Rachel Reeves is “out of her depth and out of ideas”, a financial expert has claimed in a withering verdict on the Chancellor’s performance since coming into office.
Ms Reeves, the architect of Labour’s economic strategy, has endured a turbulent few months since her party’s election victory in July 2019, buffeted by the angry reaction to the decision to begin means-testing the winter fuel payment, as well as the Bank of England’s decision to downgrade growth forecasts last week.
She is believed to have called in leaders from companies including Barclays, HSBC, Lloyds Banking Group, NatWest and Nationwide for a meeting on Wednesday to discuss ways to stimulate growth.
Attendees are likely to include Georges Elhedery, HSBC Holdings’ CEO; Debbie Crosbie, CEO of Nationwide; Charlie Nunn, the Lloyds Banking Group chief and Paul Thwaite, NatWest’s CEO.
UK-listed banks are set to begin reporting their full-year results this week, starting with Barclays on Thursday.
Patricia McGirr, Founder at Repossession Rescue Network, was among those who was unimpressed.
She said: “Like most of her policies, Reeves’ coffee morning with bankers will bring plenty of froth and zero substance.
“Banks are there to make money, not provide an emotional prop for a Chancellor who’s out of her depth and ideas.
“Businesses, investors and pensioners feel more alienated than ever. If this is her masterplan for UK PLC, we’re in serious trouble.”
Michelle Lawson, Director at Lawson Financial, suggested both Ms Reeves and Labour were “like a puffing old steam train running out of coal looking for someone else to stoke the engine”
She said: “They have run out of the few ideas that they did have at the risk of not making it out of the station let alone the end of the track. The economy is flailing and deterorating rapidly but the saving grace is at least they are asking people at the coalface itself.”
Ms Lawson warned regulation was a good thing as a means of “keeping things in line” but excessive red tape came with a risk “strangulation”.
The expert added: “The housing market is such a pivotal marker for the economy that has been ignored and undervalued by previous encumbents.
“We still need housing to be promoted to a senior department as it is a fundamental basic need.”
Chris Barry, Director at Thomas Legal, argued Ms Reeves was also asking the wrong people.
He said: “We all know the big banks struggle to balance their own risk and reward strategy, so asking them for advice on growing the economy is like asking Mr Blobby to lay the dinner table.
“SMEs are the backbone of the UK economy and often run by seasoned and successful entrepreneurs.
“These are the people we need to get the UK out of this mess and into a solid future of prosperity.”
The meetings come as the UK grapples with significant economic challenges, including a base interest rate cut. Ms Reeves is pushing for regulatory changes to encourage investment and lending, arguing that excessive caution is stifling growth.
Her approach marks a shift in government policy, with a greater focus on making the financial sector more flexible to support businesses and households.
The Chancellor is expected to press banking leaders on how they can contribute to economic recovery.
