The proposed cuts of Reavs will trigger big political arguments
The government said that Rachel Reeves will cut big expenses in this month, it is very important in many different ways.
First, it confirms whether the rumor was – that the office for the budget responsibility (OBR) for independent forecast believes that the ‘headroom’ of the Chancellor has been abolished.
This is the value of £ 10bn, which until last October, OBR believed that the government was before breaking its self-borrowed borrowing rules.
Why is that headroom disappear? The government’s obvious view is that it is due to global factors – the tariffs imposed by President Trump, widespread uncertainty from the new US administration, constant inflation in the UK and other places, and the increasing cost of government borrowings.
But there will be a big political argument about this.
Orthodoxists say that the cost of government borrowings was increasing even before President Trump took over and in October, the tax in Reves’s budget was a major factor, as well as in stunting development.
Related, it is worth emphasizing that this month did not mean a big economic moment for the government.
In recent years, a fiscal rhythm has developed where there is a budget in a year and then a second (spring or autumn) statement that also has significant taxes and measures and is similar to a mini-judgment.
Wanted to finish Reavs, with one Autumn budget And then a very limited event in the spring, on which OBR published the updated forecasts but the government did not respond with major economic measures.
Government sources say it will not be a fiscal phenomenon as it will not include tax growth, only cuts cut.
Nevertheless, for the recent budget responsibility updated by the Labor Government, Charter said that it was committed to “spending not only tax, but” to “spend changes, but” to give more certainty to families and businesses every year for a major fiscal program.
The government reserved the right to change that approach “in terms of economic shock”.
Does this mean that the government believes that the influence of President Trump is a economic blow?
There are clear political sensitivity where cuts are likely to fall. Labor party has many groups and ideological nuances, but all its MPs are committed to a liberal welfare state and will have ants on the possibility of many welfare deductions.
The people of the government are adamant, however, it is that the number – which are growing rapidly – the amount spent by the claimants and the government is simply unstable.
Along with improvement, there will also be cuts – Reavs has identified what she sees as a “deformed encouragement” in the system.
The next target for cuts especially seems to be a civil service.
The quality of the Whitehall machine has disappointed ministers and officials privately.
The government is expected to demand a large decrease in the number of civil servants, although it is unlikely to take the form of a specific numerical goal.
Ministers are also understood Discussed major changesFor the government’s machinery, that is, how government departments are organized, although this work is not likely to come in this month.
