Category Archives: Rachel Reeves

Reeves warned UK inflation will push public sector unions to seek higher pay rises

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Plan for ‘reasonable’ 2.8% rises may prove insufficient, forcing chancellor to find billions in extra funding

Rachel Reeves has been warned public sector unions will demand higher pay increases to compensate for accelerating inflation, heaping pressure on the chancellor to find billions of pounds in extra funding.

The government made recommendations in December for a 2.8% pay rise for teachers, NHS staff and other public sector workers for the financial year beginning in April, saying it was a “reasonable amount” given forecasts for the economy.

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Rachel Reeves has three options to dodge an economic crisis and all are unthinkable

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As her £9.9bn of headroom evaporates, chancellor will have to raise taxes, cut spending or break ‘iron-clad’ fiscal rules

When Rachel Reeves stood up in the House of Commons on budget day on 30 October as this country’s first woman chancellor, she was brimming with pride: “To girls and young women everywhere, I say: Let there be no ceiling on your ambition, your hopes and your dreams.”

Four months on, however, there are few women or men, young or old, at Westminster, who would envy Reeves’s lot in charge of the country’s finances. The bind she finds herself in is more the stuff of a chancellor’s nightmares than dreams.

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UK economy grows by 0.1% in unexpected boost for Rachel Reeves

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ONS data showing British national output rose in final quarter of 2024 confounds forecasts of 0.1% decline

• Business live – latest updates

Britain’s economy unexpectedly picked up in the final three months of 2024, official figures have shown, easing pressure on the chancellor, Rachel Reeves, after flatlining during the summer.

Figures from the Office for National Statistics show gross domestic product rose by 0.1% in the fourth quarter of 2024 – after zero growth in the previous three months – to beat the forecasts of City economists and the Bank of England for a decline of 0.1%.

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Cambridge risks losing ‘unbelievable talent’ amid PhD funding cut

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Warning by vice-chancellor Deborah Prentice comes as ‘Silicon Valley’ planned between Oxford and Cambridge

The University of Cambridge risks “losing unbelievable talent” owing to a drop-off in funding for PhDs, the vice-chancellor has cautioned.

Prof Deborah Prentice, who took over as vice-chancellor in 2023, described PhD students as “the lifeblood” of the university’s research and innovation work, and expressed concern that funding from research councils had “dropped off significantly”.

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‘Stagflation’ fears as Bank of England cuts growth forecast and warns of price rises

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UK economy expected to grow by just 0.75% this year, in fresh blow to Rachel Reeves’s attempts to raise confidence

Rachel Reeves’s plans for growth suffered a double blow after the Bank of England halved its forecast for the year and warned households would face mounting pressure from rising prices.

In a downbeat assessment as it cut interest rates for a third time in six months, Threadneedle Street warned people would face a fresh squeeze on living standards from rising inflation even as the economy stalled.

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Unambiguously bleak Bank of England forecasts pave way for spending cuts

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Weak jobs market and above-target inflation will dent Reeves’s growth plans and may wipe out fiscal headroom

With the public finances tight and Rachel Reeves having pledged to balance the books, interest rate cuts are one of the few levers that could boost the UK’s economic growth in the short term, and the chancellor will be glad of the Bank of England’s quarter-point reduction on Thursday – and the clear signal that it is now in cutting mode.

Seven of the monetary policy committee’s (MPC) nine members backed the quarter-point drop, taking the Bank’s policy rate to 4.5%, while two wanted to be more “activist”, proposing a half-point cut. The Bank of England’s governor, Andrew Bailey, said the MPC would be “taking a gradual and careful approach to reducing rates further”.

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Reeves’s Heathrow third runway report was commissioned by London airport

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The chancellor is under fire after a study cited as evidence for expanding the terminal to boost the UK’s economic growth was ordered by Heathrow itself

Rachel Reeves was facing criticism on Saturday night as it was confirmed that a report she cited as evidence that a third ­runway at Heathrow would boost the UK economy was commissioned by the airport itself.

Experts and green groups also challenged Reeves’s view that advances in the production of ­sustainable aviation fuel (SAF) had been a “gamechanger” that would substantially limit the environmental damage of flying, ­saying the claims were overblown and did not stand up to scrutiny.

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AstraZeneca axes £450m vaccine plant in Liverpool, blaming state funding cut

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Days after Rachel Reeves highlighted life sciences as UK strength, firm decides against site expansion

AstraZeneca has cancelled plans for a £450m expansion of its manufacturing plant in Speke, Merseyside, blaming a cut in the funding on offer from the government.

Only two days after Rachel Reeves highlighted life sciences as a key UK strength, in a speech setting out her plans to kickstart economic growth, the company said it had decided to pull its investment.

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Rachel Reeves says cabinet ‘united’ in backing Heathrow third runway plan – UK politics live

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Chancellor says she has support of cabinet as climate minister Ed Miliband reported to be sceptical over Heathrow plans

Richard Madeley goes next.

Q: The Ryanair boss Michael O’Leary says you are wrong, and the third runway won’t be built until you are 70. You are 45 now. Why is he wrong?

We’re signing off decisions on wind farms, on solar farms, a commitment to a new stadium at Old Trafford. We are upgrading the Transpennine route to make journey times easier between York and Manchester via Leeds and Huddersfield. Those things are happening right now.

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Reeves’s growth plans ‘exactly what economy needs’ say UK business groups – as it happened

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This live blog is now closed, you can read more on this story here

Reeves says the supply side of the economy has been held back.

Politicians have lacked the courage to confront the factors holding back growth.

They have accepted the status quo. They have been the barrier, not the enablers, of change.

Without economic growth, we cannot improve the living standards of ordinary working people, because growth isn’t simply about lines on a graph. It’s about the pounds in people’s pockets, the vibrancy of our high streets and the thriving businesses that create wealth, jobs and new opportunities for us, for our children and grandchildren.

We will have succeeded in our mission when working people are better off.

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Reeves: third Heathrow runway would be hard decision but good for growth

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Chancellor expected to unveil new building projects and revise planning rules to stimulate UK economy

Rachel Reeves has given her strongest hint yet that she will back a third runway at Heathrow airport, arguing that she is willing to make difficult decisions while pursuing economic growth.

The chancellor is poised to make a significant speech this week where she will outline her plans to boost the British economy by radically altering planning rules and accelerating building projects.

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Rachel Reeves indicates support for third runway at Heathrow

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Chancellor says runway would mean fewer planes circling London, and points to moves towards sustainable flying

Rachel Reeves has indicated her support for building a third runway at Heathrow airport, arguing that it would have environmental benefits such as fewer planes circling London.

Ahead of a major speech on economic growth this coming week, the chancellor made the case for Heathrow expansion and said there was “huge investment” in more sustainable aviation.

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‘Move closer to Europe – not Trump’ voters tell Starmer in major UK poll

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Pressure growing on Labour to improve trade with EU as Rachel Reeves admits Brexit damaged UK

Keir Starmer is under growing pressure to forge closer economic links with Europe five years on from Brexit, as a major new poll shows voters clearly favour prioritising more trade with the EU over the US.

The MRP survey of almost 15,000 people by YouGov for the Best for Britain thinktank shows more people in every constituency in England, Scotland and Wales back closer arrangements with the EU rather than more transatlantic trade with Washington. MRP polls use large data samples to estimate opinion at a local level

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Labour risks ‘powder keg’ clash with environmentalists as it puts growth before going green

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As chancellor Rachel Reeves’ plan to expand London airports gains traction, the party is accused of back-pedalling on its green commitments

Labour is being warned it is hurtling towards a “powder keg” confrontation with environmentalists, green groups and a swathe of its own supporters in the next few weeks, amid its claims that “blockers” are standing in the way of economic growth.

A flurry of pro-growth measures have been announced by ministers in recent days as part of a government fightback against claims that the economy is stalling.

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UK ‘second most attractive country for investment’, survey finds

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The survey of chief executives, published ahead of the World Economic Forum, follows an upgraded growth forecast from the IMF

The UK is the second most attractive country for investment behind the US, signalling a climb up the rankings, according to an annual survey of global business leaders by the consultancy PwC.

Published at the start of the World Economic Forum (WEF) in the Swiss ski resort of Davos, the survey of almost 5,000 chief executives from 109 countries puts the UK in second place, ahead of China, Germany and India.

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Hospitality firms ‘to incur £1bn costs from employer NICs on 774,000 more workers’

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Industry body says businesses and jobs at risk unless Rachel Reeves’s tax changes delayed or altered

The hospitality industry will incur an extra £1bn of costs for 774,000 of its workers who will be newly eligible for employer national insurance contributions from April, endangering jobs and businesses, a leading industry body has claimed.

UKHospitality, which represents thousands of restaurants, hotels, pubs, cafes and nightclubs, is calling on the government to delay or alter changes to the tax announced in Rachel Reeves’s October’s budget in order to protect jobs.

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Treasury seeks to keep water firm fines earmarked for sewage cleanups

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Exclusive: Restoration fund in England could be ‘siphoned off’ to be used for general government spending, not repairing rivers

Rachel Reeves’s Treasury is looking to keep millions of pounds levied on polluting water companies in fines that were meant to be earmarked for sewage cleanup, the Guardian has learned.

The £11m water restoration fund was announced before the election last year, with projects bidding for the cash to improve waterways and repair damage done by sewage pollution in areas where fines have been imposed.

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Pound falls to 14-month low as bond sell-off piles pressure on Rachel Reeves

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UK borrowing costs rise again, with analyst warning ‘things are also getting rather ugly’

The pound has fallen to a 14-month low against the US dollar as the sell-off in the bond market fuelled investors’ anxiety over UK assets and piled further pressure on the chancellor, Rachel Reeves.

As the bond sell-off gathered steam, sterling lost a cent against the US dollar, extending recent losses, falling to about $1.226.

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Rachel Reeves heads to China to build bridges, but a new golden era of relations is impossible

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Seeking business partners post-Brexit is sound policy, but even in these darker geopolitical times the UK will ultimately side with the US

Rachel Reeves will fly with a delegation of City grandees to China this week as Labour seeks closer economic links with Beijing as part of its quest for growth.

With the outlook increasingly rocky at home after a run of soft economic data, the chancellor is sorely in need of a positive story to tell.

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Trump versus trade: the global economic outlook for 2025 in five charts

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Unpredictable change will sweep through America, while old problems, from war to inflation, are likely to afflict other countries

The global economy is entering the new year with rising geopolitical tensions looming over its prospects, as the world’s leading central banks attempt to cut interest rates after the worst inflation shock in decades.

Donald Trump’s second term in the White House is expected to dominate the economic agenda. Global trade tensions are on the horizon as the president-elect threatens to impose sweeping tariffs on US imports.

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