Rachel Reeves slammed by ex-Bank of England governor in 7-word swipe | Politics | News
A former governor of the Bank of England has accused Rachel Reeves of seeking answers “behind the fag pack” to raise funds. Lord King’s seven-word scathing attack on the Chancellor came as he warned he lacked a “coherent” strategy on tax.
Ms Reeves is expected to raise taxes and cut spending in her budget next month to fill a huge black hole in the public finances. Economists estimate the difference is between £20bn and £50bn. Reports suggest Ms Reeves is considering a new mansion tax, as well as a manifesto 2p rise in income tax.
Lord King, who led the Bank of England through the 2008 financial crisis With the Trevor Phillips show on Sky News on Sunday: “What I would advise him to do is to form a group of people who, within 12 months, will look in depth at all aspects of tax treatment, not just property but all other forms of savings and wealth, to arrive at a coherent view of how this should be.
“And that doesn’t look like it’s going to happen. What’s happening is that the OBR [Office for Budget Responsibility] They produce a number right before the budget, a number, and then they look around, you know, what kind of idea, almost written on the back of a fag pack about how to get a few extra billions here or a few billions there.
“This is not a coherent tax strategy, and you can achieve a lot by thinking it through first.”
When asked if he could “figure out a plan” from the Chancellor, his crossbencher replied “no I can’t”.
“That’s what worries me,” he added.
Ms Reeves will announce her Budget on November 26.
Health Secretary Wes Streeting acknowledged on Sunday that public finances were in a “challenging situation” but also insisted there were “green shoots” of economic recovery.
But he added that “we’re not out of the woods yet” and that Ms. Reeves has a “tough job.”
The Chancellor is considering a new mansion tax, according to Mail on Sunday.
It reports that this will pay property owners an annual fee of 1% of the value exceeding £2 million.
Meanwhile, on Sunday The Sun suggested he was considering a 2p increase in income tax.
Earlier this month, the International Monetary Fund predicted the UK would have the second fastest growing economy in the G7.
However, it is also predicted that inflation in the UK will rise to the highest level among G7 countries in 2025 and 2026.
