Her government Britaindespite the difficult economic conditions, it is determined to consolidate public finances and prepare to announce new budget cuts. This time, the cuts are aimed at public administration, following the anti -charted measures taken in the fall of pensioners, patients and people with disabilities.
Britain Finance Minister Rachel Reeves, who feels strongly pressured, will announce the new measures on Wednesday (26.3.2025), during the traditional “spring declaration”, namely the presentation of the country’s financial situation. The most important announcement it will make is already known: 15% reduction of the Central Government’s operating costs by 2029/30 and therefore fewer ministries and public services. This measure will save more than 2 billion pounds (2.4 billion euros), according to the British press.
“I prefer people to work at the forefront, in our schools, in hospitals, in the police, instead of administrative positions,” Reeves said on Sunday (23.3.2025), in an interview on the Sky News television channel. The ministry is talking about 10,000 employees, about 500,000, but the unions estimate that 50,000 jobs will be abolished.
In the autumn, the heating allowance for retirees was abolished, followed by 5 billion pound cuts by the benefits of the disabled and those suffering from chronic diseases, decisions that some Labor MPs found it difficult to accept.
At the end of October, Reeves announced an increase in employers’ contributions by £ 40 billion, causing the anger of businesses warning of “dramatic consequences” on the labor market and salaries.
To calm public opinion, the government is promoting the increase in resources for the National Health System (NHS) and the ambitious reform of labor law to improve workers’ rights.
But with stagnation economy, maneuvering margin is limited. At the same time, Prime Minister Kir Starmer has announced the significant increase in the defense budget, which means that money will have to be found elsewhere.
Based on the latest data, Britain’s GDP fell 0.1% in January and inflation was 3%. At the same time, the pound was down and the interest rates increased.
Another “hot” and complicated issue that Ribs will be called upon to face is the possible abolition of the tax imposed on technology giants. This tax has brought £ 800m a year, but may be abolished in order to save Britain from the duties intended to impose US President Donald Trump on British products. The minister did not confirm it, nor did it deny it.