The Prime Minister’s office has pulled the £50 million that was due to be spent on the regeneration of Old Street’s Silicon Roundabout in East London.
No. 10 told Techworld in March that the government was holding the money until City Hall submitted appropriate regeneration plans, but a spokesperson has revealed that the £50 million has been taken off the table.
“Given that a permanent solution for the roundabout will be technically difficult and some way off that money has gone back into general expenditure,” he said.
Another spokesperson at No. 10 added: "It is normal practice for any money that hasn’t been spent to return to the Treasury to help reduce the deficit."
The funding was going to be used by City Hall and Tech City UK to give “Silicon Roundabout” a much-needed makeover so that it could act as the poster-child for London's vibrant tech sector. As part of the investment, the government pledged to build a hi-tech institute on the site of Old Street roundabout.
Speaking at the time of the announcement, Cameron said: "We're investing in creating the largest civic space in Europe - a place for start-up companies and the local community to come together and become the next generation of entrepreneurs."
The new building, which was set to include a 400-seater auditorium with boardrooms, labs and workspaces, and high-speed T4 broadband, was going to be used to help thousands of students develop their programming and business skills. It was also going to host 3D printing services for visiting start-ups and other members of the wider community.
The government said the centre would support around 200 start-ups per year, help 1,000 young people find skilled employment and host two major international conferences for the creative and tech industries each year.
At the time of the announcement, Mayor of London Boris Johnson said the civic space would provide a "vital resource to nurture upcoming technology and creative superstars from around the world, while driving huge investment into the capital and helping to create thousands of jobs."
While many of the redevelopment plans initially outlined by David Cameron are now unlikely to come to fruition, a number of improvements are scheduled to go ahead. For example, Transport for London is set to begin work on environmental improvements including landscaping of the Old Street roundabout and improvements to the subway and station.