Tulip Siddiq stood down as City Minister after a probe into her links to Bangladesh’s former government found she should have been “more alert to the potential reputational risks”.
Meanwhile the Chancellor appeared to leave open the possibility of a “mini Budget” in late March if needed to bring the public finances back into balance, following days of market turbulence.
Siddiq’s resignation came after she was accused of corruption by the new government in Bangladesh, which has replaced one led for 16 years by Siddiq’s aunt, Sheikh Hasina.
Despite being cleared of breaking the ministerial code, Siddiq told Starmer: “It is clear that continuing in my role as Economic Secretary to the Treasury is likely to be a distraction from the work of Government.”
Speaking to the House of Commons for the first time since turbulence broke out in the bond markets last week, the Chancellor acknowledged “global market uncertainty” but added: “The economic headwinds that we face are a reminder that we should, indeed, we must go further and faster in our plan to kickstart economic growth.”
Asked by an MP whether she could rule out making changes to tax or spending at that point, the Chancellor replied: “We have committed to having just one Budget a year to provide businesses with the certainty they need to invest, so we will have an update from the Office for Budget Responsibility in March.
The i Paper reported last week that City insiders increasingly believe a “mini Budget” in March will be needed to bring the state’s finances under control.
A Downing Street spokesman insisted that the Budget in the autumn would remain the only “major” fiscal intervention this year but did not rule out a smaller adjustment in the spring. The spokesman also denied that the Treasury was in crisis.
But the future of the new Sizewell C nuclear reactor project has once again been called into question after reports emerged that the cost to build the new power station has doubled since 2020 to close to £40bn.
Ahead of the OBR’s statement and the spending review, Reeves is pushing a message within the Government that it is necessary to speed up efforts to introduce pro-growth policies.
In a sign of how economic regulators have been drafted in to the Chancellor’s plans, the Competition and Markets Authority’s draft annual plan published on Monday made 111 mentions of “growth” – 10 times as many as last year.
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