Britain's new Treasury chief has pledged to bring stability back to the economy with 'iron discipline' while addressing the challenges left by the previous government. The Labour Party government, elected on promises of fiscal responsibility, is facing pressure to increase public sector wages and welfare benefits.
The Treasury chief emphasized the need to fix the foundations of the economy, highlighting the state of public services, high tax burden, and significant debt levels. The government aims to revitalize the economy, boost housebuilding, and invest in green energy projects to improve public services.
With inflation at 2% and ongoing strikes in the public sector, including healthcare workers and teachers demanding higher pay, the government is considering above-inflation pay raises. Independent bodies have recommended salary increases for teachers and NHS employees, posing a budget challenge for the government.
The government is also facing calls to address welfare policies, including the two-child cap on benefits. While unable to abolish the cap due to financial constraints, the government is exploring ways to support low-income families.
Former Treasury chief criticized the new government's approach, accusing it of planning tax hikes. The government, led by Prime Minister Keir Starmer, is focused on resolving industrial disputes and improving recruitment and retention in key sectors.
As the government navigates economic challenges and public expectations, the Treasury chief remains committed to managing the economy with discipline and transparency.
