Stop non-priority spending, Treasury warns ministers

Published On Dec 9, 2024, 6:52 PM

Chancellor Rachel Reeves is implementing a stringent budget review aimed at identifying and cutting inefficient government spending, requesting departments to save 5% of their budgets. The review will be zero-based, meaning all spending must be justified anew, focusing on delivering priorities set by the government. This initiative comes after criticisms of wasteful expenditures in the public sector. Notably, Reeves has stated that unnecessary programs, such as a costly initiative placing social workers in schools with no proven benefit, will be targeted for cuts. The Labour government aims for fiscal prudence while dealing with a £22 billion financial gap left by previous administrations.

Read full article

Stock Forecasts

SPYView SPY chart on TradingView

Positive

The focus on cutting wasteful spending may stabilize public sector finances, which could lead to investor confidence in UK fiscal policy. However, potential cuts to services may prompt public discontent and affect sector institutions. Despite this, companies linked to public sector contracts, particularly efficient service providers may stand to gain from the reviews as they position themselves as solutions to efficiency improvements.

Related News

The Fed's 'final 5-pound' issue with inflation points to gradual rate cuts: Morning Brief

Dec 10, 2024, 6:00 AM

Getting inflation down to 2% remains the Fed's key objective. But it also seems to be anticipating possible ways the cure might become another poison — and making sure it doesn't happen.

SPY

Tax Cuts Were Top of Mind at the Tax Foundation’s Annual ‘Prom’

Dec 10, 2024, 5:02 AM

Republican control of Washington and a tax bill next year have corporate America excited — and on edge.

SPY
XLC

Trump says he won't fire Fed Chair Jerome Powell

Dec 9, 2024, 6:37 PM

President-elect Trump said in an interview that he won't attempt to fire Federal Reserve Chair Jerome Powell despite his past criticism of Powell and the leadership of the central bank.

SPY