Judgement Day for Rachel Reeves – spring tax bombshell now inevitable as growth slumps

Chancellor Rachel Reeves is under pressure as the Bank of England (BoE) lowers its predictions for economic growth. Reeves came into her role with confidence, but instead of fixing the country’s problems, she’s made things worse.

It’s hard to think of even one successful policy she’s introduced. Now, she’s promising that her economic plan will boost investment, build confidence, and move Britain forward. But next week, we’ll see the real results.

On Thursday, the BoE will hold its first meeting of the year. They’re expected to cut interest rates from 4.75% to 4.5%. While lower rates are good news, the BoE’s report will also show how the economy is performing under Reeves’ leadership—and it’s not looking good.

This must be keeping Reeves up at night. After Thursday, there’ll be no way to hide the truth. The BoE’s experts will confirm what many already suspect: Reeves is harming economic growth.

When she took over in July, the economy was doing well, according to official data. But since then, growth has stalled. Some hoped her £70 billion spending plan would help in 2025, but even that hasn’t worked. The BoE previously predicted 1.5% growth for 2025, but now they’re expected to lower that to just 1%.

This isn’t just a small setback for Reeves—it’s a clear failure. And things could get worse. The Office for Budget Responsibility is also likely to lower its growth forecasts, which will put the UK’s finances in a very risky position. Reeves’ spending plans will add £10 billion to the national debt each year, leaving little room for error.

As growth slows, she’ll likely go over budget. This means two things: more tax increases (possibly as early as March) and deeper spending cuts to try to balance the books. These measures will be necessary to avoid a financial crisis.

The only bit of good news is that the BoE might cut interest rates further to try to boost growth. But even this is a sign of failure—it’s like the BoE is stepping in to rescue her.

Reeves’ problems are mostly her own doing. Next week will be a big test for her, but unfortunately, it’s the taxpayers who will end up paying the price.