Rachel Reeves Planning To Raise Taxes And Cut Spending In October Budget

22nd August 2024

Chancellor insists she still has large black hole to fill despite stronger-than-expected growth in first half of 2024.

Rachel Reeves is planning to raise taxes, cut spending and get tough on benefits in October's budget amid Treasury alarm that the pickup in the economy has failed to improve the poor state of the public finances.

The chancellor is insisting she will still have a substantial black hole to fill despite stronger than expected growth in the first half of 2024.

Strong spending on public services and welfare pushed government borrowing to £3.1bn last month, more than double its level in the same month a year earlier and worse than experts had expected, according to figures released on Wednesday from the Office for National Statistics.

The deficit was the highest for a July in three years and £3bn higher than expected by the government's spending watchdog, the Office for Budget Responsibility.

She announced last month that she was scrapping winter fuel payments for most pensioners, shelving plans for social care reform and axing road, rail and hospital investment as the first stage of a plan to reduce borrowing.

Now the Treasury has made it clear that further hard choices would need to be made when Reeves delivers the first Labour budget since 2010 on 30 October.

Read the full article at The Guardian from Tuesday 20 August 2024

There are alternatives as suggested by Richard Murphy in his Taxing Wealth Report HERE