Trump Seeks to Swap Obamacare Subsidies for Direct Cash

Transport Secretary Heidi Alexander has rejected claims that leaks ahead of the upcoming UK Budget have hurt the economy,

sarah

Nov 23, 2025 - 20:37

Trump Seeks to Swap Obamacare Subsidies for Direct Cash

Transport Secretary Heidi Alexander has denied that leaks ahead of the budget have harmed the economy, following criticism that speculation has "crippled businesses and consumers."

Media reports have been rife in recent months about which taxes might be increased, and the government has outlined several possible measures.

Former Bank of England Chief Economist Andy Haldane told the BBC's Sunday with Laura Kuenssberg program that this is "the biggest reason why [economic] growth has stalled."

In response, Alexander said that speculation always arises before the budget, but the Chancellor was clear about her priorities.

Chancellor Rachel Reeves is expected to raise taxes in her budget on Wednesday to help fill a billion-pound gap in her spending plan.

Ministers had given strong indications that the government plans to raise income tax rates.

An anonymous government source briefing to the media also revealed that Reeves was considering this move – which would have been a clear violation of Labor's election promise not to increase "the basic, higher, or additional rates of income tax."

However, last week, government sources said that Reeves had decided against doing so following better-than-expected economic projections.

Governments sometimes leak details of their budget plans to the media, either to gauge public reaction or to prepare the ground for measures so they don't come as a surprise to financial markets or voters.

Haldane called the months-long speculation about potential budget measures "fiscal fandango."

"It has been costly for the economy," he said on the program.

"It has disrupted businesses and consumers."

He said the budget process was "too long, too leaky, and there was a real cost."

Haldane acknowledged that this "pantomime" had also occurred under previous governments, and said that "the budget process has been broken for many years."

Asked whether the leaks had harmed the economy, Alexander said on the program: "People always speculate before the budget, and we have always said 'wait until the budget.'"

Defending the government's approach, he said the budget process took place in "changing circumstances," with productivity estimates being lowered and "the global economic environment being very difficult."

The Conservatives have demanded an investigation into the leaks before the budget, saying they will have "real-world implications, including on the financial markets."

In a letter to the Treasury's most senior civil servant, Shadow Chancellor Mel Stride said: "Either ministers have approved the large-scale briefing of confidential information related to the budget, or there have been serious unauthorized leaks within your department."

After backing away from raising income tax rates, the Chancellor is expected to introduce several smaller tax increases in her budget.

However, the government has not ruled out extending the freeze on the income tax threshold—the level at which people start paying tax or are required to pay a higher rate.

The freeze means that people will pay more tax with any salary increase, more people will be pushed into higher tax bands, or they will have to pay tax on their income for the first time.

Reeves has also stated that a focus will be placed on reducing the cost of living. The government has announced that rail fares in England will be frozen next year for the first time in decades.

Other priorities outlined by the Chancellor include reducing NHS waiting lists and national debt.

Meanwhile, she is also expected to eliminate the two-child benefit limit, a limit that means parents can only claim Universal Credit or tax credits for their first two children.

There has been pressure from Labour MPs to remove this cap, which was introduced under the Conservatives – a move that could cost over £3 billion.

While he refused to confirm the removal of the cap, Alexander said that tackling child poverty is "in the Labour Party's DNA."

He added, "For me, one of the most important things in this government is what we can do to ensure that children's life chances are not determined by the size of their parents' bank balances." The Conservative Party has argued against removing the cap, with Stride telling the BBC that it is "a matter of fairness" that parents receiving benefits should have the same choice about whether they can afford a large family as those who are not.

The Shadow Chancellor told Kuenssberg: "The big choice now in this Budget is whether the Chancellor has the courage to control government spending, particularly in the area of welfare where some spending is getting out of control, to make those difficult choices and not start taxing those areas again, which would harm the economy."

However, Green Party leader Zac Polansky said that scrapping the cap would be a "win" and it was "too bad it took the Labour government so long to do it."

He demanded the government "tax the rich" and not "tax the unemployed or the working people who are working really hard, even though their salaries are not increasing".