14/01/2025
Chancellor Rachel Reeves will remain in her role "for the whole of this Parliament", Downing Street confirmed, as she faces criticism over the falling pound and rising government borrowing costs.
The pound fell to $1.21 on Monday, its lowest level since November 2023, while one measure of the rate at which the government can borrow money hit its highest level since 2008.
Borrowing costs are rising for many countries across the world, but some have argued that decisions made in the latest Budget appear to have made the UK frighteningly more vulnerable.
The chancellor is now hanging on by her fingernails.
When the PM was asked whether Reeves would remain Chancellor for the whole of the Parliament, he refused to answer, but did say she had his "full confidence" and was doing a "fantastic job". Well he had to say that.
The markets are in turmoil and business confidence has crashed yet further and the chancellor is nowhere to be seen.
Reeves is a central figure in the Labour government, presented to the voters as a safe pair of hands in the run-up to the election. She also led the work to build bridges with business but business and some other observers were shaken by her first Budget in October 24, which they fear could knock the wind from the economy further, rather than spur the growth Labour has always promised.
Market jitters over the past week have increased concerns over the government's economic strategy.
Rising borrowing costs will have a knock-on effect on the government's tax and spending plans, because it will have to pay more interest to finance its existing debt. That leaves less to spend on public services and investment.
Going on their current performance does this mean our people will have to pay even more for their continued mismanagement?
