Sep 23 2024: UK Finance Minister Rachel Reeves vowed on Monday that there would be no return to austerity or widespread cuts, despite facing a challenging economic outlook and a significant budget deficit. Reeves emphasized her commitment to fostering long-term growth while addressing the economic challenges left by the previous Conservative government.
Speaking ahead of a keynote speech at the Labour Party conference in Liverpool, Reeves adopted a more optimistic tone, stating, “I have never been so optimistic about Britain’s future.” She acknowledged that tough decisions would be necessary, including tax rises to address a £22 billion ($29 billion) gap in public finances, but promised to protect living standards and public services.
No Return to Austerity, Focus on Growth
Reeves stressed that there would be no repeat of Conservative-led austerity policies, which she described as “destructive” to public services and investment. “We must deal with the Tory legacy, and that means tough decisions. But we won’t let that dim our ambition for Britain,” she said. Reeves also confirmed that Labour’s budget, to be presented on October 30, would prioritize stability for businesses, families, and public services, including the National Health Service (NHS).
Tax Rises and Tough Choices Ahead
Reeves indicated that tax increases would be necessary to plug the financial shortfall but reassured voters that Labour would maintain its manifesto commitments not to raise income tax, National Insurance, VAT, or corporation tax. However, she defended the government’s “difficult” decision to cut winter fuel payments for millions of pensioners, a move that has sparked criticism from trade unions and traditional Labour supporters.
Reeves also addressed the issue of political donations, stating that while she and other senior ministers had used donations for campaign-related expenses like clothes, she pledged that such donations would no longer cover personal expenses while in government.
Addressing COVID Corruption and Economic Optimism
In addition to outlining budget priorities, Reeves announced plans to appoint a COVID corruption commissioner to investigate over £650 million in contracts awarded during the pandemic, many of which are alleged to have gone to individuals with close ties to those in power.
Despite the financial challenges, Reeves expressed optimism about the country’s future: “If we can get this right, there is no end to what we can achieve as a country.”
