Budget breakdown: Why Rachel Reeves' next budget matters

Transcript

00:00Budget Breakdown. Why this next budget matters.

00:03So to break down the budget, let's start with where Chancellor Rachel Reeves began the year.

00:08Things were looking good, delivering 0.7% growth in the first quarter.

00:12Over the second and third quarter, however, we started to see slowing growth and higher inflation.

00:16This happened against the backdrop of falling wage growth and rising unemployment.

00:20So did the last budget have something to do with this?

00:23A lot of these problems have been partly linked to Labour's first budget,

00:26which raised some taxes and increased labour costs for businesses.

00:28The Bank of England has even said that higher national insurance and a higher minimum wage

00:33pushed up food prices earlier in the year because many firms simply passed these extra costs on to consumers.

00:39The latest PMI data shows things slowing down because companies are putting projects on pause

00:43while they wait to see what's in the budget.

00:45And it's not just businesses being cautious. Consumers are too.

00:49People worried about possible tax rises have been cutting back on spending and saving more instead,

00:54according to the ONS.

00:55Economists say this might not bounce back before Christmas,

00:57meaning theft of spending could be lower than usual.

01:00Well, Rachael Reeves, to recap on our turkey order.

01:05So what can we actually expect in this budget?

01:10Rachael Reeves' new article in the Sunday Times does detail a strong focus on fiscal discipline.

01:15And according to various reports, that can mean several possible measures,

01:19including new property taxes, a tax on electric vehicles and limits on certain tax breaks,

01:24like the cycle to work scheme and pension contributions.

01:27This comes alongside rumours of scrapping or extending the two-child benefit cap,

01:31bringing down gas and electricity bills and a youth employment guarantee.

01:37The real picture will become clear on Wednesday,

01:39when the Chancellor reveals what's actually in and what's out of the budget.

01:43Pffitts are so clear, as well as I take the sum of the musste,

01:46the time to sell and sell this together.

01:47I do not forget that it is always in that space.

01:47I do not want to sell a company in my own business.

01:48I do not want to sell a company in the last few months.

01:49Thank you to all theIO if you want to sell a company in the last few minutes,

01:50I do not want to sell it.

01:50Thank you, Rachael Reeve.