The OECD who are the top international economic and trade body have warned that Rachel Reeves policies are making unemployment numbers grim as Labour’s new taxes and costs are being pushed on to businesses in a knock-on-effect.
The OECD has warned that the Chancellor will not meet her inflation target every year as projected growth in 2026 will plummet to 1.2%, in 2027 it will rise by only 1.3%, however this depends on there being an uptick in global trade.
The international economic and trade body said inflation will remain at 2.5% next year and will fall to 2.1% in 2027, the OECD said this means it will remain “above target over the entire period.”
The OECD said that pressures are being piled on businesses by the government and the Chancellor’s hike in employers’ national insurance and further increases to the minimum wage is having a damaging effect on SMEs.
The Chancellor hailed, “Last week, my Budget cut waiting lists, cut borrowing and debt, and cut the cost of living. Less than a week later, the OECD has upgraded our growth and cut its forecast for inflation next year.
“The choices that I made at the Budget are expected to cut inflation by 0.4 percentage points, helping cut the cost of living for households and costs for our businesses.
“Alongside our plans to deliver growth, by investing in this country’s infrastructure, attracting major private investment, and pushing through bold planning reforms, we’ll deliver on our number one mission to put more money in people’s pockets.”
The shadow Chancellor Sir Mel Stride fumed, “The OECD are clear: unemployment is set to rise, driven in part by Labour’s Jobs Tax, and inflation will stay above target for the rest of their forecast.
“Rachel Reeves promised growth but growth is expected to weaken next year, because of her choices. This is the cost of policies that punish work, businesses and investment.”
