A government budget is set to be presented next month, focusing on key economic principles. The chancellor’s address highlights the commitment of a Labour government to achieve balance not only in fiscal terms but also in economic health. It acknowledges that during periods of diminished demand and reduced investment, government intervention is necessary to support employment and improve living standards.
The speech emphasizes fiscal responsibility while arguing that such responsibility should not equate to withdrawal from economic engagement. It proposes a modest levy on financial transactions to redistribute wealth more equitably. The Labour party positions itself as capable of addressing economic challenges currently attributed to the Conservative government, promoting a national reconstruction plan that involves investing 1% of GDP annually in sectors such as renewable energy, sustainable transport, and advanced manufacturing.
Additionally, the chancellor discusses a new public balance-sheet rule that aims to increase the nation’s net public worth over the economic cycle and identifies this investment in domestic industries as a means of strengthening public finances. Acknowledgment is given to the Bank of England, alongside a proposal for establishing a new concordat to align the central bank’s monetary policies with public interests and governmental economic strategies.
New initiatives include a regional job guarantee aimed at offering living-wage jobs in local green and care projects, designed to foster community resilience and employment stability. Plans for a tiered-reserve banking system are introduced, which are projected to save taxpayers approximately £20 billion annually, further supporting public services.
The chancellor assures that this budget is fully funded without increases to income tax, national insurance, or VAT, pledging adherence to promises made. The overall strategy intends to invest strategically where market failures exist and to revitalize regions that have faced economic neglect.
Source: https://www.theguardian.com/commentisfree/2025/oct/26/the-guardian-view-on-the-budget-what-a-labour-chancellor-should-really-say