Rachel Reeves Faces Mounting Pressure as Borrowing Surges and Growth Forecasts Cut
The UK Chancellor rules out tax hikes while preparing for deep spending cuts to meet fiscal rules in the upcoming Spring Statement.
- Government borrowing in February 2025 reached £10.7 billion, £4.2 billion higher than forecast, highlighting worsening fiscal challenges.
- The Office for Budget Responsibility is expected to halve the 2025 economic growth forecast from 2% to 1%, compounding fiscal pressures.
- Rachel Reeves has ruled out raising taxes in the Spring Statement, focusing instead on £5 billion in welfare cuts and civil service efficiencies targeting £2.2 billion in annual savings by 2029-30.
- The Labour government faces growing internal dissent and public backlash over welfare cuts, foreign aid reductions, and departmental budget cuts.
- Public debt has risen to 95.5% of GDP, its highest level since the early 1960s, as Reeves seeks to adhere to self-imposed fiscal rules requiring debt reduction by 2029-30.
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