Rachel Reeves has said tax rises and spending cuts are on the table for this autumn\u2019s budget, as the government aims to tackle a growing shortfall in the public finances which she said was partly due to the lingering impact of Brexit.<\/p>\n
Speaking to Sky News, the chancellor said: \u201cOf course, we\u2019re looking at tax and spending\u201d as she prepared for her 26 November statement. \u201cBut the numbers will always add up with me as chancellor, because we saw just three years ago what happens when \u2026 the Conservatives lost control of the public finances, inflation and interest rates went through the roof.\u201d<\/p>\n
Asked if Brexit<\/a> was to blame, Reeves cited \u201causterity, Brexit and the ongoing impact of Liz Truss\u2019s mini-budget\u201d as having an impact on her budget calculations.<\/p>\n \u201cThere is no doubting that the impact of Brexit is severe and long lasting,\u201d she said. \u201cPeople thought the UK economy would be 4% smaller because of Brexit.\u201d<\/p>\n Reeves said ministers were slowly \u201cundoing some of that damage\u201d with the government\u2019s recent EU arrangements<\/a> on food, farming, youth mobility and energy trading, and with a priority of making deeper trade links, \u201cmost importantly with the EU\u201d.<\/p>\n She said she wanted to be the \u201cchancellor that gets stuff built in Britain\u201d as she vowed to push ahead with plans to fast-track major infrastructure projects and overhaul Britain\u2019s slow-moving planning system.<\/p>\n The autumn budget will mark Labour\u2019s toughest fiscal test, after a downgrade in the productivity forecasts<\/a> from the budget watchdog, the Office for Budget Responsibility.<\/p>\n Reeves confirmed the OBR had \u201cconsistently overestimated\u201d the UK\u2019s productivity, with the expected downgrade of its previous assumptions likely to make its task even harder.<\/p>\n With no boom in economic growth, stubbornly high inflation and the mounting costs of government debt, Reeves will have to fill a black hole estimated at about \u00a350bn by some economists. This includes \u00a36bn after the government\u2019s U-turn on winter fuel payments to pensioners and its decision to drop cuts to the welfare budget.<\/p>\n Rachel Reeves said the planning and infrastructure bill was \u2018probably the biggest piece of legislation that this government passes in the whole of this parliament\u2019. Photograph: Stefan Rousseau\/PA<\/p>\n The chancellor said her approach would be split between fiscal discipline to make the \u201cnumbers add up\u201d and a planning offensive to push long-stalled projects over the line.<\/p>\n Asked repeatedly on the possibility of immediate tax rises, Reeves declined to rule them out or promise the cycle of fiscal tightening would end this year. She described a \u201cdoom-loop\u201d in which weak growth limited fiscal headroom and forced further tax rises as something \u201cnobody wants to end more than I do\u201d.<\/p>\n Instead she insisted sustained economic growth was the only lasting solution, as it was \u201cwhat brings in the tax revenues to be able to afford to keep taxes low and to invest in our public services\u201d.<\/p>\n skip past newsletter promotion<\/a><\/p>\n Get the day\u2019s headlines and highlights emailed direct to you every morning<\/p>\n Privacy Notice: <\/strong>Newsletters may contain information about charities, online ads, and content funded by outside parties. If you do not have an account, we will create a guest account for you on theguardian.com<\/a> to send you this newsletter. You can complete full registration at any time. For more information about how we use your data see our Privacy Policy<\/a>. We use Google reCaptcha to protect our website and the Google Privacy Policy<\/a> and Terms of Service<\/a> apply.<\/p>\n after newsletter promotion<\/p>\n The chancellor also pointed to recent figures that claimed the UK was the fastest-growing economy in the G7 in the first half of the year<\/a> and business investment was increasing. But she acknowledged cost of living pressures \u201cremain very real\u201d.<\/p>\n Reeves used the interview to harden Labour\u2019s builder-over-blocker stance, confirming backing for the Lower Thames Crossing<\/a> linking Kent and Essex east of London, and promising to cut judicial review timelines by six months, with specialist judges assigned to complex cases.<\/p>\n She said the planning and infrastructure bill<\/a>, which she called \u201cprobably the biggest piece of legislation that this government passes in the whole of this parliament\u201d, was in its final stages<\/a>. The bill would \u201cswing the pendulum a little bit in favour, or quite a bit, in favour of those who want to get things done in Britain,\u201d she said.<\/p>\n \u201cThe [Lower Thames Crossing] planning application has got 350,000 pages in it. That is longer than the complete works of Shakespeare. For getting a road built across the Thames, that is not acceptable. We used to be able to do things faster in the past.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Rachel Reeves has said tax rises and spending cuts are on the table for this autumn\u2019s budget, as…\n","protected":false},"author":2,"featured_media":501098,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5226],"tags":[802,748,2000,299,5187,1699,4884,16,15],"class_list":{"0":"post-501097","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-brexit","8":"tag-brexit","9":"tag-britain","10":"tag-eu","11":"tag-europe","12":"tag-european","13":"tag-european-union","14":"tag-great-britain","15":"tag-uk","16":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/115377423344390884","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/501097","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=501097"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/501097\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/501098"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=501097"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=501097"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=501097"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}