Spring Statement fury as Rachel Reeves blames anyone but herself for welfare cuts and flat-lining economy - recap

Here's everything you need to know on Rachel Reeves' Spring Statement in just 90 seconds:

Read more here:

• Britain's wealth gets squashed under Reeves
• Rachel Reeves is forced to admit UK economy is stalling as she desperately slashes welfare payments
• Use our interactive calculator to find out how much more YOU could be paying in tax
• Three million workers will get a £1,400-a-year pay rise as Rachel Reeves confirms 6.7% hike in National Living Wage
• Read the Chancellor's Spring Statement in full

Rachel Reeves defended her welfare reforms on LBC this evening saying those 'who can work, should work'.

Reeves said she wanted to support people to get back to 'meaningful work', but was not willing to write-off a generation of young people.

When challenged over why she is penalising poor people, Reeves pointed to tax rises for the riches and ending tax loopholes for non-doms.

Former shadow chancellor John McDonnell said 'marginal changes to taxation' would cover the cost of the cut to welfare.

He told Sky News there were multiple angry MPs at the briefing before the spring statement today.

Adding that emails he was being sent from constituents would 'make you weep' because they are fearful about the cuts to welfare.

Michelle O’Neill, Northern Ireland’s first minister, said Rachel Reeves was following a “macho agenda” at a time when the public sector is “on its knees”.

This is a time for our own administration to fight back hard against this militarisation agenda.

This does not serve the interests of the people here.

The Tories have hit out at Labour’s welfare reforms, calling them a 'shambles'.

Helen Whately, the shadow work and pensions secretary, said:

Labour’s welfare announcement will put no one into work. The savings they have announced are a drop in the ocean compared to the spiralling welfare budget.

They didn’t have a plan before the election, and have hastily thrown together some last minute ideas. Even this week, they are still making changes because their numbers don’t add up.

We need those who can work, to work - so that people who are seriously disabled get the help they need. Labour’s welfare shambles achieves neither, and the country will pay the price.

In an article for the Mirror, James Taylor, director of strategy at the charity, Scope, said:

Today we had a smash and grab raid by the Chancellor. One of the biggest ever cuts to disability benefits. One in five of all disabled households will be worse off.

This is going to hit disabled people in the pocket for years to come; people who are not responsible for the condition of the economy or government spending plans. The numbers are mind boggling, and living standards will be cut to the core.

He added:

This short-term thinking in No.10 and the Treasury will come back to haunt them as other parts of our creaking infrastructure – like the NHS – will have to pick up the pieces.

Today’s Spring Statement should shame the Government to its core.

The OBR highlighted the role of net migration - which has hit a new record annual high of 906,000 - in the growth of the economy over recent years.

The report said structural weakness in productivity was to blame for around a third of the one percentage point downgrade in forecast growth this year

The OBR said the adult population is set to expand by another 2.1million people over the next five years, again driven by net inflows.

The watchdog is assuming that annual net migration will 'fall sharply' from 728,000 in the year to mid-2024 to a 'trough' of 258,000 in the year to mid-2027. It is expected to be 340,000 in 2029-30.

Fiscal rules are non-negotiable, Chancellor Rachel Reeves says, as she addresses reporters at the news conference in Downing Street.

People should have no doubt about my commitment and how seriously I take the fiscal rules, as I said today they are non-negotiable.

In its latest outlook accompanying Rachel Reeves' Spring Statement, the Office for Budget Responsibility (OBR) said it does not expect real GDP per person to return to 2022 levels - before the energy crisis hit - until 2026.

That is around a year later than the Treasury watchdog anticipated at the time of the October Budget.

Rachel Reeves has said the Government’s view on its digital services tax on big tech firms has not changed.

She told a press conference:

We believe that companies should pay tax in the countries in which they operate, which is why we introduced a digital services tax in the first place - and our views on that have not changed.

Mr Trump has said that digital services taxes, which affect American giants including Google, Facebook and Amazon, will be considered when the US imposes fresh tariffs on countries around the globe next month.

Chancellor Rachel Reeves has said she recognises that accepting free tickets to a Sabrina Carpenter concert was 'a bit odd'.

Asked if she regretted accepting the tickets and if she will repay the cost, Ms Reeves told a press conference in Downing Street:

It may come as a surprise to some of you that I’m not personally a huge Sabrina Carpenter fan, being a 46-year-old woman, but a member of my family did want to go and see that concert. I’m not in a position now that I can easily just go and sit in a concert.

I do recognise that people think that that’s a bit odd but that’s the reason why I did that rather than just being in normal seats, which to be honest for me and my family, would have been a lot nicer and a lot easier.

Rachel Reeves declined to rule out hiking taxes at her next Budget in response to speculation she will be forced to find more money to balance the books.

The Chancellor said: “I’m not going to write four years of budgets, I’ve just delivered a spring statement today.

But I think you can see through this spring statement how determined I am, how determined this government is, to live within the means that we set ourselves in the budget last year and to grow our economy because that is the way to sustainably improve living standards and have the money that we need for our public services.

She said her 'once-in-a-generation' tax-raising first budget in October had 'wiped the slate clean' and would not need to be repeated.

There was lots of speculation that I was going to change taxes today, the Tories were desperate to call this an emergency budget – it was far from it.

Reeves has said the imposition of tariffs would harm both the US and UK economies.

Asked about the impact of increased tariffs that could come into effect next week, Rachel Reeves told a press conference:

I think all of us were very pleased when the Prime Minister went to Washington a few weeks ago to have those meetings with the US president. The last time Donald Trump was president of the United States, trade and investment flows between our two countries increased.

A million British people work for American firms and a million Americans work for British firms, so you can see how closely our economies are intertwined. Increased tariffs between our economies will damage both of our economies, and we will continue to make that case for free and open trade, and let’s see where we get to in the next few weeks.

Rachel Reeves has been questioned about the Government's own assessment that welfare cuts will leave an estimated 250,000 more people in relative poverty.

The Chancellor said she is confident that supporting people into work will lead to more people being paid 'decent wages'.

She said:

We’re confident that the changes that we are making and the support that we’re providing to get people into work will result in more people having fulfilling careers paying decent wages and, of course, that’s the best way to lift families out of poverty.

Rachel Reeves has defended her fiscal rules as she was questioned about those who claim her insistence with meeting the restraints are punishing the most vulnerable.

She told a Downing Street press conference, there was nothing 'Labour or progressive' about losing control of the public finances.

That's what the previous government did and that saw mortgage rates and rents go through the roof, it saw prices increase, and it wasn't the wealthy who paid the price for that.

She went on to defend her fiscal rules.

It is important to provide an anchor for people to know that this government will ensure that we are not living beyond our means borrowing more than we can afford.

The Chancellor is now speaking at a Downing Street press conference.

We will bring you all the key lines as and when we can.

This is the moment a Cabinet minister likened Labour's welfare cuts to his children's pocket money during an interview with the BBC.

Chief Secretary to the Treasury Darren Jones was questioned on Politics LIve about Government data which showed the welfare cuts will take, on average, £4,500 away from people receiving Personal Independence Payments (PIP).

The document, which was the Government's own impact assessment, also showed cuts to social security would push 250,000 people into poverty over the next five years, including 50,000 children.

Mr Jones said the document did not provide the full picture as it did not account for the possibility of people finding work before using an example of children's pocket money to explain his point.

He said:

Take for example, if I said to my kids, ‘I’m going to cut your pocket money by £10 a week but you have to go and get a Saturday job.’ The impact assessment on that basis would say that my kids were down £10, irrespective of how much money they get from their Saturday job.

Watch the moment below:

by Quentin Letts

How vulnerable this once-confident Chancellor looked.

Her two slender, white wrists trembled over the despatch box and she sought to buttress her voice.

Pushed lower on her larynx, pressing for more volume amid the swirling din. She shouted that the country’s economic woes were the fault of ‘the party opposite’. She must have used that phrase 20 times. ‘The party opposite...the party opposite.’

She claimed, implausibly, that her plans were working. ‘I fixed the foundations of our economy!’ It came out huskily. There was insufficient gravy in that voice. Not enough Castrol in the cogs. She sounded shrivelled. Salt.

Read more here:

Bereaved families are set to pay £2.4billion more in inheritance tax than previously expected by 2030, according to the latest official projections.

A raid on inherited pensions from 2027, on top of frozen thresholds and higher property values, is going to force better off families to hand over more of their wealth when their loved ones die.

The Treasury is now predicted to rake in a total of £66.9billion between 2024 and the end of the decade, when the annual inheritance tax take will hit £14.3billion.

The figure for the next tax year starting on 6 April has been revised up from £8.66billion to £9.10billion, according to Office for Budget Responsibility forecasts released alongside today's Spring Statement by the Government.

In 2027-2028, the first year that pensions become liable for inheritance tax like other assets such as property, savings and investments, the OBR has hiked its forecast for receipts from £11.22billion to £11.71billion.

Read more here

Conservative leader Kemi Badenoch has accused Labour of having no plan for Government as she reacted to the Spring Statement.

Speaking to broadcasters, Ms Badenoch said the build-up to today's statement was 'chaos'.

They might have been ready for an election, but they had no plan for the reality of government - and everything they're doing is in haste.

It's at the last minute. It's not fully thought through. They're having to make changes and this is just chaos.

Ms Badenoch earlier accused Ms Reeves of 'scrambling' to fix the mess she made before her shadow chancellor Mel Stride said she 'tanked the economy'.

Rachel Reeves is handing HMRC more power to crack down on tax avoidance as she looks to balance the books.

In her first Spring Statement, the Chancellor said there would be no tax increases for ordinary people but instead she'd go after tax dodgers to raise revenue of around £7.5billion.

Previously, in the Budget, Reeves said she'd delivered the 'most ambitious' package to cut down on tax evasion, raising £6.5billion per year by 2030.

Today she said she had gone further by investing in technology to help HMRC launch a crackdown on tax avoidance.

While tax avoidance and evasion are separate things - avoidance is legal and helps reduce tax liabilites, while evasion is illegal - she is looking to crack down on both to close the tax gap.

The Treasury plans to prosecute more tax fraudsters by increasing the number of annual charging decisions from 500 to 600 per year by 2029/30.

It will also tackle 'fraud committed by the wealthy, fraud facilitated by those in large corporations, and by individuals and companies who make it possible for others to hide money offshore.'

HMRC will also launch a scheme to reward informants within businesses that are not complying with the tax regime.

'The new scheme will take inspiration from the successful US and Canadian models, rewarding informants with compensation linked to a percentage of any tax taken as a result of their actions,' said the Treasury.

A new online calculator can reveal how today's spring statement will affect Britons after Rachel Reeves said she will be forced to make further welfare cuts.

The Chancellor is seeking to balance the books after the budget watchdog said the Government's plans will not save as much as ministers hoped.

She set out the measures today as she delivered her spring statement in response to a gloomy economic assessment by the Office for Budget Responsibility.

Read the full story here:

A Labour MP has told Sky News many of her colleagues are preparing to vote against the expected welfare cuts in Parliament in what could be shaping up to be a major rebellion.

Rachael Maskell, who represents York Central, told Sky News many new MPs have described the reforms as a 'step too far' following the Chancellor's Spring Statement.

She said:

This will have quite a catastrophic impact on some of the most vulnerable people, marginalised people, in our community - people that Labour needs to protect.

We must protect those people who are already experiencing extensive poverty. That's why the Labour Party was formed. And I believe today we still hold that moral purpose and must fulfil it.

There will be no stamp duty reprieve for homebuyers after Rachel Reeves made no reference of it during today's Spring Statement.

It means from 1 April, homebuyers across England and Northern Ireland will pay more upfront tax when buying a property with thousands racing to try to complete before the new rates kick in.

It is thought as many as 70,000 buyers will miss the deadline and pay more tax.

From next Tuesday, the nil-rate threshold, under which no stamp duty is paid, will drop from £250,000 to £125,000, returning to where it was before temporary changes were made in 2022.

This will increase the tax bill on the average-priced home in England from £2,028 to £4,528, according to analysis by Coventry Building Society.

First-time buyers will see their nil-rate band threshold drop from £425,000 to £300,000.

This means instead of paying no stamp duty on a purchase worth £425,000, from April they will pay £6,205.

On a £500,000 purchase their tax bill will rise from £3,750 to £10,000 - a bump of £6,250.

Demonstrators gathered outside Westminster Abbey to protest cuts to disability benefits at Downing Street during Chancellor Rachel Reeves’ Spring Statement.

Anna Rose, 81, said she was 'incandescent with rage' about the cuts.

The retiree from north-west London said: 'There’s an absolute political refusal to care. It’s harming people and it’s killing people.'

Paul Ridley, 59, an unpaid carer of his 36-year-old son, who has autism and other disabilities, said: 'If I’m cooking on my own, I can’t go to the toilet because my son will put his hand on the stove. He doesn’t understand danger, he runs off into the road on his own. How does the Labour Government expect him to be in an office?'

Here are some pictures from the demonstration:

Fresh forecasts on the outlook for the British economy were published on Wednesday alongside Chancellor Rachel Reeves' Spring Statement.

The Office for Budget Responsibility's latest figures reflect bleaker economic prospects for the UK and globally since its last projections in Autumn.

Forecasts for economic growth, public debt, inflation and other key measures have been revised and reflect the impact of adjustments outlined by the Chancellor earlier today.

Here are three charts you need to see:

Growth forecasts downgraded

The OBR halved its October GDP growth forecast for 2025 from 2 to 1 per cent

Debt costs set to climb further

The OBR said on Wednesday it now expects longer-term borrowing costs to continue rising over the next five years - even as interest rates fall.

Borrowing to fall more slowly

Public sector net borrowing is forecast to fall from £137.3billion - or 4.8 per cent of GDP - this year to £74billion and 2.1 per cent of GDP in 2029-30.

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by Dan Hodges

Rachel Reeves will be able to recall the precise moment her political career ended.

The hands of the old House of Commons clock stood at 1.06pm when she sat down, having delivered her Spring Statement.

Up until that moment the Chancellor had been praying something might come to her rescue. That amidst the thickets of charts and graphs and tables contained in the Office for Budget Responsibility's (OBR) economic projections there would be a number that would defy expectations.

That her own fiscal target had not been busted by £14billion. Growth figures that hadn’t been slashed in half. Tax receipts that meant she wouldn’t have to tell grim-faced Labour MPs that additional cuts to benefits and other public spending would have to be found.

But there was no relief. The report was as damning as had been predicted.

Read more here:

More taxpayers will face harsher late payment charges under new rules announced alongside the Spring Statement .

The Treasury published plans to increase late payment penalties for VAT and income tax self-assessment (Itsa) taxpayers as they join the 'Making Tax Digital' scheme from April 2025.

The digital scheme requires individuals and businesses to keep digital records and submit updates every quarter.

VAT and Itsa taxpayers face charges from His Majesty's Revenue and Customs if they file late, which includes a first penalty then an additional penalty, with an annualised penalty rate.

Currently, a taxpayer will not incur a penalty if the outstanding tax is paid within the first 15 days after the due date. After day 15 they are charged a fine of 2 per cent of the tax due.

If the tax is still unpaid after 30 days, taxpayers will face another 2 per cent, meaning a total 4 per cent charge by day 30.

From April 2025, taxpayers that are part of the MTD scheme will be charged 3 per cent of the outstanding tax where their tax is overdue by 15 days, plus another 3 per cent if it is still unpaid at 30 days.

They will also face a doubling of the annualised rate, from 4 per cent currently to 10 per cent.

The government said it was increasing the charges 'to encourage taxpayers to pay on time'.

Disabled people will be hit by a 'double whammy' as a result of new welfare cuts, Liberal Democrat leader Sir Ed Davey said.

Sir Ed said disabled people who cannot work will be hit as well as reduced support for their carers.

He said:

Carers need more support, not less. Snatching away the little support these carers get will do nothing to help people into work; it will just put more pressure on already over-stretched carers, social care and the NHS.

The Government’s impact assessment estimated that a tightening of eligibility rules would see 800,000 people not receive the daily living component of personal independence payment (Pip) by 2029, although a “significant proportion” would keep access to the separate mobility component of the disability benefit.

As a result of the changes, a further 150,000 people will not receive carer’s allowance or the carer element of universal credit, the assessment said.

Individual Savings Accounts could see a radical shake-up in the near future, Spring Statement documents reveal.

The Government has revealed it is considering reforms to cash Isas, after weeks of speculation.

The Treasury in its Spring Statement document said future reforms will aim to 'get the balance right between cash and equities to earn better returns for savers, boost the culture of retail investment, and support the growth mission.'

Reforms could see a cut to the current £20,000 allowance for cash Isas, an allowance which is currently shared with stocks and shares versions, with a £4,000 limit speculated in recent months.

No changes have been made for now, and the £20,000 allowance will be available to split in the 2025/26 tax year, which begins on 6 April 2025.

It comes after an ongoing debate on cash Isa accounts was sparked as some city bosses called on the Chancellor to slash cash Isa allowances in a bid to push more savers towards investing their money.

Donald Trump's plan to hit competitors, foes and allies alike with trade tariffs will hammer Rachel Reeves hopes of leading a UK economic recovery, experts warned today.

The Office for Budget Responsibility (OBR) warned that if the protectionist US plan developed into a full-blown global trade war it could reduce UK GDP by a full 1 per cent on its own.

The worst-case scenario, in which Trump hits the rest of the world with 20 per cent import taxes to protect US domestic businesses, would also increase inflation by 0.6 per cent.

The Chancellor stressed the grim realities facing the country as she delivered her Spring Statement to the Commons, arguing the 'world has changed'.

Read more here:

A Labour MP has accused Rachel Reeevs of making a 'cruel choice' as he criticised the Government's welfare reforms.

Richard Burgon, a former shadow Treasury minister, said the Chancellor had avoided more difficult decisions such as taxing wealthier people.

Mr Burgon said:

Making cuts instead of taxing wealth is a political choice, and taking away the personal independence payments from so many disabled choice is an especially cruel choice.

A disabled person who can’t cut up their own food without assistance, and can’t go to the toilet without assistance, and can’t wash themselves without assistance will lose their personal independence payment.

So hasn’t the Government on this taken the easy option of cutting support for disabled people rather than the braver option which would be to tax the wealthiest through a wealth tax?

Ms Reeves insisted there was 'nothing Labour' about not supporting people into work.

The Government has admitted its own welfare reforms will push 250,000 people, a fifth of them children, into relative poverty by the end of the decade.

An impact assessment published after Rachel Reeves' Spring Statement said the projections were estimated using a 'static microsimulation model'.

It reads:

“Using this model, we estimate there will be an additional 250,000 people (including 50,000 children) in relative poverty after housing costs in 2029/30 as a result of modelled changes to social security, compared to the baseline projections.”

Relative poverty is measured when a household's income is below a certain percentage of the median income in a country.

In case you missed the Chancellor's Spring Statement in the Commons, here are the key takeaways from her highly anticipated address:

• Rachel Reeves insisted the 'world is changing before our eyes' as she takes a veiled swipe at Donald Trump for causing 'more unstable' global trade which she claimed had impacted the British economy
• She reiterated her fiscal rules are 'non-negotiable' and says she has 'restored' nearly £10billion of 'headroom' in her financial plans by 2029/30
• Ms Reeves reveals Office for Budget Responsibility found a gap of around £14billion in the public finances since October's Budget
• She swerves further tax increases but announces new measures to tackle tax avoidance estimated to raise another £1billion
• Ms Reeves said Universal Credit standard allowance will increase from £92 per week in 2025-26, to £106 per week by 2029-30
• The Chancellor added that the Universal Credit health element will be cut by 50 per cent and frozen for new claimants.
• Reeves said the OBR concluded the Government’s planning reforms would 'help build over 1.3 million homes' in the next five years.
• She also vowed to make UK a 'defence industrial superpower' with an extra £2.2 billion boost for the Ministry of Defence budget

The Treasury has published the Spring Statement in full after Rachel Reeves presented it to Parliament today.

All 50 pages were issued as a PDF after the Chancellor blamed 'increased global uncertainty' as the budget watchdog slashed its forecast for economic growth.

The Office for Budget Responsibility halved its forecast for growth in gross domestic product in 2025 from 2 per cent to just 1 per cent.

Read more here:

Oxfam said the Spring Statement marked 'a new low' in the fight against poverty and inequality as the charity reacted to the Chancellor's speech in the Commons.

Senior policy adviser Anna Marriott said the Government had chosen to cut international aid and social security support for millions of people, while proecting the 'soaring wealth' of billionaires.

Three-quarters of the British public back Government tax increases on the very richest instead of these cruel and unnecessary cuts, but the Chancellor has decided to turn her back on fairness.

These cuts are not just numbers on a balance sheet but will cost lives and have a devastating impact on people facing conflict, poverty and climate disasters around the world. It’s not about tough decisions; it’s about political choices. The Government must stop protecting extreme wealth and start protecting people.

Millions of workers will receive a £1,400-a-year boost to their pay from next week, Rachel Reeves confirmed today.

The Chancellor revealed during her Budget in October that she would be increasing the National Living Wage by 6.7 per cent from next Tuesday (April 1).

She confirmed the move in today's spring statement - adding that three million people would see their pay rise from £11.44 to £12.21 an hour.

Meanwhile, the National Minimum Wage - for 18 to 20-year-olds - is said to rise from £8.60 to £10 an hour from April in a 16.3 per cent increase.

Read more here:

The overall tax burden in the UK is forecast to rise from the equivalent of 35.3% of GDP (gross domestic product) in 2024/25, to a 'historic high' of 37.7% in 2027/28, according to the Office for Budget Responsibility (OBR).

This is more than four percentage points above the pre-pandemic level of 33.2% in 2019/20.

The peak of 37.7% is lower than previously forecast, however.

At the budget in October 2024, the OBR said the tax burden was likely to climb as high as 38.3% in 2027/28.

The main driver of the increase in the tax burden are personal taxes, 'particularly income tax and national insurance contributions', the OBR said.

Beyond 2027/28, the figure is forecast to stabilise at 37.5% in both 2028/29 and 2029/30.

Rachel Reeves was branded a 'gambler' and accused her of having 'fiddled' the fiscal targets by Mel Stride before Speaker Sir Lindsay Hoyle intervened.

Stride told the Commons:

Even with her fiddled fiscal targets, she left way too little headroom, way too little headroom. And is (it) not the truth, that whilst (Ms Reeves) said at the last budget that that was a once-in-a-parliament reset, she rolled the dice on a wafer-thin margin and she lost?

Reckless with her fingers crossed, she fiddled the targets and she missed them.

Intervening, Speaker Sir Lindsay Hoyle urged Stride to use 'better and more constructive words' in his response.

Watch the moment below:

Stride told the Commons the Chancellor 'chose to be reckless' with the economy as he accused her of borrowing and spending 'like it was the 1970s'.

The Chancellor likes to tour the television studios and tell everybody they should be thankful that she will not be ramping up taxes in this ’emergency budget’ as she did before.

But that will be cold comfort to the millions up and down the country waiting in fear and trepidation for the start of the new tax year, buckling under the burden of tax that’ll be rising to the highest tax burden on her watch in the history of our country.

He later accused Reeves of destroying businesses and livelihoods through the increase in National Insurance contributions.

She taxed jobs and wealth creation, she’s destroyed livelihoods, businesses clobbered big and small, small companies – the backbone of our economy, enterprise – crushed on the altar of her ineptitude.

Mel Stride has claimed Rachel Reeves is the 'architect of her own misfortune' as added she blamed 'anybody but her'.

The shadow chancellor also accused Labour of having 'reneged on their promises to the British people”' during last year’s general election.

He told the Commons:

Given her track record, given the fact that she has failed to control spending and borrowing to date, what does she think the markets are going to make of her latest promises?

But (Chancellor Rachel Reeves) says of course that none of this – none of this – is her fault, that it’s the war in Ukraine, it is (US) president (Donald) Trump, it is tariffs, it is (Russian) president (Vladimir) Putin, it is the Conservatives, it is (the) legacy, it is anybody but her.

But what the British people know is that this is a consequence of her choices. She is the architect of her own misfortune: it was (Ms Reeves) who talked down the economy, who talked down the economy so that business surveys and confidence crashed through the floor.

Stride has said Reeves invented the £22 billion black hole the Labour government claimed it was left with after taking office last year.

He said the Chancellor promised to bring stability but was forced to produce an 'emergency budget' in what he described as an 'utter humiliation'.

He said:

Inflation, which was down to 2% bang on target on the very day of the last general election under a Conservative government. We are now told this year we’ll be running at twice the level of the forecast under ourselves in 2024. This is going to mean prices bearing down on households and on businesses, right across the country, because of her choices.

He said the Office for Budget Responsibility also predicted unemployment will continue to rise successively in the next few years.

So much for (Rachel Reeves’) back to work plans

Shadow chancellor Mel Stride has said that Chancellor Rachel Reeves 'chose to be reckless' with fiscal headroom as he accused her of having 'tanked the economy.

He said the Chancellor had blamed everyomr but herself for the UK's struggling economy.

Reeves said the OBR had concluded the Government’s planning reforms would 'help build over 1.3 million homes' in the next five years.

She said:

The planning system that we inherited was far too slow. The OBR have concluded that our reforms will lead to housebuilding reaching a 40-year high of 305,000 by the end of the forecast period.

And changes to the national planning policy framework alone will help build over 1.3 million homes in the UK over the next five years taking us within touching distance of delivering on our manifesto promise to build 1.5 million homes in England this parliament.

Reeves has told the Commons extra investment in the UK defence budget will help the country become a 'defence industrial superpower'.

Confirming an additional £2.2 billion to the Ministry of Defence’s budget for next year, the Chancellor said it acted as a 'further down payment' towards plans to plans to deliver 2.5% of GDP to defence.

She then pledged to spend a minimum of 10% of the Ministry of Defence’s equipment budget on noew technologies including drones and AI (artificial technology) enabled technology.

Reeves said the boost to defence industry will see the UK become a 'defence industrial superpower'.

Ms Reeves has told the Commons the OBR has revised the UK growth forecast for 2025 from 2% in the autumn to 1%. - adding she is 'not satisfied' with the numbers.

She said the Government's backing of 'builders, not the blockers' will help grow the economy as she referenced upcoming planning reforms

Ms Reeves also highlighted reforms to the pension system and a national wealth fund, adding it was part of a 'serious plan' for economic growth.

Rachel Reeves has said the state can become 'leaner and more agile' as she announced a new fund to deliver reforms to the UK's public services.

Calling it a Transformation Fund, Ms Reeves said she wanted to see more resources delivered to the frontline, citing the example of the recent abolition of NHS England.

She said:

The Health Secretary is driving forward vital reforms to increase NHS productivity, bearing down on costly agency spend to save money we can improve patient care. And the Chancellor of the Duchy of Lancaster is taking forward work to significantly reduce the costs of running government by 15%, worth £2 billion, by the end of the decade.

This work shows that we can make our state leaner, and more agile, delivering more resources to the front line while ensuring we control day-to-day spending to meet our fiscal rules.Today, I build on that work by bringing forward £3.25 billion of investment to deliver the reforms that our public services need through a new Transformation Fund.

Universal credit standard allowance will increase from £92 per week in 2025-26, to £106 per week by 2029-30, Rachel Reeves has announced

The Chancellor added that the Universal Credit health element will be cut by 50% and frozen for new claimants.

She said:

The OBR (Office for Budget Responsibility) have said that they estimate the package will save £4.8 billion in the welfare budget, reflecting their judgments on behavioural effects and wider factors.

This also reflects final adjustments to the overall package, consistent with the Secretary of State’s statement last week and the Government’s Pathways to Work Green Paper.

The universal credit standard allowance will increase from £92 per week in 2025-26 to £106 per week by 2029-30, while the universal credit health element will be cut by 50% and then frozen for new claimants.

Here is the current top story on the MailOnline website as Rachel Reeves slashes welfare payments to arrest the UK's flat-lining economy.

Rachel Reeves has claimed she has restored the fiscal headroom 'in full' which will help build resilience in an increasingly 'insecure world'.

The Chancellor said her two rules at the budget were the 'stability rule', which ensures that public spending is under control, and 'investment rule' to drive economic growth.

She said her current budget would have resulted in a deficit by £4.1bn in 2029-30 but that her headroom had now been restored.

As a result of the steps that I am taking today I can confirm that I have restored in full our headroom against the “stability rule” moving from a deficit of £36.1bn in 2025-26 and £13.4bn in 2026-27 to a surplus of £6.0bn in 2027-28, £7.1bn in 2028-29 and £9.9bn in 2029-30.

That means that we are continuing to meet the Stability Rule two years early, building resilience to shocks in this, a more insecure world.

Ms Reeves said a full spending review will be published in June before a budget is delivered in the autumn, adding it was in line with a commitment for 'one major fiscal event a year'.

She said the steps taken in the spring statement would restore her headroom against her debt target to £9.9 billion by 2029/30 after the OBR forecast she would miss it by £4.1 billion without taking action.

Ms Reeves then said her fiscal rules remained 'non-negotiable'.

In the autumn, I set out new fiscal rules that would guide this Government. These fiscal rules are non-negotiable. They are the embodiment of this Government’s unwavering commitment to bring stability to our economy and to ensure security for working people.

Ms Reeves has told the Commons the global economy has become more uncertain which has affected the UK economy and public finances.

She added the threat facing Europe was transformed when Vladimir Putin invaded Ukraine.

The job of a responsible government is not simply to watch this change. This moment demands an active government. A government not stepping back, but stepping up. A government on the side of working people helping Britain reach its potential.

We have the strengths to do just that as one of the world’s largest economies, as an ally to trading partners across the globe, and as a hub for global innovation. These strengths and the progress we have made so far mean we can act quickly and decisively in a more uncertain world to secure Britain’s future and to deliver prosperity for working people.

Chancellor Rachel Reeves opened her spring statement saying she was 'proud' of what the Government has delivered since the election.

She told MPs:

This Labour government was elected to bring change to our country. To provide security for working people and to deliver a decade of national renewal. That work of change began in July – and I am proud of what we have delivered in just nine months.

Restoring stability to our public finance, giving the Bank of England the foundation to cut interest rate three times since the general election. Rebuilding our public services with record investment in our NHS bringing waiting lists down for five months in a row and increasing the National Living Wage to give three million people a pay rise from next week.

Now our task is to secure Britain’s future in a world that is changing before our eyes.

The Prime Minister has told the Commons he has 'full confidence' in Rachel Reeves after he was challenged to do by Tory MP Jerome Mayhew.

The Conservative said Ms Reeves' 'tax and spend' budget had 'collapsed around her ears' leading to today's 'emergency budget'.

Asking the Prime Minister whether it was time to declare he has 'full confidence' in Ms Reeves, Mr Starmer said he did.

Downing Street has released a readout of the Cabinet meeting earlier today in which Rachel Reeves described her upcoming Spring Statement as reflecting a 'slowing outlook for global growth'.

Here is the readout in full:

The Chancellor welcomed the fall in inflation this morning and said the spring statement followed choices the Government took in the autumn budget to fix the foundations of the economy, put record investment in the NHS – delivering five months in a row of falling waiting lists – the rolling-out of free breakfast clubs to all primary schools, a £1,400 increase in the national living wage for three million workers coming in next week, £100 billion of increased capital investment and a £190 billion increase in day-to-day spending for public services.

The Chancellor said the spring statement would reflect a slowing outlook for global growth, which underlined the importance of the Government’s growth agenda which had already seen the Government back key projects including Heathrow, East-West Rail, the Old Trafford regeneration and yesterday’s decision to approve the Lower Thames Crossing.

The Chancellor said you do not deliver growth by abstaining on these decisions as previous governments had done, but by getting on with delivering the key projects and reforms needed to the UK’s planning system and changing the way the state operates to be more agile and effective, and deliver better value for taxpayers.

The Chancellor concluded by saying today’s spring statement would demonstrate the Government’s plan to deliver higher growth, higher living standards and better public services, built upon the key foundation of economic stability.

Stephen Flynn, the SNP's leader in Westminster, has challenged Sir Keir Starmer on how children will be lifted out of poverty in Scotland following welfare cuts.

Mr Flynn told the Commons that as someone who had suffered a physical disability, he knows the difficulties awaiting those whose payments may be reduced.

He said he wanted the Prime Minister to tell the children in Scotland how making their mums and dads poorer will help lift them out of poverty.

Mr Starmer said welfare reforms were needed to help people back into work and claimed 84,000 young people in Scotland were not in employment or education.

Kemi Badenoch branded the Spring Statement an 'emergency budget' - a phrase she has used often in recent weeks - and said it amounted to Reeves scrambling to fix the mess she made in October.

She has then turned her attentions to Bridget Phillipson, the Education Secretary, and questioned why the Government voted against banning phones in schools last week.

The Prime Minister responded by saying such a move was 'unnecessary' as most schools already have a ban in place, and added the battle should be over content on mobile phones.

Prime Minister's Questions has now started.

Speaking at the beginning of Prime Minister’s Questions, half an hour before Rachel Reeves delivers the statement, he said:

Today’s spring statement will showcase a Government going further and faster on the economy, greenlighting the Lower Thames Crossing, investing £2 billion in 18,000 affordable homes for working families, 60,000 young people being trained as the next generation of construction workers, and fixing millions of potholes.

We’re undoing a decade of stagnation, to bring jobs and opportunities for working people and securing Britain’s future.

We will bring you the best lines from PMQs before the Spring Statement which is immediately afterwards.

This is the moment Rachel Reeves was asked whether she was in 'panic mode' as she left Downing Street for the Commons.

The Chancellor was also asked if she would be announcing 'emergency cuts' in her Spring Statement later.

Watch the exchange below:

Here's what the Conservative leader Kemi Badenoch has had to say today as her party prepares its response to the Spring Statement.

In a post on X, Ms Badenoch tweeted:

Rachel Reeves claimed to be smashing a glass ceiling, but now the roof is falling on all of our heads.

Shadow chancellor Mel Stride is likely to respond to Rachel Reeves in the Commons when she finishes delivering her statement this afternoon.

Rachel Reeves has now left Downing Street to make her way to the Commons to deliver her Spring Statement .

The Chancellor gave a brief smile for the cameras as she headed for Parliament, where she will lay out her plans after PMQs.

However, Ms Reeves has already suffered a blow with the Treasury watchdog rejecting her claimed savings from benefits curbs.

Some protesters waved placards against the planned welfare cuts which will be announced later.

The Prime Minister has been pictured leaving Downing Street as he heads to Parliament for Prime Minister's Questions.

Mr Starmer will face questions from Conservative leader Kemi Badenoch in the Commons from 12pm before the Spring Statement.

Rachel Reeves is expected to leave Downing Street imminently after putting the final touches to her Spring Statement which will be delivered in Parliament this afternoon.

Earlier we reported Ms Reeves was dealt a major setback last night when the Treasury watchdog rejecting her claims for savings of around £5 billion from benefits.

Instead, the OBR valued them at more like £3 billion, meaning the Chancellor was faced with a last-ditch effort to find more cuts despite anger from Labour MPs and voters.

Another £500million is apparently being trimmed from welfare, with the rest from other areas.

Meanwhile, the Chancellor was provided some relief when inflation fell more than expected to 2.8 per cent in February.

Ms Reeves and Sir Keir Starmer have both made reference to a 'changing world' this morning in a sign the Chancellor will blame global events for the UK's stuttering economy.

Inflation fell more than expected to 2.8 per cent in February, but remains above the Bank of England's target.

At its peak, inflation stood at 11.1 per cent. The latest ONS figures show that consumer prices index inflation fell from 3 per cent in January to 2.8 per cent in December.

The headline figure had been steadily falling in 2024, before a surprise uptick in August. It has sat above the central bank’s target since October, despite forecasts that it might stay static or even fall further.

While the headline rate has dropped by more than anticipated, core inflation remains sticky at 3.5 per cent, while services inflation remained at 5 per cent.

Read more here:

Helen Miller, deputy director of the Institute for Fiscal Studies, told Radio 4's Today programme the Chancellor made promises she was unable to keep ahead of her Spring Statement later today.

Watch the interview below:

by James Tapsfield, MailOnline's Political Editor

Gordon Brown rarely made jokes – good ones, at least.

He was, however, fond of quipping that there are two types of Chancellor, ‘those whose careers end in failure and those who get out in time'.

Rachel Reeves will deliver her Spring Statement today not even a year into her stewardship of No11, and she’s already missed the latter option.

Allies stress she inherited an awful legacy of huge Covid debt and unrealistic spending plans.

But it is increasingly hard to make the case that she has improved things.

The decision to hike national insurance on employers - a tortured effort to find a huge tax rise that did not smash Labour’s manifesto – is backfiring.

Her spending plans have turned out to be just as implausible as those of her predecessors, needing to be effectively torn up after just five months.

Worryingly, things could get even worse soon as the asteroid of Donald Trump’s global trade war has yet to hit.

Whispers are getting louder in the corridors of Westminster about Ms Reeves’ judgment, and her future. She is the focus of much Labour ire about benefits cuts and alleged ‘austerity’.

Catty briefings emanating from the Treasury about other Cabinet ministers trying to defend their departmental budgets have damaged relations.

Ministers are also stopping short of full-hearted support in interviews about her freebies habit.

Whatever Ms Reeves has in the locker today to improve the outlook had better be good. Because a toxic atmosphere is building around her – and she is at risk of becoming the latest victim of Gordon Brown’s axiom.

We've now seen Cabinet ministers leave Downing Street after their weekly meeting before PMQs and, today, the Spring Statement.

Foreign Secretary David Lammy, Culture Secretary Lisa Nandy, Commons Leader Lucy Powell and Net Zero Secretary Ed Miliband were all captured heading out of Number 10.

A tightening of eligibility for the main disability benefit personal independence payment (Pip) and cut to the health element of universal credit (UC) have prompted stark warnings and calls for a rethink.

Changes to Pip are expected to account for the largest proportion of savings, with the Resolution Foundation think tank estimating this could see between 800,000 and 1.2 million people in England and Wales losing support of between £4,200 and £6,300 per year by the end of the decade.

An official impact assessment is expected to be published later today.

Charities have reported a surge in calls and visits to their advice pages following last week’s announcement, which came after lengthy speculation about what might be in store.

Mental health charity Mind said its helpline advisers had reported that some people had indicated their level of worry was such that they felt they had 'no choice but to end their own life'.

Meanwhile, a group of public health experts writing in the British Medical Journal warned people will die as a result of the cuts to personal independence payments and the sickness elements of universal credit.

Professor Gerry McCartney, from the University of Glasgow, said:

There is now substantial evidence that cuts to social security since 2010 have fundamentally harmed the health of the UK population. Implementing yet more cuts will therefore result in more premature deaths. It is vital that the UK Government understands this evidence and takes a different policy approach.

Prime Minister Sir Keir Starmer has described the current welfare system as 'morally indefensible', insisting Labour’s reforms will help those who can work to get jobs.

The Mail on Sunday reported Ms Reeves has been warned she has six months to save her job as Labour MPs grow increasingly restive over her plan to slash state spending by £15 billion.

Senior party sources say that if the economy has not sparked into life by the time of the Autumn Budget, Ms Reeves will have ‘run out of road’.

A source told the newspaper:

If we continue on this trajectory she will have three options to avoid a Liz Truss-style market turmoil – cut spending further, raise taxes or fiddle her fiscal rules to appear solvent. None of those will be politically acceptable and she will be at the end of the road.

On Sunday, Ms Reeves was asked about some on the Labour left who fear austerity is now on the table.

She told the BBC’s Sunday with Laura Kuenssberg:

Last year, I put £100 billion more into capital spending than the previous government had committed to, we put more than £20 billion into the National Health Service. That is a far cry from what we’ve seen under Conservative governments in the last 14 years.

Seemingly insprired by the Trump administration's inadvertent gaffe of adding a journalist into a group containing classified information, the Tories have taken aim at Rachel Reeves ahead of what they describe as her 'emergency budget'.

A damaging poll released on the eve of the Spring Statement reveals most voters no longer believe the Chancellor's economic claims – and are increasingly blaming her for the country's financial woes.

The More in Common survey found Ms Reeves is facing a credibility crisis, with more than half of voters (53 per cent) saying Labour lied about its economic plans to win power and 'always knew they weren't going to keep to these promises'.

Just 13 per cent say Labour has stuck to its pledges on the economy.

Voters are also tired of Labour's constant attempts to blame the last Conservative government, with only 30 per cent saying they believe the Chancellor has been honest about the scale of the fiscal challenge she inherited.

More than half of voters think Labour is spending too much time blaming the Tories. Some 31 per cent now blame Labour for Britain's growth crisis, compared with 27 per cent blaming the Conservatives and 18 per cent citing global events.

Remarkably, a majority of voters would now rather have former chancellor Jeremy Hunt or Shadow Chancellor Mel Stride at the Treasury.

Voters also fear Ms Reeves will fail in her stated ambition to turn around the economy and deliver a decade of renewal.

With tax rises and increases in utility bills set to come in next month, 49 per cent think the cost of living crisis may never end.

Sir Keir Starmer and Rachel Reeves have both emphasised a 'changing world' ahead of the Spring Statement on what is predicted to be a difficult day for the Government.

In statements on X this morning, the Prime Minister wrote: 'In an era of global change, we will deliver security for working people and renewal for Britain.'

Before that, Ms Reeves wrote: 'Security for working people and renewal for our country. That is our mission. And in a changing world we will deliver.'

Last night, she tried to blame global challenges for the British economy's stuttering performance on her watch.

'We can see that the world is changing, and part of that change is increases globally in the cost of government borrowing – and Britain has not been immune from those challenges,' she added.

In a relief to Rachel Reeves ahead of her Spring Statement, headline CPI dipped to 2.8 per cent in February from 3 per cent in January.

That was slightly better than the 2.9 per cent analysts had pencilled in - although still well above the Bank of England's 2 per cent target.

Closely-watched core inflation - excluding energy, food, alcohol and tobacco - also nudged down from an annual rate of 3.7 per cent to 3.5 per cent.

The Pound immediately slid against the US dollar, as traders priced in a higher chance of the Bank reducing the base rate at its next meeting in May.

The level was kept on hold at 4.5 per cent last week despite mounting alarm at the slowdown in the economy.

However, some economists warned that the data could be a 'false dawn' and planned hikes in energy and national insurance for firms will push inflation 'perilously close to 4 per cent sooner rather than later'.

We can now show you pictures of Cabinet ministers arriving in Downing Street on a huge day for the Government as Chancellor Rachel Reeves delivers her Spring Statement.

Deputy Prime Minsister Angela Rayner, Health Secretary Wes Streeting and Work and Pensions Secretary Liz Kendall were all pictured heading to No10.

Chief Secretary to the Treasury Darren Jones and Defence Secretary John Healey were also captured by photographers this morning.

by Angharad Carrick

The Chancellor committed to a new set of fiscal rules, which restrict how much the Treasury can spend and tax.

It means the current budget should be on course to be in balance or surplus by 2029/30; net financial debt should fall in the same tax year; and some types of welfare spending will be capped.

After the Budget, she left around £10billion of headroom against the rules, which was below the OBR's forecast of around £15billion.

Since then, geopolitical issues and rising gilt yields have brought Reeves' fiscal rules into sharp focus and she has much less room to play with.

Last month, government borrowing was much higher than expected. OBR figures show it came in at £10.7billion, higher than the forecast £6.5 billion, leaving the Chancellor with much less headroom than anticipated.

ING economists predict the Treasury has likely lost all of its headroom following the increase in borrowing costs, but spending cuts will help to meet fiscal rules.

Meanwhile, inflation and gilt yields - the interest paid on new debt - have both increased. Some experts now predict that the Bank of England will choose to keep rates higher for longer than anticipated to combat higher inflation, which is above the central bank's 2 per cent target again.

All of this will make government borrowing a lot more expensive and therefore harder for Reeves to keep to her fiscal rules.

Rachel Reeves will put the finishing touches to her Spring Statement inside Number 11 this morning before she heads to the Commons this afternoon to deliver it.

The Chancellor will step forward at the despatch box at 12:30pm after Prime Minister's Questions which starts at noon.

At 2:30pm, the Office for Budget Responsibility (OBR) will hold a press conference where it is expected growth forecasts may be slashed in half to around 1 per cent this year, as well as warning that living standards will stagnate for the rest of the decade.

Then at 4:15pm, Reeves will host a press conference in Downing Street to explain her statement in more detail and take questions.

We will bring you the latest updates throughout the day plus reaction and analysis.

Defence Secretary John Healey has said Rachel Reeves would deliver a 'tough' statement 'in tough times' as he appeared to confirm that further cuts to welfare spending will be required .

The Chancellor is expected to announce further welfare cuts after promising a £2.2 billion boost to defence spending which has caused upset among Labour MPs and supporters.

Asked how Labour voters would view her Spring Statement, Mr Healey told BBC Radio 4’s Today programme:

It will be a tough, strong statement in tough times. The Chancellor will set out this afternoon that the world is changing, our task is to secure Britain’s future and that’s why she is making an extra £2.2 billion available for defence.

The Office for Budget Responsibility is reported to have concluded the measures will cut the bill by £3.4 billion, with Rachel Reeves expected to announce further measures to save a further £500 million.

Mr Healey told Times Radio:

That’s a calculation we may see confirmed by the Office for Budget Responsibility about the longer-term savings that our plans to change the welfare system may bring.

Rachel Reeves has suffered a major setback even before her Spring Statement today with the Treasury watchdog rejecting her claims for savings from benefits.

The OBR is said to have batted away the government's estimate that reforms of work and disability handouts can curb £5billion from costs.

Instead they have been valued at more like £3billion - sparking a frantic last-ditch effort to find more cuts despite mounting fury from Labour MPs. Another £500million is apparently being trimmed from welfare, with the rest from other areas.

In total Ms Reeves is thought to have a £15billion black hole in the finances to fill in her Commons set-piece at lunchtime, after the stalling economy and rising debt servicing costs wreaked havoc with her huge tax-and-spend Autumn Budget plans.

Read more from MailOnline's Political Editor James Tapsfield here:

The Spring Statement is usually an update on the OBR's forecasts with no new policy announcements.

However, we've already had a string of announcements ahead of Wednesday as Reeves looks to balance the books.

Over the weekend, Reeves told the BBC she had ruled out 'tax and spend policies' which means she will not raise taxes or government spending.

Ahead of the statement, the Chancellor has:

• Said the UK has 'not been immune' from 'increases globally in the cost of government borrowing'
• Insisted that 'economic stability is non-negotiable' and she will 'never play fast and loose with the public finances'
• Confirmed plans to tell Whitehall departments to cut administrative budgets by 15%, expected to save £2.2 billion a year by 2029-30
• Announced £2 billion of funding for social and affordable homes in England
• Promised to train tens of thousands of construction workers to help deliver the promised 1.5 million new homes in England before the next election

The Chancellor had committed to holding only one budget a year, in the autumn, with the Spring Statement an update on the economy.

However, the changing economic and geopolitical backdrop means that Reeves' fiscal headroom has been wiped out.

The Treasury has already announced wide-ranging cuts in a bid to recoup some of the fiscal headroom lost to higher debt interest forecasts.

Read our preview from our This Is Money reporter Angharad Carrick:

Hello and welcome to MailOnline and This Is Money’s live coverage of the Spring Statement as Rachel Reeves unveils spending cuts in an attempt to balance the books.

The beleaguered Chancellor will publish official forecasts this afternoon showing the outlook for economic growth has halved to around 1 per cent.

Following her controversial tax-raising Budget in October, the Office for Budget Responsibility (OBR) is also expected to warn living standards are set to stagnate for the rest of the decade.

The gloomy forecasts put Ms Reeves on course to break her own 'fiscal rules' and unveil £15billion in cuts, triggering a Labour backlash over whether she is pursuing austerity.

Stick with us as we bring you the latest news, reaction and analysis from our reporters in Westminster and the This Is Money team.