Rachel Reeves sets out cuts to balance the books after budget watchdog’s verdict

Rachel Reeves blamed “increased global uncertainty” as the budget watchdog warned she would have missed her goal of balancing the books without action.

She was forced to set out savings of around £14 billion to ensure she met her “non-negotiable” goal of balancing day-to-day spending against tax receipts, rather than borrowing.

Ms Reeves told MPs: “The increased global uncertainty has had two consequences.

“First, on our public finances. And second, on the economy.”

At her budget in October she set out plans which met that goal with £9.9 billion to spare in 2029/30.

But she said the updated forecast from the Office for Budget Responsibility indicated she would have missed the target by £4.1 billion without taking action to restore the £9.9 billion of headroom.