Rachel Reeves' Spring Statement: The fallout at Westminster - Parliament Matters podcast, Episode 82

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Rachel Reeves' Spring Statement: The fallout at Westminster - Parliament Matters podcast, Episode 82

21 Mar 2025

Is Rachel Reeves gearing up for a standard Spring Statement — or are we in emergency budget territory? In this episode we dig into what form next week’s parliamentary statement might take and why it may be more than just an economic update. We trace the history of the “one fiscal event” a year rule, explore the tough choices facing the Chancellor, and ask whether Parliament still has any real say over tax and spending. Plus, could post-legislative scrutiny finally be coming into its own?

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In this episode, Ruth and Mark cut through the fiscal fog surrounding Rachel Reeves’ upcoming Spring Economic Statement — officially billed as a routine forecast update, but with growing signals it could be something much bigger. With whispers of an “emergency budget” and mounting pressure from the Office for Budget Responsibility’s (OBR) latest projections, they weigh the procedural factors that will determine whether Reeves will take action now to meet her fiscal rules, or kick the tougher decisions down the road to the autumn Budget and the Comprehensive Spending Review.

They also take a step back to explore how we got here. The current approach of having just one major fiscal event per year was introduced in 2016 by then-Chancellor Philip Hammond, aiming to bring predictability and control. But when long-term economic forecasts suggest those all-important fiscal rules are at risk — especially ones that stretch five years into the future — that system starts to show its cracks.

They also speak to Professor David Heald, who delivers a sobering assessment of how little control Parliament has over public finances — before spending takes place. He argues that the UK’s budget-setting process is executive-dominated and ripe for reform, but political incentives keep the status quo firmly in place.

Later, Ruth and Mark highlight an encouraging sign of reform: the growing use of post-legislative scrutiny, with the Football Governance Bill now including a statutory review clause. They reflect on how tools like these could support longer-term thinking in Parliament — if only they were used more systematically.

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Our guest

Professor David Heald

David Heald is Emeritus Professor and Honorary Senior Research Fellow at the Adam Smith Business School at the University of Glasgow, specialising in public sector accounting reform, public expenditure management, public audit, infrastructure financing, and financing devolved governments. Before becoming an academic, he qualified as a member of the Chartered Institute of Management Accountants and worked as a management accountant in the engineering and steel industries. Among his many public roles, he is a member of HM Treasury’s User and Preparer Advisory Group on government financial reporting and a former adviser to the House of Commons Treasury Select Committee.

Resources

Professor David Heald

Personal website

Hansard Society

How does Parliament authorise the Government's taxation plans? A procedural guide to the Budget process
How does Parliament approve Government spending? A procedural guide to the Estimates process

UK Parliament

Spring Statement 2025: Background briefing, House of Commons Library

Transcript

Please note, this transcript is automatically generated. There may consequently be minor errors and the text is not formatted according to our style guide. If you wish to reference or cite the transcript copy below, please first check against the audio version above.

ntro: [00:00:00] You are listening to Parliament Matters, a Hansard Society production, supported by the Joseph Rowntree Charitable Trust. Learn more at hansardsociety.org.uk.

Ruth Fox: Welcome to Parliament Matters, the podcast about the institution at the heart of our democracy, Parliament itself. I'm Ruth Fox

Mark D'Arcy: and I'm Mark D'Arcy. Coming up this week

Ruth Fox: Is it a bird? Is it a plane? Is it a spring statement or is it an emergency budget? What exactly might Rachel Reeves' big statement next week be and what might it mean?

Mark D'Arcy: Will MP's scrutiny of whatever the Chancellor announces make any difference or is that just all an empty ritual?

Ruth Fox: And is Parliament getting serious about how the laws it has already passed are working out?

Mark D'Arcy: But first Ruth, let's talk about Rachel Reeves [00:01:00] Spring Statement next week. It's actually the Spring Economic Announcement, or the Spring Forecast.

Ruth Fox: Spring forecast, yes.

Mark D'Arcy: Or something like that. It's supposed to be quite a low key event. It's supposed to be a kind of update based on the latest projections that have emerged from the Treasury and the Office for Budget Responsibility.

Slight course correction, nothing very big, just keeping you informed, guys, kind of deal. Not so much this time. Kemi Badenoch caused a bit of a furore at Prime Minister's Question Time this week when she referred to it quite deliberately as an emergency budget, implying that the government's being forced into making really serious changes because things have gone awry and their strategy isn't working, there was a roar of derision from Labour MPs.

But there is, I think, a bit of a graduation here that we've got to talk about. What's the difference between a statement, first of all, and a budget, or a mini budget, or an emergency budget, or any of the other possible identities that might be pinned on to the event that's due to happen next Wednesday?

Ruth Fox: Yeah, well, you've got to [00:02:00] go back, Mark, nearly 10 years, goodness, to sort of explain the history of this. So, in 2016, the then Chancellor of the Exchequer decided we should have just one fiscal event, as it's called, per year. So, one major event where they announced tax and spending changes. And that was going to be the budget

Mark D'Arcy: The then chancellor of the Exchequer was

Ruth Fox: Philip Hammond, I think. I wouldn't, I wouldn't swear by that, but I'm pretty sure it was Philip Hammond. He basically wanted one fiscal event, so there'd be autumn budget, and then in the spring there would be this forecast, this statement by the Chancellor, which would be solely a response to the second forecast in the year by the Office for Budget Responsibility, which is the independent body that was established under the coalition years to provide independent authoritative analysis on the state of the public finances, the government's tax and spend plans and so on.

And it's proved a bit of a straitjacket around chancellors because it forecasts whether the government is going to meet its fiscal rules, which we'll come onto in a minute. But, for context, most countries only have one fiscal event. We were unusual in having two in a year.

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