{"id":12260,"date":"2024-09-23T23:06:04","date_gmt":"2024-09-23T23:06:04","guid":{"rendered":"https:\/\/news.godj.com\/news\/chancellor-makes-switch-from-pain-to-gain\/"},"modified":"2024-09-23T23:06:04","modified_gmt":"2024-09-23T23:06:04","slug":"chancellor-makes-switch-from-pain-to-gain","status":"publish","type":"post","link":"https:\/\/news.godj.com\/news\/chancellor-makes-switch-from-pain-to-gain\/","title":{"rendered":"Chancellor makes switch from pain to gain"},"content":{"rendered":"


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The chancellor\u2019s speech at the Labour Party conference was an important and clear change in tone from the government on the economy.<\/p>\n

Just three weeks ago the PM warned of a \u201cpainful Budget\u201d prompting a frenzy of speculation over where spending cuts and tax rises would fall.<\/p>\n

Now she is focusing on the “long-term prize” that she promises will follow if Labour can restore “stability”.<\/p>\n

\u201cMy optimism for Britain burns brighter than ever, my ambition knows no limit,” <\/b>she told delegates in Liverpool.<\/p>\n

The fragile British consumer might not quite be ready, after years of rolling inflationary crises, for tough decisions on tax and spending.<\/p>\n

Consumer confidence was hit, at least this month<\/a>, and some retailers spooked by disappointing sales after this talk of pain.<\/p>\n

The chancellor was sending a message that the tax rises, when they come, will not primarily hit hard-pressed working families.<\/p>\n

She embraced the \u201cchoice\u201d she made to give above-inflation pay rises to millions of public sector workers, saying she was willing to have a fight over it with the Conservatives.<\/p>\n

Public spending will grow in real terms, or as she put it clearly in her speech there will be \u201cno return to austerity\u201d.<\/p>\n<\/div>\n

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The chancellor gave more detail about how she will prioritise investment spending, especially in infrastructure.<\/p>\n

The plans she has inherited are for a cut in the share of the economy devoted to public investment.<\/p>\n

\u201cGrowth is the challenge… and investment is the solution,\u201d she said.<\/p>\n

We are heading towards some changes to the rules on government borrowing in order to allow more investment.<\/p>\n

This should work with the newly announced Industrial Strategy, to be released with the Budget on 30 October. It might also help with bringing in significant foreign investment at a crucial summit next month.<\/p>\n

It was a coincidence, but the chancellor\u2019s speech came on the two-year anniversary of Liz Truss\u2019s mini-Budget. If anyone forgot the auspicious date, the former PM popped up with a specially crafted video to say that the Kwarteng\/Truss fiscal plans should have been implemented in full.<\/p>\n

This was fortuitous for the chancellor, as her speech defined herself as a type of anti-Truss.<\/p>\n

The Truss legacy played an important part in delivering Reeves to her position, with a commanding Commons majority. Both shared an ambition to increase British growth. The tough decisions Reeves says she needs to make at the Budget are the contrast to the Truss episode.<\/p>\n

But could it be that the Budget’s bite, will now prove to be significantly less painful than its bark?<\/p>\n<\/div>\n


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The chancellor\u2019s speech at the Labour Party conference was an important and clear change in tone from the government on the economy. Just three weeks ago the PM warned of a \u201cpainful Budget\u201d prompting a frenzy of speculation over where spending cuts and tax rises would fall. Now she is focusing on the “long-term prize” […]<\/p>\n","protected":false},"author":1,"featured_media":12261,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[61],"tags":[85,5596,5424,3033],"class_list":["post-12260","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy","tag-chancellor","tag-gain","tag-pain","tag-switch"],"_links":{"self":[{"href":"https:\/\/news.godj.com\/news\/wp-json\/wp\/v2\/posts\/12260","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/news.godj.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/news.godj.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/news.godj.com\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/news.godj.com\/news\/wp-json\/wp\/v2\/comments?post=12260"}],"version-history":[{"count":1,"href":"https:\/\/news.godj.com\/news\/wp-json\/wp\/v2\/posts\/12260\/revisions"}],"predecessor-version":[{"id":12262,"href":"https:\/\/news.godj.com\/news\/wp-json\/wp\/v2\/posts\/12260\/revisions\/12262"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/news.godj.com\/news\/wp-json\/wp\/v2\/media\/12261"}],"wp:attachment":[{"href":"https:\/\/news.godj.com\/news\/wp-json\/wp\/v2\/media?parent=12260"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/news.godj.com\/news\/wp-json\/wp\/v2\/categories?post=12260"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/news.godj.com\/news\/wp-json\/wp\/v2\/tags?post=12260"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}