Reform and Tories battle over the Budget with spending cuts calls
Opposition parties Reform UK and the Conservatives are intensifying pressure on Labour ahead of the Budget with calls for dramatic spending cuts to fix public finances.
In separate press conferences on Tuesday, leaders Nigel Farage and Kemi Badenoch called for deep cuts to government expenditure to balance the books.
Their renewed attacks on the government came a week before a Budget where Chancellor Rachel Reeves is expected to hike levies on several different sectors in the UK economy, keeping the tax burden at a post-war high.
During a press conference in Westminster, Farage unveiled a £25bn package of savings and extra taxes on foreign nationals to ease pressures on public finances.
His proposals included ending Universal Credit payments to migrants with settled status, slashing the development aid budget and nearly tripling the NHS surcharge to £2,718 paid by people on different work visas.
Reform claims that it could raise some £15bn from cutting the aid budget and raising the health fees alone.
A commitment to tighten disability payments criteria for people with “non-major anxiety” and a policy to cut benefits for hundreds of thousands of foreign nationals have been announced in previous events, with Reform claiming the changes would add up to the £25bn savings package.
The proposals include stripping access to benefits for EU citizens, which is protected under the Brexit agreement. Farage said he could not predict how negotiations would fare in response to questions on how he would re-open the terms of the deal and respond to tariff threats.
“We are a party that believes in tax cuts,” Farage said.
“But I think what we have shown you over the course of the last few weeks is that we fully understand we cannot talk about tax cuts until our spiralling debt comes under control.
The measures would more than fill the £20bn fiscal hole which the Chancellor faces next week at the Budget after it was reported the Office for Budget Responsibility (OBR) slightly improved its forecasts between negotiation rounds with the Treasury.
Tories’ £47bn Budget plan
Badenoch meanwhile reinforced Tory calls for a £47bn savings package, nearly half of which is made up of cuts to the welfare bill.
The party also called for large cuts to the development aid budget as well as slashing headcounts across the civil service to levels seen nearly 10 years ago.
Its pledges for radical cuts to expenditure came at their party conference in September, with Badenoch adding that half of savings should go towards lowering public debt as a share of GDP.
Badenoch also took aim at Farage for pledging to scrap the two-child benefit cap and threatening to re-open trade negotiations with the EU.
“You start unpicking that and you start unpicking all of the work that was done, year after year after year, with a lot of pain and effort during those years when we were negotiating Brexit,” she said.
“It is wrong of him to deceive people, lie to them and make them think this is going to be easy.”
Traders and voters are largely in the dark over the fiscal measures Reeves is set to take next week, with Speaker of the House Lindsay Hoyle slamming “hokey cokey” briefings issued to newspapers that signal several U-turns on policymaking ahead of the Budget.
Reeves has said curbing inflation and lowering borrowing costs would be central objectives at the upcoming Budget, with debt interest payments to the government’s lenders set to total £110bn this year.
Reeves and other Treasury ministers have not commented on reports at the end of last week suggesting plans to raise income taxes had been abandoned.
Bond traders are on edge ahead of the Budget, with 10-year gilt yields nudging down slightly in the early hours of trading on Tuesday, lowering borrowing costs for the government.