Reeves turns to Europe to improve growth prospects

Chancellor pitches for reset of UK-EU economic relationship

- DAVID MADDOX

Rachel Reeves will bank on Labour’s Brexit reset with the European Union to help deliver the economic growth she pledged ahead of the general election.

The hope that living standards can be raised with a better Brexit deal will be the core subject of Ms Reeves’ keynote speech in Brussels today.

With economic analysts and business leaders questioning whether Ms Reeves will achieve substantial growth after adding an extra £40bn in taxes including a hike in national insurance, the chancellor is looking towards a better deal with the EU to boost prosperity.

Already, Sir Keir Starmer downgraded the promise of economic growth – previously the centre of Labour’s election campaign – to focus more on raising living standards.

The chancellor’s speech comes as deputy prime minister Angela Rayner heralded plans to tear up planning rules to allow more housebuilding and the construction of infrastructure to turn the UK economy around.

But with the Office of Budget Responsibility suggesting that growth will peak at around just 2 per cent during this parliament, Ms Reeves is looking for changes in the flawed Brexit deal to help put more money in people’s pockets.

Ms Reeves will become the first UK chancellor to attend a meeting of EU finance ministers since the UK left the EU. The Labour government is using it to clearly signal their commitment to reset the relationship with the EU and realise the economic potential of our shared future.

In her speech, the chancellor will set out that part of the government’s mission to drive economic growth and make working people better off, a central part of the “Plan for Change”, will be achieved through a closer relationship with the EU.