2025: a year of tears, tariffs & taxes
Michael Simmons reflects on some of the economic highs and lows of 2025.
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A Green Christmas would be more awful than you could imagine
Would promising to rejoin the EU save Labour?
How a late lunch can save Britain
Spotlight
Featured economics news and data.
Cutting Britain's giant welfare bill would be an act of kindness
Does having money really matter that much? There are those, usually with quite a bit of it, who want us to care less about materialism. But, unequivocally, money really does matter – not because of any status it supposedly brings, but for the freedom it buys: freedom to choose how we live and how we look after others. Considering this, it seems that the deep disillusionment with mainstream politicians in recent years stems from a protracted and ongoing period of stagnant living standards over which they have presided. But the truth is that the average person has not got poorer since the global financial crisis. They have got a little
Monday
Starmer defends Rachel Reeves over Budget 'lies'
Much of Rachel Reeves’s Budget was unprecedented: the leaking, the speculation and the OBR accidentally uploading its details an hour early. This morning, Keir Starmer added another entry on that list. The Prime Minister assembled the nation’s journalists to lecture them about the many wonderful things contained in his neighbour’s Budget – something Reeves surely ought to have done in her own speech last Wednesday. Starmer rattled off a list of policies announced last week: frozen rail fares, prescription charges and fuel duty, childcare costs slashed and £150 off energy bills. But, naturally, all the waiting hacks wanted to ask him about was the central question which dominated the weekend
Sunday
Pensioners don't need a £10 Christmas bonus
This week, 17.5 million people on various benefits including the state pension and disability living allowance will receive a £10 Christmas bonus. It’s about time though, that Keir Starmer played Scrooge and finally abolished the bonus altogether. For, unlike their Dickensian forebears, poor pensioners this Christmas won’t be going without food or warmth. In fact, they have more than enough of both. When the Christmas bonus was introduced by the Tory minister Keith Joseph more than 50 years ago, the basic argument was that pensioners needed the money to cope with that year’s soaring inflation of 7.1 per cent. Although believing £10 did not go far enough, the Labour politician
Friday
Rachel Reeves’s Budget was based on fiction
I think we will look back on this week as one of the most pivotal of this government. It was the moment when Keir Starmer and Rachel Reeves revealed themselves. This week’s Budget showed clearly what Reeves’s revealed preferences are – and what they are not When we were all trying to work out what Theresa May really thought about Brexit, her chief negotiator Oliver Robbins privately told his team they should be guided by her ‘revealed preferences’. This week’s Budget showed clearly what Reeves’s revealed preferences are – and what they are not. Growth is not, as the government keeps claiming, its top priority. Growth was downgraded for every
Starmer's workers' rights U-turn is a small victory for business
A psychoanalyst might have some ideas as to why Keir Starmer’s thoughts have suddenly turned to the subject of unfair dismissal. But on the face of it, the government’s U-turn on giving workers the right to sue their employers for unfair dismissal from day one of their employment does seem to mark a change in its relations with business. The Employment Rights Bill had become bogged down in the House of Lords as peers and business leaders warned of the bizarre consequences of the legislation. The ability to sue for unfair dismissal would have provided a field day for job applicants who managed to land themselves a role for which they
Defending marriage, broken Budgets & the 'original sin’ of industrialisation
38 min listen
‘Marriage is the real rebellion’ argues Madeline Grant in the Spectator’s cover article this week. The Office for National Statistics predicts that by 2050 only 30 per cent of adults will be married. This amounts to a ‘relationship recession’ where singleness is ‘more in vogue now than it has been since the dissolution of the monastries’. With a rising division between the sexes, and many resorting to alternative relationships like polyamory, how can we defend marriage? For this week’s Edition, host William Moore is joined by political editor Tim Shipman, assistant editor – and parliamentary sketchwriter – Madeline Grant and the Spectator’s diary writer this week, former Chancellor and Conservative MP Kwasi Kwarteng. As
Thursday
Zack Polanski’s insane economics
When the ubiquitous Green party leader Zack Polanski was on the BBC’s Sunday with Laura Kuenssberg show singing the praises of wealth taxes last month, he said something that got my spider-sense tingling: ‘This isn’t about creating public investment, we can do that anyway, we don’t need to tax the wealthy to do that.’ On the face of it, this is a slightly odd thing to say. Other lefties, such as Richard Burgon MP, have argued that a wealth tax could be used to give more money to Our Precious NHS or remove the two child benefit cap. Polanski is right to say that we can have more ‘public investment’
Britain is giving up on work
Work is good. Work generates wealth, makes people happier and, maybe, delivers salvation. The Protestant work ethic is much disputed among sociologists and economic historians, but most people accept that some level of work is both necessary and desirable. This makes it all the more troubling that, buried in the OBR data under the Budget, are signposts to a future Britain where fewer people work at all – and where those who do are working less. The Office for Budget Responsibility says the labour force participation rate is forecast to fall ever so slightly, from 63.5 per cent in 2024 to 63.4 per cent in 2029. A tenth of a percentage
Rachel Reeves may have just killed the Great British pub
It is just after tea-time on Budget day, and my pub is already half-empty. A few hours ago, Rachel Reeves stood up and, in the name of ‘fiscal responsibility’, drove the final nail into what remains of Britain’s hospitality industry. By failing to address the devastation that Labour’s decision to hike employers’ National Insurance did to pubs, restaurants and hotels, it could be game over for hundreds of beloved locals. Reevesageddon is not just a Budget. It is a requiem. Raise one last pint while you still can There was little in the way of good news for us publicans in the Budget, but there was plenty to make us
Reeves' Budget could mark the finish line for British horse racing
When Rachel Reeves confirmed in her Budget that horse racing will be exempted from rises in gambling taxes, there were cautious celebrations. Racing Post editor Tom Kerr described it as ‘a reprieve for the sport’s battered finances’. Trainer Mark Walford, referring to the industry’s ‘Axe the Tax’ campaign, told the trade newspaper: ‘Racing as a whole has got behind the campaign, and it shows what we can do.’ This was a disastrous – potentially existential – day for racing My advice would be to put the champagne away. This was a disastrous – potentially existential – day for racing. The tax exemption is essentially meaningless in the context of the broader
Let the Daily Mail buy the Telegraph
When I first joined The Spectator under the proprietorship of Conrad Black, we operated in sisterhood with the Telegraph titles which he also owned, and no one objected to the Daily Mail ringing the Spectator house in Doughty Street most Fridays to buy the best of the week’s articles for re-publication or to commission the authors to rewrite them in humourless Mail house style. In short, there were frequent meetings of minds in our grove of the media forest. Three decades later, The Spectator sails confidently on under its new owner while the Telegraph – orphaned when the Barclay family lost control to Lloyds Bank in 2023 and the subsequent
Wednesday
Rachel Reeves's Klarna Budget: spend now, pay later
After the frenzy of the Commons, comes the poring over the fine print. Rachel Reeves’s Budget is being studied across Westminster, following a chaotic lunchtime in which the OBR’s response was uploaded online an hour before her speech. That speech was heavily pre-briefed, with few real surprises. Taxes were hiked by £26 billion – though not as much as last year’s £32 billion. The level of fiscal headroom has been doubled to more than £22 billion. Growth will be up this year from 1 per cent to 1.5 per cent – but down from earlier projections by 2029. ‘The Chancellor is relying heavily on tax rises towards the back end
Labour's Budget sparks North Sea fears
True to form, Rachel Reeves’s autumn Budget didn’t land smoothly. The publication of the OBR report she was supposed to unveil during her announcement meant that broadcasters, politicians and the public were more focused on scanning the leaked document than the speech she had been preparing for months. The headlines have focused on a huge uptick in welfare spending, stealth taxes which may or may not constitute a Labour manifesto pledge and the scrapping of the two-child benefit cap (Labour backbenchers can breathe a sigh of relief). What has received relatively less coverage is the North Sea – and just how energy-friendly Labour’s Budget is. Reeves’s fiscal statement will have
Rachel Reeves is a true disaster artist
It is genuinely astonishing that Rachel Reeves isn’t accompanied by the Benny Hill theme at all times. Her ability to harvest the fruit of incompetence is without compare. She is the Nellie Melba of cock-ups, an anti-Midas in a pantsuit and a Lego hairpiece. Really, those of us who take joy from seeing a disaster artist hone their craft ought to have thrown bouquets at her from the gallery. Today was a real tour de force. Having trailed for weeks that this would be the Budget that restored her reputation, Reeves managed only to enhance her reputation… for screwing things up. Of course there were some excellent supporting performances; a
The EV charging tax is the coward's way out for Rachel Reeves
One moral of the Budget is to beware of governments offering you incentives to buy a particular kind of car. On the advice of the then EU Transport Commissioner Lord Kinnock 25 years ago, the Blair government encouraged us all to buy diesel vehicles on the grounds they did more miles to the gallon and were therefore better for the environment. A few years later those who fell for the bait – including me – suddenly found ourselves treated like antisocial thugs, destroying kids’ lungs, and had our cars driven off the road by ULEZ zones. But at least we got the chance to drive around for a few years
The Budget has created a £2 million house-price limit
It has lots of original features. It is close to good schools, and with a few cans of Farrow & Ball it will make the perfect family home. The estate agents already have lots of familiar lines they use to sell a property. From next year, they will have one that will be more crucial than any other: it is priced at £1.95 million, just escaping the new ‘mansion tax’ introduced by the Chancellor Rachel Reeves in her Budget. In effect, we have just introduced a price limit on houses – and it will distort the market even further. The UK has had some spectacular badly designed taxes over the decades.
Badenoch's PMQs attack ran out of steam
Kemi Badenoch had two chances to attack the government today: first at Prime Minister’s Questions, and then again in response to the Budget. The Tory leader used her first bite of the cherry to try to frame the Budget speech as being part of wider government chaos. The attack started out well, but lost steam towards the end. Badenoch went off on a tangent about Angela Rayner Badenoch started by paying tribute to ‘the many farmers who have come to Westminster today to protest the shameful attack on them in last year’s Budget’, before claiming that ‘this has been the most chaotic lead up to a Budget in living memory,
Rachel Reeves’s Budget is a shambles
What we have seen today is unprecedented. The entire list of Budget measures announced by Rachel Reeves – along with their costings and economic impacts – were leaked by the Office for Budget Responsibility (OBR) an hour before the Chancellor took to her feet. The OBR apologised and called it a ‘technical error’, but make no mistake: this is perhaps the biggest scandal in Britain’s Budget history. Make no mistake: this is perhaps the biggest scandal in Britain’s Budget history The headlines from the Budget are: Reeves will hike taxes by a total of £26 billion. Income tax thresholds will be frozen again, raising £8 billion and dragging nearly 800,000
Kemi blasts Reeves's Budget after OBR leak
Kemi Badenoch has labelled the Budget a ‘total humiliation’ after Rachel Reeves’s big announcement was derailed by an Office for Budget Responsibility leak. ‘There is no growth and no plan,’ the Tory leader told the Chancellor after Labour hiked tax, froze income tax thresholds and scrapped the two-child benefit cap. Reeves used her Budget to announce that: A new levy will be imposed on properties worth more than £2 million Income tax thresholds will be frozen for another three years from 2028 The two-child benefit cap will be lifted The OBR has updated growth for this year to 1.5 per cent of GDP Follow every twist and turn of the
Rachel Reeves’s days are numbered
In her Budget speech today, Chancellor Rachel Reeves will have four goals. Two political – keeping her own job and keeping Keir Starmer in his as PM – and two economic – avoiding a financial crisis and getting the economy going. Her chances look poor on all of them. In the latest polling by Lord Ashcroft Polls, 76 per cent of voters expect the Budget to make them personally worse off, versus only 2 per cent who expected it to make them personally better off. Even amongst Labour voters, only 8 per cent expect the Budget to make them better off. As to making the country as a whole better
How bad will Rachel Reeves’s Budget be?
After a needlessly long run-up, Budget day is finally here. Investors, bond traders and house builders are breathing a collective sigh of relief – not because of what the Chancellor will say at around 12.40 p.m., but because the speculating, pitch-rolling and U-turning is finally over. Under the rules of engagement between the Treasury and the Office for Budget Responsibility (OBR), the fiscal watchdog must be given ten weeks to produce forecasts. After dithering over when to trigger the process, Reeves decided to give them 12. I’d argue that decision has proved close to catastrophic. Her hope that good news might materialise in the meantime has, in fairness, partly paid