Labour won't announce spending cuts before next election, Rachel ...
Labour will not set out detailed plans for public spending before the general election, Rachel Reeves has confirmed.
The shadow Chancellor appeared to accept that a new Labour government would have to cut some spending, saying: “We’re not going to be able to turn things around straightaway.”
But she insisted that over time her party’s plans for growing the economy would boost public services without needing to raise taxes or borrowing.
The Government’s plans to bring down borrowing, as confirmed by Jeremy Hunt’s Budget last week, would see annual increases in public spending restricted to 1 per cent in real terms.
Given existing promises to spend more on health, defence and childcare, economists estimate that this policy would require cuts of up to £20bn in other departments such as justice and local government.
Each department’s budget has been guaranteed for the next year, but a new spending review to decide funding for future years will not take place until after the election.
Ms Reeves told the BBC’s Sunday with Laura Kuenssberg that it would not be possible for Labour to set out the details of spending cuts that it would carry out in government.
The shadow Chancellor said: “At the moment the Government have not set out their plans by individual departments so we don’t have a spending review. I will do a spending review quickly if we win the election, but that’s not something that is possible to do from opposition.”
She added that “I do know that public services need more money”, arguing Labour’s plans to grow the economy would help the state of the public finances.
A Labour spending review would be based on the overall funding package already set out by the Conservatives, unless Ms Reeves also holds an emergency Budget to change the so-called “envelope” of state spending.
She claimed that an incoming Labour government would face the worst economic legacy since World War II, saying: “We’re not going to be able to turn things around straightaway but we will get to work on all of that.”
The shadow Chancellor is currently considering possible ways to fill a £2bn hole in her spending plans left by Jeremy Hunt’s decision to adopt Labour’s policy of scrapping non-dom tax status for wealthy foreigners. She said: “I’m going through all the Government documents to identify the funding streams to honour those commitments.”