Britain's finance minister requires spending self-discipline, however no return to austerity

Rachel Reeves, Chancellor of the Exchequer, speaks to the media ahead of her keynote speech during the 2024 Labour Party Conference at the ACC Liverpool on September 23, 2024 in Liverpool, England.

Ian Forsyth | Getty Images News | Getty Images

Liverpool, ENGLAND – British Finance Minister Rachel Reeves said on Monday that Britain would not return to austerity and that her proposed budget would be aimed at rebuilding the country.

“It will be a budget with real ambition… a budget that delivers the changes promised. A budget to rebuild Britain,” she told Labour delegates on Monday. “There will be no return to austerity.”

Her speech, which was briefly interrupted by heckling from a protester in the crowd, came at the start of Labour's annual party conference on Monday – the first in power for 15 years.

The Labour government is facing criticism that it is stirring up a mood of doom over the state of public finances. Prime Minister Keir Starmer warned of “painful” decisions following his party's victory in the general election in July.

Reeves has suggested taxes are likely to rise in her upcoming autumn budget on October 30 after discovering a £22 billion ($29 billion) “black hole” in the public finances. Her predecessor, Jeremy Hunt of the rival Conservative Party, dismissed the claims as “fictitious”.

Reeves has already ruled out increases in income tax, national insurance contributions, value added tax (a sales tax) and corporation tax.

However, the government has announced that millions of pensioners will no longer receive heating allowances in winter – a decision criticised by Labour supporters.

Half of Britons, including a quarter of Labour voters (26%), are disappointed with the government's performance so far, according to an Ipsos opinion poll on Friday. Gideon Skinner, Ipsos' senior director of UK politics, said the results were an indication that the government's “honeymoon phase” was over.

“After a few months of post-election hope, pessimism and worry are creeping back,” Skinner said at the Labour Party conference on Monday morning.

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