Rachel Reeves took 15 minutes to announce nothing and it may be her epitaph as chancellor
TIn some ways, this was a make-or-break statement for Rachel Reeves’ chancellor, with the country being dragged into a Middle East war of Donald Trump’s making and the economic numbers going completely wrong for this government.
Interest rates are no longer falling, inflation and unemployment are already rising, and growth is also falling.
Against this backdrop, and after last night’s big billing with the Cobra emergency meeting, there were expectations that the chancellor would come to the House of Commons with a plan to deal with a potential economic shock.
Instead, we heard Ms Reeves put forward a range of previously announced policies, somehow ditching the two-child benefit limit and nursery funding when concerns focused on energy and fuel. But there was no new plan to deal with the rise in prices.
No wonder the silence in the House of Commons was deafening. It took 15 minutes for Reeves to read that nothing had been announced.
There is no movement on the fuel tax, nothing on further support for energy prices, no extra defense spending and nothing on extracting oil and gas from the North Sea.
Not only was there a defiant response to the demands of the Opposition benches, there was also a swipe at Labor MPs.
The chancellor is under huge pressure from Labor supporters and some cabinet ministers to relax his rules on borrowing and spending to help deal with the crisis.
But Ms. Reeves said a clear “no” to these requests.
He told the House of Representatives that he would “act within our strict fiscal rules.” So no new borrowing, no flexibility in the rules, just more of the same.
The statement only included a promise to re-examine fuel prices next month and a decision to take further measures against “price gouging” and “profiteering”.
There will be many people looking anxiously at the calendar and schedule of a 5p increase in fuel duty this September.
I find it hard to believe that, should the expected economic shock arrive, Monday’s Cobra meeting could emerge without serious new measures but only with a “continuingly stable” plan.
Another way to look at this is that Ms. Reeves announced “there is no extra help for millions of people.”
But the real question is: What was the purpose of this statement?
He may have been reassured by some mild questions from Labor MPs. But in reality most of his colleagues will boil.
While Ms Reeves sees this as a moment of vindication for herself, Labor MPs looking ahead to local and devolved elections on May 7 and the party’s dismal poll results below 20 per cent may have a different view.
They will want to receive information about planned aid for households in difficult situations due to the effects of the war, as well as measures that can be sold on their doorstep.
Unless the war ends quickly (which is always possible with President Trump’s promiscuous nature), it looks like Ms. Reeves or perhaps her successor will have to return to the House to announce emergency measures that she failed to present as possibilities on Tuesday.
The truth is that this statement could be an epitaph to Ms Reeves’ troubled reign as chancellor if she is sacked in the coming weeks. A chancellor struggling to adapt to or understand the political mood, whether it’s winter fuel payments to pensioners, benefit cuts or now the impact of a war in the Middle East.
