Rachel Reeves Considers Fiscal Rule Change to Boost Infrastructure Investment

Labour's potential shift in borrowing strategy aims to unlock significant funding but raises concerns about market stability.

Chancellor Rachel Reeves is exploring changes to Labour's fiscal rules to enable increased borrowing for infrastructure projects.
The proposed revisions could potentially free up £57 billion, focusing on public sector net worth rather than just debt reduction.
Experts warn that altering borrowing rules might lead to market instability reminiscent of the 2022 mini-budget crisis under Liz Truss.
Reeves faces the challenge of balancing investment needs with economic stability, as current debt levels already demand high interest payments.
The Labour government is under pressure to demonstrate that any new borrowing will directly contribute to long-term economic growth.