Chancellor Rachel Reeves has presented her first highly-anticipated Spring Statement to parliament.
After a controversial first Autumn budget was revealed in October 2024, Ms Reeves returned to reveal her latest financial statement.
Last year’s budget saw major tax increases, which Labour believed will bring in an extra £40billion.
Ms Reeves, who became the first woman to deliver the Budget, announced that the Office for Budget Responsibility’s economic growth forecast for 2025 has been slashed from 2% to 1%, although GDP growth forecasts for future years have been upgraded.
In a Commons speech following Prime Minister’s Questions, the Chancellor promised an extra £2.2 billion for defence from April, telling MPs that a “more insecure world” requires a greater focus on national security.
Ms Reeves previously hinted that tax rates will remain the same, but experts have warned further hikes now look likely in the autumn.
Pressure was relieved slightly on the Chancellor on Wednesday morning as the Office for National Statistics (ONS) has revealed that the rate of inflation fell to 2.8% last month.
But the OBR has warned the Chancellor Rachel Reeves that UK and global economic uncertainty could derail her plans.
Follow below for the latest news and information.
Key Points
- Rate of Inflation falls to 2.8% relieving some pressure on the Chancellor
- Sir Keir Starmer begins PMQ's by saying Government 'going further and faster on the economy'
- Chancellor says she's 'not satisfied with numbers' as OBR halves 2025 growth forecast
- Voluntary exit schemes will be introduced to reduce the size of the civil service
- Find out more about the key points announced by Chancellor Rachel Reeves in the spring statement
- Protesters rail against Labour welfare cuts set to push 250,000 more into poverty
Coverage ends
20:40 , Matt WattsThat ends our coverage of Rachel Reeves’s Spring statement. Thanks for joining us.
You can get a full round up of the key announcements the chancellor made here.
Reeves disagrees with Government assessment on poverty impact
20:38 , Matt WattsRachel Reeves said she does not believe that 3.2 million people will be worse off from the welfare changes, or that 250,000 will be pushed into relative poverty, as the Government’s own impact assessment suggests.
Asked whether she denied that this would be the impact, the Chancellor told LBC: “I don’t think that is what will happen… what the OBR say is they’re not at this stage making any allowance that people are likely to go into work, but we’ve put aside a billion pounds for personalised guaranteed training.”
Tax the richest instead of imposing cuts, union boss tells Labour
18:41 , Matt WattsUnite general secretary Sharon Graham has slammed the cuts announced in Rachel Reeves' Spring statement.
She said: "There is absolutely no point doggedly keeping to fiscal rules, while society crumbles around you."
She welcomed an increase in the defence budget, saying it would help British manufacturing jobs, but said public spending priorities should be funded via taxes on the richest rather than cuts.
"A wealth tax, as well as fairer taxes on corporate profiteers and the highest earners, would deliver far more money than any cuts to benefits and public services," she said.
Reeves refuses to rule out tax rises amid warnings millions face tax hikes in Autumn
17:53Rachel Reeves declined to rule out hiking taxes at her next budget in response to warnings she will be forced to find more money to balance the books.
Leading economists have warned the chancellor may be forced to raise taxes for millions in a “blockbuster” autumn Budget.
But she insisted she was focused on growing the economy as a way to generate revenue, rather than relying on tax rises or spending cuts.
The Chancellor said: “I’m not going to write four years of budgets, I’ve just delivered a spring statement today.
“But I think you can see through this spring statement how determined I am, how determined this government is, to live within the means that we set ourselves in the budget last year and to grow our economy because that is the way to sustainably improve living standards and have the money that we need for our public services.”
At a Downing Street press conference she said her “once-in-a-generation” tax-raising first budget in October had “wiped the slate clean” and would not need to be repeated.
“There was lots of speculation that I was going to change taxes today, the Tories were desperate to call this an emergency budget – it was far from it,” she said.
Chancellor: Trump’s tariffs will damage UK and US
17:29
When it comes to Donald Trump’s tariffs on Canada, Mexico and China, which has sparked fears of a global trade war, Ms Reeves said: “The OBR has set out today in its documents some different scenarios for what tariffs might mean for the UK economy.
“I think all of us were very pleased when our Prime Minister went to Washington just a few weeks ago to have those initial meetings with the US president. The last time Donald Trump was president of the United States, trade and investment flows increased between our countries.”
She added: “Tariffs between our economies, increased tariffs between our economies will damage both our economies, and we’ll continue make that case for free and open trade.
“Let’s see where we get to in the next few weeks. But I recognise how important free and open trade is not just with the United States, although they are our biggest trading partner, but also with the EU and that’s why I’m pleased the summit between the UK and the EU has been organised for May this year because we also want better trade flows between us and our nearest neighbours in Europe, particularly to help small businesses that have been tied up in red tape since the botched Brexit deal the previous government did.”
Rayner refuses to be drawn on Rayner's claim tax is at ‘sweet spot’
17:22 , Bill Bowkett
Rachel Reeves was asked about Deputy Prime Minister Angela Rayner telling LBC that taxation was at a ‘sweet spot’.
The Chancellor said: “I think the most important thing is that when people pay money in tax, that we treat it with the respect that we would treat our own money.
“For too long that hasn’t happened, whether it was Covid contracts that went to friends and donors of the Conservative Party, whether it was a bloated bureaucracy, quangos getting out of control. And I’m determined that when we ask people to pay tax to fund public services, it actually goes to people’s priorities.
“More money on the NHS, more money on our schools and crucially in the changed world we face today more money on defence.”
Chancellor defends accepting free Sabrina Carpenter tickets amid cuts
17:17 , Bill Bowkett
Ms Reeves has defended accepting free tickets worth £600 to a Sabrina Carpenter concert at London’s O2 Arena earlier this year amid her welfare benefit cuts.
The Chancellor said: “Now it may come as a surprise to you that I’m not personally a huge Sabrina Carpenter fan being a 46-year-old woman but a member of my family did want to go and see that concert.
“I’m not in a position now that I can easily just go and sit in a concert and some of the things that I might be able to do in my everyday life in the past are not so easy now, so I had advice that it would be easier to be in a box.
“The owners of the O2 had a box with tickets that are not available to buy and they said that I could go in there and that was better for security reasons. I do recognise that people think that’s a bit odd but that’s the reason why I did that rather than just being in normal seats which to be honest for me and my family would have been a lot nicer and a lot easier.”
Rayner's workers' rights bill will make ‘ordinary working people’ better off
17:09 , Bill BowkettThe Chancellor, commenting on Angela Rayner’s Employment Rights Bill, said: “As we grow the economy we want ordinary working people to benefit and that’s why we are banning exploitative zero-hour contracts and banning fire-and-rehire.
“And also that’s why we are increasing the national living wage because we want to incentivise people to go into work and offer the security and dignity that should come from employment.
“Now the OBR haven’t put anything in their forecast today about the Employment Rights Bill because it’s still working its way through Parliament but we’re confident it will result in ordinary working people having more money in their pockets but also having the security to spend that money because they don’t have to worry from week to week whether they’ll be in work or how many hours they’ll get.”
Chancellor: You can’t tax and spend towards prosperity
17:05 , Bill BowkettRegarding the £14 billion in spending cuts, Ms Reeves insisted her Budget was a “once-in-a-generation” measure.
The Chancellor added: “We have now wiped the slate clean, we’ll never have to do a Budget like that again.
“There was a lot of speculation I was going to change taxes today, the Tories were desperate to call this an emergency budget, it was far from it. We have found efficiencies in public spending, we have shifted money from ODA to defence and of course one of the ways we restored the headroom is the fact the OBR have scored one of our planning reforms... which has also provided £3.4 billion that we can sue to restore that headroom.”
“You can’t tax and spend your way to prosperity. The previous government only knew tax and spend but didn’t know growth and we are growing the economy.”
Reeves plays down prospect of watering down Digital Service Tax to help US tech firms
17:02 , Bill BowkettOn whether she is playing down the prospect of the Digital Services Tax being watered down to help global tech giants, Ms Reeves said: “In terms of tax policy, it’s up to the UK government to set tax policy for the UK economy, including digital services tax.
“Now the digital services tax was supposed to be temporary until there was a global agreement as part of pillar one and pillar two of the OECD agreement, but we believe that companies should pay tax in the countries in which they operate, which is why we introduced the digital services tax in the first place, and our views on that have not changed.”
Reeves pressed on whether pushing Britons into poverty a 'price worth paying'
16:56 , Bill BowkettAsked whether pushing 250,000 more people into relative poverty, according to the Office for Budget Responsibility, was a “price worth paying”, Ms Reeves said: “As the OBR have also set out they haven’t accounted for any change in the number of people who are on benefits today who will go into work, and they set out in the document they produced today that they’re going to do some work ahead of the Budget in the autumn to analyse our plans, the £1 billion of investment that we’re putting in to have guaranteed personalised and tailored support for people to get back into work.
“So we’re confident that the changes we are making and the changes we’re making to get people back into work will result in more people having fulfilling careers, paying decent wages and of course that’s the best way to lift families out of poverty.”
We are going further and faster, says Reeves
16:53 , Bill Bowkett
We can hear once more from Rachel Reeves, who is currently giving a press conference in Downing Street following her first spring statement.
The Chancellor said: “Security for working people, renewal for Britain. That is the Government’s mission in a changing world. That is why we have invested in our NHS to cut waiting lists five months in a row, why we are rolling out breakfast clubs in every school in England, and why we are increasing the minimum wage by £1,400 for someone who works full-time from next week.
“But I know that it’s not enough. The cost-of-living crisis is still very real for people in Britain, global instability is holding back prosperity across the world and countries across Europe are rightly having to spend more on defence.
“That is why today I have spelled out how we are going further and faster in delivering our Plan for Change.”
Save the Children: This could be first Labour government to oversee rising child poverty
16:50It is a political choice to plunge 50,000 more children into poverty by the end of this parliament, as a result of the health and disability benefit cuts. This news will be devastating for families across the country struggling to make ends meet.
— Save the Children UK (@savechildrenuk) March 26, 2025
1/3 https://t.co/YP0z9DLJtI
Reform: OBR are 'delusional'
16:30 , Bill Bowkett
Reform UK deputy leader, Richard Tice, said: “Quite simply, this emergency budget is a disaster and was entirely avoidable, yet Labour decided to plough regardless. The OBR has forecast that tax as a share of the economy will hit a historic high within three years and halved the revised growth forecast for 2025 from 2% in the autumn to 1% today.
“Yet the OBR thinks that this government will somehow pluck growth out of thin air in the coming years. The OBR are delusional.
“The economy is shrinking, growth is collapsing towards recession, energy bills soaring because of net zero, the cost of government borrowing soaring back to 15 year highs and the job market is collapsing.”
Greens: Benefit cuts over wealth tax 'morally repugnant'
16:26 , Bill Bowkett
Adrian Ramsay, co-leader of the Green Party, said: “The Chancellor had a choice today. To rebalance our economy by asking the very wealthiest to contribute more, or to remove vital support from ill and disabled people. That she chose to take from the most vulnerable to balance her books is a damning reflection of how out of touch this government is. It is morally repugnant.
“And it’s not just ill and disabled people who will suffer as the chancellor doubles down on cuts to frontline services. This will weaken our communities and leave us all poorer. Labour once claimed that they were for the many, not the few – it’s clear now that is this is no longer the case.”
Stride renews call to abandon Rayner's flagship workers' rights bill
16:20 , Bill Bowkett
Mel Stride, the Conservative shadow chancellor, has called on Labour to scrap deputy prime minister Angela Rayner’s Employment Rights Bill after warnings from the Office for Budget Responsbility that it could damage the economy.
The OBR said the bill, which includes new rights to guaranteed hours, flexible working and bereavement leave, could have a “net negative” impact on prices, productivity and jobs.
Mr Stride told reporters after the spring statement: “We want to see (the Chancellor) fundamentally drop a number of the measures in that Bill because it is holding back growth.”
“Unless we can get growth going and productivity improving, businesses thriving, then that makes the whole world that much more difficult.”
Reeves likely to need further tax rises, bank predicts
16:07 , Bill BowkettJames Smith, an economist at Dutch banking giant ING, said: “The UK’s public finances are operating on increasingly fine margins, and we don’t think that defence will be the only department requiring fresh cash injections over the coming years. At the Autumn Budget, that may leave the Treasury with little choice but to boost government spending plans even further.
“In the absence of further upgrades to GDP growth, or a fall in gilt yields... we think this is likely to necessitate further tax hikes.”
Carers UK: Benefits cuts will cause 'huge anxiety'
15:51 , Bill BowkettResponding to the Chancellor’s statement, Carers UK boss Helen Walker said: “Today’s spring statement confirms that the government’s welfare reform plans will include the first substantial cuts to carer’s allowance in decades, realising many carers’ worst fears. This is an unprecedented step in the wrong direction and must be swiftly rectified.
“Carers save the UK economy an estimated £184 billion a year, but now many more are in danger of further financial hardship and poverty. They deserve so much more. The repercussions of today’s changes will be felt deeply by those who for too long, have been our last line of defence – providing vital support which simply can’t be found elsewhere.”
Starmer says Labour 'delivering change for Britain'
15:50Wages growing faster than prices. Jobs up. Inflation down. Interest rates down. NHS waiting lists down. Houses and infrastructure unblocked. Free breakfast clubs rolling out. National Living Wage increasing. National Minimum Wage increasing. Defence spending increased. 2 million…
— Keir Starmer (@Keir_Starmer) March 26, 2025
OBR: Reeves has left ‘tiny margin for manoeuvre'
15:49 , Bill Bowkett
Richard Hughes, chairman of the Office for Budget Responsiblity, told reporters at a press conference responding to Ms Reeves’ statement: “Chancellors set their own fiscal rules. If they want to break them, they can. If they want to change them, they can. The task they give to us is to assess whether they are on track to meet them once we take account of their policies. The Chancellors set their own policies as well.
“So those levers are very much in the hands of the chancellor of the day. And one of the reasons why policy has ended up being very responsive to changes in our forecast is because recently chancellors leave themselves tiny amounts of headroom these days against their fiscal forecasts.
“What you saw in this forecast has been emblematic of what you’ve seen in recent forecasts which is relatively small changes in fiscal forecast over a five-year period. We’re forecasting £1.5 trillion worth of revenue, £1.5 trillion worth of spending. What you saw here was a swing and a difference of £14 billion. That is tiny by comparison to the totals that we are forecasting.
“Unfortunately chancellors have left themselves tiny margins for manoeuvre against their fiscal rules, which means if they want to stick to them they have to adjust policy in light of our relatively small forecast changes.”
Chief Secretary to the Treasury compares benefit cuts to cutting kids' pocket money
15:37 , Bill Bowkett"If I cut my child's pocket money by £10 a week and tell them to get a Saturday job..."
— Saul Staniforth (@SaulStaniforth) March 26, 2025
Minister Darren Jones on disabled people losing £4,500 a year because of the governments cuts. pic.twitter.com/vvKnJbGuED
Welfare cuts 'double whammy to the most vulnerable', says Davy
15:31 , Bill BowkettCommenting on the Chancellor’s statement, Liberal Democrat leader Sir Ed Davey, referring to 800,000 people losing Personal Independence Payment (PIP) and 150,000 losing carer’s allowance, said: “These cuts will be a double whammy to the most vulnerable, hitting disabled people who cannot work while slashing support for the loved ones who care for them.”
The Kingston and Surbiton MP, who was a carer for his terminally ill mother as a teenager and now for his disabled son, added: “Carers need more support, not less. Snatching away the little support these carers get will do nothing to help people into work; it will just put more pressure on already over-stretched carers, social care and the NHS.”
Labour MPs vent fury at Chancellor over welfare cuts
15:17 , Bill BowkettRachel Reeves is facing pleas from Labour MPs, including Debbie Abrahams, who chairs the Work and Pensions Committee, to reverse the government’s welfare cuts amid warnings they will lead to soaring poverty.
National Debtline braced for calls due to welfare cuts
15:05 , Bill BowkettSteve Vaid, chief executive at the Money Advice Trust, a charity that runs the National Debtline, said: “The unexpected cut to the Universal Credit health element for new claimants risks pushing more people facing health issues into financial difficulty in future. Around half of people receiving Universal Credit who we help at National Debtline already have a negative budget, meaning they don’t have enough money coming in to cover their essential costs, like food and household bills. In light of this announcement, it is likely that we will see more even more people coming to us in this predicament.
“With households due to be hit next week by rises in energy, water and council tax bills, the Chancellor’s statement was light on help for people whose budgets are already at breaking point. Instead of these cuts, we need to see the introduction of an energy social tariff and increased council tax support to help lift the pressure on households on the lowest incomes.”
Labour cuts go further than Tories ever dared, former leader Corbyn claims
15:02 , Bill BowkettJeremy Corbyn, the former Labour leader and Islington North MP, who now sits as an independent, says Labour’s welfare cuts goes further than the Conservative Party ever dared .
He said in a statement alongside four other independents: “After 14 years of Conservative rule, we were told that austerity was over. That was a lie.
“Ever since this Labour Government was elected, they have chosen to balance the books off the backs of the poor.”
“The Government has not just refused to undo the suffering the Tories have inflicted. They have gone further than even the Tories ever dared.”
Britons are getting poorer, Farage tells Reeves
14:58 , Bill BowkettNigel Farage, the leader of Reform UK and MP for Clacton in Essex, asked the Chancellor in the Commons: “Would the Chancellor agree that measuring growth and relative wealth by GDP is not the most relevant number to our constituents?
“Because we’re living in an age of mass immigration and a rising population, it is GDP per capita, surely, that matters to our constituents, and that has fallen for the last two years, and is falling still, and shouldn’t we tell people, actually, they are getting poorer?”
Ms Reeves replied: “The OBR forecast the GDP per capita will increase by 5.6pc during the course of this Parliament, having fallen under the previous government.”
“So, if he ever gets to Clacton, he can tell his constituents that.”
Finance crisis is 'holding boroughs back', say London Councils
14:52 , Bill BowkettThe cross-party London Councils group has responded to the Chancellor’s spring statement.
Cllr Claire Holland, Chair of London Councils, said: “The government is right to prioritise boosting economic growth. Whether it’s building new homes, supporting people into work or attracting investment into our local areas, councils have a critical role to play in this mission. However, the crisis in town hall finances is holding us back.
“It’s vital the upcoming Spending Review and planned reform of council funding deliver the investment and financial sustainability boroughs need to drive growth in the capital and across the country. Without this, we risk more and more boroughs entering effective bankruptcy – a situation which would undermine economic confidence, hold back growth, and cost the public purse more in the long run.
“Given the tough fiscal outlook, we must continue to focus on investing in prevention and reform of public services so we can deliver better value for money and better outcomes for our communities. Boroughs are committed to this agenda, but we need funding which enables us to make these long-term changes, as well as dealing with the current pressures which have built up over the last 15 years.”
OBR warns of 'particularly uncertain' outlook for the UK economy
14:50 , Bill BowkettThe Office for Budget Responsibility’s chairman Richard Hughes, and committee members David Miles and Tom Joseph, are now giving a press conference in central London following the Chancellor’s spring statement.
Hughes said the OBR halved its growth forecast for this year, from 2% to 1%, due to signs of a waning domestic confidence, rising gas prices and a “particularly uncertain” outlook for the UK economy.
The OBR also predicts that Labour will miss its manifesto pledge of building 1.5 million new homes in this parliament.
IFS: Businesses face months of speculation on tax rises
14:35 , Bill BowkettPaul Johnson, director of the Institute for Fiscal Studies think-tank, says businesses face months of speculation about tax rises following the Chancellor’s statement.
He said: “Ms Reeves has left herself with the same £9.9 billion sliver of headroom against her target to balance the current budget as she had in October, and a very similar amount of headroom against the target that debt should be falling in 2029–30 (£15.1 billion, down from £15.7 billion in October).
“All of that adds to uncertainty around policy. We can surely now expect 6 or 7 months of speculation about what taxes might or might not be increased in the autumn. There is a cost, both economic and political, to that uncertainty. The government will suffer the political cost. We will suffer the economic cost.”
Protesters rail against Labour welfare cuts set to push 250,000 more into poverty
14:22 , Bill Bowkett
Demonstrators have gathered on Whitehall to protest against cuts to welfare spending as the government admitted they would likely drive another 250,000 people into poverty.
The key points from Reeves' Spring Statement
14:11Reeves covered a deluge of topics in her Spring Statement.
Among the top talking points were the economic forecasts, the benefits cuts, the cost of living crisis and housing.
For all the key points from the Spring Statement, read The Standard’s political editor’s complete run down.
Welfare cuts will push 250,000 people into poverty, according to Government assessment
14:11 , Bill BowkettAn impact assessment by the Department for Work and Pensions into Labour’s health and disability benefit cuts has found that 250,000 more people — including 50,000 children — would be driven into relative poverty by 2029/30.
Recap: Reeves says welfare reforms will save £4.8bn
13:57 , Jacob PhillipsMel Stride jokes about Chancellor's LinkedIn after calling for further defence spending
13:46 , Jacob PhillipsShadow chancellor Mel Stride has called for Rachel Reeves to increase defence spending further, as well as jesting about the Chancellor’s LinkedIn profile.
He told the Commons: “When [Labour] got into office, they pussy-footed around and dithered. Why? Because it’s deeply divisive within their rank and file.
“And then, suddenly, when the Chancellor decided that she had run out of money, out the word went to find some savings in welfare, to scrabble around, to yank every lever … possible
“The spectacle, frankly, of what the OBR (Office for Budget Responsibility) has said about the changes that were only announced last week by the Secretary of State for Work and Pensions is simply shambolic. We have gone from incompetence to chaos.
“There have been more changes in this policy than there were, at the last minute, to the profile of (Rachel Reeves) on LinkedIn.”
Mr Stride also pressed Ms Reeves to increase defence spending to 3% of GDP in this parliament.
He urged the Chancellor to “go further”, adding: “The 3% target should be brought forward to this parliament.
So, can I ask (Ms Reeves), given the geopolitical tensions that she has raised, what provision has she made in her headroom, in her fiscal plans, for increasing defence spending more quickly in this parliament, if that proves necessary?
“And could I ask her, would she scrap the absurd Chagos deal and put that money … behind our armed forces?”
'The Chancellor has chosen to double down on harmful benefits cuts' warns Disability Benefits Consortium
13:36 , Jacob PhillipsA coalition of more than 100 disability organisations has said further cuts to welfare will “heighten alarm” among claimants.
Charles Gillies, co-chair at the Disability Benefits Consortium, said: “The Chancellor has chosen to double down on harmful benefits cuts, despite warnings this approach will push more disabled people into poverty and worsen people’s health.
“Since the cuts were announced last week, we’ve seen an outpouring of fear and dread from disabled people, including many with MS.
“The extra cuts announced today will heighten alarm even further, largely hitting those who are unable to work and rely on these benefits to survive.
“People are wondering how they’ll continue to cover their basic living expenses and the extra costs of their disability – like visits from carers to help with things like washing, cooking and going to the toilet. The Government has a moral obligation to scrap these cuts before the real damage is done.”
Oxfam labels spring statement as 'new low in the fight against poverty and inequality'
13:33 , Jacob PhillipsOxfam said the spring statement marked ”a new low in the fight against poverty and inequality”.
The charity’s senior policy adviser Anna Marriott said: “Today marks a new low in the fight against poverty and inequality as the Government chooses to cut vital international aid and social security support for millions of people struggling at home and around the world while protecting the soaring wealth of millionaires and billionaires.
“Three-quarters of the British public back Government tax increases on the very richest instead of these cruel and unnecessary cuts, but the Chancellor has decided to turn her back on fairness.
“These cuts are not just numbers on a balance sheet but will cost lives and have a devastating impact on people facing conflict, poverty and climate disasters around the world.
“It’s not about tough decisions; it’s about political choices. The Government must stop protecting extreme wealth and start protecting people.”
Labour have gone back on promises to British people, says Mel Stride
13:30 , Jacob PhillipsConservative shadow chancellor Mel Stride has accused Labour leaders of having “reneged on their promises to the British people” during last year’s general election.
Mr Stride told the Commons: “Given her track record, given the fact that she has failed to control spending and borrowing to date, what does she think the markets are going to make of her latest promises?
“But (Chancellor Rachel Reeves) says of course that none of this – none of this – is her fault, that it’s the war in Ukraine, it is (US) president (Donald) Trump, it is tariffs, it is (Russian) president (Vladimir) Putin, it is the Conservatives, it is (the) legacy, it is anybody but her.
“But what the British people know is that this is a consequence of her choices. She is the architect of her own misfortune: it was (Ms Reeves) who talked down the economy, who talked down the economy so that business surveys and confidence crashed through the floor.
“It was (Ms Reeves) who confected the £22 billion black hole, a smokescreen that was only ever there in order to cover up for the fact that she and the Prime Minister (Sir Keir Starmer) reneged on their promises to the British people during the last general election.”
Spring statement a 'cold hard reckoning' says shadow chancellor
13:27 , Jacob PhillipsRachel Reeves’ spring statement is a “cold hard reckoning” with the state of the British economy, the shadow chancellor has said.
Mel Stride termed the Chancellor’s announcement as an “emergency budget” as he criticised falling growth rates in the UK.
He said: “At the last budget (Ms Reeves) said she would bring stability to the public finances – stability to the public finances – but this statement more appropriately referred to as an emergency budget has brought her to a cold, hard reckoning.
“She has become very fond recently about the world having changed. Well, indeed it has.
“This country was growing at the fastest rate in the G7 only about a year ago, and just as the OECD and the Bank of England and other forecasters and now we learn, the OBR have stated growth has been halved in this year.
“Cut in two as a consequence of the decisions and the choices that the right honourable lady made on her watch.”
Watch: Reeves reveals extra £2.2bn for Ministry of Defence
13:14 , Jacob PhillipsPlanning reforms will add £6.8bn a year by end of the decade
13:12 , Jacob PhillipsThe OBR have concluded that planning reforms will permanently increase the level of real GDP by 0.2% by 2029-30, adding £6.8 billion to the economy, and 0.4% of GDP within the next 10 years, an additional £15.1 billion, in what the Chancellor described as the “biggest positive growth impact that the OBR have ever reflected in their forecast, for a policy with no fiscal cost”.
Rachel Reeves added: “And taken together with our plans to increase capital spending this government’s policies will increase the level of real GDP by 0.6% in the next ten years.”
Reeves says £400m will be allocated to 'bring innovative technology to the front line'
13:08 , Jacob PhillipsA protected budget of £400 million will be allocated to bring innovative technology to the front line, Rachel Reeves said.
The Chancellor told the Commons: “We will establish a protected budget of £400 million within the Ministry of Defence for UK Defence Innovation, rising over time, with a clear mandate to bring innovative technology to the front line at speed.”
She added: “We will take forward our Plan for Barrow, a town at the heart of UK nuclear security, working with (Michelle Scrogham) and providing £200 million, supporting the creation of thousands of jobs.
“We will regenerate Portsmouth naval base, securing its future, as called for by (Stephen Morgan).”
Rachel Reeves reveals extra £2.2bn for Ministry of Defence
13:06 , Jacob PhillipsThe Chancellor Rachel Reeves has also confirmed that an extra £2.2 billion will be provided for the Ministry of Defence next year on the way to lifting defence spending to 2.5% of GDP.
She told MPs: “This additional investment is not just about increasing our national security but increasing our economic security, too.
“As defence spending rises, I want the whole country to feel the benefits. So I will set out the immediate steps that we are taking to boost Britain’s defence industry and to make the UK a defence industrial superpower.
”A minimum of 10% of the Ministry of Defence’s equipment budget will be spent on novel technologies including drones and AI enabled technology.
“A protected budget of £400m will be created within the Ministry of Defence for UK Defence Innovation.”
Reeves will introduce 'voluntary exit schemes to reduce the size of civil service'
13:04Earlier in her spring statement, the Chancellor said the Government’s transformation fund will introduce “voluntary exit schemes to reduce the size of the civil service”.
Rachel Reeves told MPs: “That is money brought forward now to bring down the costs of running Government by the end of the forecast period by making public services more efficient and more productive.
“I can confirm today the first allocations from this fund include funding for voluntary exit schemes to reduce the size of the Civil Service, pioneering AI tools to modernise the state, investment in technology for the Ministry of Justice to deliver probation services more effectively, and up-front investment to support children in foster care to give them the best start in life and reduce cost pressures in the future.
“Our work to make Government leaner, more productive and more efficient will help deliver a further £3.5bn of day-to-day savings by 2029-30.”
Watch as Chancellor says spring statement does not contain further tax increases
12:59 , Jacob PhillipsChancellor says she's 'not satisfied with numbers' as OBR halves 2025 growth forecast
12:57 , Jacob PhillipsThe Chancellor has told MPs that the Government has a “serious plan for economic growth” after revealing that the OBR’s growth forecast for 2025 has halved from 2% to 1%.
Explaining the figures, Rachel Reeves said: “Earlier this month, the OECD downgraded this year’s growth forecast for every G7 economy, including the UK.
“And the OBR have today revised our growth forecast for 2025 from 2% in the autumn to 1% today.
“I am not satisfied with these numbers. That is why we on this side of the house are serious about taking the action needed to grow our economy.
“Backing the builders, not the blockers, with a third runway at Heathrow Airport and the Planning and Infrastructure Bill.
“Increasing investment with reforms to our pension system and a new National Wealth Fund and tearing down regulatory barriers in every sector of our economy.
“That is a serious plan for economic growth. That is a serious plan to improve living standards. That is a serious plan to renew our country.”
Chancellor says cost of running the government will be slashed by £2bn
12:52 , Jacob PhillipsThe cost of running the government will be reduced by 15%, worth £2bn, by the end of the decade, the Chancellor has announced.
She told MPs: “This work shows that we can make our state leaner, and more agile delivering more resources to the frontline while ensuring we control day-to-day spending to meet our fiscal rules.
“Today, I build on that work by bringing forward £3.25bn of investment to deliver the reforms that our public services need through a new Transformation Fund.”
Welfare reforms will save £4.8bn says Reeves
12:50 , Jacob PhillipsRachel Reeves also insisted that welfare reforms will save £4.8 billion, adding that welfare spending as a share of GDP will fall between 2026-27 and the end of the forecast period.
Chancellor pledges the 'investment rule' is met two years early
12:49 , Jacob PhillipsChancellor pledges the “investment rule” is met two years early with net financial debt at 82.9% 2025-26 and 83.5% in 2026-27, falling to 82.7% by 2029-30 providing headroom of £15.1 billion.
Reeves: 'Statement does not contain any further tax increases'
12:48 , Jacob PhillipsRachel Reeves has kept her promise of not adding any further tax increases, the Chancellor said.
She added: “But when working people are paying their taxes, while still struggling with the cost-of-living. It cannot be right that others are still evading what they rightly owe.
“In the Budget, I delivered the most ambitious package of measures that we have ever seen to cut down on tax evasion raising £6.5bn per year by the end of the forecast.
“Today, I go further continuing our investment in cutting-edge technology investing in HMRC’s capacity to crack down on tax avoidance and setting out plans to increase the number of tax fraudsters charged each year by 20%.
“These changes raise a further £1bn taking total revenue raised from reducing tax evasion under this government to £7.5bn figures verified by the Office for Budget Responsibility.”
Chancellor says she will restore fiscal headroom by the end of the decade
12:44 , Jacob PhillipsThe Chancellor has said she will restore fiscal headroom by the end of the decade as she continued to deliver her spring statement.
Reeves told MPs gathered in the Commons: “The OBR’s forecast shows that before the steps I will set out in this statement the current budget would have been in deficit by £4.1bn in 2029-30 having been in surplus by £9.9bn in the autumn.
“As the UK, alongside its international peers like France and Germany, has seen the cost of borrowing rise during this period of heightened uncertainty in financial markets.
“As a result of the steps that I am taking today. I can confirm that I have restored in full our headroom against the stability rule moving from a deficit of £36.1bn in 2025-26 and £13.4bn in 2026-27 to a surplus of £6.0bn in 2027-28, £7.1bn in 2028-29 and £9.9bn in 2029-30.”
Reeves insisted fiscal rules are 'embodiment of this government’s unwavering commitment to bring stability to our economy'
12:40 , Jacob PhillipsRachel Reeves has backed her self-imposed fiscal rules, insisting they are non-negotiable.
She added: “They are the embodiment of this government’s unwavering commitment to bring stability to our economy and to ensure security for working people.
“Because the British people have seen what happens when a government borrows beyond its means.
“The mini-budget delivered by the party opposite led to higher bills, higher rents and higher mortgages.”
Reeves: 'Increased global uncertainty has hit public finances and economy'
12:38 , Jacob PhillipsRachel Reeves continued: “The threat facing our continent was transformed when Putin invaded Ukraine. It has since escalated further and continues to evolve rapidly.
“At the same time, the global economy has become more uncertain bringing insecurity at home as trading patterns become more unstable and borrowing costs rise for many major economies.”
Turning to the OBR forecast Reeves added: “The increased global uncertainty has had two consequences. First, on our public finances. And second, on the economy.”
Chancellor Rachel Reeves begins her spring statement
12:35 , Jacob PhillipsRachel Reeves has begun her spring statement as Prime Minister’s Questions comes to an end.
The Chancellor began by telling the Commons: “This Labour government was elected to bring change to our country. To provide security for working people.
“And to deliver a decade of national renewal. That work of change began in July – and I am proud of what we have delivered in just nine months.”
Badenoch starts PMQ's with Conservative 'emergency budget' attack line
12:20 , Jacob PhillipsConservative leader Kemi Badenoch labelled Rachel Reeves’ spring statement as an “emergency budget” as she began Prime Minster’s Questions.
She told the Commons: “In 30 minutes, we will hear the Chancellor’s emergency budget – even the Home Secretary’s husband (Ed Balls) calls it an emergency budget – as she scrambles to fix the mess she made last October.”
She quickly turned to focus on a recent Labour vote against banning phones in schools last week.
Starmer: 'Government going further and faster on the economy'
12:13 , Jacob PhillipsSir Keir Starmer has begun Prime Minister’s Questions by telling MPs that the spring statement will show the Government going “further and faster on the economy”.
Speaking half an hour before Rachel Reeves delivers the statement, he said: “Today’s spring statement will showcase a Government going further and faster on the economy, greenlighting the Lower Thames Crossing, investing £2 billion in 18,000 affordable homes for working families, 60,000 young people being trained as the next generation of construction workers, and fixing millions of potholes.
“We’re undoing a decade of stagnation, to bring jobs and opportunities for working people and securing Britain’s future.”
In pictures: Protesters opposing welfare cuts hold placards outside Downing Street
11:58 , Megan HoweA group of protesters who oppose Chancellor Reeves’ cuts to welfare have been pictured outside Downing Street.
In a fresh wave of welfare savings, Reeves is reportedly expected to freeze universal credit incapacity benefits for new claimants until 2030, instead of allowing it to rise in line with inflation.
Reeves seen leaving Downing Street ahead of Spring Statement
11:45 , Megan HoweChancellor Rachel Reeves has been pictured leaving Downing Street and heading to the Commons for the Spring Statement this afternoon.
She will deliver the speech at 12.20pm today.
Recap: £2bn funding boost for new homes in England announced ahead of spring statement
11:14A £2bn funding boost for new homes in England was announced ahead of the spring statement on Tuesday.
Thousands of new homes in England will be built as part of the biggest boost in social and affordable housebuilding in a generation, the Government said, describing the funds as a “down payment from the treasury” ahead of longer-term investment expected later in the year.
Chancellor Rachel Reeves has vowed that the grant funding will deliver up to 18,000 new homes in England, going some way to “fixing the housing crisis”.
The housebuilding boost will help Labour towards its pledge of delivering 1.5 million new homes over the next five years.
You can read more about how the spring statement could impact London’s property market here.
'Emergency budget' or 'rebuilding the economy'? What to expect from Reeves' spring statement
10:42 , Jacob PhillipsThe Chancellor is expected to reveal more cuts to welfare in her spring statement after being told the reforms announced last week will save less than planned.
Rachel Reeves is understood to be planning to slash Britain’s welfare bill by another £500million after the Office for Budget Responsibility (OBR) rejected the Government's assessment that the package of previous measures will save £5billion.
The Work and Pensions Secretary Liz Kendall has already announced a raft of cuts, including restricting the eligibility criteria for personal independence payments (PIP) claimed by people with disabilities.
But the OBR said the cuts would only save £3.4billion, leaving the Government scrambling to find further savings.
The Chancellor has faced criticism from all sides of the political spectrum ahead of the spring statement.
The Conservatives have labelled it as an “emergency budget” while Mother of the House, Labour backbencher Diane Abbott has argued “the most vulnerable” members of society will face cuts as they are least able to mount co-ordinated resistance.”
Read more about what to expect from the spring statement here.
Conservatives brand Reeves' spring statement as 'emergency budget'
09:34 , Jacob PhillipsThe Conservatives have branded Rachel Reeves' spring statement as “an emergency budget” with shadow chancellor Mel Stride insisting his opposite number’s “mismanagement of the economy is evident for all to see”.
Writing for The Telegraph, Mr Stride said: “Taxes are rising, borrowing is spiralling, and businesses are suffering.
“Families are feeling the pinch, with mortgage costs higher and inflation eating away at their incomes.
“Labour’s choices have led us here. Rachel Reeves chose to raise taxes and borrow excessively, without focusing on the measures that would actually stimulate growth.
“She promised stability, but her decisions have only led to economic stagnation, and I fear this emergency budget will only be plastering over the gaping cracks in our economy and public finances.”
'If you borrow more, prices go up' minister insists
08:58 , Jacob PhillipsCritics and reporters alike have pressed the Chancellor recently about her self-imposed fiscal rules.
Rachel Reeves has refused to loosen her rules to allow greater borrowing to help cover a rise in defence spending.
Quizzed on the topic on the BBC’s Today programme, Defence Secretary John Healey insisted that if you borrow more, prices go up.
Mr Healey said: “Whichever way you do it, if you borrow more you have to service the cost of that borrowing and if you borrow more the price goes up.
“We are in a situation, nine months into this government, where the overhang of the period of Liz Truss means that our debt levels are still too high, the cost of servicing that debt is too high.
“And the central responsibility – that will be at the heart of the way that Rachel Reeves sets her statement out – of strong public finances, fiscal responsibility in the end will provide the foundation for us to rebuild the economy, rebuild confidence in British investment and then rebuild the public services.”
'A tough, strong statement in tough times' minister stays
08:50 , Jacob PhillipsDefence Secretary John Healey has told the BBC that Chancellor Rachel Reeves will deliver a “tough, strong statement in tough times”.
The Chancellor is expected to announce further welfare cuts at a time when she has promised a £2.2 billion boost to defence spending.
Asked how Labour supporters would view that, Mr Healey told BBC Radio 4’s Today programme: “It will be a tough, strong statement in tough times.
“The Chancellor will set out this afternoon that the world is changing, our task is to secure Britain’s future and that’s why she is making an extra £2.2 billion available for defence.”
Reeves to begin speech saying 'the world has changed'
08:36Rachel Reeves is expected to begin her spring statement with the words “the world has changed,” according to reports.
The Chancellor is expected to blame global factors for Britain’s struggling economic growth, including uncertainty caused by US President Trump’s tariffs, the Times reports.
Trump has pledged to unveil new tariffs in a week’s time on April 2, labelling the event as “liberation day”.
Meanwhile, ahead of the spring statement, Prime Minister Sir Keir Starmer has warned we are in “an era of global change”.
In an era of global change, we will deliver security for working people and renewal for Britain.
— Keir Starmer (@Keir_Starmer) March 26, 2025
What does Rachel Reeves day look like ahead of the spring statement?
08:10 , Jacob PhillipsToday will be one of the busiest days in office so far for Britain’s first female Chancellor.
Political newsletter Politico has provided a useful breakdown of what the day ahead looks like for Rachel Reeves.
Sir Keir Starmer will chair a meeting with his cabinet at 9am this morning with Reeves expected to attend.
The Chancellor will then leave Number 11 at around 11.20am ahead of Prime Minister’s Questions at midday.
Reeves will begin her spring statement speech at around 12.30pm and shadow chancellor Mel Stride will then respond at around 1.30pm.
Reeves will go on a defence-related visit at around 2.30pm before holding a press conference at 4.15pm. She will then sit down for an interview with Robert Peston and Steph McGovern for the Rest is Money podcast.
Finally Reeves is expected to ring around newspaper editors to try and secure favourable front pages on Thursday.
Further cuts to welfare spending expected, minister hints
07:30 , Jacob PhillipsA Cabinet minister appears to have confirmed that further cuts to welfare spending will be required because the budget watchdog has said previously-announced measures will not save the £5 billion a year expected by 2030.
The Times and ITV reported this morning that the Chancellor will bring forward even more welfare cuts in her spring statement.
Defence Secretary John Healey has just been speaking on Times Radio about what “plans to change the welfare system may bring”.
Mr Healey said: “You can’t have a benefits system that is failing people and out of control in this way.
“That’s why the plans that (Work and Pensions Secretary) Liz Kendall laid out last week, and that you’ll hear more from the Chancellor this afternoon in the spring statement, are so important.
“We want the social security system to work. It’s got to be there to support the poorest, but it’s also got to be there to make sure those who can work are able to do so.”
Rate of inflation falls taking some pressure off Reeves
07:18 , Jacob PhillipsThe Office for National Statistics (ONS) has revealed that the rate of inflation fell to 2.8% last month.
The ONS said lower clothing prices were largely behind the dip in the Consumer Prices Index (CPI) from 3% in January.
The decline in the inflation rate was bigger than expected in the City, relieving pressure on Rachel Reeves ahead of her spring statement later today.
You can read more about the latest figures here.
Welcome to the Standard's live blog on the spring statement
07:07 , Jacob PhillipsGood morning and welcome to the Standard’s live blog covering the spring statement.
The Chancellor Rachel Reeves is set to formally introduce welfare cuts and a boost to defence spending in her statement on Wednesday.
It could be a grim day for the Chancellor with the Office for Budget Responsibility (OBR) 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).
The watchdog is said to have warned that cuts to welfare set out in recent weeks have fallen short of the £5 billion savings ministers expected, according to media reports, leaving the Chancellor with a £1.6 billion hole likely to be filled with further cuts.
Reeves will have to go “futher and faster to kickstart growth” as she tries to stick to her rule of meeting day-to-day spending with tax receipts rather than extra borrowing.
What happened in the Autumn Budget?
Tuesday 25 March 2025 22:02 , Sean MartinThe Autumn Budget proved to be a rather controversial affair.
Taxes soared, National Insurance jumped up and borrowing once again increased.
Businesses were infuriated by the announcement, and threatened to pass the buck onto the consumer.
As a result, consumer confidence fell and many were left wondering what impact Labour would have on the economy.
Who is Rachel Reeves?
Tuesday 25 March 2025 20:00Rachel Reeves has served as the Member of Parliament (MP) for Leeds West since 2010 and as the shadow chancellor since May 2021.
Before entering politics, Ms Reeves worked as an economist. She began her career at the Bank of England and later worked as an economist at the British Embassy in Washington, DC.
She also worked for Halifax Bank of Scotland (HBOS) and in the private sector for the management consulting firm Bank of America Merrill Lynch.
She has been MP for Leeds West since 2010.
She first contested for the Labour Party in the 2005 general election in the constituency of Bromley and Chislehurst but was not elected.
But just who is Rachel Reeves?
When is the Spring Statement?
Tuesday 25 March 2025 18:24 , Sean Martin
Ms Reeves will take centre stage in the House of Commons straight after Prime Minister’s Question on Wednesday.
Proceedings for PMQs will finish at around 12.30pm, after which Ms Reeves will deliver the budget.
There, she will update the nation on the state of its finances.
What are you anticipating from the Budget?
Tuesday 25 March 2025 17:49Is Labour doing a good job, or has it been much of the same from the previous regime?
Is the state of global affairs hindering the Government’s progress?
What have they done right and what have they done wrong?
We would love to hear from you in the comment section.
What can we expect from the budget?
Tuesday 25 March 2025 17:32Significant cuts to welfare payments and the Civil Service have been top of the agenda for many.
However, Ms Reeves is also expected to reanalyse Labour’s growth predictions.
When Sir Keir Starmer came into power, he said growth was the Government’s “number one priority”.
However, for a variety of reasons, this has not come to fruition.
Our political correspondent Rachael Burford believes Ms Reeves will blame the global situation, particularly Donald Trump’s tariff war.
Read our full story here on what to expect from the Spring Statement.
