Aside from pledging a summer of fun, Rachel Reeves has been out of the fray in Labour’s leadership battle.
The Chancellor’s main hope for survival has been the fear that moving her from the Treasury would cause ructions in the nervy gilts market.
Reeves cannot have been overjoyed with the published emails written by senior Labour figure Pat McFadden.
He told Peter Mandelson the question faced at every meeting that he attends is ‘who can we tax in order to pay benefits to others’.
After £75billion of tax increases since July 2024, with the ticking time bomb of frozen thresholds and ‘pension sacrifice’ still in the works, there is little more that can be squeezed from the lemon.
The assumption is it would be tricky to depart company with the nation’s first female Chancellor, who is seen as an inspiration to many young women.
Uncertain future: Chancellor Rachel Reeves’ main hope for survival has been the fear that moving her on from the Treasury would cause ructions on the nervy gilts market
The truth, as McFadden pointed out, is that keeping backbenchers on side by avoiding welfare cuts has been a substantial blow to economic output.
Even a resilient and flexible economy such as Britain struggles to grow under the weight of higher employers’ national insurance, business rates, packaging taxes and an assault on wealth and aspiration.
Rather than tackling the welfare bill, Labour increased spending by ending the two-child limit on benefits.
As worthy as that may be in addressing child poverty, it gobbled up fiscal space. If the New Statesman is to be believed, it is not just business, Andy Burnham and other candidates for the leadership who want to wave goodbye to Reeves – but also the Treasury.
There is an assumption the Civil Service willingly played a part in Reeves’ mistakes, such as the early abolition of the winter fuel allowance for pensioners (later reversed) and the damaging late November date for last year’s Budget.
Now it isn’t so certain, and officials may have been opposed all along. What is clear, as Oxford Economics points out, is that the UK is more vulnerable to global shocks than our trading partners and needs a ‘strong, coherent narrative’ and policies that will fix market confidence.
It is no accident that the Club Med economies of Greece, Italy and Spain are now the fastest expanding in Europe. They all took a meat-axe to the size of government to dig their way out of the euro-crisis of the 2010s.
There must be doubt as to whether Keir Starmer or any of the candidates to replace him are gutsy enough to take similar steps.
Bullion’s bounce
The effort to demonetise gold has been relentless. The Nixon Shock of 1971 saw America end gold-backing for the dollar. Britain abandoned the gold standard in 1931 as the Great Depression dawned.
Chancellor Gordon Brown sought to give bullion a further heave-ho in 1999, eventually selling £2billion worth of the yellow metal.
It was a world-class mistake as those reserves would now be worth £40billion, providing a government asset that could act as a bulwark against bond market volatility.
Russia’s war on Ukraine and tense relations between the US and China have seen gold roar back.
The European Central Bank reports gold displaced the dollar as the world’s top reserve asset in 2025, accounting for 27 per cent of reserves. Holdings of US Treasuries tumbled to 22 per cent.
The change follows relentless gold-buying by Russian and Chinese central banks, which has helped the gold price double over the past two years. Western hoarders, such as the US Treasury and the IMF, have reason to be grateful.
O Canada
The arrival of Joanne McNamara as boss of British Land is a landmark choice, if you excuse the pun. She is the first female chief executive at a top listed, male-dominated real estate company.
It will cost shareholders close to £10million to bring her across from Oxford Properties, which is owned by the Ontario Municipal Employees Retirement System.
The 44-year-old is the second refugee from an Ontario pension fund to run a FTSE firm, following in the footsteps of Maggie Fanari at Rothschild Investment Trust (RIT).
And they used to say never use Canada in a headline.
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