In preparation for her long-awaited Budget, expected to be revealed on October 30, Chancellor Rachel Reeves declared that she has negotiated expenditure settlements with every government department. This development corresponds with accounts of heated debates over the degree of upcoming budget cuts between the Treasury and many departments.
In an exclusive interview, Reeves said she effectively negotiated with every cabinet colleague. Following a time-honoured custom, she also mentioned popping all the Treasury’s displayed balloons, which stood for the funding allotment for every department. Reeves said, underlining the end of these negotiations, “There are no balloons left in the Chief Secretary’s office—the balloons have been burst.”
What Concerns Have Been Raised About Spending Cuts?
The Budget calls for spending cutbacks required to reach the Treasury’s aim of discovering £40 billion in savings, causing growing signals of discontent inside the Cabinet. Reports state that the Treasury missed its first target date of October 16 to complete all significant Budget proposals for submission to the government’s spending watchdog, the Office of Budget Responsibility.
Key Cabinet members, including Deputy Prime Minister Angela Rayner, who manages the Ministry of Housing, Communities and Local Government, Justice Secretary Shabana Mahmood, and Transport Secretary Louise Haigh, have reportedly written to Sir Keir Starmer, voicing their worries about the extent of cuts their respective departments are suffering. Haigh subsequently said she did not write a letter but underlined she has been negotiating with the Treasury “in the normal way.”
How Is Reeves Addressing the Challenges Ahead?
Reeves said, “I wouldn’t believe everything you read,” in response to allegations that some colleagues had skipped her to address their issues directly to the Prime Minister. She conceded, though, “It is perfectly reasonable that Cabinet colleagues set out their case—both to me as Chancellor and to the Prime Minister—about the scale of the challenges they find in their departments.”
Saying, “I’m very sympathetic towards the mess that my colleagues have inherited,” Reeves showed sympathy for her colleagues’ challenges. Ultimately, any extra money must be paid by increasing taxes or drawing funds from other departments.
How Does the Labour Manifesto Commit to Protecting Working People?
To defend “working people,” the Labour manifesto committed not to increase income tax rates, national insurance, or VAT. Referring to the significant tax hikes and expenditure cuts carried out during the Conservative-Liberal Democrat coalition government beginning in 2010, Labour also campaigned on a promise not to “return to austerity.” Reeves underlined that these pledges call for additional financing: “All of those things mean that we do need to find additional money.”
The Chancellor noted that this could call for changes to “other taxes to ensure the sums add up.” She said, “We were apparent during the election campaign; you cannot reverse fourteen years of damage in one Budget or just a few months. Rebuilding our public services will take time to guarantee that working people live better and correct the underpinnings of our society and economy.
How Is Reeves Building Relationships and Seeking Guidance?
Reeves said she often speaks with several well-known political personalities as she prepares to balance the first Labour Budget in 14 years. “I see Gordon regularly; I also see Tony Blair,” she said. She also keeps a “good relationship” with Jeremy Hunt, her predecessor, often messaging the Conservative shadow chancellor. “I may not be particularly impressed with the state of the public finances that he left me, but I do recognise that he had a tough job to do as well, following Kwasi Kwarteng,” Reeves said.
Reeves said that the one person she would like to “pick up the phone to now” is Alistair Darling, the last Labour Chancellor, who passed away last year at 70. Serving in Cabinet for 13 years under Tony Blair and Gordon Brown, Darling was particularly praised for helping the UK survive the financial crisis of 2008. “I hope that as the next Labour Chancellor after him, he would be proud of what I’m doing,” she remarked.
What Does It Mean for Female Leadership in This Role?
Reeves expressed her delight as the first female Chancellor in the 800-year annals. From my typical milieu, “Becoming Chancellor was beyond what a girl like me could have ever dreamed of.” Now in her “dream job,” Reeves said, “One of the wonderful things in the first few months of doing this job is to meet female finance ministers from around the world,” referencing eminent individuals such as US Secretary of the Treasury Janet Yellen and Canadian Finance Minister Chrystia Freeland.
Reeves stressed the need for female representation in leadership roles: “I take a lot of inspiration from those amazing women and so many others.”
