Rachel Reeves has spent the morning touring the broadcast studios as she attempts to pitch roll for Wednesday’s Spring Statement. While this was never meant to be a big fiscal event, it has taken on a new significance as a result of the worsening public finances. The Chancellor is looking for billions in savings with the OBR expected to slash its growth forecast and for rising borrowing costs to have wiped out Reeves’s £10 billion of fiscal headroom. Speaking this morning, Reeves tried to put the unappetising options she faces down to a changing world as a result of global instability part related to Donald Trump and tariffs as well as the war in Ukraine. She told the BBC’s Laura Kuenssberg: ‘The world has changed’ – arguing this was having a negative impact on growth.
With Reeves disinclined to raise taxes even further or change her fiscal rules, spending cuts are coming to make up the shortfall.
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