Despite a slight growth in the final quarter of last year, the UK economy is facing stagnation. Tax hikes and high inflation are impacting living standards and raising concerns about a new era of 'stagflation'. Chancellor Rachel Reeves is under pressure to balance her fiscal rules with the need to support the economy.
READ MOREIt could have been worse. Official figures today show the economy grew by a meagre 0.1 per cent in the final three months of last year.
But £40billion of tax hikes - including a £25billion 'tax on jobs' that breached the Labour Party manifesto - have derailed any hopes of a sustained recovery. All this makes grim reading for the Chancellor, cruelly dubbed ‘Rachel from accounts’ by her critics amid claims she embellished her economic credentials on her CV.
Read More Report Rachel Reeves cited as evidence for a third Heathrow runway 'was commissioned by the airport' At the time of the last Budget, the OBR pencilled in growth of 2 per cent this year and Ms Reeves gave herself some £10billion of fiscal headroom. At the same time, subdued economic growth pushes up government spending on areas such as unemployment benefits.
Politics ECONOMY STAGFLATION TAXES BUDGET REVEES
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