Ministers are attempting to justify all departmental spending by aligning it with Labour’s key priorities—economic growth, net zero, crime, education, immigration, and the NHS—ahead of a critical spending review, according to officials. Chancellor Rachel Reeves has instructed departments to justify every pound they receive or risk funding cuts.
Government sources told The Guardian that ministers and civil servants are scrambling to demonstrate how their programs fit within the government’s core missions to avoid budget reductions, with unprotected departments potentially facing annual cuts of at least 1%. The Treasury has warned that any expenditure that does not contribute to economic growth will not be approved.
Final spending proposals will be submitted to the Treasury in the coming weeks, with officials admitting that some departments are stretching definitions to fit their programs into the government’s priorities. One official described this approach as “mission-washing,” where departments attempt to reframe existing initiatives to appear aligned with Labour’s objectives.
A source from one department compared the process to job applications, explaining that departments are simply inserting key terms from the government’s agenda into their justifications. Some claims have been particularly tenuous, such as the Department for Science, Innovation and Technology suggesting that digitizing death records would boost economic growth by eliminating the need for people to take time off work to register a death in person.
The Liberal Democrats mocked the government’s approach, stating, “It seems there are three certainties in life: death, taxes, and ministers forcing the word ‘growth’ into every announcement.”
Other departments have made similar arguments, with ministers claiming that flood defences and waste management are crucial for economic growth, while the Foreign Office has asserted that its diplomatic missions support UK trade and its aid programs help reduce immigration.
Meanwhile, the Office for Budget Responsibility is expected to significantly lower its economic growth forecasts, potentially erasing the £9.9bn fiscal headroom previously projected. The Treasury has tried to persuade the fiscal watchdog to factor in the effects of planning and welfare reforms in growth projections, but these long-term and uncertain impacts are unlikely to be considered.
Sources close to Reeves have emphasized that she will not deviate from her fiscal rules or introduce major new tax increases, making spending cuts her primary option. As a result, officials in departments outside health and defence have been instructed to prepare for significant budget reductions.