
Rachel Reeves has made tax rises inevitable
This Wednesday, Rachel Reeves will be in the firing line once again.
The event in question will not be a Budget, or even a mini-Budget, but rather a spending review. But such is the pressure on the public finances that the political and economic ramifications will be significant.
On the face of it, this review is meant to spell out the details of departmental spending within the overall totals that have already been set to 2028/29 for current day-to-day spending and to 2029/30 for capital spending.
Such reviews are not, therefore, meant to be the vehicle for announcing major changes in fiscal policy.
There is now supposedly only one major fiscal event for this purpose, namely the autumn Budget, with a subsidiary event, the Spring Statement, which was delivered in March.
That said, it would not come as a surprise if the Chancellor increased the spending totals on Wednesday.
After all, if defence spending is increased to 3pc of GDP (costing over £17bn per annum by 2029/30) and spending on health increases by 3.4pc in real terms per annum, this would imply that other departments would have to suffer an average real terms reduction in their budgets of 1.8pc per annum out to the end of the review period.
Good luck with selling that to the Labour Party.
Admittedly, although at one point increasing defence spending to 3pc of GDP was supposedly a 'commitment', more recently it seems to have been downgraded to an 'ambition'.
Hashtags

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles


BBC News
26 minutes ago
- BBC News
Public toilet restoration approved by Chichester District Council
Eight public toilets in the Chichester district will be refurbished after getting council plans follow the demolition and rebuilding of the old toilet block in Tower new Tower Street toilet, which opened earlier this month, cost more than £200,000 and has been said to be inspiring "envy" in other areas after receiving positive Google reviews. The cost of the latest scheme has not yet been revealed but will be made up of money from the Asset Replacement Fund and from reserves. Chichester District Council does not legally have to provide public toilets, but leader Adrian Moss said they were important to residents, adding that the Tower Street project had been "a triumph".Councillor John Cross added: "There is a bit of toilet envy going on with other district councils because our Tower Street toilets have been given a five-star rating on Google and other district councils want the same!"The toilets set for improvement are in Bracklesham Bay in Bracklesham, Pound Road car park in Petworth, Lifeboat Way in Selsey, Northgate car park in Chichester, Avenue de Chartres car park in Chichester, Hillfield Road in Selsey, Kingfisher Parade in East Wittering and Marine Drive in West council will now look for a contractor to carry out the work, which will be a phased approach over the next two years, said the Local Democracy Reporting Service.


The Herald Scotland
28 minutes ago
- The Herald Scotland
UN urges UK to negotiate new Chagos deal that allows islanders to return
But a panel of experts appointed by the UN Human Rights Council said retaining the base and continuing to bar Chagossians from Diego Garcia 'appears to be at variance with the Chagossians' right to return'. The Chagossians were expelled from the islands between 1965 and 1973 to make way for the joint UK-US base and have not been allowed to return. Although the UK-Mauritius deal includes a £40 million trust fund for the benefit of the Chagossians, the UN experts expressed concern that this would not provide an 'effective remedy' for the islanders. They also criticised an apparent lack of consultation of the islanders prior to the deal, saying: 'We are gravely concerned about the lack of meaningful participation of Chagossians in processes that have led to the agreement.' The experts added: 'In light of these significant concerns, we call for the ratification of the agreement to be suspended and for a new agreement to be negotiated that fully guarantees the rights of the Chagossian people to return to all islands of the Chagos Archipelago, including Diego Garcia.' Conservative shadow foreign secretary Dame Priti Patel urged the Government to 'do the right thing (and) stop this'. She said: 'We have been warning from the start that this deal is bad for British taxpayers and bad for the Chagossian people. 'Now even the United Nations is saying the very same. 'Labour has completely ignored this community from the get-go, and failed to consult with them at every step of the way. 'It is why I have introduced a Bill in Parliament that would block the (agreement) and force the Government to speak to the people at the heart of their surrender plans.' The deal follows a 2019 advisory opinion from the International Court of Justice saying the islands should be handed over to Mauritius. As well as the fund for Chagossians, the UK has agreed to pay at least £120 million a year for 99 years in order to lease back the Diego Garcia base – a total cost of at least £13 billion in cash terms. The deal also includes provisions preventing development on the rest of the archipelago without the UK's consent, which the Government has argued will prevent countries such as China setting up their own facilities. The agreement has also been backed by the United States. The Foreign, Commonwealth and Development Office has been contacted for comment.


The Independent
36 minutes ago
- The Independent
This vision for Britain's nuclear future is to be warmly welcomed
A politician with such a long and mixed track record as energy secretary Ed Miliband should perhaps have been more wary of declaring that nuclear power will 'deliver a golden age of clean energy abundance', and that it is 'the only way to protect family finances, take back control of our energy, and tackle the climate crisis'. Such things may yet prove to be so – and indeed investment in a new generation of nuclear power may well be inevitable. However, it is equally the case that the history of nuclear power in Britain, spanning some seven decades, has been far from an unalloyed success. At home and – sadly, more dramatically – abroad, scientists and engineers overconfident in their abilities and seized by the promise of the future have found themselves all too often watching the consequences of their complacency played out with devastating effect, most infamously at Fukushima, Chernobyl and Six Mile Island, but also at many other locations. Previous visions of a golden age melted down as rapidly as the faulty reactors. If the early post-war hopes for the peaceful use of nuclear power had been well founded, just as was claimed in the 1950s, the abundant electrical power generated by nuclear fission would have been so cheap it would have been pointless to meter and charge for it, fossil fuels would have been rendered redundant, and, as it happens, the pace of climate change greatly retarded. But it was not to be. Therefore, the public is right to be sceptical now about why, in the old and dangerous phrase, 'this time it's different'. With those heavy caveats, Mr Miliband's announcements about Britain's nuclear future are to be welcomed, and his reasoning endorsed. He is right, above all, to seek a great variety and plurality in sources of the UK's long-term energy supply. As the Germans discovered when the Nord Stream pipelines and gas supplies from Vladimir Putin's Russia were cut, it is extremely unwise to become so heavily dependent on any single source of energy. Mr Miliband declares himself an enthusiast for offshore wind, onshore wind, solar, hydro, nuclear, and even fossil fuel sources where effective carbon capture can be achieved. In the nuclear sphere, he's also correct to adopt the previous government's plans for small, 'modular' reactors, which could speed up the transition from carbon and reduce costs. The only disappointment in that area is that time has already been lost, and Rolls-Royce and other private interests are not yet in a position to make any deployment pump meaningful wattage into the National Grid before the early to mid-2030s, as Mr Miliband told the House of Commons. The £14.2bn investment in the Sizewell C plant is a more traditional kind of project, and carries the familiar risks. Mr Miliband will need to be much more specific about private sector involvement, and who will bear the financial risks for such a costly programme over such a long and uncertain timeframe. Disposal of waste and decommissioning costs will also have to be fully transparent to carry public opinion, especially for the people of Suffolk, who will be hosting this latest iteration of a long-standing lodger. Of course, it all would have been better if successive governments hadn't slowed the nuclear programme in the aftermath of successive accidents, and had found the money to invest in previous decades. In fact, the Sizewell C plant is set to become Britain's first new nuclear power station since 1995. The French have long prioritised nuclear power and weathered the recent energy crisis better than the British or the Germans, more tied as they were to foreign gas and soaring world prices. The aim now is to ensure that the new generation of nuclear power doesn't turn into a costly disaster, and can indeed help the transition to renewables and lower energy bills. Cheap, plentiful power and net zero on track? Mr Miliband may yet leave a legacy more permanent than any of his colleagues. Golden, indeed.