Reeves gambles on mega £300BN spending splurge including winter benefits & free school meals – but sparks tax hike fears
Ms Reeves pledged to end the use of expensive asylum hotels
SHOW US THE MONEY Reeves gambles on mega £300BN spending splurge including winter benefits & free school meals – but sparks tax hike fears
RACHEL Reeves today gambled on a £300billion spending spree in a do-or-die bid to drive growth - and revive her shaky Chancellorship.
In a clear tack to the Left, she used her Spending Review to defend higher taxes and borrowing to fund the cash shower.
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Rachel Reeves unveiling her Spending Review in the Commons today
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The Chancellor leaves No11 Downing Street
Credit: PA
Billions more have been poured into the defence and health budgets - with hundreds of millions also to tackle illegal migration.
Ms Reeves pledged to end the use of expensive asylum hotels - that are costing taxpayers £4million a day - before the next election.
But it risks infuriating voters who want to see action to stop using them now rather than in four years time.
And critics have warned Ms Reeves mega spending blizzard will drive Britain even further into debt and raise the prospect of more tax hikes.
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Laying out her package in the Commons, Ms Reeves said: 'My choices are different. My choices are Labour choices."
The Spending Review includes:
A pledge to end the use of migrant hotels by the next election
Confirmation that nine million pensioners will get the winter fuel allowance this year
Free school meals for half a million more children
An extra £39billion over the next decade for social housing
A £15billion boost to transport to "properly connect" Britain's towns and cities
£22billion investment in research and development and £2billion in Artificial Intelligence
A £30billion injection in clean energy including £14billion for nuclear energy
A rise in departmental budgets by 2.3 per cent a year totalling £190billion more than the Tories
The Defence budget hiked to 2.6 per cent of GDP by 2027
The Chancellor was heckled by Tory MPs as she claimed to have turned around the economy 'after 14 years of mismanagement and decline'.
Earlier Kemi Badenoch tore chunks out of Labour's record of raising taxes on business that have led to job losses.
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Despite widespread fury from bosses, Ms Reeves defended her National Insurance raid as the reason she can splash the cash today.
She is using increased taxes to splurge £190billion more than the Tories on day-to-day departmental spending.
The Chancellor confirmed departmental budgets will rise by 2.3 per cent a year, slamming past Tory austerity as 'a destructive choice for our society and our economy.'
She also doubled down on her decision last year to loosen her fiscal rules to hike borrowing by an extra £113billion to pay for shiny infrastructure projects.
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Tory Shadow Chancellor Mel Stride blasted Ms Reeves spending review as a 'spend now, tax later' fantasy.
He said Labour had 'completely lost control' and warned a 'cruel summer' of tax hikes speculation was coming.
Her short Chancellorship has been blighted by the winter fuel debacle, fury over tax hikes, angry farmers and rows over welfare spending.
A YouGov survey yesterday found just 12 per cent of voters think she is doing a good job.
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Border farce
One of her flagship promises was a commitment to scrap the use of hotels for asylum seekers within this Parliament.
Slamming the system left behind by the Tories as 'broken,' she said it wasted billions and 'shunted the cost of failure onto local communities.'
She confirmed new funding – including from the Transformation Fund – will be used to speed up asylum decisions, ramp up returns, and restore control at the border.
An extra £280 million a year by the end of the Spending Review will also go to the new Border Security Command to 'support the integrity of our borders.'
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The Chancellor added: "Billions of pounds of taxpayers' money [were] spent on housing asylum seekers in hotels.
'We won't let that stand.'
The Chancellor also unveiled a major hike in defence spending today, raising it to 2.6 per cent of GDP by 2027 — up from the previous 2.5 per cent pledge.
Cash boosts
She confirmed an £11bn boost for the Ministry of Defence and £600m for the UK's intelligence services, calling it essential in an 'age of insecurity.'
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She said: "That investment will deliver not only security, but also renewal."
Ms Reeves unveiled a £29bn-a-year increase for the NHS, with day-to-day spending rising by 3 per cent in real terms each year of the Spending Review.
She said a strong economy depends on a strong NHS - 'not an insurance-based system,' but one 'free at the point of use.'
While Health Secretary Wes Streeting had called for a 4 per cent rise, the Chancellor said 3 per cent was a 'record investment' that would still deliver real change.
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She said: "The National Health Service: Created, by a Labour government. Protected, by a Labour government. And renewed, by this Labour government."
She confirmed a £15bn package to 'properly connect' Britain's towns and cities
The cash includes upgrades to buses in Rochdale, stations in Merseyside and Middlesbrough, and mass transit in West Yorkshire, Tyne and Wear, Birmingham and Stockport.
The Chancellor has pledged the "biggest rollout of nuclear power for half a century" - with a £30bn commitment to clean, homegrown energy.
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And she announced £14bn for Sizewell C to power six million homes and create over 10,000 jobs, including 1,500 apprenticeships.
Ms Reeves also pledged to deliver Labour's manifesto promise to upgrade millions of homes with energy efficiency improvements — saving families and pensioners up to £600 a year on their bills.
'Corbynist'
Shadow Chancellor Sir Mel Stride blasted Ms Reeves her for a 'humiliating U-turn' on winter fuel payments and accused her of paving the way for tax hikes.
He mocked the absence of an Office for Budget Responsibility forecast, saying: 'The Chancellor must be delighted she does not have to face a new OBR forecast today, because if she did, she would have to set out how she will fund her humiliating U-turn on winter fuel payments.'
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Sir Mel demanded clarity on tax, asking: 'Can she confirm categorically that there will be no additional borrowing to pay for this chaotic reversal? And if that is the case, how on earth can it be paid for without raising taxes?'
He also pressed the Chancellor to guarantee that income tax thresholds won't be frozen at the next Budget — something she previously admitted would 'hurt working people.'
And in a final swipe, he warned she may soon be forced to consult the 'Corbynist catalogue' of tax rises put forward by her party's left.
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