As the first female chancellor of the United Kingdom, Rachel Reeves is navigating a complex landscape of economic policy and public finance. Her pragmatic approach to public finances has sparked debate over whether it reflects deeply held beliefs or pragmatic strategy.
The past few weeks at Westminster have been dominated by Rachel Reeves‘ decision to press for £5bn of welfare cuts. Photograph: Jeff Overs/PA
Rachel Reeves is a British Labour Party politician serving as the Member of Parliament (MP) for Leeds West since 2005.
She was appointed Shadow Chancellor of the Duchy of Lancaster in 2020 and has held various roles within the party, including Shadow Secretary of State for Work and Pensions.
Reeves has been involved in several high-profile campaigns, including advocating for workers' rights and social justice issues.
Rachel Reeves, the first female chancellor of the United Kingdom, has taken a tough approach to public finances, prompting debate over whether her strategy is pragmatic or driven by deeply held beliefs.
The Treasury’s Return to Form
Critics argue that Reeves‘ tenure has seen the Treasury revert to its traditional role as a department that says ‘no‘. One senior thinktanker with close links to government described this phenomenon as an ‘institutional capture’, suggesting that the Treasury is being influenced by those within it. However, Reeves‘ allies reject this characterization, instead pointing to sexism and an undertow of opposition from within the government.
A Shift in Economic Views
Reeves‘ economic views have evolved significantly since her time in Labour’s shadow cabinet. In 2018, she advocated for a radical overhaul of the tax system, calling for wealth taxation reforms. However, during her tenure as chancellor, she has eschewed such measures, opting instead to focus on growth and infrastructure spending.
The Role of Growth
Reeves‘ emphasis on growth has been a key aspect of her policy agenda. She has announced plans to increase borrowing significantly without busting her new fiscal rules, making space for an infrastructure splurge. However, this approach has also led to criticism from business leaders, who have expressed concerns over the impact of increased employer national insurance contributions.
A Leader with Intense Loyalty
Reeves is known for commanding intense loyalty from her staff, who describe her as hardworking, committed, and energetic. However, she can be stern when disappointed by the quality of an official’s work. Her team has also become more sceptical about the Office for Budget Responsibility’s forecasting process, with some describing it as overly rigid.
A Divided Labour Leadership
Reeves is facing criticism from within her own party, with a Survation poll putting her at the bottom of a league table of cabinet members. However, Labour backbenchers who have known Reeves describe her as a good colleague and a steeped-in-party figure. She has also been praised for her frequent appearances in the House of Commons tearoom and her willingness to engage with local party functions.
As the first female chancellor of the United Kingdom, Rachel Reeves is navigating a complex landscape of economic policy and public finance. While her approach may be seen as pragmatic by some, others argue that it reflects deeply held beliefs. One thing is certain: Reeves‘ leadership style has already begun to shape the direction of the Treasury.
