“Rachel Reeves is preparing to announce a £19 billion shortfall in public finances, citing pressures on the NHS, prisons, and schools. This figure, identified by a Treasury audit, includes costs for inflation-busting public sector pay deals. Reeves is expected to reveal the deficit in Parliament on Monday, alongside the date for her first Budget. Despite the expected tax hikes, Reeves and Sir Keir Starmer have ruled out austerity measures, focusing instead on finding efficiency savings and potential project delays to manage the deficit. The Office for Budget Responsibility’s economic outlook will influence the scale of tax increases, as Labour navigates its pledge to avoid raising income tax, national insurance, or VAT while hinting at potential changes to pension and inheritance tax reliefs.”
Quotation by Nigel Holland.
- Rachel Reeves to announce a £19 billion deficit in public finances.
- Deficit due to pressures on the NHS, prisons, and schools.
- Expected tax hikes to manage the shortfall and avoid austerity.
- Efficiency savings and project delays considered to reduce deficit.
- Labour pledges no income tax, national insurance, or VAT increases.