What are Reform’s economic pledges – and how sensible are they?
In his first major speech as the party’s economic spokesman, Robert Jenrick laid out his plan for the economy if Reform UK wins the next general election.
Mr Jenrick, who took charge of the top team less than a month after Nigel Farage’s chaotic exit from the Conservative Party, has sought to sort out his financial priorities.
Referring to his time in the Cabinet as a Conservative, Mr Jenrick said seeing how the government “didn’t work” would shape his approach.
His policies included a promise to reintroduce two controversial child benefit caps and a pledge to reform the Office for Budget Responsibility (OBR).
Mr Jenrick also said Reform UK would not raise taxes unless it created the “necessary fiscal space”, adding: “I promise you today that a Reform Government will never play fast or loose with your savings.”
Here are some of the key policies Mr Jenrick has committed to and what they actually mean for the UK economy:
Bank of England
Mr Jenrick said the Bank of England would remain independent under the Reform but “must perform better”.
One element he said he would remove was a requirement for the Bank to help the UK transition to net zero, which he called a “distraction”.
In 2021, when Rishi Sunak became chancellor, the Bank’s remit was changed to include a duty to support the government’s net zero carbon target.
In response, the bank’s Corporate Bond Purchase Plan (CBPS) has undergone a green revision.
Bank of England Governor Andrew Bailey said in a speech earlier this year that net zero was slowing global economic growth.
However, he argued that the cost of not taking action against the climate crisis in 2021 could be greater and said: [the effects of climate change] is not an answer” and warned that inaction would lead to “larger” adaptation costs.
Office for Budget Responsibility
Mr Jenrick accused the Office for Budget Responsibility (OBR) of exaggerating the benefits of low-skilled immigration, but vowed not to eliminate it entirely.
He said: “The OBR has consistently overestimated the short-term benefits of immigration and underestimated its long-term costs. It has underestimated the dynamic impact of cutting taxes.”
There is debate among experts over whether the OBR, which was established in 2010 to provide independent analysis of the government’s fiscal policies, is exaggerating the economic benefit of immigration.
“We are going to disrupt this cordial consensus and ensure there is diversity of opinion,” Mr Jenrick said.
“And we will hold competitions for superforecasters to join the alliance and pay competitive salaries to those who most accurately model the impact of Treasury decisions.”
‘British card’
One of the policies that Mr Jenrick recommended to the party was the “Britannia Card” visa.
Reform said the card would grant residence permits to wealthy foreign nationals for a one-off fee of £250,000. In return, they will not be taxed on wealth, income or capital gains earned abroad.
The party believes the scheme will generate around £2.5bn a year, which it plans to distribute as a £1,000 dividend to the lowest earners.
“We will also ensure that foreign investors are welcomed back to the UK with a Britannia investor visa ready to weed out those who have self-destructed economically in recent years,” Mr Jenrick said.
Dan Neidle of Tax Policy Associates has previously said the policy would cost the economy £34bn over five years, saying: “The card would deliver a huge and expensive tax windfall to the small number of very wealthy people already here. Office for Budget Responsibility data shows this would amount to a loss of £34bn of Government income over five years.”
Universal credit and limiting foreign aid
Mr Jenrick said Reform UK would save £25bn a year through measures such as ending universal credit for foreign nationals, raising the Immigration Health Surcharge and capping foreign aid at £1bn.
The UK’s Official Development Assistance (ODA) spending in 2024 is £14.08bn, down £1.26bn on 2023.
According to the numbers you seeTelegramThe UK also spent around £10.1bn on universal credit payments to households without at least one UK or Irish citizen.
This means Reform UK would save £23.18bn if it could deliver these reforms and would need to increase the Immigration Health Surcharge to meet its £25bn savings commitment.
Labor is already implementing plans to cut Britain’s overseas aid budget from 0.5 per cent to 0.3 per cent, with MPs calling this a “tragic mistake” that would put Britain’s national security at risk.
Public service
Mr Jenrick claimed the party’s plan to cut the public service would avoid an extra £4 billion in “emergency savings” and a further £1 billion in pension liabilities.
Reform MP Danny Kruger previously announced plans for 68,500 public service redundancies and said the proposal was aimed at reducing the wage bill by 17 per cent and saving taxpayers £5.2bn a year.
However, this policy will likely not generate savings for several years due to the cost of layoffs.
Mr Kruger said he expected the cost of redundancies in the civil service under the Reform UK plans to pay for itself within two years, on the basis that letting someone go would cost around £60,000.
Boris Johnson’s plan to cut 91,000 jobs was later scrapped by Liz Truss amid reports the cost of redundancies could be as high as £7bn.
Limit of two child benefit
Mr Jenrick confirmed that Reform UK would reinstate the two-child benefit limit if it wins the next general election, in a U-turn on the party’s previous stance.
Sir Keir Starmer said Reform’s pledge to bring back the benefits cap showed “a complete disregard for young people’s lives”.
The government estimates that lifting the cap would lift 450,000 children out of poverty.
Labor leader Anna Turley also criticized the policy change, saying: “Robert Jenrick has united the right-wing behind a draconian child poverty deal that will push almost half a million children into poverty.”
tax deductions
In an announcement that may be unexpected for some, Mr Jenrick said Reform UK would not commit to cutting taxes if elected.
The party’s new ‘shadow chancellor’ has slammed Rachel Reeves for “previous assumptions” about the economy “are no longer realistic”.
“We will never make promises to the British people that we cannot keep,” he said.
“So we will cut taxes only when we create the fiscal space needed to make these tax cuts sustainable.”
