalancing the economy. However, the initial £2bn announced by Chancellor George Osborne yesterday fell well short of the £49bn Lord Heseltine had urged. But David Frost, chair of the LEP Network, said the funding was "a good start." If they do that, it's quite clear that other monies will flow," he said. James Hurley Revenue told to raise £1bn more as budget cut by 5pc Tax inspectors have been instructed to raise an extra £1bn in revenue by targeting tax evasion and avoidance, fraud and debt. The Chancellor announced a 5pc cut in HMRC's budget, but will be expected to do "more with less." Their target for extra tax revenue is increasing from £23.5bn in 2014-15 to £24.5bn in 2015-16. According to Treasury estimates, HMRC should be able to deliver £130m of efficiency savings in 2015-16 through "improved productivity and further digital transformation, reducing inefficient manual processing and dealing with error." Experts were divided over the impact of the cuts and whether the target was achievable at a time when David Cameron has escalated his campaign against tax cheats at home and abroad. Michael Izza, chief executive of the chartered accountants" organisation ICAEW, claimed they could have "significant implications" on tax-collecting efforts. But Jonathan Riley, UK head of tax at Grant Thornton UK, said: "Recently, HMRC has shown a return for the taxpayer through careful targeting of tax evaders, showing how it can drive up effectiveness in tackling evasion even with a reduction in its own budget." Mr Osborne also imposed a 10pc budget cut on his own department. "The Treasury will, as you would expect, lead by example," he told the House of Commons. The savings will come from flexible working and sharing IT provisions with other departments. Louise Armitstead Science 'investment" spared the axe Britain's science budget was spared the Treasury's axe by the Chancellor, who declared that an "investment in science is an investment in our future." Scientists said they were relieved by George Osborne's decision to maintain research spending at £4.6bn in 2015-16 and almost double capital funding for laboratory infrastructure to £1.1bn. Mr Osborne, who said science was "an enormous strength for a modern economy," pledged £185m of resource funding for the Technology Strategy Board (TSB) to support innovation, including Catapult Centres and the Biomedical Catalyst. The Chancellor said: "From synthetic biology to graphene - Britain is very good at it. And we're going to keep it that way. The BioIndustry Association said it was "delighted" with the promise of continued support for the schemes, which have helped scientists convert research into commercial companies. However, researchers said they were braced for the full details of the Coalition's plans for science, expected to be set out by Danny Alexander, the Treasury Secretary, today. Derek Jones, chief executive of the Babraham Research Campus, which is "incubating" 44 start-ups on a science park near Cambridge, told The Daily Telegraph: "The science budget has not been cut and for that we must be delighted, considering all the other cuts. But the devil is in the detail and we'll wait to see what that involves. He added: "The more funding there is, the more science will be done and the more chance for spin-out companies, jobs and growth." Vince Cable, the Business Secretary, used the science budget to claim a victory in his fight against deep cuts. "I made it clear that I would fight for a deal that ensured the Government had a credible growth story," he said. The Business Department has agreed to find another £50m of administrative cost savings and some skills training. But the Chancellor maintained his support for apprenticeships, the Green Investment Bank and the Regional Growth Fund. John Cridland, director general of the CBI, said: "Innovation is a crucial engine of growth and it has been under-resourced for far too long. Protecting the science budget will help maintain growing levels of business investment in R&D.