Budget plan to spend billions more won’t stop tax rises

Published On Oct 9, 2024, 11:18 AM

Rachel Reeves is planning to alter borrowing rules to allow for increased spending on major projects in the upcoming Budget. This involves changing how debt is measured, potentially excluding losses from the Bank of England's national debt to free up funds for longer-term investments. However, tax increases are still anticipated due to government commitments to fund daily spending through tax revenues. The Treasury is in talks with the Office for Budget Responsibility to assess the financial implications of these changes, with existing infrastructure investment projected to decline significantly unless reversed by new policies.