Have your say on whether the Labour chancellor should be replaced after a period of “weak growth” in the UK economy.
The drop in GDP comes just days before the Chancellor’s Spring Statement (Image: Getty)
Rachel Reeves is under pressure once again after the UK economy took a nosedive in January, driven by a decline in the manufacturing sector. The Office for National Statistics (ONS) warned that a contraction of 0.1% showed “weak growth” as the Chancellor also prepares to face a backbencher rebellion over planned welfare cuts.
The economy’s contraction compared to a 0.4% rise measured in December. Liz McKeown, ONS director of economic statistics, said the latest trend was linked to “a slowdown in manufacturing” as well as in the oil and gas extraction and construction industries. Ms Reeves attributed the shift to “changes across the globe” and stressed the need for increased defence spending to “protect our country” alongside “fundamentally reshaping the British state to deliver for working people and their families”. She also pledged to “go further and faster” to streamline economic growth and “get Britain building again” – but MPs fear such measures will involve even more cuts in the upcoming Budget
The Government could be facing a backbench rebellion over planned welfare cuts (Image: Getty)
Ms Reeves will lay out the details of her Spring Statement on March 26, but could struggle to win over public opinion as well as that of her own party amid increasing backlash to a slew of budget cuts that are doing little to tackle bleak economic prospects.
Over half of Sir Keir Starmer’s Cabinet have reportedly urged the Chancellor to rethink her plans to overhaul the benefits system, with Bloomberg suggesting that high-ranking officials could resign over the issue
However, Sir Keir backed his Chancellor in this week, insisting the existing welfare system was not “morally” or “economically” justifiable. “If we don’t do anything, the cost of welfare is going to go up £70 billion per year,” he said during a visit to Hull on Thursday.
“That’s a third of the cost of the NHS. That’s more than the Home Office and our prisons combined. So, we’re making choices here.”
