CHANCELLOR Rachel Reeves could face an ethics probe as financial experts and business owners warned “it’s hard to see how she survives this”.
It’s going from bad to worse for the Chancellor, as Nigel Farage has now written to Sir Laurie Magnus, the Independent Adviser on Ministers’ Interests, demanding an inquiry into her use and knowledge of the OBR numbers ahead of the Budget — saying she is potentially guilty of “serious breaches of the ministerial code”.
It is claimed the Chancellor was told by the Office for Budget Responsibility (OBR), the body that provides independent economic forecasts and analysis of the public finances, that the country had a £4.2 billion surplus before ploughing ahead with a punitive fiscal Budget to address a huge black hole.
Reeves repeatedly insisted she did not lie to voters in interviews today and yesterday.
Financial experts said they thought Reeves is on borrowed time.
Patricia McGirr, Founder at Burnley-based Repossession Rescue Network, said: “Reeves is clinging to authority that evaporated the moment the OBR revealed the surplus. You cannot preach fiscal discipline while sitting on numbers that told a completely different story.
“The public anger isn’t manufactured. It is the sound of people realising they were marched into austerity for no reason at all. Will she survive until Christmas? Only if the Prime Minister decides the damage of removing her is greater than the damage of keeping her.
“Right now, that calculation changes by the hour. This government keeps talking about stability while behaving like a group that can’t be trusted with a calculator. We’re well past questioning whether they’re fit to govern. The real question is how long the country can tolerate leadership that misreads the books, misleads the public and calls it economic strategy.”
Sam Alsop-Hall, Chief Strategy Officer & Co-Founder at Birmingham-based Clive Henry Group, accused the government of “manipulation”.
He added: “It’s hard to see how Rachel Reeves survives this. Of all the politicians in government, the Chancellor is the one you should be able to trust the most because you do not mess with people’s money.
“In any business, a finance director who ignored a surplus and told the board there was a black hole would be out the door the same day. I’m yet to meet a single person who will admit they voted for this government and the anger is real.
“The scale of this manipulation is enormous and it is now clear that Britain has a crisis of confidence at the very top. Who does she think she is? A Chancellor who behaves like this has no place in Number 11.”
Tony Redondo, Founder at Newquay-based Cosmos Currency Exchange, said he expects changes at the top by Easter.
He continued: “It is claimed the Chancellor promoted a sustained narrative about a fiscal black hole without disclosing the OBR’s positive headroom forecast. The controversy centres on the fact that while the OBR did deliver a productivity downgrade, wiping £16 billion off expected tax receipts, much of that was offset by inflation and higher wage growth, leaving a £4.2 billion surplus.
“Starmer signed off on the Reeves Budget, so despite the pressure, Downing Street has no choice but to back the Chancellor. The coming days will be critical for both. This government came into office on a manifesto of increasing taxes by up to £8 billion in this parliament’s 5-year term.
“Instead, Reeves has increased taxes by £70 billion in her first two Budgets. Labour’s majority at the last election was described as a mile wide and an inch deep. Given the lack of vision and constant failings on all fronts, I expect major changes at the top before Easter.”
Samuel Mather-Holgate, Independent Financial Adviser at Swindon-based Mather and Murray Financial, said the UK is in a mess.
He added: “From a Budget that the markets loved, and what the country needed, it seems crazy that the Chancellor is now under pressure for painting a bleak picture. The facts are the numbers are awful.
“When you look at annual growth forecasts of around 1.5%, the public of 20 years ago would laugh or cry. The UK is in a mess, and bemoaning about how much extra or little headroom there was is tinkering around the edges. Reeves needs to answer the bigger questions, or lose her job. How do we stimulate growth?”
Ken James, Director at London-based Contractor Mortgage Services, said Reeves is in deep trouble.
He continued: “Budget black hole or political dark arts? Either way Rachel Reeves is in deep trouble. The OBR told her the UK had a £4.2bn surplus and yet she delivered a Budget framed around a £20bn black hole, hammering taxpayers in the process.
“With Nigel Farage now trying to burn Reeves at the stake demanding an inquiry, the political temperature is rising fast.
“Will she survive? With her popularity ratings hitting the floor harder than ever, and public anger being increased by these reports it is hard to see how. The media smell blood so a pre-Christmas resignation isn’t unthinkable. Even lasting the week isn’t guaranteed.
“Supporters claim Reeves was simply being cautious, building ‘headroom’ into the economy. But a manufactured crisis used to justify punishing tax rises does not look or feel good. If trust collapses, competence doesn’t matter and this government risks losing its moral authority. New Chancellor and even possibly a new PM?”
But Rohit Parmar-Mistry, Founder at Burton-on-Trent-based Pattrn Data, attacked the Reform leader.
He said: “It’s a bit rich for Nigel Farage to play the ethical arbiter. But this circus shouldn’t distract from the real scandal: Reeves is doubling down on the same failed Thatcherite Neoliberalism that got us here.
“We now know the OBR flagged a surplus, yet she manufactured a ‘black hole’ narrative to justify punishing the public with more austerity. This isn’t ‘tough decisions’, it’s economic sabotage. We are obsessed with supply-side investment while ignoring the demand side.
“You cannot invest your way out of a slump if nobody has money to spend. We need bold Keynesian policy, putting money into pockets to boost consumption, not this relentless squeezing of the public.
“Reeves is treating the economy like a household budget, ignoring that her ‘savings’ destroy the market’s ability to consume.”
