Politics
Labour’s New Economic Era: Rachel Reeves Sets Date for Inaugural Budget Amid Fiscal Challenges
Rachel Reeves has declared that the initial budget from the Labour government will be unveiled in October. She noted that comprehensive economic and fiscal projections from the Office for Budget Responsibility will accompany the budget announcement.
Political journalist @alixculbertson
Monday, July 29, 2024, 18:
Rachel Reeves has declared that the inaugural budget from the new administration is scheduled for October 30.
The chancellor announced the date for the budget – the first under Labour since their electoral victory on July 4 – in an extensive address in the Commons, where she charged the former Conservative government with misleading the public about their intended public spending.
Ms. Reeves announced her findings following a Treasury analysis of the government's finances, revealing a £22 billion deficit.
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The Tories see Ms. Reeves' comments as setting the stage for possible tax increases in the upcoming budget, even though Labour had promised not to raise significant taxes during the election campaign.
Ex-chancellor Jeremy Hunt charged Ms. Reeves with unfairly blaming the Conservative government as a pretext for increasing taxes and halting projects.
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Ms. Reeves stated that the budget, outlining the government's economic strategies, will be presented concurrently with comprehensive economic and fiscal projections from the Office for Budget Responsibility.
She described it as "a budget to stabilize the economic base."
"She added that the budget will be crafted based on the ideals that led to the new government's election."
The chancellor vowed to handle public funds with care, making sure that each pound is utilized effectively.
Ms. Reeves stated her commitment to making sure that all government expenditures are cost-effective.
She vowed not to increase tax rates for the working class.
"She reiterated Labour's campaign pledge to not raise national insurance, nor the basic, higher, or additional rates of income tax or VAT," she stated.
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The chancellor announced that her initial budget would adhere to three key guidelines: complying with Labour's financial regulations, achieving a balanced current budget, and reducing the national debt relative to the economy's size by the conclusion of the projected period.
In preparing for the delivery of unwelcome news, she stated, "I must be upfront, difficult compromises are still at play."
Ms. Reeves announced the initiation of an extensive spending review, spanning multiple years, which will establish the budget allocations for various departments for a minimum of three years. This review will also cover the budgets for the current and the following year, in conjunction with the budget set for October 30.
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