Chancellor Rachel Reeves will deliver a press conference from Downing Street following her Spring Statement which saw billions of pounds of welfare cuts announced
Chancellor Rachel Reeves will give a press conference at 4:30pm in Downing Street after delivering her Spring Statement.
Ms Reeves announced sweeping welfare cuts and plans to slash the number of civil servants as she tries to balance the books. Prime Minister Keir Starmer has described the current welfare system as “morally indefensible”, insisting Labour’s reforms will help those who can work to get jobs.
The Chancellor confirmed there would be no tax changes in the major financial announcement, meaning she was forced to balance the books in other ways. Gloomy forecasts and slow economic growth meant she had to expand her already announced cuts to benefits. She also announced a reduced uplift in day-to-day government spending – meaning cuts for some unprotected government departments – and a downgraded economic growth forecast for this year.
Ms Reeves has faced loud pushback in the last week – including from Labour MPs – who say the Treasury should instead raise taxes for Britain’s ultra-wealthy instead of targeting the poorest in society. And pressure is mounting on her after the DWP’s official estimates show her benefits cuts will push over 250,000 people – including 50,000 children – into relative poverty.
In a major Spring Statement announcement to the Commons, the Chancellor said the world is “changing before our eyes” and that there is a need for an “active government” to respond to global events. She explained to MPs that escalating threats across the continent were “evolving rapidly” as she laid the ground for tough decisions in order to boost defence and security. She announced a £2.2billion down payment on defence spending, which will help the UK hit is target of spending 2.5% of GDP on defence by 2027.
The new cash is funded from Treasury reserves and from controversial cuts to the foreign aid budget announced last month. Ms Reeves defended the decision to slash support for the world’s poorest to pay for defence, saying: “The number one priority of any government has got to be to keep its citizens safe and secure.”
In some good news, her planning reforms will create a “permanent” increase to GDP. Furthermore, while the Office for Budget Responsibility downgraded growth forecasts for this year, it increased its estimates for all its subsequent yearly forecasts. And the spending watchdog also predicted that real household disposable income would grow faster than it had expected last October. Ms Reeves said: “People will be on average £500 a year better off under this Labour government.”
But the revised forecasts, nor Ms Reeves’ explanations of “increased global insecurity”, will provide little comfort to vulnerable and disabled people across the country who face fresh cuts.