Chancellor Rachel Reeves has placed a reckless wager, casting her lot with City bankers and their gilded coffers, rather than the electorate whose pockets she promised to fill. With Sir Keir Starmer’s government marching to the drum of economic growth at all costs, one might be forgiven for wondering whether the true cost is to be borne by those who can least afford it. The fiscal policy of this Labour administration—once draped in the noble rhetoric of wealth redistribution—now appears to be little more than a well-dressed game of ‘robbing Peter to pay Paul.’
Since seizing the reins of power, Reeves and her ilk have engaged in a relentless spree of extraction, prising contributions from pensioners, farmers, business owners, and taxpayers alike. It is a policy of insatiable acquisitiveness, shrouded in the pious incantations of fiscal responsibility. And yet, with every levy, with every adjustment to the balance sheet, the government seems ever further removed from the lofty pledges it made on the campaign trail.
The recent downgrade of growth forecasts by the Office for Budget Responsibility (OBR) should, one might think, serve as a warning. The government’s much-vaunted fiscal headroom—an ephemeral £9.9 billion—has been swallowed by a perfect storm of economic malaise: sluggish growth, higher borrowing costs, and spiralling interest rates. Reeves, insistent on maintaining her ‘iron-clad’ fiscal rules, finds herself now facing the unenviable choice between further tax hikes or deepening spending cuts. For a government that grandstands on its commitment to raising living standards, this is, at best, a paradox; at worst, a betrayal.
Yet rather than deploying the full force of the Treasury to invest in people, this administration remains fixated on the City’s avaricious elite. The path to sustainable economic prosperity does not lie in further impoverishing the electorate; it lies in bold investment—investment in education, in lifelong earning, in cultivating an economically active citizenry. Instead of ransacking the coffers of those already struggling, the government ought to be directing its energies towards mobilising the economically inactive, fostering employment opportunities that are both meaningful and lucrative.
Consider, for a moment, an alternative strategy—one that does not rely on emptying pockets but on filling them. Addressing age inequality in the workplace would empower older workers to remain productive for longer, leveraging their experience and entrepreneurial acumen to drive national productivity. Equipping individuals with the skills required to thrive in an ever-evolving job market would not merely serve their interests but would fuel economic expansion in a manner both organic and sustainable.
Instead, we are left with the feeble murmurings of a government wedded to an ideology of punitive austerity dressed in the finery of fiscal prudence. The insistence on adhering to arbitrary fiscal targets—targets that will likely necessitate even greater impositions upon the taxpayer—is not the hallmark of economic sagacity; it is the myopic vision of a chancellor who has mistaken accountancy for leadership.
And what of growth? Downing Street clings desperately to the forecasts of the OECD and IMF, boasting of their minor upward revisions as though they were harbingers of a golden economic era. Meanwhile, the Bank of England has halved its own expectations for growth this year, and the OBR’s impending figures threaten to reveal the stark reality Labour has sought to obfuscate: an economy lumbering under the weight of mismanagement, bereft of the dynamism it was promised.
It is a curious spectacle, watching a government so brazenly abandon its pledges within mere months of assuming office. Having promised to be the stewards of prosperity, they have become its saboteurs. Reeves and Starmer, in their quixotic pursuit of growth at all costs, appear to have forgotten that growth is meaningless if it is not felt by those whom it purports to serve.
One does not build prosperity by hollowing out the very foundations upon which it stands. If the Labour government is serious about delivering economic renewal, it must shift its focus from the counting houses of the Square Mile to the pockets of the British people. Until then, it remains little more than a high-stakes gambler—placing all its chips on the City, with the public left to foot the bill.
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