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Reeves’ growth ambitions – flighty or flying?

31 January 2025
| by Field Team

After months of grumbling from business about her Budget and flat-lining growth statistics, Rachel Reeves sought to draw a line in the sand this week with a major speech on her plans for growth this week.

While HMT would enthusiastically deny the event was any kind of “reset” moment for the Chancellor, Reeves’ rhetorical pivot in recent days won’t have been missed by anyone paying the slightest attention. The question is whether any of it will work – either to turn around perceptions of a Chancellor who has struggled to hit the ground running or, more importantly to Labour’s prospects, by getting more money into people’s pockets?


The heavily rumoured government backing of a third runway at Heathrow came to fruition, with Reeves insisting it would create 100,000 jobs, increase exports, and establish Heathrow as a European hub, stating that “we cannot duck the decision any longer” – all while insisting protected bats and newts would have to suck up the arrival of the diggers.


But for a Government facing issues now, Reeves’ announcements are looking far, far ahead. While the Chancellor predicted the first spade in the ground at Heathrow could be in this parliament – optimistic to say the least in many experts’ eyes - it's certainly not an immediate growth-booster, and a controversial one at that. The decision has unleashed the first serious Red-on-Red cross fire since the election, with London Mayor Sadiq Kahn warning the plans would have “a severe impact on noise, air pollution and meeting our climate change targets”. Speculation persists DESNZ Secretary and long-term Heathrow opponent Ed Miliband will find the expansion “uncomfortable”, though he is not expected to resign.


Heathrow doesn’t exist in isolation. She’s also backed expansion for Oxford and Cambridge, electric vehicle (EV) charging networks, green material funding, a number of new reservoirs across England, and investment in and around Manchester United’s Old Trafford football stadium, which will either be redeveloped or fully rebuilt, a decision expected in the summer.

Reeves hopes the decisions will signal a vibe shift: that making big, bold and noisy commitments will instil confidence in business to implement their own investment plans and get consumers spending. Much like the Budget and its tax rises, it’s a significant gamble.


While the speech was widely welcomed on Wednesday, it will take weeks and months before anything shows up in the economic data – little help when the Chancellor has to issue an update on whether the economy is so slow she has already broken her “non-negotiable” fiscal rules on March 26. Fingers firmly crossed in the Treasury, TWFW suspects.

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