Rachel Reeves prepares to unveil Spring Statement in bid to ‘kickstart growth’ ...Middle East

Rachel Reeves will acknowledge she needs to go “further and faster to kickstart growth”, amid dour predictions about her cost-cutting measures and as she scrambles for savings to help balance the nation’s books without hiking taxes.

The Chancellor will be forced to take action to stick to her rule of meeting day-to-day spending through tax receipts, rather than extra borrowing, in response to gloomy forecasts from the budget watchdog.

The Office for Budget Responsibility (OBR) is widely expected to slash its forecast for economic growth, following similar recent revisions by the Bank of England and the Organisation for Economic Co-operation and Development (OECD).

And the watchdog is said to have warned that cuts to welfare set out in recent weeks have fallen short of the £5bn savings ministers expected, according to media reports, leaving the Chancellor with a £1.6bn hole likely to be filled with further cuts.

Follow The i paper live blog for updates.

What Reeves has said in the lead-up to her Spring Statement

Ahead of the statement, the Chancellor has:

Inflation unexpectedly falls to 2.8% in boost for Reeves

UK inflation eased by more than expected last month, new official figures show, delivering a boost to Chancellor Rachel Reeves ahead of her spring statement.

The prices of clothes and shoes fell for the first time in more than three years, the Office for National Statistics (ONS) said.

The rate of Consumer Prices Index (CPI) inflation fell to 2.8 per cent in February from 3 per cent in January.

Most analysts had been expecting CPI inflation to come in at 2.9 per cent for February.

The latest figures mean the cost of living is still rising for households across the UK – and inflation remains above the Bank of England’s 2 per cent target – but at a much slower rate than in recent years.

The bigger-than-forecast inflation drop could provide some relief for Reeves as she prepares to deliver her spring statement on Wednesday afternoon.

She is expected to announce spending cuts for some Government departments and respond to weaker economic growth projections from the Government’s official forecaster.

ONS chief economist Grant Fitzner said: “Inflation eased in February. Clothing prices, particularly for women’s clothes, was the biggest driver for this month’s fall. This was only partially offset by small increases, for example, from alcoholic drinks.”

Overall prices for clothing and footwear fell by 0.6 per cent in the 12 months to February – which the ONS said was the first drop since October 2021. Prices typically rise between January and February, when Christmas sales end and new ranges are launched.

Women’s clothes, accessories like hats and scarves, and children’s clothing all helped bring down the inflation rate last month. Housing inflation, including rents, also slowed in February, as did admission prices for live music.

On the other hand, alcohol and tobacco prices jumped higher, following a tax increase on bottled alcoholic drinks at the beginning of the month.

Responding to the latest data, Chief Secretary to the Treasury Darren Jones said: “Our number one mission is kickstarting growth to raise living standards for working people, that is why we are protecting working people’s payslips from higher taxes.”

Read more here.

‘In an era of global change, we will deliver security,’ says Starmer

Ahead of the spring statement, Prime Minister Sir Keir Starmer said: “In an era of global change, we will deliver security for working people and renewal for Britain.”

Charities and health experts warn welfare cuts could cost lives

Charities and health experts have warned welfare cuts could risk lives, as the Government prepared to publish an official impact assessment into how many people will be affected by its plans.

Prime Minister Sir Keir Starmer has described the current welfare system as “morally indefensible”, insisting Labour’s reforms will help those who can work to get jobs.

But the plans, announced last week, to cut £5bn off the welfare bill have been met with criticism from charities as well as some of his own MPs.

A tightening of eligibility for the main disability benefit personal independence payment (PIP) and cut to the health element of universal credit (UC) have prompted stark warnings and calls for a rethink.

Changes to PIP are expected to account for the largest proportion of savings, with the Resolution Foundation think tank estimating this could see between 800,000 and 1.2 million people in England and Wales losing support of between £4,200 and £6,300 per year by the end of the decade.

An official impact assessment is expected to be published today, coinciding with Chancellor Rachel Reeves delivering her Spring Statement.

Charities have reported a surge in calls and visits to their advice pages following last week’s announcement, which came after lengthy speculation about what might be in store.

Mental health charity Mind said its helpline advisers had reported that some people had indicated their level of worry was such that they felt they had “no choice but to end their own life”.

The charity’s welfare advice line saw calls rise from 90 the previous week to 182 last week, while other information and support lines received more than 2,540 calls, which was a 10 per cent rise on the previous week.

Disability charity Scope said calls to its helpline on the day of the announcement had more than doubled to 344 from 118 the week earlier, while its online community saw 20,000 interactions on the day compared to 15,000 seven days before.

Citizens Advice saw views of its PIP advice pages rise to almost 80,000 views last week, which was a 44 per cent rise from the week before. Scope said people feel “abandoned by the Government”.

Meanwhile, a group of public health experts said further cuts to social security could lead to deaths.

Writing in the British Medical Journal (BMJ), they said the reforms, coming after years of austerity, would have a detrimental effect on already-vulnerable people.

The Government has pledged to invest an additional £1bn-a-year by 2029/2030 to help support people into work including through one-to-one help and said it will protect disabled people who will never be able to work by scrapping the need for them to have benefits reassessments.

Reeves to address grim economic outlook as she faces budget watchdog’s verdict

Rachel Reeves will acknowledge she needs to go “further and faster to kickstart growth”, amid dour predictions about her cost-cutting measures and as she scrambles for savings to help balance the nation’s books without hiking taxes.

The Chancellor will be forced to take action to stick to her rule of meeting day-to-day spending through tax receipts, rather than extra borrowing, in response to gloomy forecasts from the budget watchdog.

The Office for Budget Responsibility (OBR) is widely expected to slash its forecast for economic growth, following similar recent revisions by the Bank of England and the Organisation for Economic Co-operation and Development (OECD).

And the watchdog is said to have warned that cuts to welfare set out in recent weeks have fallen short of the £5bn savings ministers expected, according to media reports, leaving the Chancellor with a £1.6bn hole likely to be filled with further cuts.

The Government has also borrowed more than previously expected, with the cost of those loans rising – in part due to global turbulence.

In her spring statement, the Chancellor will tell MPs that a “more insecure world” requires a greater focus on national security, with a promise to increase defence spending by £2.2bn from April as part of the previously announced plan for the biggest boost in military funding since the Cold War.

She will say: “This moment demands an active government stepping up to secure Britain’s future. A government on the side of working people.

“To grasp the opportunities that we now have and help Britain reach its full potential, we need to go further and faster to kickstart growth, protect national security and make people better off through our plan for change.”

Reeves will tell MPs she is “proud” of her record in office – despite the sluggish economic growth figures which have heaped pressure on her.

In its October forecast, the OBR expected gross domestic product – a measure of the economy’s size – to grow by 2 per cent in 2025 and 1.8 per cent in 2026 but that is widely expected to be downgraded.

The Bank of England halved its growth forecast for the UK economy in 2025 to 0.75 per cent in February, and earlier this month the OECD cut its 2025 forecast from 1.7 per cent to 1.4 per cent.

Lower-than-expected growth will lead to smaller tax receipts than had previously been budgeted for. The latest official borrowing figures, for February, were £4.2bn higher than had been forecast by the OBR.

Reeves’ self-imposed rule to meet day-to-day spending at the end of the five-year forecast through receipts rather than borrowing was forecast to be met with £9.9bn of headroom to spare in the OBR’s October assessment.

But the lack of growth and the increased cost of borrowing will eat into that headroom, forcing the Chancellor to take action to ensure she continues to meet the rule – which is designed to show that Labour can be trusted with the public finances.

Hence then, the article about rachel reeves prepares to unveil spring statement in bid to kickstart growth was published today ( Wednesday 26/03/2025 - 12:03 PM ) and is available on inews ( Middle East ) The editorial team at PressBee has edited and verified it, and it may have been modified, fully republished, or quoted. You can read and follow the updates of this news or article from its original source.

Read More Details
Finally We wish PressBee provided you with enough information of ( Rachel Reeves prepares to unveil Spring Statement in bid to ‘kickstart growth’ )

Also on site :

• Meta-backed Hupo finds growth after pivot to AI sales coaching from mental wellness
• Iran protests latest: Trump to be briefed on military strike options after he orders new sanctions on Tehran
• What we know about the alleged arson at Mississippi’s largest and oldest synagogue