Politics latest: Chancellor to deliver spring forecast – Greens leapfrog Labour into second place in poll
Politics latest: Chancellor to deliver spring forecast – Greens leapfrog Labour into second place in poll
Today marks a pivotal moment as Chancellor Rachel Reeves presents her Spring Forecast, with the Greens surpassing Labour to claim second place in recent polling. Amid ongoing tensions in Iran and mounting energy price concerns, the economic landscape remains volatile. Reeves will outline the government’s strategy during this critical update, set against a backdrop of global uncertainty.
Reeves aims to demonstrate that her financial decisions have fortified the UK’s resilience to external pressures. She will reference the current conflict and its potential economic ripples but is expected to maintain a measured tone, acknowledging the unpredictability of the situation. Analysts suggest that the Office for Budget Responsibility (OBR) will provide insights into the fiscal outlook, even without a formal statement.
Chancellor’s Fiscal Roadmap
Reeves is determined to consolidate her fiscal plan, focusing on a single major event this year—the autumn budget. The Spring Forecast will not introduce new policies or tax reforms, but it will consolidate existing measures. Notably, recent adjustments to farm inheritance tax and business rates, along with a £3.5bn boost for special education, are expected to be factored into her budgetary flexibility.
The chancellor’s goal remains to reduce the cost of living, manage public debt, and stimulate economic growth. Her fiscal rule—achieving a surplus in the current budget by 2029/30—will be central to today’s discussion. However, the OBR’s revised growth projections, which have dropped below November’s 1.4%, may challenge her narrative. Critics will highlight slower growth and rising unemployment, predicted at 4.9% for the year, as areas needing further attention.
“If international oil and gas prices rise by 20%, that’s 1% higher inflation and half a percent lower growth. You cannot ignore that kind of impact on the economy.” – Sir Jeremy Hunt
Former Conservative chancellor Sir Jeremy Hunt has cautioned that the Iran war could exacerbate energy costs and inflation. He warns that even a 20% increase in global oil prices could push inflation up by 1 percentage point and dampen growth. Hunt argues that the UK is particularly vulnerable due to its reliance on international gas prices for domestic energy costs. During his tenure, he allocated £100bn to support energy bills, a move he believes is essential for economic stability.
Meanwhile, the prime minister has defended his decision to avoid participation in the US-Israeli offensive. This stance comes as the Greens rise in popularity, with an exclusive Sky News poll placing them second behind Reform. The by-election in Gorton and Denton will test Labour’s position, with Starmer’s party facing pressure to shift further left to counter the Greens’ progressive appeal.
