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Rachel Reeves has instructed the Treasury to provide an assessment of state spending under the Conservatives as she prepares the ground for tough choices on the public finances later this year.
The chancellor said decisions had been “deferred and ducked” by the last government, leaving the UK’s economy facing “the worst set of circumstances since the second world war”.
In a speech at the Treasury on Monday, she said: “We face a legacy of 14 years of chaos and economic irresponsibility, that is why over the weekend I instructed Treasury officials to provide an assessment of the state of our spending.”
The Treasury analysis of the Labour government’s fiscal inheritance from Rishi Sunak’s Conservative government will come out before the summer recess later this month, and will pave the way for “difficult decisions” in an autumn Budget, she added.
Placing the quest to bolster growth at the heart of her “national mission”, Reeves declared that the UK now has a “stable government” that will work as a partner with business, while reiterating previous pledges not to lift the main tax rates on income tax, national insurance and VAT.
She focused her speech on reforming the country’s sclerotic planning system, saying her party had been “elected on a mandate to get things done and to get Britain building again”.
The Labour government has set a target of the UK building 1.5mn new homes over the next five years, with measures including reform to the National Planning Policy Framework by the end of the month. Mandatory housing targets would be restored and the de facto ban on onshore wind farms in England would be ended, she added.
She pledged to end prevarication on planning decisions, saying “we will not succumb to a status quo that responds to the existence of trade-offs by always saying no”.
Among the measures set out by Reeves is an attempt to unblock “stalled sites” of large housing schemes stuck in mid-development — with two already approved over the weekend. She will work with mayors and councils to draw a list of target sites.
Neil Jefferson, chief executive of the Home Builders’ Federation, welcomed the return of housing targets for local government. “We can only build if we plan effectively and if councils take responsibility for the housing needs of their communities,” he said.
But Jefferson said the government also needs to unblock 160,000 homes held up by environmental regulations and support buyers of new homes to encourage more building.