Reeves cuts a very different figure to the bold, proud, stylish woman who took charge of the nation’s finances after July’s election.
The UK economy cuts a very different figure too.
GDP was showing signs of life before the election. Today, it has a grim and haunted look, just like the Chancellor. And no wonder.
Reeves gave the economy the fright of its life last July, by yelling about the £22billion “black hole” it was about to fall into.
Then she spooked it further, by warning of all the growth-crushing taxes required to drive this spectre away.
That wasn’t a scare story.
Her decision to slap £40billion of taxes on UK businesses was a stake to the heart of British enterprise.
Adding a further £30billion to the UK’s towering debt mountain left the UK finances on a cliff edge.
And they’re about to tip over.
We’re going bust and there’s nothing Reeves can do about it now. She knows it too.
Every day, we edge a little closer to the abyss. On Monday, the EY item club cut its 2025 growth forecast from 1.5% to 1%.
Yesterday, the Bank of England cut its prediction to a spine-chilling 0.75%. My colleagues called that a horror forecast, and with good reason.
Even if we avoid a recession, we still face a terrible reckoning in the months ahead.
So does Reeves. She looks paralysed with shock. Which should strike mortal fear into the rest of us.
Those growth figures are worse than they look. In reality, the UK economy has been shrinking for years. Including under the useless Tories.
The headline GDP figure is calculated for the UK as a whole, rather than per person. It’s only rising because of rocketing immigration.
Calculated per person, it’s falling.
For example, in 2023 GDP grew by 0.4%. Which is miserable. Per person, it actually fell 0.7%. Which is worse.
The UK has the world’s sixth biggest economy. Per head, we’re down to 27th place.
In other words, we’re a lot poorer than we think. But spending like rich kids.
One thing is growing. The state. It eats up 45% of our total economic output. It was around 36% for decades.
Much of that is down to the pandemic, but Reeves won’t reverse that trend. Instead, she’s put her foot to the floor.
Yesterday, Bank of England Governor Andrew Bailey warned that Britain’s bloated public sector is dragging down the economy.
We’ve added half a million public sector workers since lockdown but productivity hasn’t grown at all.
And with civil servants threatening to strike over the indignity of being asked to come into the office, it never will.
Especially with another half a million set to join the public sector payroll by 2030, according to the Office for Budget Responsibility.
It’s eating the economy alive and Reeves can’t stop it.
At the same time, she’s taken an axe to private sector growth. The one place where productivity is rising.
We’re in a doom loop. Unless we dramatically change course, bankruptcy is inevitable. And the horror of this is etched on the Chancellor’s face. Because she’ll get the blame.
