Rachel Reeves, the Chancellor, plans to use Wednesday's spending review to articulate Labour's purpose in power beyond fiscal repair, aiming to reassure voters and backbench MPs after recent political setbacks. The review will highlight significant public spending uplifts, particularly for the NHS, despite future squeezes on 'unprotected' departments. The article discusses the challenge of justifying potential future tax rises and the need for a clearer narrative on economic growth and societal missions, as advised by economist Mariana Mazzucato.
Spending review is a chance for Reeves to paint a more positive picture
Rachel ReevesLabourTax and spendingEconomic policyEconomicsPoliticsBusinessUK
AI Summary
TL;DR: Key points with love ❤️Rachel Reeves, the Chancellor, plans to use Wednesday's spending review to articulate Labour's purpose in power beyond fiscal repair, aiming to reassure voters and backbench MPs after recent political setbacks. The review will highlight significant public spending uplifts, particularly for the NHS, despite future squeezes on 'unprotected' departments. The article discusses the challenge of justifying potential future tax rises and the need for a clearer narrative on economic growth and societal missions, as advised by economist Mariana Mazzucato.
Trending- 1 2010-2019: Day-to-day departmental spending bobbled around £300bn/year.
- 2 Covid pandemic & subsequent energy crisis: Spending shot up.
- 3 Last month: Labour battered by Reform in local elections.
- 4 Last autumn: Budget included £40bn/year tax increase, RDEL bumped to £481bn for current financial year.
- 5 2023-4: RDEL hit £423bn.
- 6 End of parliament: Labour expects day-to-day departmental spending to be more than £540bn/year.
- 7 Wednesday (upcoming): Rachel Reeves hopes to use spending review.
- 8 Autumn (future): Reeves may have to make more tax increases.
- Potential future tax increases
- Difficult decisions on spending for 'unprotected' departments
- Need for Labour to articulate a clearer economic vision
- Potential downgrading of productivity growth projections by OBR
What: Rachel Reeves, the Chancellor, is preparing for a spending review to outline Labour's economic plans and purpose in power, focusing on public spending increases for priorities like the NHS, while facing challenges in justifying potential future tax rises and defining economic missions.
When: Wednesday (upcoming), Last month (local elections), Last autumn (budget), 2010-2019, 2023-4, current financial year, end of the parliament, this week.
Where: UK, London and the south-east (rebalance economy away from).
Why: To explain Labour's purpose in power, reassure voters and backbench MPs after political setbacks (winter fuel U-turn, local election battering by Reform), justify significant public spending, and potentially prepare the ground for future tax increases.
How: Through a spending review, articulating a clearer narrative about Labour's purpose, highlighting public spending increases, and potentially implementing further tax rises.