--- title: How the U.K. Labour Government Squandered the Autumn Budget description: The chaos leading up to Chancellor Rachel Reeves's budget is a reminder of the country's unpopular leadership, writes Oliver Eagleton. canonical: https://time.com/7336967/uk-starmer-reeves-budget/ author: Oliver Eagleton article:opinion: true article:content_tier: free article:published_time: 2025-11-26T16:25:55.000Z article:modified_time: 2026-03-11T00:37:00.107Z article:section: Ideas og:title: Britain's Labour Government Unveils a Budget of Last Resort og:description: Chancellor Rachel Reeves' latest tax and spending plans show a government hemmed in on all sides, writes Oliver Eagleton. og:url: https://time.com/7336967/uk-starmer-reeves-budget/ og:site_name: TIME og:image: https://static.time.com/v3/assets/bltea6093859af6183b/blt72d7d0c5f4184215/6998cbfb83ec373e19c7b2a8/GettyImages-2247961505.jpg?branch=production&width=1024&quality=75&auto=webp&crop=16:9 og:image:width: 1024 og:image:height: 576 og:image:alt: Rachel Reeves leaves 11 Downing Street ahead of revealing budget in parliament og:type: article twitter:card: summary_large_image twitter:title: Britain's Labour Government Unveils a Budget of Last Resort twitter:description: Chancellor Rachel Reeves' latest tax and spending plans show a government hemmed in on all sides, writes Oliver Eagleton. twitter:image: https://static.time.com/v3/assets/bltea6093859af6183b/blt72d7d0c5f4184215/6998cbfb83ec373e19c7b2a8/GettyImages-2247961505.jpg?branch=production&width=1024&quality=75&auto=webp&crop=16:9 ---  IDEAS Time ideas # Britain's Labour Government Unveils a Messy Budget of Last Resort > Sponsored content. 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It explains how TIME's journalism is made, from the first pitch through the editorial decisions behind a finished story or cover. #### How can I read about how TIME chooses its covers? Inside TIME is the newsletter where TIME's Editor-in-Chief explains cover selection and the editorial reasoning behind major stories. It is free at time.com/newsletters. #### Who is the editor of TIME? Sam Jacobs is TIME's Editor-in-Chief. He writes Inside TIME, a twice-weekly newsletter about the newsroom's reporting and editorial decisions. #### Is Inside TIME free? Yes. Inside TIME is a free newsletter, available at time.com/newsletters. A paid TIME subscription is separate and available at time.com/subscribe-agent. by [Oliver Eagleton](https://time.com/author/oliver-eagleton/) ## Oliver Eagleton Contributor Oliver Eagleton is managing editor at Phenomenal World and the author of The Starmer Project. Nov 26, 2025 4:25 PM UTC  Chancellor of the Exchequer Rachel Reeves leaves 11 Downing Street with traditional red box ahead of revealing Labour government's budget in House of Commons in London on Nov. 26 2024. Chancellor of the Exchequer Rachel Reeves leaves 11 Downing Street with traditional red box ahead of revealing Labour government's budget in House of Commons in London on Nov. 26 2024. Rasid Necati Aslim—Anadolu/Getty Images by [Oliver Eagleton](https://time.com/author/oliver-eagleton/) ## Oliver Eagleton Contributor Oliver Eagleton is managing editor at Phenomenal World and the author of The Starmer Project. Nov 26, 2025 4:25 PM UTC Weeks of chaos came to a head today in Britain. The government of Prime Minister Keir Starmer [unveiled its Autumn Budget](https://www.bbc.co.uk/news/live/cy8vz032qgpt) after it floated, then [abandoned](https://www.ft.com/content/6cbb46b1-c075-453b-a9f9-7eb1e9120d9b), an election manifesto-busting income tax rise to plug a £30 billion fiscal black hole. The controversy has not helped the [least popular Prime Minister on record](https://edition.cnn.com/2025/09/30/uk/keir-starmer-labour-party-conference-intl), prompting [talk of a leadership challenge](https://www.reuters.com/world/uk/talk-plan-replace-uk-pm-starmer-is-not-true-says-health-minister-2025-11-12/) as the far-right Reform [tops the polls](https://www.politico.eu/europe-poll-of-polls/united-kingdom/) and the upstart Greens draw even with Labour. Now that the document which was supposed to reset Britain’s direction has finally been published, it looks less like a long-term plan and more like an attempt to contain this mounting crisis. Misgivings about the Budget flowed partly from the fortunes of its author, the Chancellor Rachel Reeves. Her fast-and-loose approach to public office—with [allegations that she plagiarized her memoir](https://www.theguardian.com/politics/2023/oct/26/rachel-reeves-labour-denies-plagiarism-new-book-female-economists), [embellished her resume](https://www.bbc.co.uk/news/articles/c77r05nx11po), filed [inappropriate expenses](https://www.bbc.co.uk/news/articles/ckg75jr5284o), accepted lavish gifts, and [breached housing rules](https://www.theguardian.com/politics/2025/oct/29/rachel-reeves-admits-breaking-rules-by-renting-out-her-house-without-a-licence) when renting out her second home—has not inspired much confidence in her blueprint. Nor has her broader attitude to the country’s finances, which has so far been defined by the contradictory aims of imposing cuts and boosting growth in an economy where Brits now [earn half](https://www.telegraph.co.uk/money/jobs/american-flocking-britain-even-half-the-pay/) that of Americans. Reeves’s inability to reconcile these two imperatives has caused her to lurch between various half-formed policies over the past year. At one point she [shed tears](https://www.bbc.co.uk/news/articles/cn0qr9wlpnqo) in the House of Commons after she announced harsh new austerity measures and was then forced by her own colleagues to backtrack on them. The row over income taxes is just the latest in this series of reversals. This erratic mood has characterized the entire Starmer government, which came to power last July without a real vision of change. Its mission was never to remake Britain, no matter how sorely that was needed in the wake of the Great Recession, the [upheaval of Brexit](https://www.theguardian.com/politics/2022/aug/03/spiralling-inflation-crops-left-in-the-field-and-travel-chaos-10-reasons-brexit-has-been-disastrous-for-britain), [COVID](https://www.bbc.co.uk/news/health-65975154), and [five Tory Prime Ministers](https://time.com/6223365/why-liz-truss-resigned/) in six years. It was rather to provide “stability” and good government after a long spell of political chaos. **Read More:** [_The Man Who Wants to Fix Britain_](https://time.com/6275507/keir-starmer-interview-uk/) These precepts have done nothing to remedy the U.K.’s most acute problems, like [rising poverty](https://edition.cnn.com/2025/11/24/uk/britain-child-poverty-intl-scli) or [sapped industry](https://www.telegraph.co.uk/news/2025/10/26/british-manufacturing-decline-energy-acceleration/) or [creaking public services](https://www.nbcnews.com/world/europe/uks-public-health-service-crisis-threatening-institution-heart-british-rcna228773). And so the government has spent much of its time responding to the ephemera of the news cycle rather than pursuing a clear agenda. The result has been a rapid deterioration in its credibility. Polls put Labour [consistently below 20%](https://yougov.co.uk/topics/politics/trackers/voting-intention), despite winning a huge parliamentary majority last year. Its most serious threat comes from the right, with Nigel Farage’s Reform now [supported](https://www.ipsos.com/en-uk/uk-opinion-polls) by a third of the country, meaning it would win a clear majority were an election held tomorrow. Reform’s platform is threadbare, marked by a single-minded obsession with immigration as the root of seemingly every social ill and [offering mass deportations as the solution](https://time.com/7312223/uk-immigration-debate-farage/). Yet [Starmer’s own outsized focus](https://www.newstatesman.com/ideas/2025/05/keir-starmers-island-of-strangers) on the issue has helped to legitimize this ugly tendency, as has Home Secretary Shabana Mahmood’s [hardline new rules](https://www.economist.com/britain/2025/11/20/will-britain-copy-asylum-policy-from-a-place-with-poor-integration) on asylum and immigration. The sterile conservatism of Labour has opened the door to the boisterous reaction of Reform. On the left, the Greens’ new leader [Zack Polanski](https://time.com/collections/time100-next-2025/7318841/zack-polanski/) has turned this humdrum party of middle-class gardeners into an eco-populist campaign machine—shifting its emphasis onto the cost-of-living crisis with a set of simple policies to lower bills, while refusing to accept the scapegoating of migrants. Some polls even put them in [second place](https://www.thelondoneconomic.com/politics/new-poll-puts-greens-in-second-ahead-of-labour-and-tories-400516/). At the next election, they could form a pact with the new socialist party being founded by the former Labour Party leader Jeremy Corbyn, which, though its launch has been [marred by remarkable infighting](https://www.newstatesman.com/author/olivereagleton), could still plausibly pick up several seats, further expanding the left bloc in Parliament. These insurgent forces have hastened the demise of the U.K.’s two-party system, ushering in what could be a once-in-a-century political revolution. Labour’s only way to save itself is either to tack left, using public spending to materially improve people’s lives, or to develop a newly assertive centrism, promising an antidote to populists on either end of the spectrum. The Budget was a major opportunity to take one of these paths. But Labour squandered it. While the initial plan to hike income tax was [unpopular](https://yougov.co.uk/politics/articles/53388-how-much-does-opposition-to-raising-the-basic-rate-of-income-tax-vary-by-the-level-of-increase), it would have at least brought in more revenue which could have been used to help fulfil the government’s promises to invest in public services and boost growth. Starmer has [staked his governing project on economic growth](https://www.economist.com/the-world-ahead/2025/11/12/the-british-economy-will-pick-up-a-little) that would boost government receipts and obviate the need for higher taxes. When this growth [failed to appear](https://www.reuters.com/sustainability/sustainable-finance-reporting/how-uk-economy-has-fared-since-reeves-first-budget-2025-11-24/), Labour found itself in a corner. The upshot is a Budget of piecemeal measures that fall well short of a considered economic strategy. In its final form, the Budget is merely an attempt to appease disparate interests: gesturing to the affordability crisis by removing [certain electricity levies](https://www.thisismoney.co.uk/money/bills/article-15323973/Green-levies-energy-bills-scrapped-Budget-Rachel-Reeves-opts-against-cutting-VAT.html), placating the markets with [scattergun tax rises](https://news.sky.com/story/budget-2025-reeves-to-announce-26bn-of-tax-rises-after-budget-leak-13475665), and courting the hard right with [new funds](https://www.mirror.co.uk/news/politics/dodgy-nail-bars-takeaways-car-36278195) to investigate nail bars and car washes where migrants are thought to illegally work. This is the behavior of a government that feels hemmed in on all sides—by price rises and spending limits, and by opponents who have capitalized on their fallout. Starmer and Reeves cannot escape this labyrinth by offering minor concessions to various voters and investors. Finding the exit route requires a level of political imagination that both appear to lack. [TIME Ideas](https://www.time.com/ideas) hosts the world's leading voices, providing commentary on events in news, society, and culture. We welcome outside contributions. 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