Budget 2025 latest: Reeves boosts defence spending by £2.2bn as more benefit cuts foreshadowed

An additional £2.2 billion will probably be spent on the UK’s defence over the following yr, the Chancellor is to announce on the spring assertion.

The additional funding is being placed on the desk because the Authorities goals to hike defence spending to 2.5% of the UK’s financial output by 2027.

Ms Reeves will insist this plan, set out by the Prime Minister in February, was the “proper determination in a extra insecure world”, including: “However we have now to maneuver rapidly in a altering world. And that begins with funding.”

The April funding enhance will assist pay for brand spanking new applied sciences, like lengthy vary laser and microwave weapons – collectively referred to as directed power weapons – which will probably be fitted to warships.

Properties for army households will, in the meantime, be refurbished, together with the 36,000 just lately introduced again into public possession from the personal rented sector.

The Chancellor is reportedly set to announce additional welfare cuts throughout her spring assertion on Wednesday.

In line with The Occasions, the Workplace for Funds Accountability (OBR) rejected the federal government’s estimate that £5 billion could be saved from deliberate welfare reforms.

As a substitute, the watchdog reportedly advised ministers it will solely save £3.4 billion – leaving Rachel Reeves to fill a £1.6 billion gap in her financial plans.

The Occasions reported that Ms Reeves will announce round £500 million of additional welfare financial savings on Wednesday.

These are thought to incorporate the freezing of common credit score incapacity advantages for brand spanking new claimants t be frozen till 2030 slightly than elevated in keeping with inflation and a small discount within the fundamental price of common credit score in 2029.

The paper additionally reported that the remainder of the hole will probably be stuffed by decreasing public spending by £5 billion, with particulars of the cuts to be introduced on the spending evaluation in June.

Rachel Reeves is gearing up for a serious battle with trade unions who warn they won’t stand by and permit a second age of austerity within the UK.

In an ominous warning a couple of potential wave of strikes if pay calls for should not met, one main commerce union chief, Steve Wright of the Fire Brigades Union (FBU), advised The Unbiased: “Staff struggling to afford the fundamentals is not going to settle for falling residing requirements from Labour.”

It has been understood that Ms Reeves will announce main cuts in her Spring Assertion, which might quantity to billions throughout a number of Whitehall departments. There might be as a lot as 7 per cent taken from the budgets of some departments over the following 4 years, The Guardian experiences.

Alongside the just lately introduced cuts to welfare spending, these might quantity to the “steepest cuts since 2019,” the Institute for Fiscal Research’ (IFS) affiliate director, Ben Zaranko, stated.

“The federal government will probably be hoping that the short-term money injection offered final yr, and effectivity enhancements as public companies proceed to get better from the pandemic, will probably be sufficient to ship service enhancements even when cash is tight,” he added.

“However we’re in a really completely different world to 2010 and, though the tempo of cuts could be considerably slower than within the peak austerity years, it will nonetheless characterize the steepest cuts since 2019.”

There was hypothesis that the chancellor might look to effectively increase taxation through extending the freeze on income tax thresholds beyond the current 2028/29 end point. Since 2021, the personal allowance has been frozen at £12,570, with the basic, higher and additional rate also staying at the same level.

Sir Sadiq Khan is anxious that Islamophobic abuse geared toward him is placing individuals from ethnic minorities off getting concerned in politics, sources near the Mayor have stated.

Evaluation from the Larger London Authority (GLA) discovered Islamophobic abuse concentrating on Sir Sadiq greater than doubled final yr, making 2024 the second worst yr of his mayoralty for such abuse.

A supply near Sir Sadiq stated: “The Mayor is extraordinarily involved in regards to the affect of hateful and abusive content material on-line. This sort of content material can have devastating real-life penalties, and it’s an issue which is getting worse not higher.

“The Mayor is anxious that his remedy is discouraging younger minority Brits from getting concerned in politics or public life, which means we’re shedding loads of expertise.

“It might be having a chilling impact on ethnic minorities placing their head above the parapet.”

The Liberal Democrats have urged the UK to “maintain agency” on Russian sanctions regardless of indicators the US might be about to ease restrictions on Moscow.

Lib Dem international affairs spokesman Calum Miller stated: “Russia has terrorised Ukraine and has been rightly shunned by the UK and our allies.

“There isn’t a foundation for eradicating sanctions whereas Russia continues to occupy Ukraine and menace different nations. The UK and our fixed allies ought to maintain agency.

“Trump has had the wool pulled over his eyes if he thinks this Black Sea deal is a good swap for lifting Russian sanctions. In Trump’s world, Putin can have his cake and eat it: restored Russian entry to world markets whereas he continues to raze Ukraine.”

Mr Miller added that whereas the deal was “an vital first step” in direction of peace, Vladimir Putin would “proceed his unlawful invasion throughout land and air to drive Kyiv’s submission”.

He stated: “The UK and our allies should double down on our assist for Zelensky, to compel Putin to again down from his purpose of turning Ukraine right into a vassal state.”

The Treasury has not shared particulars of what is going to be within the Spring Assertion, however economists have begun making predictions of what’s almost certainly.

It has been understood that Ms Reeves will announce main cuts on 26 March, which might quantity to billions throughout a number of Whitehall departments. There might be as a lot as 7 per cent taken from the budgets of some departments over the following 4 years, The Guardian experiences.

There has additionally been hypothesis that the chancellor might look to effectively increase taxation through extending the freeze on income tax thresholds beyond the current 2028/29 end point. Since 2021, the personal allowance has been frozen at £12,570, with the basic, higher and additional rate also staying at the same level.