What are Rachel Reeves’ main priorities as Chancellor of the Exchequer?

Budget, News, Tax,

In the few days that have passed since the landslide election of the Labour Party, Rachel Reeves has become the UK’s first female Chancellor. She’s also made some early announcements, so let’s take a look at them:

1. Driving economic growth

Reeves has pledged to make kickstarting economic growth a ‘national mission’. She views sustained economic growth as the primary route to improving the country’s prosperity and living standards, and has pledged to take immediate action to drive sustained economic growth. She has promised a new economic model focused on growing the economy while keeping taxes, inflation, and mortgages as low as possible.

2. Housing and infrastructure

Reeves plans to bring back compulsory house building targets of 1.5 million houses over the next five years, and overhaul Britain’s planning rules. She aims to ‘get Britain building again’ by restoring housing targets and reforming the planning system to address housing shortages.

3. Clean energy initiatives

The Labour government has announced the immediate removal of the de facto ban on onshore wind in England, signalling a focus on green technologies and sustainable practices.

4. Fiscal responsibility

Reeves has committed to Labour’s position on reducing the national debt, despite inheriting what she describes as challenging circumstances. She plans to maintain fiscal rules and tax rate promises made in the manifesto.

One of her first actions was to request an assessment of the UK’s public spending situation, which will be disclosed to MPs before the end of the month.

5. Private Sector investment

Reeves is focused on ‘unlocking’ private-sector investment, which she believes is ‘the lifeblood of a successful economy’. This could mean new opportunities for businesses to collaborate with the government on economic initiatives.

6. Reform of the planning system

Reeves has emphasized the need for substantial reforms in the planning system to expedite projects and drive economic advancement.

7. Support for women in the workplace

As the UK’s first female Chancellor, Rachel Reeves has emphasized the importance of women’s participation in the economy for driving growth. She has expressed commitment to closing the gender pay gap and making flexible working the norm.

Is there a Budget on the horizon?

There will be an announcement around a new Budget before the end of July 2024. It’s expected to take place in Autumn 2024, though the exact date is yet to be released. 

What’s likely to be in an Autumn Budget?

Any Budget is likely to address some of Labour’s manifesto pledges and include:

   – Information on adding VAT to private school fees from September 2025.

   – Reaffirmation of the manifesto commitment to the state pension triple lock.

   – Potential launch of a ‘review of the pensions landscape’.

   – Details on housing and infrastructure plans, including the pledge to ‘get Britain building again’.

  – Labour has promised to publish a business tax ‘road map’ for the Parliament within six months of taking office. This may be addressed in the Budget or may form a separate announcement, but will, we hope, go some way to providing some comfort to business owners for Labour’s future plans.

Do bear in mind that, although they’ve had many years and months to plan the move from Opposition to Government, specific details and policies may change as Labour settles into office and assesses the economic situation.

Some of the reported ‘gaps’ in the Labour manifesto calculations may also become more evident over time, and it may also become clear what they intend on some of the questions that were unanswered during the election. 

We will of course keep you informed as further announcements are made, particularly around any future Budget, and the new landscape becomes clearer. If you have any specific concerns around any of the announcements and how they may affect your business, please get in touch.

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