What’s gone wrong for the UK's finances, is it Rachel Reeves’ fault and how bad is it?

This is Money Podcast

This is Money

Business News, Business, Investing, News

4.1 • 650 Ratings

🗓️ 10 January 2025

⏱️ 71 minutes

🔗️ Recording | iTunes | RSS

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Summary

You have to feel for Rachel Reeves. After establishing a solid reputation in opposition, things haven’t gone to plan as Chancellor so far.

Her Autumn Budget led to widespread criticism over tax rises on employment and extra costs for businesses, while questions abound over whether her plans will deliver the growth Labour promised voters.

Now, a slow burn rise in the UK’s borrowing costs has led to gilt yields surpassing the levels seen after Liz Truss and Kwasi Kwarteng’s ill-fated mini-Budget.

Unfortunate, for a Labour party that has spend the past couple of years citing a gilt yield spike as evidence while banging on about Liz Truss ‘crashing the economy’ and Tory mortgage penalties.

But is Britain’s current predicament Rachel Reeves and Sir Keir Starmer’s fault or do they just find themselves caught out by an unfortunate set of circumstances? Or is it a bit of both?

Where did things start to go wrong? Was it the Budget, or was it the claimed ‘£22billion black hole’ and months of miserabilism? And what are gilts and why do yields even matter?

On this This is Money podcast, Georgie Frost, Lee Boyce and Simon Lambert dig into what’s gone wrong with Britain’s finances and what it means for people.

Plus, in better news Lee looks at the jobs that delivered the biggest pay rises last year and why.

Simon explains what’s going on with the US hedge fund staging a raid on seven investment trusts – and why investors should make sure they vote.

And finally, Lee catches up with Dave Fishwick as the new Bank of Dave film is released.

Transcript

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0:00.0	Welcome to This Is Money podcast sponsored by Charles Stanley Direct.
0:06.5	I'm Georgie Frost and joining me and Simon Lambert today is Lee Boyce.
0:11.2	And coming up, the pound slumped to its lowest level in over a year this week as UK borrowing costs soared to the highest peak for more than a quarter of a century.
0:20.5	Just what is going
0:22.2	on out there? What's gone wrong with the economy? Is it trust mini budget disaster mark two?
0:28.5	What does it mean for interest rates? And importantly, for our money. Also today, the US hedge fund
0:34.0	trying to raid seven investment trusts. Private shareholders are being urged to vote.
0:39.8	What is happening and why does it even matter? January the 10th is Quitters Day, apparently, so
0:45.1	if you're looking for a new job paying just a little bit more cash, we have those that saw the
0:49.4	biggest pay rise last year. And friend of This is Money, Dave Bank of Dave Fishwick, has a new film out. So Lee
0:56.3	turns entertainment reporter and caught up with him to get the inside goss. Don't be getting
1:01.5	to upstate with all the latest breaking money news. Just go to this ismoney.com.uk or download
1:07.3	the app. Take control of your finances with Charles Stanley Direct, invest, save, coach or plan,
1:15.9	using technology where it's helpful and people where it matters.
1:20.5	Our website and app make trading cost effective and flexible,
1:24.3	but we're more than just an online investment service.
1:27.3	We're here for you regardless of your financial needs or if your life takes an unexpected
1:32.3	term.
1:33.3	Your finances, your way.
1:35.3	Take control today with Charles Stanley Direct.
1:39.3	Sign up now.
1:40.3	Investment involves risk.
	...

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