250,000 more people will face relative poverty after Rachel Reeves’ benefits cuts, DWP says – spring statement live

Department for Work and Pensions says thousands, including children, will be hit by chancellor’s announcement, as OBR forecasts UK growth to halve in 2025

Rachel Reeves will not be raising taxes in the spring statement today, even though there are many people on the left who would prefer taxes to rise as an alternative to public spending being cut. Reeves came into office promising only one budget-type event a year, and that is one reason why she is not hiking taxes today. But mainly it’s because she thinks Britons are relatively highly taxed already, because Labour was elected on a manifesto ruling out most of the obvious possible tax rises and because she’s not convinced a sweeping wealth tax would work.

But that has not stopped campaigners calling for a wealth tax, and yesterday about 300 people attended a ‘Tax the Super-Rich’ rally outside the Treasury. It was organised by charities and social justice campaign groups, but one of the speakers was Carla Denyer, co-leader of the Green party, which is in favour of a wealth tax.

Across the country, inequality is soaring and people are being left behind, struggling to make ends meet and dealing with broken public services, all while the very richest get richer. Choosing to make cut after cut to the poorest and most marginalised, while leaving the vast resource of the extreme wealth of the super rich untouched, is immoral, harmful, and will not deliver for our communities or the economy.

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Rising fears of Trump tariffs pummel US consumer confidence to four-year low

Tariffs panned by economists for sowing uncertainty that they said made it challenging for businesses to plan ahead

US consumer confidence plunged to the lowest level in more than four years in March, with households fearing a recession in the future and higher inflation because of tariffs.

The Conference Board said on Tuesday that write-in responses to the survey showed “worries about the impact of trade policies and tariffs in particular are on the rise”, adding: “There were also more references than usual to economic and policy uncertainty.”

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All UK families ‘to be worse off by 2030’ as poor bear the brunt, new data warns

Keir Starmer has been dealt a fresh blow to his living standards pledge in advance of the spring statement

Living standards for all UK families are set to fall by 2030, with those on the lowest incomes declining twice as fast as middle and high earners, according to new data that raises serious questions about Keir Starmer’s pledge to make working people better off.

The grim economic analysis, produced by the respected Joseph Rowntree Foundation (JRF), comes before the chancellor, Rachel Reeves, makes her spring statement on Wednesday in which she will announce new cuts to public spending rather than increase borrowing or raise taxes, so as to keep within the government’s “iron clad” fiscal rules.

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Reeves to raise spectre of Liz Truss to persuade Labour MPs to accept cuts

Chancellor to tell party she is making steep cuts to avoid similar fallout to that which followed 2022 mini-budget

Rachel Reeves will raise the spectre of Liz Truss’s disastrous mini-budget in the lead-up to next week’s spring statement as she tries to persuade her Labour colleagues to accept the steepest departmental cuts since austerity.

The chancellor will tell her fractious party she has decided to cut public spending rather than increasing borrowing because of the risk of a similar fallout to that which followed the then prime minister’s disastrous fiscal statement in 2022.

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US-EU trade war could cost Ireland more than €18bn, says report

Report co-authored by Irish government also finds tariffs could cause job losses and relocation of US multinationals

A trade war between the US and the EU could cost Ireland more than €18bn (£15bn), trigger waves of job losses and cause US multinationals to relocate, according to a report co-authored by the Irish government.

Ireland’s GDP could shrink by 3.7% over the next five to seven years under the worst-case scenario, in which Donald Trump imposed 25% tariffs on all exports on the EU and the EU retaliated with counter-tariffs, the study carried by the Economic and Social Research Institute (ESRI) found.

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UK borrowing rises to £10.7bn in setback for Rachel Reeves

February figure comes in higher than forecasts less than a week before chancellor’s spring statement

UK government borrowing rose by more than expected in February to £10.7bn, underscoring the challenge for Rachel Reeves before next week’s spring statement.

Figures from the Office for National Statistics showed borrowing – the difference between total public sector spending and income – was little changed from the same month a year earlier. However, over the financial year to date borrowing was up nearly £15bn on the same period last year.

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Bank of England in no hurry on interest rates – but cuts will come

Despite the decision to hold at 4.5%, businesses and households can take a confident view of the UK’s prospects

Bank of England policymakers might be on a “go-slow” as they look forward to interest rate cuts this year, but the direction of travel is almost certain.

After a meeting on Thursday when interest rates were kept on hold at 4.5%, City investors bet there would be more reductions in the cost of borrowing this year, most likely two cuts reducing the rate to 4%.

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Government debt costs in richest nations at highest since 2007

Payments by OECD countries outstrip amount spent on defence, police services and housing, report finds

The cost of government debt payments in the world’s richest nations last year reached its highest level since 2007, outstripping the amount spent on defence, police services and housing, a report has found.

Across the 38 members of the Organisation for Economic Co-operation and Development (OECD), debt service costs as a percentage of national income rose to 3.3% in 2024, from 2.4% in 2021.

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Former Bank of England deputy warns Rachel Reeves against kneejerk cuts

Charlie Bean says OBR forecasts are ‘flaky’ and cautions against trying to hit targets five years away

The former Bank of England deputy governor Charlie Bean has warned the chancellor against making kneejerk cuts in next week’s spring statement to try to hit fiscal targets that are five years away.

Rachel Reeves is preparing to slash spending, including on disability benefits, in response to weaker forecasts from the independent Office for Budget Responsibility (OBR) – prompting a backlash from within her own party.

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Shrinking economy offers unhelpful backdrop for Rachel Reeves’s growth push

GDP goes in wrong direction as chancellor puts final touches to fiscal plans

For a government that has made growth its overriding mission, the 0.1% decline in GDP in January signalled by the Office for National Statistics will be depressing news.

As Rachel Reeves prepares to announce her spring statement on 26 March, the economy appears to be going in the wrong direction – underlining the fact that the Office for Budget Responsibility is likely to have presented her with notably weaker forecasts than in October.

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UK economy shrinks unexpectedly in blow to Rachel Reeves

ONS data showing 0.1% fall in GDP in January comes less than two weeks before chancellor’s spring statement

The UK economy contracted by 0.1% in January, dealing a blow to Rachel Reeves before the spring statement later this month.

In a surprise to City economists, who expected 0.1% growth in January, the Office for National Statistics data showed the services sector failed to offset a decline in the industrial sector and maintain growth from the previous month.

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Ed Davey calls on Keir Starmer to back Canada against Trump attacks

Lib Dem leader says PM should make public show of support for ally against ‘shocking attacks’ on its sovereignty

The leader of the UK’s Liberal Democrats has called on the prime minister to publicly support Canada and oppose the “shocking attacks” on Canadian sovereignty, as the Trump administration further escalates its global trade war against longstanding allies.

Ed Davey, who leads the third largest political party in the UK, has called on Keir Starmer to travel to Canada in a show of support to the nation’s new prime minister, Mark Carney, as the commonwealth nation faces a generational crisis under Trump’s tariff war and suggestions that the country might become the 51st US state.

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UK drops down list of affluent nations after decade of stagnation, NIESR finds

Districts in Birmingham now ranked below poorest areas of France, Malta and Slovenia as institute urges rethink on planned welfare cuts

The UK has tumbled down the league of affluent nations after almost a decade of welfare cuts and stagnant incomes, according to a report that found the poorest districts in Britain now rank below the lowest-income areas of Malta and Slovenia.

In a warning for ministers to protect welfare spending before Rachel Reeves’s spring statement later this month, the National Institute of Economic and Social Research (NIESR) said the UK’s reputation for high living standards was under threat.

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Ontario sets 25% surcharge on energy exports to US to counter Trump tariffs

Premier Doug Ford says province ‘won’t back down’ until US president retracts duties on Canada

The Canadian province of Ontario is imposing a 25% surcharge on electricity exports to the states of New York, Michigan and Minnesota in protest against Donald Trump’s tariffs, the premier, Doug Ford, said on Monday.

President Trump’s tariffs are a disaster for the US economy. They’re making life more expensive for American families and businesses,” Ford said in a statement.

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Risk of ‘Trumpcession’ rising, economists say, as global markets fall

Donald Trump’s brinkmanship and stop-start approach to tariffs rattle investors

The risk that the US economy will enter recession this year is rising, according to economists, as Donald Trump’s chaotic approach to tariffs continued to hit markets.

Shares on Wall Street fell sharply on Monday as investors bet the president’s unpredictable tariff trade war and handling of the economy would hit growth, amid a recent plunge in business and consumer confidence.

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Firms hold back on hiring amid ‘significant cost rises’, surveys say

KPMG/REC report shows decline in people being placed in roles continues, while unemployment is rising, says BDO

Companies are putting the brakes on hiring new staff amid a “subdued” economic outlook and rising wage bills, according to the latest business surveys.

In signs of a weakening UK labour market, the consultancy KPMG and the trade body the Recruitment and Employment Confederation (REC) said a marked decline in the number of people being placed in permanent and temporary roles continued in February, although hiring declined at a slower pace than in January.

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‘Military Keynesianism’? Reeves faces British defence dilemma after EU spending surge

Even Berlin and Brussels are bending fiscal rules in the face of Russia’s threat. Will the chancellor still stick to hers?

As the Nobel laureate Robert Lucas quipped during the 2008 financial crisis: “I guess everyone is a Keynesian in a foxhole.” Donald Trump’s upending of the postwar security consensus has underlined the enduring wisdom of Lucas’s observation. But now, instead of bank bailouts and emergency bond buying, European firepower is being directed at bombs, tanks and drones in the desperate fight to secure the continent’s border with Russia.

Berlin and Brussels – typically capitals of financial orthodoxy – have been convinced that this approach is required once again. Under the plan put forward by Germany’s chancellor-in-waiting, Friedrich Merz, Berlin is on the brink of relaxing its “debt brake” rule to pave the way for spending on defence and infrastructure worth an additional €1tn (£840bn) over the coming decade.

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Justice department opens investigation into soaring US egg prices – report

Officials said to be looking at whether producers have conspired to increase prices or have held back supply

The justice department has reportedly opened an investigation into what is driving the sharp rise in egg prices, including whether top producers have conspired to increase them.

Officials are also said to be looking at whether companies have held back supply. Their investigation is in its early stages, and may not lead to any formal action, according to the Wall Street Journal, which cited sources familiar with the matter.

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Trump temporarily spares carmakers from US tariffs on Canada and Mexico

After a call with top executives at GM, Ford and Stellantis, president approves one-month exemption from tariffs

Donald Trump has temporarily spared carmakers from sweeping US tariffs on goods from Canada and Mexico, one day after an economic strike on the US’s two biggest trading partners sparked warnings of widespread price increases and disruption.

The US president extended his aggressive trade strategy at midnight on Tuesday by targeting the country’s two closest neighbors with duties of 25%.

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European markets soar as Germany moves to lift ‘debt brake’ and raise defence spending

Berlin’s ‘big bazooka’ proposal sends industrial stocks surging but fiscal sea change also hikes borrowing costs

European financial markets have rallied sharply and German borrowing costs have soared after the country’s prospective leaders announced a historic deal to loosen its “debt brake” rule to boost spending on defence.

The yield – in effect the interest rate – on 30-year German government bonds rose by about 25 basis points to 3.08% in its biggest daily increase since October 1998.

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