OBR slashes UK growth forecast for 2025 but upgrades it for rest of parliament, chancellor says
The Office for Budget Responsibility has halved the UK growth forecast for 2025 from 2% to 1%, Chancellor Rachel Reeves has said.
However, the fiscal watchdog said that while growth has been downgraded for this year, it had been upgraded for every year after for the rest of this parliament – which is due to end in 2029.
The chancellor said she is “not satisfied with the numbers” for this year as she delivered her long-awaited spring statement in the House of Commons this afternoon.
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But, she explained, the OBR has forecast growth to hit 1.9% in 2026, 1.8% in 2027, 1.7% in 2028, and 1.8% in 2029.
She told MPs: “There are no shortcuts to economic growth. It will take long-term decisions. It will take hard yards. It will take time for the reforms we are introducing to be felt in the every day economy.
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Rachel Reeves has confirmed that the OBR has downgraded the UK’s economic growth forecast for this year from 2% to 1%.
“It is right that the Office for Budget Responsibility consider the evidence and look carefully at measures before recognising a growth impact in their forecast.”
The chancellor pointed to changes to the National Planning Policy Framework, saying mandatory housing targets and bringing “grey belt” land into scope for development will “permanently increase the level of real GDP by 0.2% by 2029-30”.
This will bring an “additional £6.8bn in our economy and by 0.4% of GDP within the next 10 years”, she said.
Ms Reeves also highlighted reforms to the pension system and a national wealth fund, adding it was part of a “serious plan” for economic growth.
Also announced in the spring statement today:
- The budget will move from a deficit of £36.1bn in 2025/26 and £13.4bn in 2026/27, to a surplus of £6bn in 2027/28, £7.1bn in 2028/29 and £9.9bn in 2029/30;
- The Office for Budget Responsibility estimates Labour’s cuts to the welfare budget will save £4.8bn, with changes going further than initially thought;
- Reeves says the health element of universal credit will be cut by half and frozen for new claimants;
- There are no more tax rises today, but the chancellor claims she’ll raise an extra billion pounds by cracking down more on tax evasion;
- Day-to-day spending will be protected, other than the aid budget, with spending increasing above inflation every year;
- The defence budget will get a £2.2bn boost for next year, paving the way for spending eventually hitting 2.5% of GDP;
- House building will hit a 40-year-high thanks to Labour’s planning reforms.
The chancellor confirmed that a voluntary redundancy scheme is set to launch for civil servants as part of her mission to “make government leaner”. She said this will deliver £3.5bn in “day-to-day savings by 2029-30”.
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Sky’s Economics and Data Editor Ed Conway goes through the latest economic data following the chancellor’s spring statement.
Shortly afterwards, Conservative leader Kemi Badenoch accused Labour of financial “chaos”.
She said the spring statement was “all smoke and mirrors”, adding: “I remember the last budget when Rachel Reeves said she was smashing glass ceilings, now it feels like the roof is falling over all our heads.”
A handful of Labour MPs were unimpressed with the moves around welfare, with Debbie Abrahams – the MP for Oldham East and Saddleworth – claiming “all the evidence points to cuts in welfare leading to severe poverty and worsened health conditions”.
An impact assessment into Labour’s welfare reforms, which include narrowing the eligibility criteria for personal independence payments (PIP), found there could be an additional 250,000 people in “relative poverty” by 2030 due to the changes.
Richard Burgon, the Labour MP for Leeds East, said “taking away the personal independence payments” from disabled people is an “especially cruel choice”.
A British grandmother has died after contracting rabies from a “slight scratch” from a puppy during a holiday in Morocco, her family has said.
Yvonne Ford’s daughter said she travelled to the North African country in February but did not become ill until two weeks ago.
Robyn Thomson said in a Facebook post: “Our family is still processing this unimaginable loss, but we are choosing to speak up in the hope of preventing this from happening to others.
“She was scratched very slightly by a puppy in Morocco in February. At the time, she did not think any harm would come of it and didn’t think much of it.
“Two weeks ago she became ill, starting with a headache and resulted in her losing her ability to walk, talk, sleep, swallow. Resulting in her passing.”
Yvonne Ford went to Morocco in February, her family said. Pic: Facebook
Ms Ford, from Barnsley, South Yorkshire, was diagnosed with the virus at Barnsley Hospital.
The UK Health Security Agency (UKHSA) said health workers and close contacts were being assessed and offered vaccination when necessary.
It said there was no risk to the wider public because there is no evidence rabies can be transmitted between people.
What is rabies and how is it treated?
Rabies is caused by a virus invading the central nervous system.
It is spread by mammals – such as cats, dogs, bats, raccoons and foxes – but in the UK it’s only found in some bats, according to the NHS.
Once symptoms appear, it is almost always fatal, according to the World Health Organisation (WHO).
The first symptoms can mirror a flu, while later symptoms include numbness or tingling in the affected area, hallucinations, anxiety, difficulty swallowing or breathing, nausea, vomiting, agitation, excessive saliva and paralysis.
But if seen to promptly after a bite, scratch or lick by an animal that may carry the virus, treatment is usually very effective at preventing the condition.
Treatment usually involves two or more doses of the rabies vaccine or a medicine called rabies immunoglobulin, which is a liquid administered to the wound and is only required if the patient has not had the rabies vaccine or has a weakened immune system.
The rabies vaccine is recommended if you’re travelling to a part of the world where rabies is more common.
Around 60,000 people die every year from rabies worldwide, with the majority in Africa and Asia, according to the WHO.
Read more about rabies, and how to avoid getting it, here.
Dr Katherine Russell at the UKHSA said: “I would like to extend my condolences to this individual’s family at this time.
“If you are bitten, scratched or licked by an animal in a country where rabies is found then you should wash the wound or site of exposure with plenty of soap and water and seek medical advice without delay in order to get post-exposure treatment to prevent rabies.”
The UKHSA urges travellers to rabies-affected countries, for example in Asia and Africa, to avoid contact with dogs, cats and other animals wherever possible and check whether a vaccination is needed before travelling.
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There have been six cases of human rabies associated with animal exposure abroad that have been reported in the UK between 2000 and 2024.
This includes a case in 2012, when a UK resident died after being bitten by a dog – the most common source of infection in most parts of the world – in South Asia.
The latest case was in 2018, when another Briton died after being bitten by a cat in Morocco.
Latest World Health Organisation figures show a number of deaths from rabies in Morocco have been reported every year from 2010 to 2022.
Rabies does not circulate in either wild or domestic animals in the UK, although some species of bats can carry a rabies-like virus. No human cases of rabies acquired in the UK from animals other than bats have been reported since 1902.
The grieving mother of a Scottish teenager who vanished for almost five weeks has told Sky News she believes a “third party” was involved in her son’s death – but police say there’s “no evidence” of that.
Cole Cooper, 19, was discovered dead in woods near Falkirk earlier this month following a missing persons inquiry his relatives don’t believe was taken seriously enough by police.
He was last seen on CCTV in May after leaving a house party, but police later revealed a former school friend had spoken to Cole a few days later nearby.
Speaking exclusively to Sky News, his mother Wendy Stewart, 42, revealed her son had “various arguments” in the days and hours before he disappeared.
Cole’s mum Wendy (L) and his aunt Aimee
In an emotional interview, she said: “He was only 19, he should never have been taken. I am never going to see him again. I never got a chance to give him a last cuddle and hold his hand.
“Someone has taken that away from me far too soon. Whether it be intentionally or unintentionally, I do believe there has been some involvement by a third party and the result is the death of Cole.”
The family, who organised a local vigil in Cole’s memory last weekend, have vowed to get “justice”.
Asked what that means, Ms Stewart told Sky News: “Finding the culprit and getting justice that way. Finding the person that is responsible for the death of my child.”
Police previously said 400 residents were spoken to during door-to-door enquiries and more than 2,000 hours of CCTV footage was collected.
The 19-year-old’s death is being treated as “unexplained”, with a top police officer saying “at this time there is no evidence of any third party involvement”.
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A vigil was held in Banknock for Cole Cooper. Pic: PA
Cole’s aunt Aimee Tennie, 32, revealed the family’s anger over the police handling of the case as they attempt to find out what happened.
She said: “We are aware of small details surrounding the weekend leading up to it with arguments. He had a few arguments over that weekend. We want the details re-examined thoroughly.”
Sky News put all of the family’s concerns and allegations to Police Scotland.
The force initially swerved our questions and responded saying: “Enquiries remain ongoing.”
In an update later on Wednesday morning, Detective Chief Inspector Bob Williamson said: “We are carrying out significant enquiries into Cole’s death, however, at this time there is no evidence of any third party involvement.
“It is vital that we establish the full circumstances leading up to Cole’s death so that we can provide some answers to his family.
“The thoughts of everyone involved in this investigation are very much with his family and friends and officers will continue to offer them support and keep them informed as our enquiries progress.”
Ms Stewart claimed the probe has been handled “shockingly” with a failure to take her son’s disappearance seriously.
The 42-year-old said: “I have had to scream and shout from rooftops to be heard by the police. I don’t think they have handled it well.
“The police really need to take accountability and listen to families, they are reporting a missing child and understand the family knows their child best.”
Cole’s loved ones still have not been told when his body will be released to allow them to lay him to rest.
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