Finance chief rules out more austerity

The United Kingdom's finance minister, Chancellor of the Exchequer Rachel Reeves, said on Monday there would be no return to an era of widespread spending cuts, despite previously being pessimistic about the state of public finances and warning of a "painful" budget next month.

Ahead of a keynote speech at the Labour Party's annual conference in Liverpool on Monday, Reeves told media she planned to strike an optimistic tone, emphasizing positivity about the UK's future while acknowledging the need for hard work ahead.

"The commitment that I will make for this budget is that it will be about protecting living standards, fixing the National Health Service, and then, crucially, about rebuilding Britain, because we can't keep cutting investment spending," Reeves told Times Radio.

In her speech, she was expected to say: "There will be no return to austerity. Conservative (Party) austerity was a destructive choice for our public services — and for investment and growth too."

According to extracts from her conference speech released to media, she was due to add: "We must deal with the Tory (Conservative Party) legacy, and that means tough decisions. But we won't let that dim our ambition for Britain.

"So, it will be a budget with real ambition. A budget to fix the foundations. A budget to deliver the change we promised. A budget to rebuild Britain."

The Labour Party government, which came to power after winning the general election on July 4, has faced criticism for portraying a gloomy economic outlook while simultaneously accepting substantial gifts and donations from affluent supporters.

Led by UK Prime Minister Keir Starmer, the government has promised long-term growth. However, Reeves has warned of tax rises in her budget, which is due on Oct 30, saying "any plan for growth without stability only leads to ruin".

Speaking to the BBC's Today radio program, she promised "real-terms increases to government spending in this parliament" but added that "the only way to sustainably fund public services is through growing the economy".

Data published last week showed consumer confidence fell sharply this month, prompting Andy Haldane, a former Bank of England chief economist, to criticize the government for generating a sense of "fear and foreboding", reported the Financial Times newspaper.

Reeves and Starmer will attempt to reassure more than 500 corporate figures attending the party conference at a "business day" on Monday and counter concerns about the party's economic stance and reaffirm support for business.

In her lunchtime speech, Reeves was set to say: "My optimism for Britain burns as bright as it ever has done. I can see the prize on offer, if we make the right choices now. And stability is the crucial foundation on which all our ambitions will be built."