4 key takeaways from Rachel Reeves first speech as Chancellor on Labour’s plans

Rachel Reeves has warned the UK economy is in its worst state since the Second World War and blamed previous governments for “decisions deferred and decisions ducked.”

In her first major speech as Chancellor, Ms Reeves said she had discovered how bad things are in her first 72 hours in the job as she grapples with the legacy of “14 years of chaos and economic irresponsibility”. Treasury analysis she saw over the weekend showed the UK’s economy would have been £140billion bigger – with £58billion more for public services – if it had grown at the average rate of OECD economies during the last 14 years, she said.

Ms Reeves faces an unenviable task of trying to get the economy firing again, while trying to repair battered public services without pouring in loads of cash. Here are the key takeaways on from her first major speech as Chancellor on how she plans to do it.

Chancellor Rachel Reeves set out the challenge ahead as she gave her first major speech

Chancellor Rachel Reeves set out the challenge ahead as she gave her first major speech

An autumn Budget

The Chancellor suggested she would set a date for the next Budget within the next few weeks, before Parliament breaks up for the summer recess. MPs are expected to sit until the end of July so the new Government can get going on its legislative plans.

Ms Reeves said she would “do things properly when it comes to our budget” and ask the Office for Budget Responsibility (OBR) to produce detailed forecasts for it. Liz Truss famously refused the OBR’s forecasts for her tax-slashing mini-Budget in 2022, which sent the economy into meltdown and triggered the end of her short-lived stint in No10.

“We will set out the date for that budget before summer recess,” Ms Reeves said. This means it will likely be in the autumn, although it’s unclear whether it will come in early September – before the party conference season – or afterwards, in October/November.

Taking on the Nimbys

Ms Reeves confirmed Labour’s commitment to build 1.5million new homes by the next election with an overhaul of planning rules that are stopping Britain building. New developments will be allowed on some parts of the green belt after review of the boundaries by local authorities.

The Government will prioritise brownfield and so-called grey belt land for housebuilding, which would include affordable housing and housing for social rent. Mandatory housebuilding targets will be restored and 300 additional planning officers will be hired to speed up decisions.

Ms Reeves said: ““This is not a green light for any type of housing. We will take an interventionist approach to make sure we have the right housing mix that our country needs and our people need.”

Decisions for major infrastructure projects will be made nationally rather than locally to stop important schemes getting tied up in red tape. The Chancellor said a new taskforce would fire up progress on stalled housing sites, including some 14,000 homes in Liverpool central docks, Worcester Parkway, Northstowe and Langley Sutton Coldfield.

Onshore wind ban ditched

The new Government has immediately ripped up the effective ban on onshore wind. Under the Tories, wind farms were treated differently to other developments, with schemes stopped if there were any local objections.

Onshore wind is one of the cheapest forms of green energy. Schemes can be built quickly, helping to slash emissions and reduce dependence on expensive gas.

Ms Reeves unveiled the reforms today as part of Labour’s commitment to double onshore wind and transform the grid to clean energy by 2030.

Going for growth – and dig at Liz Truss

Ms Reeves is pinning her hopes on boosting economic growth, which has been flatlining in recent years. She said it was about more than “lines on a graph”, adding: “This is about whether working people feel better off, whether our high streets and town centres are revived, whether there are good jobs paying decent wages in more parts of the country.

“Success for me will be whether working class kids from ordinary backgrounds have more opportunities than they do today, and I think those opportunities have gone backwards in the last few years.”

The Chancellor said businesses have doubted whether to invest in Britain in recent years but she wanted firms to see that the Government is “pro business and pro growth” – and stable after years of Tory chaos.

Asked about ex-PM Liz Truss’s complaints that she was held back by an “anti-growth coalition”, Ms Reeves said: “The anti-growth coalition are the Conservative Party and the British people kicked them out of office last week.”