Three weeks ahead of her first Budget, Chancellor Rachel Reeves delivered an unprecedented pre-Budget speech this morning, refusing to rule out tax increases and signalling that “difficult choices” lie ahead.
Speaking from Downing Street, Reeves said the world had “thrown even more challenges our way” over the past year, including persistent inflation, weak productivity and higher borrowing costs and that her 26 November Budget would be guided by the principles of growth and fairness.
The Chancellor said she would “do what is right, not what is popular”, adding that every decision will be shaped by the need to “protect families, get debt under control, and secure the economy for the future.”
While Labour’s election manifesto pledged not to raise income tax, VAT or National Insurance for working people, Reeves declined to repeat that commitment, instead stating that “each of us must do our bit” – comments widely interpreted as preparing the ground for possible tax rises.
Independent forecasters, including the Resolution Foundation, have said such measures may be inevitable given the government’s fiscal rules and expectations that the Office for Budget Responsibility will downgrade productivity forecasts later this month, creating a £20 billion shortfall in the public finances.
Reeves also criticised years of “economic instability and indecision” under previous governments, arguing that the UK’s “productivity puzzle” was not complex but “the result of stop-go policymaking.” She reaffirmed her “iron-clad” commitment to the fiscal rules, stressing that further borrowing was not a sustainable answer.
Beyond the fiscal discipline, Reeves sought to frame the upcoming Budget around fairness and shared responsibility, highlighting plans to cut NHS waiting lists, reduce national debt and ease the cost of living, pledging a strategy that balances growth with realism.
What today’s speech means
Today’s address was about context rather than detail. It served to manage expectations ahead of the 26 November Budget, confirming that the Treasury faces limited headroom and that the choices ahead will be challenging.
While the exact policy measures remain to be seen, the message was clear: this will be a Budget shaped by necessity rather than popularity with the Chancellor asking the country to share in that effort.
We will provide same-day coverage and commentary on 26 November, summarising the key announcements as they are released, followed by a more detailed post-Budget analysis examining the implications for individuals, businesses and trustees.
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