How Labour’s Reeves Might Fix UK’s Expanding Budgetary Hole

The UK government’s series of costly policy reversals in recent weeks, combined with slow growth, weak tax receipts and higher spending demands are threatening to leave Chancellor of the Exchequer Rachel Reeves with a hole to fill in her autumn budget measured in the tens of billions of pounds.

In all, Britain’s finance minister could be left £8 billion ($11 billion) to £22 billion in the red, according to Deutsche Bank Chief UK Economist Sanjay Raja. Bloomberg Economics’ Chief Economist Dan Hanson has her £20 billion underwater, largely due to a “downbeat GDP outlook.” As Reeves would also need to restore her fiscal buffer — a margin for error that in spring stood at £9.9 billion, that means she may have to find £30 billion come the fall.