Tax & Spend
Reeves Eyes Spending Cuts If UK Bond Slump Eats Up Headroom
- Chancellor to reaffirm her fiscal rules in speech this month
- Treasury under fresh pressure from soaring borrowing costs
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Chancellor of the Exchequer Rachel Reeves will favor fresh cuts to public spending over tax hikes if soaring UK borrowing costs wipe out her fiscal headroom.
Reeves plans to reaffirm her fiscal rules in a speech in the coming weeks aimed at reassuring investors and businesses about her handling of the economy, according to people familiar with her plans. She will argue that Prime Minister Keir Starmer’s Labour government will prioritize stability and not consider any loosening of budgetary guidelines, said the people, who asked not to be identified discussing unannounced proposals.