Rachel Reeves asks officials to assess state of public spending

Reeves also announces housebuilding taskforce and plans for modern industrial strategy
Rachel Reeves delivering speech. Photo: Kirsty O'Connor/Treasury

By Tevye Markson

08 Jul 2024

Rachel Reeves has asked HM Treasury officials to provide an assessment of the state of public spending that the Labour government is inheriting.

Giving her first speech as chancellor at at 1 Horse Guards Road, Reeves said that she told officials upon her arrival at the department's headquarters that “that the work starts straight away”.

She said she will present the analysis of the financial situation to parliament before the summer recess, while the date for separate Autumn budget will be confirmed soon.

Reeves also announced that the government will set up a taskforce to unblock stalled housing sites and create a modern industrial strategy in a speech outlining her plans to “fix the foundations of our economy…rebuild Britain and make every part of our country better off”.

Reeves said the first targets for the taskforce would be Liverpool Central Docks, Worcester Parkway, Northstowe and Langley Sutton Coldfield, which would collectively deliver more than 14,000 homes.

And she said the focus of the new modern industrial strategy would be to “create good work and drive investment in all of our communities”.

The chancellor said the department has also begun work to kickstart its growth agenda, establishing a growth delivery unit at the heart of the department in the last few days and starting work on the establishment of a growth mission board,  which will meet before summer recess.

Reeves said she also requested and received Treasury analysis over the weekend on growth, which she said “shows that, had the UK economy grown at the average rate of other OECD economies this last 13 years, our economy would have been over £140bn larger”.

The chancellor said this “could have brought in an additional £58bn in tax revenues in the last year alone”, which “could have revitalised our schools, our hospitals, and other public services”.

Much of her speech focused on planning reform. As well as the housebuilding taskforce, she confirmed the government would reform the National Planning Policy Framework, consulting on a new growth-focused approach to the planning system before the end of the month, including restoring mandatory house-building targets. 

And she said the government would end the “absurd” ban on new onshore windfarms and consult on bringing onshore wind back into the Nationally Significant Infrastructure Projects regime, meaning decisions on large developments would be taken nationally not locally.

She also said that government will support local authorities with 300 additional planning officers across the country, which is around 0.95 officers per English council.

Reeves said she had met with Angela Rayner, the deputy prime minister and secretary of state for levelling up, housing and communities, to agree on the planning-related announcements. 

The chancellor also confirmed that a taskforce launched by Labour in March to look into the establishment of a new National Wealth Fund, led by former governor of the Bank of England Mark Carney, has delivered its report. She said she will soon announce the next steps for the fund, which will have “a remit to invest – and so to catalyse private sector investment – in new and growing industries”.

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