Latest news with #nationalrenewal
Sky News
2 days ago
- Business
- Sky News
Is chancellor's spending review the start of a 'national renewal' - or too good to be true?
If you sat through the entire spending review speech delivered by Rachel Reeves in the House of Commons, you might have been lulled into a sense that the UK was awash with a wealth of riches as the chancellor sprinkled billions across the land. There were billions for social housing, nuclear power stations, rail lines and research and development to power the economy. There was money for schools, the police, the NHS, and defence spending, as the chancellor sketched out her roadmap for Britain for years to come, with an acknowledgement that the government - and particularly this chancellor - had endured a difficult first year. "We are renewing Britain. But I know that too many people in too many parts of our country are yet to feel it…the purpose of this spending review is to change that," she said. There was £113bn of borrowing to fund capital investment and an extra £190bn over the course of the parliament for public services, fuelled by those contentious tax rises in the budget last autumn. This was a Labour chancellor turning her back on austerity. "In place of decline, I choose investment. In place of retreat, I choose national renewal," she said. The chancellor deserves credit for the capital investment, which she hopes will unlock jobs and power economic growth. But when something sounds too good to be true, it normally is. For me, former shadow chancellor John McDonnell hit the nail on the head on Wednesday night as he remarked rather wryly to me that "the greater the applause on the day, the greater the disappointment by the weekend". 3:43 Could tax hikes be needed? Because, in talking up the prospect of national renewal, the chancellor glossed over what the "hard choices" mean for all of us. There are questions now swirling about where the cuts might fall in day-to-day budgets for those departments which are unprotected, with local government, the Home Office, the Foreign Office, and the Department for Environment all facing real-terms cuts. My colleague Ed Conway, analysing the government figures, found cuts in the schools budget for the last two years of this parliament - the chancellor's top line figure showed an overall rise of 0.6% over the five-year period of this Labour government. There are questions too over whether council tax bills might be increased in order to top up local government and police budgets. Ms Reeves told me in an interview after her speech that they won't, but she has predicated increases in police funding and local government funding coming locally, rather than from central government, so I will be watching how that will play out. 4:28 Even with the increase in health spending - the NHS is getting a 3% boost in its annual budget - there are questions from health experts whether it will be enough for the government to hit a routine operations target of treating 92% of patients within 18 weeks. My point is that this might not be - to again quote Mr McDonnell - "mathematical austerity", but after over a decade where public dissatisfaction in public services has grown, the squeeze of day-to-day spending could make it hard for the chancellor to persuade working people this is a government delivering the change for them. There is pressure to reverse some of the welfare cuts, and pressure to lift the two-child benefit cap, while the pressure to reverse the winter fuel allowance has already resulted in Reeves this week making a £1.25bn unfunded spending commitment (she will set out how she is paying for it at the next budget). 10:03 Will voters feel the 'renewal'? Reeves told me on Wednesday there was no need for tax rises in the autumn because the spending envelope had already been set, and the money now divvied out. It's a very live question as to whether that can hold if the economy weakens. She did not rule out further tax rises when I asked her last week, while Treasury minister Emma Reynolds told my colleague Ali Fortescue on Wednesday night: "I'm not ruling it in, I'm not ruling it out." The gamble is that, by investing in infrastructure and getting spades in the ground, and tilting limited public money into the NHS, the government can arrive at the next election with enough 'proof points' to persuade voters to stick with them for another five years. On Wednesday, the chancellor laid the foundations she hopes will turn the government's fortunes around. The risk is that voters won't feel the same by the time they are asked to choose.
Telegraph
2 days ago
- Business
- Telegraph
Our purpose is clear: to make you and your family better off
This Labour Government was on a promise of change: to deliver a decade of national renewal. To build a stronger, more resilient country that could navigate an ever-changing world. On Wednesday, we took the next step in delivering on that promise by investing in Britain's renewal – and investing in the priorities of the British people. First, on security. We are keeping our country safe with an £11 billion real-terms increase in defence spending, making sure our Armed Forces have the equipment they need. And we are boosting funding for our security and intelligence agencies, so they have the tools to respond to new threats. Strong national security depends on strong border security. We are cracking down on criminal gangs and illegal immigration, with new investment in Border Security Command, worth up to £280 million more each year. We are ending the costly use of hotels for asylum seekers, saving taxpayers' money and restoring order to our immigration system. The Conservatives lost control of our borders, Labour is taking back control. Second, we are investing in the nation's health. A strong economy needs a strong NHS. The NHS we inherited from the Conservatives was broken. Patients waiting too long for treatment. Families getting caught up in the 8am scramble to get a GP appointment. And services stuck in the analogue era. We promised to change that and we are changing it. That is why I have announced record investment in the NHS, with £29 billion more a year to improve patient care. But let me be clear: this investment comes on the condition of reform. It's not enough to spend money on a broken system. It is about investing to reform services so they are fit for the modern century. And finally we are investing in the economy. We cannot tax and spend our way to prosperity. We need to grow the economy. That is why I announced this week we are giving the green light to Sizewell C, a multi-billion nuclear station that will create and support tens of thousands of jobs. We are investing to fix our roads, rail and national infrastructure, so people can get to and from work and businesses can prosper. And we are creating jobs in the industries of the future – from defence and nuclear to technology and life sciences. This investment is with a singular purpose in mind: to make you and your family better off. To turn the page on 14 years of decline. To deliver a Britain where every family can feel safer, healthier and better off. This is what the British people voted for, and this is what this Government is delivering.
The Guardian
2 days ago
- Business
- The Guardian
Labour promised people we would rebuild Britain – and that's what we're doing
The mandate we received from the British people could not have been clearer. First, we had to stop the chaos and return Britain to economic stability. Second, we had to turn the page on Tory decline with clear Labour choices. Third, we were instructed to rebuild our country. Wednesday's spending review turbocharged that rebuilding. It is an investment in Britain's renewal, so working people have more money in their pocket, more pride in their community and more hope for their children's future. It's what people voted for. An NHS cutting waiting lists, with care closer to the community. Wealth and opportunity no longer hoarded by only a few towns and cities. That means carbon capture projects in Merseyside, Scotland and along the east coast. It means nuclear fusion in Nottinghamshire. Rail investment in Wales. New metro schemes, everywhere from the north-east to the West Midlands, Manchester, South and West Yorkshire. Labour's message is clear. Every community is now viewed as a source of dynamism and growth. National renewal is for everyone. Don't mistake us – it must still be built on firm foundations. The first job of this government was to stabilise the British economy. We did need to stop the chaos. We did need to repair our public finances. And we did need to turn the page with a budget of tough but fair Labour choices. Nobody wants taxes to go up. But politics is about choices. So when we asked private schools, second homeowners and non-doms to contribute more, we chose a fairer way. Take our announcement last week to extend free school meals to every child on universal credit. One hundred thousand children will be lifted out of poverty as a result – £500 back in the pockets of hard-pressed parents. And more than that, the time. The comfort that knowing the only hunger your kid will experience that day is the hunger for learning. That is the difference we were elected to make. But it's only possible because we took tough decisions nine months ago. It's the same for every success in my Plan for Change so far. Every breakfast club opened, every pothole filled, every extra hospital appointment, rests on those foundations. Change and stability are not in tension. They must advance together. Look at our opponents. Once again, they believe in the alchemy that says taxes can come down and spending can go up. It's fool's gold – precisely the sort of fiscal fantasy that dragged Britain into the mire of decline in the first place. We were crystal clear at the election – we would never put working people through that again. And we would never recklessly forfeit the opportunity to renew their communities with investment. The spending review shows why, and it starts with security. Security in your family finances, security at work, security at our borders and the defence of our country – this government is investing to keep you safe. We are protecting jobs when they are on the line, as we did with British Steel. We are creating new opportunities by investing in homegrown clean energy and life sciences where Britain has a competitive edge. We are pushing forward with the biggest sustained increase in defence spending since the cold war, unleashing a 'defence dividend' that will fire up our industrial communities. The NHS, too, will receive record levels of investment. The best scanners, equipment and technology will be placed in the hands of our brilliant NHS staff. And we will step up to tackle the great social justice cause of our time, with a £39bn investment in affordable housing. This last one is deeply personal for me. Shamefully, after years of Tory failure to build, more than 80% of Britons now believe owning your own home is 'unaffordable for most people'. This is a national emergency – home ownership should not be a distant dream. If we don't build more homes, homelessness rises, more children are forced to grow up in temporary accommodation, and millions of ordinary families are denied the security they deserve. It would be a disaster for working-class aspiration and I am determined to change it. I know what it's like to struggle to make ends meet. Growing up, my family's phone was regularly cut off, because that was the easiest bill to skip when money ran out. But because we owned our house, we always had that bedrock of security we could build a future around. A base camp for aspiration. Young working-class people today deserve that same opportunity. It's basic Labour fairness. Whether you are a young family trying to buy your first home, an apprentice looking for construction jobs in your community, or a nurse working harder and harder with outdated technology at your hospital, Britain should give you a fair crack of the whip. That's what this spending review delivers. It spreads opportunity more fairly across the country. It backs the potential of working people in every community. And with wages rising strongly, it gives a further boost to an economy that is beginning to turn a corner. A nation returned to growth, defiantly open for business, determined to deliver security and renewal for its people. I know there is so much more to do. But this week we entered a new stage in the mission of national renewal. Last autumn, we fixed the foundations. Today, we showed Britain we will rebuild. Keir Starmer is the prime minister of the United Kingdom
Reuters
3 days ago
- Business
- Reuters
UK's Reeves to make $2.7 trillion bet on 'Britain's renewal'
LONDON, June 10 (Reuters) - British finance minister Rachel Reeves will divide up more than 2 trillion pounds ($2.7 trillion) of public spending on Wednesday in a speech she hopes will foster a sense of national renewal and make clear the year-old Labour government's political priorities. In an address to parliament due after 1130 GMT, Reeves will set out day-to-day budgets for government departments from 2026 to 2029 and investment plans out to 2030. Reeves set the overall total for spending in an October budget, financing her plan with the biggest tax rise in a generation and looser fiscal rules that make it easier for her to borrow to cover long-term investment. The choices she announces on Wednesday must start paying off quickly if Labour is to achieve its goals of boosting Britain's growth rate and improving the quality of overstretched public services. "This government is renewing Britain. But I know too many people in too many parts of the country are yet to feel it," Reeves is expected to tell parliament, according to speech extracts released by the finance ministry. Reeves said the government would "invest in our country's security, health and economy so working people all over our country are better off." Among the projects announced on Wednesday was likely to be a 39 billion-pound 10-year programme to build lower-cost housing - almost doubling the annual amount spent on this compared with existing support, the finance ministry said. Since its sweeping election victory last July, Labour has seen its popularity slide. The right-wing Reform Party led by former Brexit campaigner Nigel Farage is now ahead of it in the polls and outperformed it in English local elections last month. While Britain's economy recorded the fastest growth of the Group of Seven advanced economies in the first quarter of this year, the International Monetary Fund has forecast that in coming years it will lag behind the United States and Canada and barely outperform the euro zone. Official data on Tuesday showed the jobless rate had hit its highest in nearly four years - which the opposition Conservatives blamed on Reeves' October decision to place the main burden of tax rises on employers and boost workers' rights. Discussions between Reeves and government ministers have continued into this week over how big a slice their departments will receive of a pie whose size was set last year. Plans announced so far include 86 billion pounds on research and development, 16 billion pounds on public transport, 4 billion pounds on a new nuclear power station, 6 billion pounds on nuclear submarines and 4 billion on prisons. The final spending increases are unlikely to be shared out equally. Capital-intensive plans to raise defence spending to 2.5% of gross domestic product, announced by Starmer in February, mean other departments will see no real-terms increase in the pace of investment after this year, the Institute for Fiscal Studies think tank estimates. Day-to-day spending on public services is due to rise by an average of 1.2% a year on top of inflation between 2026-27 and 2028-29, while capital budgets will increase by an average of 1.3% in real terms through to 2029-30, according to the IFS. Both rates of growth are much slower than in the current financial year, when investment spending is set to jump by 11.6% and current spending rises by 2.5%. For day-to-day spending, increasing the health budget by 2 percentage points more than the average - as was typical when Labour was last in power before 2010 - would mean real-terms cuts of 1% a year for other departments, the IFS said. Chris Jeffery, head of macro strategy at Legal & General, Britain's largest asset manager, said the fact that the overall spending total was known limited the impact for investors. Instead, financial markets would be most focused on whether any proposed cuts looked realistic for the departments affected. "If they're imposing really large real-terms cuts in spending, then I think the market will come to the conclusion that these are less likely to be delivered than if they are less aggressive," he said. ($1 = 0.7409 pounds) ($1 = 0.7410 pounds)
