UK

Ministers have pledged to ‘tear down’ barriers to trade with the European Union after new figures showed Brexit has cost UK business £37bn a year. The price of the UK’s departure was laid bare as the government said the UK’s total trade with the EU was 5 per cent lower than before we left the bloc. Trade minister Douglas Alexander hit out at the Brexit deal agreed by the previous Conservative government, saying it was “clear .. (it) is not working well enough.” Labour is currently negotiating a “reset” of relations, in a deal Keir Starmer has said will repair the UK’s damaged relationship with the EU for the benefit of “generations to come”. Mr Alexander said ministers would work with other countries “to improve the UK’s trade and investment relationship with the EU, tearing down unnecessary barriers to trade to help drive growth”. The Prime Minister faces a challenge in his own party as Britain and the European Union inch closer to an agreement (PA) More

Rachel Reeves has ruled out “tax and spend” policies ahead of her crunch spring statement next week. The chancellor is under pressure to fill a hole of around £20 billion in the public finances as she scrambles to meet her own financial rules following higher-than-expected borrowing and disappointing economic growth.A further blow to her plans came on Friday, when official figures showed government borrowing had soared past February forecasts. In an interview with the BBC, Ms Reeves signalled that she would not raise taxes, amid expectations of swingeing cuts to government departments in her statement on Wednesday. “We can’t tax and spend our way to higher living standards and better public services. That’s not available in the world we live in today,” she said.UK Government borrowing has soared above forecasts last month (Jordan Pettitt/PA) More

Rachel Reeves will soon give an update on her plans for the UK economy as she prepares to make the first Spring Statement of the new Labour government. The chancellor will also speak to an economic forecast as part of the event, with many predicting further spending cuts to come as the Treasury seeks to tackle ailing growth.Ms Reeves will be delivering the statement on Wednesday 26 March. She had previously committed to one major economic event a year – the Budget – which usually comes in the Autumn. This is to “give families and businesses stability and certainty on tax and spending changes,” she says.This means there a no major policy announcements expected as part of the statement, although some have predicted that reduced spending targets and some key tax changes will be revealed.Chancellor Rachel Reeves will deliver her Spring Statement on 26 March (Jonathan Brady/PA) More

‘What was the point?’ Starmer grilled on real-life impacts of disability benefits cutsIn another setback for Rachel Reeves, UK Government borrowing soared above forecasts last month as public sector spending rose, putting pressure ahead of the spring statement next week. The Office for National Statistics (ONS) said public sector net borrowing was £10.7 billion in February. This was £100 million more than the same month last year and the fourth-highest February on record.The UK’s official economic growth forecast for the year is also reportedly set to halve in a blow for a Labour government that has pledged to prioritise growth.The expected growth rate for the 2025 financial year, from April to March 2026, will be downgraded by the Office for Budget Responsibility (OBR) next week, The Telegraph reported, reducing from 2 per cent to around 1 per cent.In her spring statement next week, Rachel Reeves is expected to try blaming the drop on worsening global economics amid Donald Trump’s tariffs.The chancellor is also set to announce the biggest cuts since the George Osborne era on Wednesday, forcing Labour to reject claims the government is returning to a policy of austerity, days after the party slashed the welfare bill by around £5 billion.Is the UK facing a new age of austerity?There are ever more signs that the chancellor, Rachel Reeves, will use her spring statement next week to introduce further public spending cuts, augmenting fears that the country could be on the verge of a new age of austerity. How has the growth agenda morphed so soon into something akin to its opposite?Why might new cuts be needed?The growth that was the theme of Reeve’s first Budget last autumn has failed to materialise, and economic forecasts have become ever more pessimistic. The Bank of England last month reduced its growth forecast for this financial year by half – from 1.5 per cent to 0.75 per cent, and predicted higher inflation. Worse, according to the National Institute of Economic and Social Research think tank, the combination of poor growth and rising interest rates has reduced the chancellor’s spending buffer – or fiscal headroom – from an estimated £10bn to zero. And while the effect of US trade tariffs could be less damaging to the UK than to EU and other countries, there could still be a cost.Read the full analysis here: Is the UK facing a new age of austerity? Another round of expected cutbacks in the spring statement has led some to ask if we’re heading towards more austerity? The return of the A-word to conversations would be very bad for the chancellor, says Mary DejevskyHolly Evans21 March 2025 14:50The planning system is broken. Here’s how we should fix itHolly Evans21 March 2025 14:30’Nothing off the table’ in placing UK troops on the ground for Kyiv Downing Street on Friday said officials from allied countries will meet again at the same site next week to firm up a strategy to protect Kyiv as plans enter an “operational phase”.Asked whether the focus of discussions had shifted away from the prospect of ground troops for Ukraine, a Number 10 spokesman said: “No, nothing is off the table on any of these fronts, so I wouldn’t start ruling anything out.“But clearly thousands of troops will be required to support any deployment, whether that is at sea, on land or in the air.”Prime Minister Sir Keir Starmer and Defence Secretary John Healey (Oli Scarff/PA) More

The UK’s official economic growth forecast for this year will be cut in half next week in a blow to Sir Keir Starmer and Rachel Reeves, it has emerged. As the chancellor prepares to unveil a swathe of spending cuts at next week’s mini-Budget, the government’s spending watchdog is set to lower the expected growth rate for 2025 from 2 per cent to about 1 per cent. The Office for Budget Responsibility’s (OBR) downgrade is a major blow for the government, with Sir Keir having repeatedly said economic growth is his top priority. The news is a major blow to Sir Keir Starmer and Rachel Reeves More

Suspended Reform UK MP Rupert Lowe said Nigel Farage “must never become prime minister” after the party leader allegedly called his behaviour “disgusting” and “contemptible” in leaked private messages.Mr Farage accused Mr Lowe of “damaging the party just before elections” in a WhatsApp conversation with a member of the Great Yarmouth MP’s staff, the BBC reported.It comes as new polling suggests the fallout from the Great Yarmouth MP’s ousting is now hurting Reform. The weekly Techne UK tracker poll revealing the Tories level with Reform on 23 per cent each for the first time in two months.The messages were sent after Mr Lowe, who was suspended from the party amid allegations he made threats of violence to its chairman Zia Yusuf, had criticised Mr Farage in a Daily Mail interview, according to the broadcaster. In his latest attack on Reform, Mr Lowe said: “These messages unquestionably prove that the Reform leadership has zero integrity.”He added: “I will not work with the rotten and deceitful Reform leadership … Nigel Farage must never be prime minister.”The staff member, who is not currently a party member, had asked Mr Farage why Reform had not allowed a lawyer to complete an investigation into allegations about the MP’s conduct before removing the whip.Nigel Farager (Lucy North/PA) More

The mayors of Liverpool and Manchester have agreed a deal with an American space firm to put north-west England in a “central role in the global space economy”.Liverpool City Mayor Steve Rotheram and Greater Manchester Mayor Andy Burnham signed the agreement with Axiom Space on Thursday in a move they said could “unlock billions” of pounds for the region.Houston-based Axiom, which is developing a commercial space station, said the partnership would focus on space-based communications, disaster management, cybersecurity, microgravity research in medicines and in-space manufacturing.British astronaut and Axiom adviser Tim Peake, one of only two astronauts the UK has sent to space, was involved in initial discussions with Mr Rotheram to secure the deal.Mr Rotheram said: “For centuries, our region has been at the forefront of innovation – from the world’s first passenger railway to breakthroughs in modern medicine.“Now, we’re looking to space as the next great frontier for our expertise in advanced manufacturing, materials science, and biotech.”The plan will utilise the Liverpool City Region Freeport and the Greater Manchester Investment Zone, where different economic regulations apply compared with most of the UK.In January, Mr Burnham unveiled a decade-long plan to increase Greater Manchester’s contribution to the UK economy by £13 billion a year.Mr Burnham said of Thursday’s agreement: “Space is one of the UK’s fastest-growing sectors, and Greater Manchester is perfectly placed to lead this innovative work, with our strengths in advanced materials and manufacturing, life sciences, AI and data.“The expertise in our universities, digital sector, and manufacturing and engineering firms mean that we can seize this opportunity to create highly skilled, well-paid jobs across our city region.” More