A Budget Defined by Party Management
Chancellor Rachel Reeves faced a disastrous setting for her Budget speech on Wednesday 26 November 2025. The theatre of the occasion was shattered after the Office for Budget Responsibility accidentally published its full report an hour early. This came after a previous leak to the Financial Times had already robbed her of the chance to surprise the Commons with the decision not to raise income tax rates.
Forced to begin her statement by blaming the OBR – a deeply unfortunate move for a chancellor often accused of shifting responsibility – Reeves delivered a strong speech despite the awkward start. However, no presentational tricks could conceal the core reality: this was a Budget that put the Labour Party's internal unity before the national interest.
Choosing Welfare Spending Over Voter Goodwill
The heart of the Budget revealed the Chancellor's true priorities. The loudest cheers from the Labour backbenches came with the announcement that the two-child limit on benefits would be lifted. While Reeves argued passionately against punishing children for their birth circumstances, this marked a stark reversal from her position last year, when she stated, "If we cannot afford it, we will not do it."
This move, along with the abandonment of attempts to control the spiralling cost of disability benefits, is deeply unpopular with the voters and taxpayers who will foot the bill. The Chancellor and Prime Minister Keir Starmer have clearly prioritised their political survival and the support of their MPs over the wishes of the electorate.
Tax Rises and a Broken Manifesto Promise
Reeves attempted to justify tough decisions by pointing to the OBR's downgraded economic growth forecasts, blaming the legacy of Brexit, the pandemic, and the previous government. Crucially, she failed to mention that the OBR had also revised its tax revenue forecasts upwards, meaning the need for higher taxes stemmed more from increased spending than a weaker economy.
The Chancellor admitted voters would not like her decision to extend the freeze on income-tax thresholds for another three years, a clear breach of the manifesto promise. This stealth tax rise will hit working people in the years to come. Her attempts to soften the blow with a fuel duty freeze and a £150 energy bill rebate were seen by many as taking with one hand and giving with the other.
This second tax-raising Budget, which raises taxes primarily to fund increased welfare spending, is unlikely to impress swing voters. While it may help Starmer and Reeves cling to power a little longer by appeasing their backbenchers, it is a strategy that does no good for the country.
