BIG READ: Rachel Reeves tipped for axe as ‘vultures circle’ after terrible week for UK economy.uk
ANALYSIS: Britons face tax hikes this Autumn because of the Chancellor’s spending spree
Rachel Reeves has taken a massive gamble – on the economy, on Labour’s political fortunes and on her own future as Chancellor. Her gargantuan spending spree in this week’s eagerly-awaited Spending Review set the clock ticking on all three.
But time is not on her side. The economy is in retreat again, her party is plunging in the polls and the vultures are circling to oust her from No 11. Labour Chancellors tend to stick around, the current incumbent being only their sixth across four governments in sixty years.
Rachel Reeves is in a serious spot of bother (Image: Getty)
Jim Callaghan lasted three years, while Roy Jenkins nearly had the same innings until he was ousted in Labour’s election defeat in 1970.
When they returned to power four years later Denis Healey held the position for five years until the Tories, under Margaret Thatcher, swept into government in 1979.
Gordon Brown was Chancellor for a decade during the Blair era with Alastair Darling becoming the country’s accountant during his own three-year tenure as Prime Minister.
But the likelihood of Ms Reeves being a long-term Chancellor is shrinking, much like the economy.
Official figures show GDP fell by 0.3% in April – the fourth time it has shrunk during her first 10 months in charge of the nation’s coffers.
The Treasury knew this dip was coming.
So it came as no surprise when she delivered her spending blueprint to MPs on Wednesday that the Chancellor reached for Labour’s old comfort blanket of higher taxes, higher borrowing and higher spending.
Ms Reeves splashed out £300 billion in an unprecedented spending spree which will eventually run into the trillions.
But the largesse already means many people in England and Wales will be forking out on higher council taxes to help fund the police – something she didn’t explicitly set out at the dispatch box.
Meanwhile, government borrowing is running at £148 billion, £11 billion higher than forecast, and there is the spectre of further tax hikes to come in the autumn.
Her massive spree means she can point to shiny new infrastructure projects and talk the language of “renewal”.
However, Ms Reeves is now running the economy at its uppermost limits after failing to get a grip on welfare and debt.
It is a high-stakes gambit to win over working class voters that Labour is bleeding to Reform UK.
Many of those flocking to Nigel Farage do so out of growing despair that – in his words – “Britain is broken”.
It is why she made big plays on pouring money into defence, the NHS and ending migrant hotels.
Nigel Farage (Image: Getty)
