Spring Statement 2025 LIVE: Rachel Reeves’ ‘reckless choices’ have tanked the economy, blast Tories

Accepting free tickets was 'a bit odd'

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.

"Some of the things that I might have been able to do in my everyday life in the past are not so easy now, and so I had advice that it would be better to be in a box, the owners of the O2 (arena) had a box, tickets that are not available to buy, and they said that I could go in there, and that was better for security reasons.

"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."

Chancellor 'confident' about bill

The Chancellor is "confident" the Government's package to boost workers' rights will help the economy grow, despite warnings from the Office for Budget Responsibility (OBR) to the contrary.

The fiscal watchdog warned the Employments Rights Bill, currently making its way through Parliament, could have a negative impact on economic growth.

Asked about the OBR's assessment, the Chancellor told reporters at a press conference in Downing Street: "As we grow the economy we want ordinary working people to benefit, and that is why we are banning exploitative zero-hours contracts, fire-and-rehire, and also it's why we are increasing the national living wage, because we want to incentivise people to go into work, and for that work to offer the security and dignity that should come from employment.

"The OBR hasn't put anything in their forecast today about the Employment Rights Bill because it is still working its way through Parliament.

"But we're confident that it will result in ordinary working people having more money in their pockets but also having the security to spend that money because they don't have to worry from week to week whether they'll be in work or how many hours they'll get."

Chancellor doesn't rule out tax hikes

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.

But she insisted she was focused on growing the economy as a way to generate revenue, rather than relying on tax rises or spending cuts.

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."

At a Downing Street press conference 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," she said.

Impact of increased tariffs

The imposition of tariffs would harm both the US and UK economies, the Chancellor has said as she urged the public to "see where we get to" with the United States.

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.

"But I recognise how important free and open trade is, not just for the United States, although they are our biggest single trading partner, but also with the EU."

View on digital services tax not changed

Rachel Reeves has said the Government's view on the digital services tax 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."

More people being paid 'decent wages'

Rachel Reeves has said she is "confident" that the "support" the Government is providing to get people into work will lead to more people being paid "decent wages".

She was asked about the assessment that welfare cuts will leave an estimated 250,000 more people in relative poverty during a presser.

Ms Reeves 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."

Boris Johnson weighs in

Here comes ex-PM Boris Johnson, who accuses Labour of "wreaking havoc" on the UK economy.

Farage: People are still getting poorer

Reform UK leader Nigel Farage told the House of Commons that measuring growth by GDP is "not the most relevant number to our constituents".

The Clacton MP added: "Because we’re living in an age of mass immigration and a rising population, it is GDP per capita, surely, that matters to our constituents.

"That has fallen consistently for the last two years, and is falling still, and shouldn’t we tell people, actually, they are getting poorer?”

Chancellor Rachel Reeves replied: “The OBR forecast the GDP per capita will increase by 5.6pc during this Parliament, having fallen under the previous government.”

“So, if he ever gets to Clacton, he can tell his constituents that.”

RECAP: Labour to be in 'touching distance' of manifesto housebuilding target

Rachel Reeves told the House of Commons that 1.3million houses will be built, putting Labout within “touching distance” of its manifesto pledge to build 1.5million homes.

That's still 200,000 short, however.

The OBR said it would have “the biggest positive growth impact” of any policy that cost nothing to the public purse.

Reeves added it would add £15.1 billion to the UK economy within a decade, though house prices are still estimated to rise £30,000.

HARRY COLE analysis: It's grim news everywhere you look

It's Spring Statement Day and Rachel Reeves has given her economic update.

And guess what? It's not great.

Growth for this year has been slashed in half.

The buffer that the Chancellor put in place in October to protect her against global instability, to keep the books balanced, has been wiped out.

It’s a £14 billion hit to the economy.

Now, the Chancellor tried to put a brave face on things, but frankly, the whole government bet of relying on growth to avoid having to slash the size of the state has crumbled. It's in tatters.

The growth figures are in - the economy will grow by just one per cent this year.

That will go up to 1.9 per cent next year, and by 1.8 per cent by the end of the Parliament.

That is not enough for the government to avoid tough and harsh decisions.

So how is she going to pay for it?

Well, £6 billion was slashed from government department budgets. That's going to be quite painful for some of them.

And then a £5 billion slashing of the welfare bill.

Now, some people are saying that's not even enough to even touch the sides of Britain's bloated benefits payments, but already, politically, the Chancellor is in a very, very tricky position because Labour MPs don't want to touch it any more.

That's going to make a collision course with her own party.

Everywhere you look in this update, there's grim news. Inflation, that has been going down for the last couple of years after it soared after COVID, is forecast to go back up.

It will eventually, by the end of the parliament, they say, get back to that target of two per cent, meaning two per cent price rises each year. But we’re looking at three per cent by the end of this year. That's going to hurt as well.

Is Rachel Reeves essentially now just in a bit of a doom loop?

Her October budget, which put £40 billion of tax rises onto the British economy.

£25 billion of those tax rises were directly aimed at employers - people that keep the country growing, people that create jobs.

That hasn't even kicked in yet - that kicks in next month. So the pain is already here before the actual money has been taken from people’s paychecks.

She increased borrowing by £30 billion in November and in the small print of this OBR document, it says she's going to increase borrowing by an extra £17 billion.

The markets are not going to like that. So what's she going to do? Because in October she's going to have to have another Budget.

And lo and behold, we all expect the OBR to come back then and say, look, your headroom's gone again.

So where is she going to find even more money?

Politically, she's trapped between left-wing Labour MPs who don't want to slash the benefits bill, markets who don't want to increase borrowing, and so the only place there really is, is more tax rises or more spending cuts.

So she's put a brave face on it today, but she'll be back in six months having this exact same conversation.

Rachel Reeves to speak at 4.15pm

The Chancellor will face the media at 4.15pm today - and will be pressed on her £4.8bn cuts to welfare, and whether she has mismanaged the economy as the growth forecast was halved.

Inflation will only return to target from 2026 onwards

Mr Hughes said the UK GDP performance has been "disappointing in recent months" and had "stagnated".

He says gas prices rising means inflation is likely to only get back to the two per cent target from 2026 onwards.

OBR speaking live

Richard Hughes, the chairman of the Office for Budget Responsibility, is holding a live press conference.

He says yields on government bonds have risen by half a percentage point since their last forecast in October, and could go higher over the next five years.

£3.2bn to be spent on reducing Whitehall blob

A £3.25 billion public sector “transformation fund” will be used to pay off failing civil servants and replace them with cutting edge AI tech.

Rachel Reeves said the money would cover “funding for voluntary exit schemes to reduce the size of the civil service”.

The Civil Service has 543,000 employees, compared to 418,000 in 2016.

Benefits impact assessment

Some 3.2 million families will lose out on an average of £1,720 as part of Labour's welfare cuts, which are already appearing unpopular with backbench MPs.

A further 800,000 people who either claim the Personal Independence Payment, or could claim it in the future, will lose out on £4,500.

Trump tariffs would wipe out £10bn surplus

Donald Trump deploying tariffs would be a hammer blow to the British economy, Rachel Reeves has been warned.

The Chancellor has been told by the independent watchdog that the tariffs would wipe out the projected surplus of £10 billion by the end of the decade.

The trade war would also see GDP reduced by up to 1 per cent, the Office for Budget Responsibility says.

The US President could impose a levy of 20 per cent between the States and the rest of the world sparking a global trade war.

Trump is planning to bring in these tariffs on "liberation day" next week which will be devastating for Britain.

The watchdog says it will lead to a "permanently lower" GDP level by around 0.3 per cent.

OBR criticises Reeves and the Treasury

Don't annoy the OBR, or they'll stick a line in their 180 page report about how disgruntled they are.

Joking aside, the independent experts are unhappy, and claim Rachel Reeves's team failed to provide them with "sufficient detail" on some policy plans.

They write: "Policy costings information on the direct fiscal effects of some measures was received late and without sufficient detail.

"So far, as some of the measures are concerned, we have certified the Government’s estimates of their fiscal effects as reasonable and central, but with a high degree of uncertainty attached to them."

They add: "We were not, in the limited time available, able to develop our own analysis."

OBR: £500 household boost will be by 2029

The OBR has confirmed the much-hyped £500 boost to the average household will be felt by 2029, not this year.

Rachel Reeves had declined to say when Brits would feel the effect of a boost to real household disposable income.

Benefit cuts could push 50,000 children into poverty

Rachel Reeves' £4.8billion cut to the welfare state will push an additional 250,000 people into relative poverty after housing by 2029/30, a newly published impact assessment has revealed.

The figure includes 50,000 children.

Spring Statement at a glance

House prices to rise despite buliding blitz

The Office for Budget Responsibility says house prices will increase by an average of £30,000 from now until 2029.

The average home, now £265,000, will increase to £295,000 - despite Rachel Reeves committing to 1.3million new homes in the Spring Statement.

They say the price increase is part-fuelled by inflation and the arrival of an estimated 1.5million migrants into the UK by 2030.

Reeves 'fiddling while Rome burns', say Lib Dems

Rachel Reeves is “fiddling while Rome burns”, according to the Lib Dems.

Treasury spokeswoman Daisy Cooper said the slashing of growth was a "hammer blow" to the chancellor's financial ambitions.

She also called for closer co-operation with the European Union.

Ms Cooper added: "This Government is simply fiddling while Rome burns instead of fixing our trading relationship with Europe.

“The Chancellor must immediately launch negotiations for a new UK-EU customs union, to kickstart growth, boost small businesses, and secure the vital revenue that our public services desperately need."

So, what have we learnt?

Rachel Reeves' speech went longer than expected. Here is what's new:

• No new tax rises: The Chancellor ruled out further tax hikes and pledged to crack down on tax avoidance, aiming to raise an extra £1bn.
• Growth downgraded for 2025: The OBR halved its GDP growth forecast for next year from 2% to just 1%.
• Growth boost from planning reforms:  New housing policies expected to raise GDP by 0.6 per cent over the next decade.
• Housebuilding surge:  1.3 million homes expected over five years, with construction hitting a 40-year high.
• £2.2bn extra for defence: Additional funding confirmed to help meet the 2.5 per cent of GDP defence target by 2027.
• £400m Defence Innovation Fund: Backing new tech like drones and AI for the front line.
• Welfare shake-up: Targeted employment support and welfare reform to reduce benefit spending by £4.8bn. Reeves says: "If you can work, you should work."
• Civil service cuts: New voluntary exit schemes and AI tools to shrink Government.

OBR: Donald Trump's tariffs would sink growth

The Office for Budget Responsibility says that should US President Donald Trump slap 20 per cent tariffs on all nations, the forecast for growth would sink growth by 0.6 per cent of GDP in 2026-27.

The quango adds it would be caused by "weaker global GDP growth and heightened uncertainty dragging on investment" weighing on the UK economy.

Trump's latest round of tariffs are set to kick in on April 2, with the UK among dozens of countries angling for an exemption.

Britain is already subject to a 25 per cent tariff on steel and aluminium.

Stride: We are poorer and we are weaker

Mr Stride continues: "The forecast for growth is down, borrowing is up, inflation is up, and business confidence smashed.

"The right response is not to duck responsibility but to build a resilient economy."

He asks: "How can we believe this chancellor? She said she wouldn't increase borrowing, but she did.

"She said she wouldn't tax farmers, but she did. And she said she would not move to more than one fiscal event a year, but she just has."

"Today's numbers confirm it - we are poorer, and we are weaker.

"To govern is to choose. And this chancellor has made all the wrong choices."