“The state of government finances is the worst since World War II,” stated Rachel Reeves, the new Finance Minister of the U.K., in her first speech after taking office on the 8th. She criticized the Labour government, saying she inherited “the worst (financial) situation since World War II.”
Immediately after taking office, Reeves initiated an investigation into the financial expenditures under the Conservative government and revealed the findings.
According to the Financial Times (FT), in her first official speech, Reeves announced that her priorities would be on economic growth, housing development, and offshore wind power. She also stated that she would pursue aggressive restructuring for fiscal soundness this year.
She said, “We have inherited 14 years of chaos and economic irresponsibility (from the Conservative government),” adding “That’s why I instructed Treasury managers last weekend to review the previous government’s spending status, so we can accurately identify the problems we face.”
The Treasury’s analysis of the financial situation inherited from the previous government will be disclosed before the parliamentary summer recess this month.
The Labor Party is forecasting tax increases and fiscal spending restraints.
Reeves warned that difficult choices will need to be made regarding next year’s budget, which will be created this fall through financial analysis.
She said that her previous warning was confirmed in the past 72 hours, stating “Regardless of who won the election, the worst situation since World War II has become a reality.”
During the election, the Conservative Party claimed that if the Labour Party took power, taxes would rise sharply and that Reeves would use financial analyses to justify this.
A former Conservative minister criticized the Labour Party for using the tax increase as an excuse, arguing that the government’s financial expenditure was already disclosed in detail.
Reeves promised to implement policies traditionally associated with the Conservative Party, such as pro-business policies and creating an investment heaven.
She emphasized that her growth policy involves reforming the U.K.’s rigid land use system, declaring that the Labour Party “won the election to achieve this and rebuild the U.K.”
Reeves reaffirmed her goal to build 1.5 million homes over the next five years by easing land use regulations.
She promised to start a myriad of policies by the end of this month, including reform of the National Planning Policy Framework (NPPF), a key land use regulatory agency.
Reeves particularly pledged to support the resumption of large-scale housing projects that have been halted midway.
She also committed to reviewing the greenbelt surrounding major cities, announcing plans to lift restrictions and issue building permits for areas that are still tied to regulations despite not functioning as a greenbelt.
Reeves also vowed to increase renewable energy production by lifting regulations on offshore wind farms, which are currently virtually banned.
