Manchester United’s plans for a new 100,000 capacity stadium as the centrepiece of a major regeneration project have been given a huge boost after the Government threw its support behind the proposals.

Chancellor Rachel Reeves announced that she would be “championing” the project around Old Trafford which is forecast to generate £7.3 billion annually for the UK economy and create around 90,000 jobs nationally.

The Government said the plans – which will lead to new housing, commercial and public spaces – was a “shining example of the bold pro-development model that will drive growth across the region”.

Reeves’s backing was welcomed by United chief executive Omar Berrada. “The delivery of a world-class stadium can be the catalyst for major regeneration of an area of Greater Manchester which requires new investment to thrive again,” he said.

“We cannot achieve that wider aim on our own, which is why we welcome the announcement by the Chancellor and the ongoing support of the Mayor of Greater Manchester and Trafford Council.

“If we work together, there is a once-in-a-lifetime opportunity to create a landmark project around Old Trafford that the whole region can be proud of.”

Credit: Manchester United/Old Trafford Regeneration

United are expected to make a final decision at the end of the season over whether to build a new stadium or redevelop their existing Old Trafford home with an increased capacity to 87,000.

But the club – and influential minority owner Sir Jim Ratcliffe – are leaning very much towards a new build which has been dubbed the “Wembley of the North” and could cost between £2 billion to £2.3 billion.

While United will have to finance any stadium themselves, public money could be provided to help with infrastructure improvements and other developments within or around the so-called “stadium district”.

A mayoral development corporation body is expected to be set up which would speed up and improve decision-making powers around any redevelopment project.

Telegraph Sport revealed this month how Ratcliffe could aim to “fast track” delivery of a new stadium.

United have been in constructive talks for some time with Freightliner, the UK’s largest maritime intermodal logistics operator, about acquiring land they own by Old Trafford to ease and improve development options. Freightliner is thought to be open to moving its operations to St Helens and there is optimism that a deal can be struck and enabling work could begin on the stadium project before the end of this year.

‘Biggest opportunity for urban regeneration since London 2012’

Andy Burnham, the Mayor of Greater Manchester who is on the Old Trafford regeneration task force set up by Ratcliffe to explore the stadium options, said: “With our devolved powers we’re mobilising the whole Greater Manchester system to lock in growth for the next decade and reap the rewards for our city-region and UK plc.

“The project around Old Trafford represents the biggest opportunity for urban regeneration this country has seen since London 2012 and is a key part of our 10-year plan to turbocharge growth across Greater Manchester.

“We look forward to working with the Government on moving freight away from the site around Old Trafford to new locations to open up capacity in our rail network and unlock massive regeneration potential – delivering benefits across the whole of the North.”