Uk Budget Deficit Soars More Than Forecast On Debt Costs
BloombergJAN 23
UK: Borrowing Hits Four-Year High as Reeves Attends World Economic Forum
Above: Rachel Reeves, UK chancellor of the exchequer, at Bloomberg House during the World Economic Forum (WEF) in Davos, Switzerland, on Jan. 22, 2025. Image copyright: Chris Ratcliffe/Contributor/Bloomberg via Getty Images
The Spin
Left narrative
Reeves's plan remains sound despite criticism. Borrowing more to invest in infrastructure is crucial for boosting productivity and long-term growth, even with higher costs. Reeves is playing a long game, focusing on addressing deep-rooted structural issues rather than seeking short-term fixes. Her strategy is right — public investment, especially in green technology and affordable housing, is essential for creating sustainable economic prosperity.
Right narrative
Reeves's trip to Davos during a time of economic trouble is but another example of poor decision-making. With the economy faltering and borrowing soaring, her focus should be on addressing domestic issues rather than once again fleeing the country when times are tough. Meeting behind closed doors won’t help solve the UK's pressing challenges — her tax increases on businesses have damaged business confidence, and there's still no clear plan for growth.