Rachel Reeves’ Spring statement was so depressing. There is no denying that Labour inherited a whole herd of pigs in pokes when it came to the Government finances, but the way in which they have dealt with it has been so wrong both in the October budget and now. A friend of mine accused the Chancellor of writing George Osborne fan fiction. He’s not wrong.
Faced with the choice of taxing tech giants, banks and large corporations or cutting the lifelines of some of the poorest and most vulnerable people in the country, they chose the latter.
Today’s announcement of further cuts to social security for sick and disabled people prompted our DWP spokesperson to criticise the Chancellor:
He said:
Just now I challenged the Chancellor on the rushed and severe welfare cuts that will hit the most vulnerable in our society. While benefit reform is necessary, this approach is ill-conceived and unfair. Balancing the nation’s books shouldn’t come at the expense of those who need… pic.twitter.com/rRoaUVoEUe
— Steve Darling MP (@SteveDarlingMP) March 26, 2025
Jennie, his beautiful and lovely guide dog, stayed resolutely on her side of the Commons after last week’s friendly overtures to the opposition.
The Government acknowledges in an impact assessment that its changes will push an additional quarter of a million people, including 50,000 children, into relative poverty.
The potential impact of these reforms on poverty projections has been estimated using a static microsimulation model. Using this model, we estimate there will be an additional 250,000 people (including 50,000 children) in relative poverty after housing costs in 2029/30 as a result of modelled changes to social security, compared to the baseline projections.
For me, it’s just too cruel to cut vital income to people who are sick, who can’t in many instances get treatment, and force them to participate in a job market when the odds are stacked against them as additional costs being forced on to employers via the National Insurance increase. Are employers seriously going to take making reasonable adjustments seriously if they are hiring? I won’t hold my breath.
Tim Farron told Times Radio that the Chancellor had loads of opportunities to create growth but hadn’t taken them.
“If this was a plan to make our own luck, there must have been some pages missing.”
Rachel Reeves’s spring statement was a “wasted opportunity” to create growth, says Lib Dem MP @TimFarron.
@AlirazaManji99 | #TimesRadio pic.twitter.com/WiepRXOaLd
— Times Radio (@TimesRadio) March 26, 2025
Christine Jardine responded on behalf of the Scottish Liberal Democrats:
The Spring Statement was a missed opportunity to deliver the change our communities are crying out for. People voted for change but so far Labour are delivering more of the same.
The Government had the chance today to kickstart growth by scrapping their jobs tax. Instead the government has chosen to inflict more pain on our small businesses – leaving communities facing the prospect of yet more boarded up high streets. And they’ll be a hammer blow for GPs, pharmacies and care homes who will see their taxes hiked. That is why we have repeatedly raised the alarm about the damage from the Employer’s National Insurance rise and fought to exempt health and care providers.
The government could have raised money instead by asking the big banks, social media giants and online gambling companies to pay their fair share.
The Spring Statement also shows that this government does not understand our rural communities at all. They’ve refused to cancel the cruel family farm tax.
One of the few bright lights was the Government’s commitment to higher defence spending, with Liberal Democrats having urged them to commit to 2.5% of GDP and called for cross-party talks so we can get to 3% as soon as possible. I am optimistic that this can support jobs in Scotland and ensure both our security and that of Ukraine. However there is more to do in terms of rebuilding economic and defence ties to our European allies and neighbours.
For Wales, David Chadwick MP said:
The slashing of growth is a hammer blow to the Chancellor’s economic credibility.
This statement was a missed opportunity to kickstart growth by reforming business rates or scrapping Labour’s jobs tax that has already claimed thousands of jobs in Wales, but this Government is more interested in raising taxes on GPs and care providers.
“The Chancellor should immediately launch negotiations for a new UK-EU customs union, to kickstart growth, boost small businesses, and secure the vital revenue that our public services desperately need.
The government could have raised money instead by asking the big banks, social media giants and online gambling companies to pay their fair share.
The Spring Statement also shows that this government does not understand our rural communities at all. They’ve refused to cancel the cruel family farm tax.
* Caron Lindsay is Editor of Liberal Democrat Voice and blogs at Caron's Musings
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14 Comments
Different party in power, same old Tories in practice.
“… George Osborne fan fiction…”
Yes, it’s very reminiscent of the huge cuts to disability benefits carried out under the Coalition government 2010-2015.
Current government is behaving similar to Osborne but the coalition constrained him at first, e.g. allowing benefits to go up more than inflation for a while. The basic problem then and now is focussing on fiscal rules so much that we loose sight of investment for growth. Nick Clegg later said they should have invested right from the start in infrastructure both to set the foundations for the future and kickstart better growth.
I agree entirely with Ed and Daisy about the mistakes made by this government and they are very serious both economically (due to lack of growth) and politically (due to less well-off people suffering and likely to turn to Reform). Money is there in certain places and the policy not to increase borrowing is probably right. We must note however, that the Tories are saying this government is not hard enough on poorer people.
Unfortunately there won’t be any growth. We need to make things better without it.
I’ve been a lifelong labour supporter, but they are about to cause more harm than thatcher ever did, like the tory party they’re going for the vulnerable.
I’ll never put my cross next to a labour candidate again, i guess i’m lib dem now
The party is currently running consultations on policy review https://digitallibdems.typeform.com/to/yRePm2JA
With the bleak prospects for economic growth to provide solutions to funding pressures we must look to more radical reform of the tax and benefits system to be able to protrect public services and welfare going forward.
Integrating the tax and benefits system and reforming business rates and council tax around land value tax would be a good starting point.
There’s a saying that goes roughly that if you keep on ding the same things will get the same results. Thatcherite economics has been wrong from the start, but Labour keep following the Thatcherite playbook. [as, sadly, do the LibDems]. Thus we talk about fiscal rules, black holes, not having the money to support people who can’t work, cutting benefits and never seriously taxing the rich. All because the right wing press say we have to do it.
And people the length and breadth of the UK are fed up with it. We need a new playbook that focuses an economics for people.
Agree with Andrew. Any of us who joined the Lib Dems after 2015 should wade in without compunction. The many of us who sat through the coalition without, or with minimal protest, at benefit freezes, abolition of pregnancy grants, and the like, should perhaps approach this with some humility.
I am now applying for my “David Raw” T-shirt which I will wear with pride.
With Labour having spent the last fifteen years comparing their policies to those of the coalition, it is inevitable that that will be the baseline for comparing their performance in government. I would predict that on almost every measure (including growth and inequality), Rachel Reeves will underperform George Osborne. Even those of us who endured coalition as party members have a right to point that out.
It seems the LibDem party only has a conscience when in opposition…
I well remember articles about how ‘80%? of coalition policies are LibDem’ and how NHS reorganisation, disability cuts, the bedroom tax, removal of employment rights, etc. were lauded both in the mainstream media by our ministers (especially Danny Alexander) and here on LDV….
Ah, well..
@ Ruth Clark To you, Ruth,…….. no charge.
@ expats Quite right, and it’s always disappointing when one hopes for better things but they turn out worse. I’m more than disappointed at the direction the present sounding like a ‘Tory’ government is going. Cuts in welfare and foreign aid are disgraceful….. and whatever induced Starmer to bring back Milburn and Mandelson is beyond comprehension. Can Michael Meadowcroft be persuaded to take on Leeds West again ? It would be a shoe in. As for Lib Dems – a refocus on a genuine participatory radical society a la Grimond would be of advantage. A good hard look at what works outside the low hanging fruit of the prosperous leafy south east (a la Grimond) would be an advantage…… for to be sure in five years time the Tories will be back.
And, incidentally, where are all the movers and shakers of 2010-15 now ? All long gone. There’s a PhD thesis waiting to be written by some brave soul. An opportunity for you, Ruth.
Social security programs are coming under increasing pressure across the developed world perhaps with the exception of places like Norway who had the foresight to invest the windfall of North Sea Oil and Gas revenues for the benefit of future generations.
In the USA, Elon Musk’s DOGE is making much of the fraud, waste and abuse that is inherent in any large spending program whether it be social security, health or defence spending. The stated aim of Doge is to eliminate the Federal deficit of $2 trillion with spending cuts of $1 Trillion, tax shifts from income taxes to consumption taxes like Tariffs and selling of investor visas.
What is not being pursued is the $1.9 trillion of US tax expenditures that arise from the sheer power of corporate lobbyists in Washington DC such as the Oil and Gas industry.
The Nationl audit office estimated UK tax expenditures at £155 billion for 2018-19 The management of tax expenditures
“The UK tax system had 1,190 tax reliefs as at October 2019. A tax relief reduces the tax an individual or business owes. There are two broad categories of tax reliefs:
structural tax reliefs that are largely integral parts of the tax system and define the scope and structure of tax (such as the personal tax allowance); and non-structural tax reliefs where government opts not to collect tax to pursue social or economic objectives.
Non-structural tax reliefs are often referred to as ‘tax expenditures’ and we use this description in this report. Examples include tax credits for companies’ research and development (R&D) costs and income tax relief on pension contributions”.
David – 😊👍
@ Ruth Clark, Is ‘Liberal Left’ still on the go ?