Rachel Reeves wanted last year’s Budget to be a one-off “corrective” event. The Chancellor raised taxes by £41.5bn – the largest increase as a share of GDP since 1993 – and confirmed the removal of winter fuel payments from most pensioners.
Rather than repeating such measures, Ms Reeves’ hope was that higher economic growth would liberate her. But it has not. After falling by 0.1 per cent in January, GDP has shrunk in four out of the seven months since Labour entered office. The “stability dividend” that ministers believed would accompany the end of Conservative rule proved illusory.
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