LONDON — In her inaugural multi-year spending review, UK Chancellor Rachel Reeves has committed billions of pounds to bolster the country’s struggling health service, challenging opposition parties to counter her proposals. Speaking to parliament, Reeves announced a 3 percent annual increase in state spending on the National Health Service (NHS), set to continue each year until 2029, adjusted for inflation.
The Chancellor indicated that the economic constraints she implemented in last fall’s budget have now created room for enhanced government investment. “I made the choices necessary to fix the foundations of our economy,” Reeves stated, referring to the rise in national insurance contributions for employers that occurred earlier this year.
Commitments to asylum and public safety
Under mounting electoral pressure from Nigel Farage’s right-wing Reform UK party, Reeves also announced the phasing out of hotels as temporary accommodations for asylum seekers by the next general election scheduled for 2029. Her plans include allocating funding to “cut the asylum backlog, hear more appeal cases, and return people who have no right to be here, saving the taxpayer £1 billion a year,” she noted.
Additionally, Reeves utilized her platform in the House of Commons to criticize Farage, accusing him of wanting to recreate the chaos from former Conservative Prime Minister Liz Truss’ disastrous mini-budget in 2022. While Labour has pledged not to raise income tax, VAT, or national insurance since the last election, the Conservatives contend that the government will need to impose further tax increases to support its commitments.
Public safety emerged as another focal point in Reeves’ funding agenda. She announced an average 2.3 percent annual increase in police spending, aimed at enhancing protection for communities, homes, and public spaces. Furthermore, over £280 million is earmarked for the Border Security Command, targeting human smuggling operations across the English Channel.
Investing beyond London
The Chancellor emphasized a commitment to invest outside of London, highlighting transportation projects and expanded social housing. “I said we wanted growth in all parts of Britain and Mr. Speaker, I meant it,” she affirmed to Members of Parliament (MPs). Funding has also been allocated for 350 disadvantaged communities to improve local amenities, including parks, youth facilities, swimming pools, and libraries, alongside incentives for growth initiatives.
In framing her spending commitments as “Labour choices,” Reeves criticized the opposition Conservatives for their past austerity policies implemented during their 14 years in power from 2010 to 2024. “Austerity was a destructive choice for the fabric of our society,” she remarked. “It was a destructive choice for our economy too, choking off investment and demand, creating a lost decade for growth, wages and living standards.”
Reflecting on her nearly 30 years with Labour, Reeves expressed her belief that the Conservative Party historically neglected schools and communities like the ones she grew up in. She challenged opposition parties to “make an honest choice, and they can oppose these spending plans as they opposed every penny I raised to fund them.”
In response, Conservative Shadow Chancellor Mel Stride criticized the government’s proposals as lacking credibility and accused Reeves of yielding to pressure for U-turns. “The lesson of the last year has been that when the going gets tough, the right honorable lady blinks,” he remarked in Commons. Stride characterized her spending plan as a “fantasy,” adding, “She presented herself as the iron chancellor, but what we have seen is the tin foil chancellor, flimsy and ready to fold in the face of the slightest pressure.”