Keir Starmer to face PMQs as reports claim Treasury must fill ‘£40bn funding gap’ in budget – UK politics live

Sources say Rachel Reeves told cabinet colleagues yesterday the figure was much higher than previously estimated

Good morning. Governments engage in expectation management, and the latest example is on the front page of the Financial Times this morning, where there is a story saying Rachel Reeves, the chancellor, has identified a “£40bn funding gap” as she prepares the budget, which is happening a fortnight today. In their story George Parker and Sam Fleming report:

UK chancellor Rachel Reeves has identified a £40bn funding gap ahead of her Budget in two weeks — far more than previously expected — as she prepares big tax rises to patch up the NHS.

The figure represents the funding that Reeves needs to protect key government departments from real-terms spending cuts, cover the enduring impact of an annual £22bn overspend and build up a fiscal buffer for the remainder of the parliament.

If we get tax rises on that scale [£40bn], that really would be extraordinary, I mean unprecedented. That would be tax rises sort of three times as big as George Osborne, for example, introduced back in 2010 in the depths of the aftermath of a financial crisis.

But that said that, if you are as the government wanting to not just protect public services, but significantly increase spending on the health service and increase spending on other things in line with the size of the economy, yes, there is a very big hole in the public finances.