Reeves warns cabinet of £100bn budget shortfall over five years

Rachel Reeves has told the cabinet that the UK still faces a £100bn shortfall in the public finances over the next five years amid concerns that ministers are yet to grasp the full scale of the fiscal deficit ahead.

- Pippa Crerar

At a cabinet meeting, the chancellor said the £22bn gap this year - which the government has blamed on their poor economic inheritance from the Tories - would be a recurring cost each year of this parliament.

Cabinet ministers have pushed back against some of the cuts demanded of them, in particular to in-year capital spending, and Reeves's words will be interpreted as a signal that she will not back down.

"The chancellor highlighted the £22bn black hole inheritance from the previous government that needed to be filled just to keep public services standing still," a Labour spokesperson said.

"She said that the scale of inheritance meant there would have to be difficult decisions on spending, welfare, and tax- and that the longterm priority had to be unlocking private sector investment to drive economic growth. The chancellor told cabinet the budget would focus on putting the public finances on a strong footing and being honest with the British people about the scale of the challenge."