Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
UK Chancellor Rachel Reeves has called for a new approach to public sector investment, in a set-piece speech at the Labour party conference in Liverpool on Monday.
On a day when Britain’s governing party sought to overcome internal divisions over its plans to cut winter fuel payments to pensioners, Reeves tried to emphasise a pro-growth agenda ahead of next month’s Budget.
“It is time that the Treasury moved on from just counting the costs of investments, to recognising the benefits too”, she said, as she confirmed plans to publish a new industrial strategy for Britain next month.
“The era of trickle-down, trickle-out economics is over,” she added.
Reeves’ conference speech was briefly disrupted by protesters against Labour’s position on Israel’s war against Hamas.
“This is a changed party, a party that represents working people, not a party of protest,” Reeves said as the individuals involved were escorted out.
Earlier in the day, delegates had booed a decision to delay a non-binding vote in which the leadership faces possible defeat over its plans to means test winter fuel payments.
Reeves argued in her speech that Labour had to respond to what she characterised as a £22bn black hole left in its accounts by the previous Conservative government.
After being criticised for her downbeat message in recent days, the Chancellor added that October’s Budget would have “real ambition” and that there would be no return to austerity.
Several cabinet ministers, mayors and other senior Labour figures told the FT this weekend that the party leadership has been far too “gloomy” and “downbeat” in his first two months in power.
“This budget will be a budget for economic growth; it will be a budget for investment,” the Chancellor said. “My ambition knows no limits, because I can see the prize on offer if we make the right choices now.”
In another remark highlighting the role of the state, she said: “Government cannot just get out of the way and leave markets to their own devices”.
The new administration could deliver “a Britain of opportunity, fairness and enterprise” despite the fiscal challenges it faced, she said.
Reeves announced an accelerated timeline on the party’s pledge to roll out free breakfast clubs to every primary school in the UK, saying it will start in hundreds of schools from April 2025, ahead of the national rollout.
This would mark “an investment so that, in years to come, we can proudly say that we left behind a Britain where the next generation has a chance to do better than those who came before it”, she said.
This is a developing story