real life application Flashcards
(15 cards)
What type of review did Rachel Reeves present in 2025 instead of a traditional budget?
A three-year Spending Review to show fiscal credibility and long-term planning.
Why did Rachel Reeves opt for a multi-year spending plan?
To signal stability, rebuild trust, and control public spending after early austerity.
What was the key aim of the spending review?
To support long-term growth while maintaining fiscal discipline.
Why was day-to-day government spending increased by around 1.2% in real terms?
To allow moderate public service support while staying within fiscal rules.
Why has NHS funding increased by 2.8% per year in real terms?
To address capacity issues and public pressure on healthcare services.
What was the purpose of allocating £15 billion to regional transport projects outside London?
To promote regional growth, reduce inequality, and support productivity in the North and Midlands.
Why was £86 billion allocated to science and tech R&D?
To drive long-term economic growth via innovation and future industries like AI and biotech.
Why were winter fuel payments reinstated for lower-income pensioners?
To protect vulnerable groups and respond to political backlash over earlier benefit cuts.
Why did Reeves avoid new across-the-board tax rises?
To maintain political support and avoid weakening household finances.
How is increased spending being funded under Reeves’s strategy?
Through reprioritisation, efficiency savings, and targeted fiscal adjustments.
Why is capital spending being preserved despite fiscal constraints?
To maintain infrastructure investment that supports future productivity and growth.
What fiscal rule did Rachel Reeves commit to maintaining?
No borrowing for day-to-day spending and ensuring debt falls as a share of GDP.
Why is the 2025 Spending Review seen as a political reset?
It shifts from early austerity moves to investment-led, credibility-focused economic management.
Why are police and local councils in negotiation over budgets?
Because Home Office departments are being asked to find savings internally rather than receive major increases.
Why is the Spending Review considered supply-side supportive?
It prioritises infrastructure, education, and innovation to boost productive potential.
