Spring Statement 2025: When time is the Spring Statement from Rachel Reeves? What cuts should we expect?

Rachel Reeves is set to deliver an update on the state of the British economy on Wednesday.

The Chancellor will stand up after Prime Minister’s Questions to make the Spring Statement, which is not a formal budget, but rather an update on the economy.

Rachel Reeves has been urged to boost business confidence in the forthcoming Spending Review

Despite not being billed as a major economic event, it is expected to include sweeping cuts due to the gap in the public finances.

Here’s what to expect, when the statement is, and what it means for Scotland.

What time is the Spring Statement?

Ms Reeves will deliver the statement from about 12:30pm on Wednesday in the Commons. the Office for Budget Responsibility (OBR) will publish its forecast on the UK economy beforehand. Under Labour, the public body now delivers an OBR forecast at every fiscal event.

What cuts will be in the Spring Statement?

The theme of the statement is expected to be sweeping cuts, which could amount to billions across several Whitehall departments. Reports suggest this could be as much as 7 per cent from some departments in the next four years, as Ms Reeves seeks to balance the books. The Chancellor has already promised government running costs will be cut by 15 per cent by the end of the decade, with the savings coming from back office and administrative roles rather than frontline services. However, unions have warned such cuts would impact public services, with 10,000 jobs expected to go.

Welfare is another area facing cuts, with savings of £5 billion year by 2030 from the welfare Bill outlined last week. While we already know about stricter tests for personal independence payments, more detail on welfare reforms are expected on Wednesday.

There are also reports the Labour Party could end universal free school meals and cut school spending by £500 million, something disputed by government sources. The SNP say doing so would squeeze the Scottish Government's Budget.

The changes could impact the Scottish Budget | Getty Images

What will happen on defence?

One of the most significant announcements by the UK government so far has been the decision to cut international aid to increase funding for defence. The government has said it will increase defence spending to 2.5 per cent of national income by 2027.

In her statement, Ms Reeves is expected to argue the "world has changed", and explain how the funding will be reallocated.

What will it mean for Scotland?

Plans to cut welfare are likely to have a knock-on effect for Holyrood's block grant, though its unclear how the changes will integrate with disability and health benefits funded through Holyrood. The Institute for Public Policy Research (IPPR) Scotland told The Scotsman last week the cuts risked reducing the Scottish Budget, due to the higher caseload of those receiving disability and incapacity benefits in Scotland.

Cuts to other devolved services will also likely see a reduction in funding, though ministers insist it will not impact the Scottish Budget in “25/26”.