Rachel Reeves has accused Jeremy Hunt of deliberate deception regarding the state of public finances, sparking a political debate.
- Reeves alleges Hunt and the previous government lied to both Parliament and the public.
- Hunt denies the accusations and has formally disputed Labour’s assessment.
- Reeves has cited multiple financial discrepancies and policy cancellations as necessary measures.
- The dispute underlines the ongoing political friction over economic transparency and accountability.
Rachel Reeves has made serious allegations that Jeremy Hunt, her predecessor, lied to Members of Parliament and the public about the state of public finances. She claimed, “Jeremy Hunt covered up from the House of Commons and the country the true state of the public finances. He did that knowingly and deliberately. He lied, and they lied during the election campaign about the state of the public finances.”
Hunt has firmly rejected these allegations and has taken the matter to Simon Case, the cabinet secretary and head of the UK’s civil service. In a letter, Hunt demanded an immediate resolution to what he called “conflicting claims” that risk “bringing the civil service into disrepute.” He questioned whether the spending plans signed off by senior civil servants were incorrect, or if the document Reeves presented to the Commons was flawed.
Citing a £22bn shortfall in public finances, Reeves has scrapped several policies previously endorsed by the Conservative government. These include the long-anticipated cap on social care costs, the construction of 40 new hospitals, and various road projects. Additionally, Reeves has cut winter fuel payments to 10 million wealthier pensioners, reversing a policy introduced by Gordon Brown. This move is expected to save £1.5bn in the upcoming financial year.
The reduction in winter fuel payments is significant, as the number of pensioners receiving this benefit will drop from 11.4 million to 1.5 million. The Conservatives highlighted that while in opposition, Labour had criticised the potential scrapping of the winter fuel allowance. Darren Jones, now the Chief Secretary to the Treasury, had warned Hunt in November that pensioners would be “deeply concerned” and “anxious that their incomes may be under threat from this government.”
Nearly half of the £22bn shortfall, specifically £9.4bn, is attributed to Reeves’ decision to fully fund above-inflation public-sector pay recommendations. When asked about the cost to settle junior doctors’ pay, Reeves stated, “It’s £350m – and that’s a drop in the ocean… It cost £1.7bn to our economy last year because of industrial action.” She emphasised that public sector workers deserved pay rises in line with the private sector.
Reeves also defended her decision to cancel the planned cap on social care costs, citing the need to make “incredibly difficult decisions.” She explained, “What I inherited… is a gap between what the previous government said it was going to spend and what it was actually spending of £22bn so I’m in a position of having to make urgent decisions to restore economic stability and financial stability.”
Lastly, Reeves highlighted that many promises made by the previous government were unfunded, spanning areas such as social care, hospital construction, transport spending, education, and asylum support. She concluded, “There are lots of difficult decisions that I had to make yesterday, decisions that I didn’t want to make, decisions that I never expected to make. But unless you can say where the money is going to come from, you can’t do them.”
The controversy between Reeves and Hunt underscores the significant political and economic challenges facing the current government.
