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Rachel Reeves carried out a £14bn repair job on the UK’s strained public finances on Wednesday in a push to restore the government’s fiscal “headroom” and keep to her “non-negotiable” budgetary rules.
The chancellor’s announcements in the Spring Statement included big cuts to welfare and a squeeze in day-to-day spending by Whitehall departments later in the parliament.
Reeves, who told MPs that her statement took account of “a world that is changing before our eyes”, stopped short of raising taxes. But analysts warned that she might be forced to announce fresh increases later this year.
Here are the main takeaways from the Spring Statement.
Reeves restored the government’s fiscal room for manoeuvre against her current budget rule.
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But she still has one of the lowest margins in recent times.
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While growth forecasts for this year have been halved, the Office for Budget Responsibility is more optimistic for later years.
But the fiscal forecasts may prove optimistic.
