We all knew what was coming, long before the general election result was in. The only question was the timing.
Once Reeves had the keys to Number 11, she would ask Treasury officials to prepare an assessment of the “spending inheritance” left by the Tories.
Once that was in, she would call a press conference where she would assume her saddest expression, and inform us that the nation’s finances were in an even worse state than she ever imagined.
Reeves would then use that as cover to hike as many taxes as she could think of, to plug the gap and more.
We knew the strategy, and now we know the date. On Monday, she will unveil a £19billion black hole in the public finances.
At the same time, she will tell us the date of the autumn Budget, when she will plug this black hole with a vengeance.
The strategy even has a name. It’s called “kitchen sinking”. The phrase is common in political and business circles, where a new leader releases every possible piece of bad news at once, thereby justifying drastic measures.
I warned on June 7 that Reeves was going to throw the kitchen sink at us, and now it’s going to happen.
I suppose she thinks we won’t notice what she’s doing.
The worse things are, the more Reeves can tax us. She can then blame it all on the Conservative Party.
Former chancellor Jeremy Hunt knew this was coming too – and had his statement ready. He labelled Reeves claims “nothing but a fabrication”, noting the nation’s books are “wide open”, and have been ever since the Office for Budget Responsibility (OBR) was set up 14 years ago.
Hunt wants to defend his decidely patchy legacy but he’s not the only one alert to Reeves’ shameless tactics.
On June 10, Paul Johnson, director of the independent Institute of Fiscal Studies, called out Reeves in advance.
He said: “We will be very rude if a new government comes in and says ‘This is a terrible shock, we’ve opened the books and the Office for Budget Responsibility have told us something we never expected’.”
Johnson added: “The books are open. Everyone knows exactly the problems a new government will inherit.”
That won’t stop Reeves. She has a tax raid to justify.
It’s going to be brutal. Johnson may not be the only one saying rude things after her upcoming Budget, to be held at some point between September and November.
The chancellor is expected to blame pressures on the NHS, prisons and schools for the funding gap, but she’ll underplay other reasons.
Like the fact that she’s set to rubber stamp inflation-busting pay rises of more than 5.5 percent for two million public sector employees.
That would cost taxpayers £5.5billion, rising to £10billion if handed to all six million public sector staff.
She can’t blame the Tories for that (but will no doubt try).
The UK economy is unquestionably in a poor state. However, it has been heading in the right direction lately, with the deficit shrinking, growth rising, inflation falling, wages racing ahead in real terms and the first interest rate cut due in August or September.
What we need now are measures to boost growth. Instead, Reeves is going to drive up our taxes, making people feel poorer while crushing consumer spending and any hope of a feelgood factor.
And the bill? Reports suggest she’ll hit us with £25billion of taxes, to fund Labour’s spending plans.
The only thing we don’t know is which taxes will take the strain, but it is clearly going to be an awful lot of them.
