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Saturday, 28 June 2025
Politics

Rachel Reeves admits some will lose out in spending review

Rachel Reeves admits some will lose out in spending review

Chancellor Rachel Reeves has said that in the review of the upcoming expenditure, every government department “whatever they want will not get everything”, because he defended his economic decisions.

In a speech in Manchester, Reaves suggested that he had rejected the requests for funding from ministers and argued that a squeeze on funding was “product of economic reality”.

Reeves said that his rules were “non-pervasive” when borrowed to pay for public services and insisted that he was essential for the “orthodox malnutrition” of the economy.

Chancellor also confirmed Winter fuel payment will be restored to some pensioners this yearAfter cutting allowance by the government.

The government said that the expenditure will be reviewed on June 11, “will check every pound to be spent by the government”.

The review will prepare the day-to-day departmental budget in the next three years and the investment budget in the next four.

The internal sources in the Whitehall have told the BBC that they hope it would be “ugly”, and the ministers are fighting for their respective departments winning small amounts of cash.

During the Prime Minister’s questions, Conservative leader Kemi Badenoch said that the government was in anarchy and accused cabinet ministers of “squabbing” on funding.

Sir Kir Stmper said that the government was taking a “correct decision” on the economy, stating that development figures had increased, while interest rates were cut.

The situation of Reeves has been speculated that the expenditure will be cut for day to day expenses and not increasing taxes again.

The Chancellor said that the already declared in the last year’s budget, already declared £ 40BN tax hikes and changes for borrowing for investment, means that £ 300BN was available to pay for infrastructure projects in additional years to come.

But the Chancellor indicated that there was some friction within the government on the decision on day-to-day expenses on public services, from jails to policing.

The Chancellor said that despite the increase of £ 190BN in funding during the review period of spending, “not every department will get everything they want next week and I do not have to say for things that I want to do”.

“This is not due to my fiscal rules,” Reavs said.

“This is the result of 14 years of our public services, our public sector and conservative malnutrition of our economy.”

She said that “there were good things that do not tell me” but “The reason is that it is important to control public finance”.

The conservative shadow Chancellor Mail Strued said: “The government’s mismanagement of the economy has already increased heavy tax.”

He said: “I think next week we are going to see some very difficult things during the allocation of spending.”

The Institute for Fiscal Studies (IFS) Think Tank has warned that difficult options are “unavoidable”, some departments have faced cuts in spending.

In his speech, Reeves made a tremendous defense of his fiscal rules, As he announced a £ 15.6BN investment in transport infrastructure in England,

“In the next week you will hear a lot of debate about my so-called self-flowning fiscal rules,” Reeves said.

“Unlike some traditional knowledge, I did not want to enter politics because I care about fiscal rules passionately.”

The Chancellor said that she came into politics, “because I want to make a difference on the lives of working people”, saying that she “goes through economic responsibility and social justice”.

Reeves accused former conservative Prime Minister Liz Trus of trashing the market confidence with his mini-judgment, including borrowing, waging global investors, and 45 billion tax deductions for their resignation.

The Chancellor suggested that the reform UK leader Nigel Faraj was “itching to repeat that accurate use”, calling it “fantasy politics”.

“This is why my fiscal rules are non-pervasive,” said Reavs.

“Let’s clear: It is not putting me a borrowing limit on the government, those boundaries are products of economic reality.”

There are two main rules of Chancellor that he has argued that he will bring stability to the UK economy:

  • Instead of borrowing, day to day government cost will be paid for tax income
  • Debt fall as part of national income by the end of this Parliament in 2029/30.

Reeves was speaking at Roshadel as he confirmed the plan to move away from the treasury’s green book, which is used by the authorities to calculate the value for the money of major projects.

The book is criticized in favor of London and southeast.

In his speech, the Chancellor stated that staying from the rules of the book meant “the growth made in very few places, felt by very few people and wide gaps between areas and between our cities and towns”.

Changing the rules means that more money for areas of North and Midlands, including the so -called “red wall”, where Labor MPs face an election challenge from the UK.

The £ 15.6bn package trams, train and bus projects will be spent in the Midlands, North and West of the country.

After his speech in Q&A, Reavs also confirmed that “more people will get winter fuel payment in winter”.

This comes after a backlash on the decision after the return of allowances from millions of pensioners after Sir Kir.

However, it was not yet clear whether the policy change would be for this winter.

Reeves said that the instrument test which determines that the qualification for payment “will increase” and they will determine the details of how the government will fund it in its next budget in the autumn.

More than 10 million pensioners were paid last year after the Labor government banned the eligibility for those who qualified for pension credit and other income-related benefits.

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