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Scottish Sun
2 days ago
- Business
- Scottish Sun
Chancellor Rachel Reeves unleashes eye-watering borrowing spree in do-or-die bid to drive growth
RACHEL Reeves was yesterday branded a 'spend now, tax later' Chancellor after unleashing an eye-watering borrowing spree in a do-or-die bid to drive growth. Ms Reeves put £113billion on the country's credit card to fund 'national renewal' projects — with defence and the NHS taking the lion's share of the budget uplifts. 3 Rachel Reeves was branded a 'spend now, tax later' Chancellor Credit: Simon Walker / HM Treasury 3 The Chancellor unleashing an eye-watering borrowing spree in a do-or-die bid to drive growth Credit: AFP She was accused of digging the 'black hole' in public finances Labour claimed to have inherited into a 'crater into which public confidence is plunging'. Experts said her next Budget may have to raise up to £23billion to keep to her fiscal rules amid economic slowdown and uncertainty over US tariffs. It sparked fears of tax rises in autumn to stop UK debt worsening and spooking money markets. Ms Reeves came out fighting after a humiliating 48 hours in which she U-turned on winter fuel cash for millions of OAPs. She unveiled spending plans for the next three years, calling them 'Labour choices' in the hope of shoring up support in the party's heartlands amid the threat of Nigel Farage's Reform UK. Shadow Chancellor Mel Stride said she had a 'Corbynist catalogue' of tax rises to flick through to fund her pledges — a reference to a secret memo Deputy PM Angela Rayner sent her suggesting ways to raise cash. He called her a 'tinfoil Chancellor, flimsy and ready to fold in the face of the slightest pressure' as she set out her plans. He said: 'This is the spend now, tax later review, because the Chancellor knows she will need to come back here in the autumn with yet more taxes and a cruel summer of speculation awaits. 'How can we possibly take this Chancellor seriously after the chaos of the last 12 months?' Mr Reeves insisted later that no tax rises would be needed to pay for her commitments. Top 5 takeaways from Spending review She said: 'Every penny is funded through the tax increases and changes to the fiscal rules that we set out last autumn.' The review was the first since 2007 to go through spending 'line by line', it was claimed. The health department is expected to make £9billion in efficiency savings by 2028-29, and the defence budget £905million. The Chancellor told MPs: 'I've made my choices. In place of chaos, I choose stability. 3 'In place of decline, I choose investment. In place of pessimism, division and defeatism, I choose national renewal. 'Reforms that will make public services more efficient, more productive and more focused on the user. I have been relentless in driving out inefficiencies. 'I will be ruthless in calling out waste with every penny being reinvested into public services.' She will hope the cash injections will ease relationships with Labour backbenchers concerned at welfare cuts. A vote on measures is planned for next month. The biggest winner in the review was the NHS, which gets a three per cent budget rise in England over the next three years, taking its funding to £226billion. Financial cushion The defence budget will go up by 2.6 per cent but pressure is mounting on ministers to raise it again to 3.5 per cent by 2035. The vow to build 1.5 million homes in the next five years was boosted with confirmation an average of £3.9billion will be go on social and affordable housing in the next decade. Ed Miliband's energy department gets a 16 per cent real-terms rise with £14.2billion extra going on the Sizewell C nuclear plant. Families and OAPs could save £600 a year on bills in more energy-efficient homes, she said. A pledge to end the use of asylum hotels by 2029 will save £1billion a year, she insisted. The police will get an above-inflation increase but top cops have warned of 'incredibly challenging' budgets following tense talks between the Chancellor and Home Secretary Yvette Cooper. Surrey Chief Constable Gavin Stephens said the money will 'fall far short' of that needed to fund Government ambitions and maintain the existing workforce. He said the increase 'will cover little more than annual inflationary pay increases'. The Chancellor inherited, supposedly, a black hole and she has dug a crater into which public confidence is plunging. Richard Tice Ms Reeves aims to meet her fiscal rule of balancing day-to-day spending with revenues by 2029-30 and plans to reduce the UK's debt. Her financial cushion is just less than £10billion. Reform deputy leader Richard Tice said public spending was 'completely out of control'. He said: 'The Chancellor inherited, supposedly, a black hole and she has dug a crater into which public confidence is plunging.' Economist Ruth Gregory, of Capital Economics, said Ms Reeves may need to find an extra £13billion to £23billion in autumn's Budget 'simply to maintain her current buffer against the fiscal rules'. Stephen Millard, interim director of the National Institute of Economic and Social Research, said it is now 'almost inevitable' that if she sticks to her rules, she will have to raise taxes this year. Rain Newton-Smith, director general of the Confederation of British Industry, warned that the Government cannot target business again following its £25billion raid at the last Budget. She said: 'We will hold the Chancellor to account that she won't come back for tax rises on business . . . because I don't think business can shoulder any more. 'The Prime Minister himself has said you cannot tax your way to growth. "So I think it's critical that we don't see rises like that on business because they are the ones that need to invest to deliver the growth mission.'
Rhyl Journal
2 days ago
- Business
- Rhyl Journal
Reeves will need ‘Corbynist catalogue' of tax rises to back up spending
Ms Reeves denied the Treasury would produce a 'repeat' of last October's budget and said the Government had 'already drawn a line under the Tory mismanagement'. But shadow chancellor Sir Mel Stride told MPs that Wednesday's spending review was a 'fantasy' and 'not worth the paper that it is written on'. Responding to Ms Reeves's spending plans, the Conservative frontbencher told the Commons: 'This is the spend now, tax later review, because (the Chancellor) knows she will need to come back here in the autumn with yet more taxes and a cruel summer of speculation awaits. 'How can we possibly take this Chancellor seriously after the chaos of the last 12 months?' Sir Mel labelled Ms Reeves 'the tinfoil Chancellor, flimsy and ready to fold in the face of the slightest pressure', who he said was 'weak, weak, weak'. He added: 'She is constantly teetering on the edge of blowing her fiscal rules, which she already changed to allow even more borrowing. 'And the only way she can claim to be meeting her rules is by pretending that she can control spending over the coming years.' As part of the Government's plans, departmental budgets are forecast to grow by an annual average of 2.3% across the period 2023/24 to 2028/29. Ms Reeves also promised a 'record cash investment in our NHS', with an extra £29 billion per year for day-to-day running costs, plus money for rail projects including £3.5 billion additional funding for the TransPennine route upgrade between York and Manchester, and £2.5 billion more for the Cambridge-to-Oxford East West Rail. 'The Chancellor knows she will have to come back in the autumn with more tax rises to fund these plans,' Sir Mel said. 'Or can she assure us right now that this is not the case? Yes or no?' Referring to the former Labour leader and now independent MP for Islington North Jeremy Corbyn, Sir Mel said: 'We know that the Deputy Prime Minister (Angela Rayner) has helpfully provided her with an entire brochure of tax rises that she will no doubt be perusing over the summer, the 'Corbynist catalogue'.' He told MPs: 'Her tone today suggests that all is well, the sunny uplands await. 'What a hopeless conceit. A masterclass in delusion.' Ms Reeves hit back that Sir Mel was 'Stride by name, 'baby steps' by nature'. She said he had 'welcomed our nuclear investment of £30 billion' and continued: 'But he said it's not enough. He welcomed our defence investments of £11 billion, but he said it was not enough. 'He and his party opposed the decisions that this Government has taken to make those announcements possible, by voting against the budget in October last year. 'You can't spend the money if you won't raise the money. Now, that's a lesson from Liz Truss that he has already forgotten. 'He complains about the level of investment that I've announced, ignoring the fact that the reason this investment is so important is because his party oversaw 14 years of cratering investment, stagnating wages and public service collapse.' She said the more comprehensive budget later this year will 'set out in the round all of the fiscal plans' and added: 'We have already drawn a line under the Tory mismanagement with tax rises last year. 'And we will never have to repeat a budget like that again, because we will never have to clean up after the mess that the party opposite made.'
South Wales Guardian
2 days ago
- Business
- South Wales Guardian
Reeves will need ‘Corbynist catalogue' of tax rises to back up spending
Ms Reeves denied the Treasury would produce a 'repeat' of last October's budget and said the Government had 'already drawn a line under the Tory mismanagement'. But shadow chancellor Sir Mel Stride told MPs that Wednesday's spending review was a 'fantasy' and 'not worth the paper that it is written on'. Responding to Ms Reeves's spending plans, the Conservative frontbencher told the Commons: 'This is the spend now, tax later review, because (the Chancellor) knows she will need to come back here in the autumn with yet more taxes and a cruel summer of speculation awaits. 'How can we possibly take this Chancellor seriously after the chaos of the last 12 months?' Sir Mel labelled Ms Reeves 'the tinfoil Chancellor, flimsy and ready to fold in the face of the slightest pressure', who he said was 'weak, weak, weak'. He added: 'She is constantly teetering on the edge of blowing her fiscal rules, which she already changed to allow even more borrowing. 'And the only way she can claim to be meeting her rules is by pretending that she can control spending over the coming years.' As part of the Government's plans, departmental budgets are forecast to grow by an annual average of 2.3% across the period 2023/24 to 2028/29. Ms Reeves also promised a 'record cash investment in our NHS', with an extra £29 billion per year for day-to-day running costs, plus money for rail projects including £3.5 billion additional funding for the TransPennine route upgrade between York and Manchester, and £2.5 billion more for the Cambridge-to-Oxford East West Rail. 'The Chancellor knows she will have to come back in the autumn with more tax rises to fund these plans,' Sir Mel said. 'Or can she assure us right now that this is not the case? Yes or no?' Referring to the former Labour leader and now independent MP for Islington North Jeremy Corbyn, Sir Mel said: 'We know that the Deputy Prime Minister (Angela Rayner) has helpfully provided her with an entire brochure of tax rises that she will no doubt be perusing over the summer, the 'Corbynist catalogue'.' He told MPs: 'Her tone today suggests that all is well, the sunny uplands await. 'What a hopeless conceit. A masterclass in delusion.' Ms Reeves hit back that Sir Mel was 'Stride by name, 'baby steps' by nature'. She said he had 'welcomed our nuclear investment of £30 billion' and continued: 'But he said it's not enough. He welcomed our defence investments of £11 billion, but he said it was not enough. 'He and his party opposed the decisions that this Government has taken to make those announcements possible, by voting against the budget in October last year. 'You can't spend the money if you won't raise the money. Now, that's a lesson from Liz Truss that he has already forgotten. 'He complains about the level of investment that I've announced, ignoring the fact that the reason this investment is so important is because his party oversaw 14 years of cratering investment, stagnating wages and public service collapse.' She said the more comprehensive budget later this year will 'set out in the round all of the fiscal plans' and added: 'We have already drawn a line under the Tory mismanagement with tax rises last year. 'And we will never have to repeat a budget like that again, because we will never have to clean up after the mess that the party opposite made.'
North Wales Chronicle
2 days ago
- Business
- North Wales Chronicle
Reeves will need ‘Corbynist catalogue' of tax rises to back up spending
Ms Reeves denied the Treasury would produce a 'repeat' of last October's budget and said the Government had 'already drawn a line under the Tory mismanagement'. But shadow chancellor Sir Mel Stride told MPs that Wednesday's spending review was a 'fantasy' and 'not worth the paper that it is written on'. Responding to Ms Reeves's spending plans, the Conservative frontbencher told the Commons: 'This is the spend now, tax later review, because (the Chancellor) knows she will need to come back here in the autumn with yet more taxes and a cruel summer of speculation awaits. 'How can we possibly take this Chancellor seriously after the chaos of the last 12 months?' Sir Mel labelled Ms Reeves 'the tinfoil Chancellor, flimsy and ready to fold in the face of the slightest pressure', who he said was 'weak, weak, weak'. He added: 'She is constantly teetering on the edge of blowing her fiscal rules, which she already changed to allow even more borrowing. 'And the only way she can claim to be meeting her rules is by pretending that she can control spending over the coming years.' As part of the Government's plans, departmental budgets are forecast to grow by an annual average of 2.3% across the period 2023/24 to 2028/29. Ms Reeves also promised a 'record cash investment in our NHS', with an extra £29 billion per year for day-to-day running costs, plus money for rail projects including £3.5 billion additional funding for the TransPennine route upgrade between York and Manchester, and £2.5 billion more for the Cambridge-to-Oxford East West Rail. 'The Chancellor knows she will have to come back in the autumn with more tax rises to fund these plans,' Sir Mel said. 'Or can she assure us right now that this is not the case? Yes or no?' Referring to the former Labour leader and now independent MP for Islington North Jeremy Corbyn, Sir Mel said: 'We know that the Deputy Prime Minister (Angela Rayner) has helpfully provided her with an entire brochure of tax rises that she will no doubt be perusing over the summer, the 'Corbynist catalogue'.' He told MPs: 'Her tone today suggests that all is well, the sunny uplands await. 'What a hopeless conceit. A masterclass in delusion.' Ms Reeves hit back that Sir Mel was 'Stride by name, 'baby steps' by nature'. She said he had 'welcomed our nuclear investment of £30 billion' and continued: 'But he said it's not enough. He welcomed our defence investments of £11 billion, but he said it was not enough. 'He and his party opposed the decisions that this Government has taken to make those announcements possible, by voting against the budget in October last year. 'You can't spend the money if you won't raise the money. Now, that's a lesson from Liz Truss that he has already forgotten. 'He complains about the level of investment that I've announced, ignoring the fact that the reason this investment is so important is because his party oversaw 14 years of cratering investment, stagnating wages and public service collapse.' She said the more comprehensive budget later this year will 'set out in the round all of the fiscal plans' and added: 'We have already drawn a line under the Tory mismanagement with tax rises last year. 'And we will never have to repeat a budget like that again, because we will never have to clean up after the mess that the party opposite made.'
South Wales Argus
2 days ago
- Business
- South Wales Argus
Reeves will need ‘Corbynist catalogue' of tax rises to back up spending
Ms Reeves denied the Treasury would produce a 'repeat' of last October's budget and said the Government had 'already drawn a line under the Tory mismanagement'. But shadow chancellor Sir Mel Stride told MPs that Wednesday's spending review was a 'fantasy' and 'not worth the paper that it is written on'. Responding to Ms Reeves's spending plans, the Conservative frontbencher told the Commons: 'This is the spend now, tax later review, because (the Chancellor) knows she will need to come back here in the autumn with yet more taxes and a cruel summer of speculation awaits. 'How can we possibly take this Chancellor seriously after the chaos of the last 12 months?' Sir Mel labelled Ms Reeves 'the tinfoil Chancellor, flimsy and ready to fold in the face of the slightest pressure', who he said was 'weak, weak, weak'. He added: 'She is constantly teetering on the edge of blowing her fiscal rules, which she already changed to allow even more borrowing. 'And the only way she can claim to be meeting her rules is by pretending that she can control spending over the coming years.' As part of the Government's plans, departmental budgets are forecast to grow by an annual average of 2.3% across the period 2023/24 to 2028/29. Ms Reeves also promised a 'record cash investment in our NHS', with an extra £29 billion per year for day-to-day running costs, plus money for rail projects including £3.5 billion additional funding for the TransPennine route upgrade between York and Manchester, and £2.5 billion more for the Cambridge-to-Oxford East West Rail. 'The Chancellor knows she will have to come back in the autumn with more tax rises to fund these plans,' Sir Mel said. 'Or can she assure us right now that this is not the case? Yes or no?' Referring to the former Labour leader and now independent MP for Islington North Jeremy Corbyn, Sir Mel said: 'We know that the Deputy Prime Minister (Angela Rayner) has helpfully provided her with an entire brochure of tax rises that she will no doubt be perusing over the summer, the 'Corbynist catalogue'.' Shadow chancellor Mel Stride responds after Chancellor Rachel Reeves delivered her spending review to MPs (House of Commons/UK Parliament/PA) He told MPs: 'Her tone today suggests that all is well, the sunny uplands await. 'What a hopeless conceit. A masterclass in delusion.' Ms Reeves hit back that Sir Mel was 'Stride by name, 'baby steps' by nature'. She said he had 'welcomed our nuclear investment of £30 billion' and continued: 'But he said it's not enough. He welcomed our defence investments of £11 billion, but he said it was not enough. 'He and his party opposed the decisions that this Government has taken to make those announcements possible, by voting against the budget in October last year. 'You can't spend the money if you won't raise the money. Now, that's a lesson from Liz Truss that he has already forgotten. 'He complains about the level of investment that I've announced, ignoring the fact that the reason this investment is so important is because his party oversaw 14 years of cratering investment, stagnating wages and public service collapse.' She said the more comprehensive budget later this year will 'set out in the round all of the fiscal plans' and added: 'We have already drawn a line under the Tory mismanagement with tax rises last year. 'And we will never have to repeat a budget like that again, because we will never have to clean up after the mess that the party opposite made.'
