Rachel Reeves has privately urged Labour MPs to back her make-or-break budget, telling them they will not like every measure but promising it will be "fair". Speaking to a fractious parliamentary party after a fortnight of leadership speculation, the chancellor said "politics is a team sport" and that the budget would be a package, not a pick-and-mix.
Reeves told MPs that the distributional analysis would show the budget to be a "Labour budget, a progressive budget". She acknowledged that some might dislike up to 5% of the measures but insisted the overall package would appeal to constituents. The budget is expected to reveal downgraded economic growth forecasts for each of the next five years, despite the government naming growth as its top mission.
The chancellor promised tax rises would be kept to a minimum, with the budget prioritising cuts to the cost of living, NHS waiting lists, and the cost of debt. She highlighted government actions such as increasing the national living wage, protecting the triple lock, and expanding free childcare and school meals. Reeves added that a freeze on prescription charges and rail fares had already been announced.
Among expected spending measures are a rise in headroom of up to £20bn, lifting the two-child benefit cap, and actions to cut energy bills. To fill the fiscal hole, the Treasury is considering a new property levy on high-value homes, an income tax threshold freeze for two more years, a pay-per-mile scheme for electric cars, and less generous salary sacrifice schemes.
Reeves criticised pre-budget speculation as "incredibly destabilising", comparing it to last year's rumours about pension reforms that prompted early lump-sum withdrawals. She vowed to remain chancellor, telling MPs: "I'll show the media, I'll show the Tories, I will not let them beat me." The Office for Budget Responsibility is expected to attribute the productivity downgrade to Brexit and Conservative austerity, not current government policies.
