Rachel Reeves black hole is of her own making

By johnredwood on October 17, 2025

The original black hole estimated around £20 bn was blamed on the previous government, though more than half of it was higher public sector pay awards made by the new government. This was more than covered by large tax rises in the first budget where we were told this would be a one off tax raising budget to get the finances into prudent shape.

Instead the Chancellor boosted spending greatly, Give aways to Mauritius with Chagos,to France who accompany Channel migrants into our waters instead of stopping the boats, to record numbers of illegals arriving here, to a surge in mental health disability benefits, to a huge increase in NHS spending with no productivity requirements, to an further increase in the civil service and more net zero projects, for paying the losses by British Steel and the Bank of England.

Now we hear the Chancellor wishes to claim her economic problems arise from Brexit. Nonsense. Anyway Brexit happened well before the election so it is not a new issue.

The truth is the black hoke would be much bigger were we still in the EU. They levy up to 1.4% of GNI or ££42 bn on the UK. The average member state pays 1% or £30 bn for Uk. We would also be paying away £4 bn of customs dues and £1 bn of plastics tax to the EU if we were back in.

So the black hole would be £35 bn to £47 bn bigger spending on our terms of membership. Instead of blaming the EU she should be grateful we are saved such a big set of payments.

I am fed up with hearing the lie our GDP is down 4% owing to Brexit. It isn't. The dodgy OBR forecast said a loss of 0.25% a year for 15 years from our growth rate, which was also wrong. This was based on forecasts of a loss of trade. We now know our trade post Brexit is well up thanks to a surge in services which are the majority of our exports.