Rachel Reeves vows Brits shall be higher off on her watch as she shakes off criticism

Rachel Reeves has vowed ordinary people will be better off on her watch as she sets her sights on smashing obstacles holding the economy back.

The Chancellor said putting more money in people’s pockets was driving every decision as she pledged to go “further and faster” to fire up economic growth. Speaking to the Sunday Mirror in No11 Downing Street, Ms Reeves admitted there were tough choices ahead to fix the mess left by the Tories.

But she stood by her commitment that there would be “no return to austerity” – and the focus on growth had working people at its heart. Today, Ms Reeves announced a push to unlock housing near commuter hubs as part of the Government’s pledge to build 1.5million new homes over the next five years.

And new planning laws will be tabled in the Spring to rip up red tape to get Britain building. It comes after a bruising start to the year for the Chancellor as market turmoil sent government borrowing costs soaring and hit the value of the pound, triggering an onslaught of criticism over her economic strategy.

But Ms Reeves dismissed her “opportunistic” critics and said she was determined to turn things around. She said: “For 14 years, our growth has been anaemic. It’s been on the floor. It’s not been good enough. I’m determined to be the Chancellor, and I’m determined that this is going to be the government that turns that around.”

She said it was impossible to fix everything overnight but added: “I want working people to be better off, and that means we need to go further and faster in removing those obstacles that are stopping our economy from growing and delivering the improved living standards for people.

“I’m not satisfied with where we are today. Low growth is not our country’s destiny. I am so much more ambitious for Britain.”

She said her critics were a “bit opportunistic”, adding: “The UK is an open economy, an open trading economy. When there are global movements, there’s going to be movements in Britain as well… People who say that this is somehow a UK thing need to explain why government borrowing costs increased in America, Germany and France as well.”

Ms Reeves is expected to make a major speech this week on firing up the economy, after a trip to Davos to bang the drum for investment.

She said: “I’m going around selling Britain and making people know that this is a government that’s doing things differently, that’s working with businesses to unlock the huge potential we have, and it’s all for a simple reason. I want British people to be better off, more money in their pockets to spend on the things that they want.”

Asked if ordinary people would be better off on her watch, she said: “Yes. Our number one mission is to grow the economy for a simple reason. It’s a growing economy that’s creating good jobs that pay decent wages, that is the route for people to be better off.”

She added: “It is through that investment and through that prosperity that we can lift living standards for mums and dads and families, for people later in life, for young people starting out after college or university.

“The way to live their living standards is to make sure in the community where they live there are decent jobs paying decent wages, housing that is affordable for them, and that’s why building 1.5 million homes, tackling the cost of living crisis is front and centre of what we’re setting out to achieve.”

Experts have warned that the Chancellor may be forced to make spending cuts or further tax hikes to stay within her strict fiscal rules. Keir Starmer recently said the Treasury would be “ruthless”, sparking fears of looming cuts to Whitehall departments’ budgets in the upcoming spending review.

Ms Reeves acknowledged there would be difficult decisions but said her memories of growing up in south London in the 1980s and 1990s under the Tories fuelled her commitment to public services. She said: “My sixth form was two prefab huts in a playground, my school library was turned into a classroom because there were more students than space and there were never enough textbooks to go around.

“I felt very strongly that the Government then, in the 80s and 90s, didn’t care very much about schools like mine and communities like mine, and that’s why I got involved in politics.

“So there will be no return to austerity. But I think everybody knows that difficult decisions have to be made to make sure that the numbers add up because the previous Government was spending money they didn’t have.”

One of the key planks of the plan to drive up growth is to get Britain building again, with 1.5million new homes and 150 decisions on major infrastructure projects over the next five years. Analysis by Labour found it currently takes nearly two years for decisions on key national infrastructure to be made.

Between 2011 and 2023, decisions were made on 130 applications for nationally significant infrastructure projects, such as offshore wind farms, roads and electricity lines. On average, these decisions took 609 days – around 87 weeks – to be reached.

The new Planning and Infrastructure Bill will be brought forward in the Spring, which will rip up red tape that slows down the approval of projects. Under the plans, the Government will ensure that when developers submit an application for acceptable types of schemes in key areas – such as locations near commuter transport hubs – that the default answer is ‘yes’.

Ministers will also review the hurdles developers must jump through, such as input from expert bodies and environmental assessments – in a move which could spark controversy.

Ms Reeves said: “Too often the answer to new development has been “no”. But that is the attitude that has stunted economic growth and left working people worse off.”

Ms Reeves also revealed that she is championing a regeneration project around Old Trafford, and ministers are working with authorities in Greater Manchester to release land around transport hubs for development, such as around Castleton Station in Rochdale. Officials are looking at setting up a mayoral development corporation body to redevelop the area.