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‘A £20 billion black hole combined with the narrative knots Reeves has weaved for herself in the past, the story-telling options are meagre.’
The most eagerly anticipated moment of a Chancellor’s budget speech is the conclusion, the famous hiding place in years gone by for rabbits plucked from hats. Just as important, however, and doubly so for Rachel Reeves on Nov. 26, is the opening. This is where the Chancellor answers a crucial question: What is the story of this budget? What is the grand narrative idea that binds together everything I’m about to announce? 
It may not surprise you that crafting one for this budget is forbidding. With Reeves facing a £20 billion black hole in the public finances, requiring a wince-inducing package of tax rises and spending restraint to plug the gap, combined with the narrative knots Reeves has weaved for herself in the past, the story-telling options are meagre.
‘Fixing the foundations’ would be a nice choice, given a good chunk of the tax rises are needed to combat a productivity downgrade from the OBR which is in part linked to Brexit and the impact of Tory-era austerity in the 2010s. The problem, of course, is this was Reeves’ slogan at her first budget, when she hiked taxes by £40 billion. Foundations shouldn’t need fixing twice.
‘A budget for growth’ is also a tale Reeves would like to tell, given this is the self-proclaimed mission of Keir Starmer’s government. But good stories can’t sustain glaring plot holes, and a barrage of tax increases that economists widely predict will be growth-inhibiting undermines that framing. Indeed, the frenzied pre-budget period of tax fear has already hurt business investment and spurred the wealth flight.
Too much focus on growth also risks reminding the public of the story Reeves and Starmer used to tell, a happier and more enticing yarn which led Labour to their landslide election win last year. Growth, they used to say, was the remedy which would obviate the need for any further tax rises beyond those in Labour’s manifesto. The fact Reeves is now talking about tax rises suggests one of two things: either she and Starmer were being dishonest during the election campaign, or the growth hasn’t in fact come. Neither looks good.
So what does that leave in the narrative locker? My sense is she’ll go for a “budget for fairness and stability”, stressing her credentials of fiscal prudence and talking up a changed world which is in part forcing her hand. Donald Trump’s global tariff war has indeed weighed on economies and filtered through into higher borrowing costs, and she will say she needs to react. Her tax increases will be targeted towards higher-earners and the asset-rich, and she’ll also have measures to ease the pain on the cost-of-living. Echoing George Osborne, she’ll paint it as a ‘no alternative’ budget.
This story has its flaws too, of course. A hefty portion of her predicament is in fact due to the self-inflicted costly policy U-turns on welfare and winter fuel for pensioners, plus leaving such a small margin against her fiscal rules at her inaugural budget. That decision has come back to bite. But as a narrative pick, ‘providing stability in a changing world’ is her least-worst option.
Then the ultimate question: is it a story the public will internalize and buy? Reeves and Starmer, already at the depths of unpopularity, are braced for some brutal front pages in the days after the budget, where you can expect wall-to-wall coverage of tax hikes and bitter criticism from the Conservatives, Reform and even disaffected Labour MPs. Amidst all that noise, I have my doubts.
Joe Mayes is the best-selling author of ‘Can You Run The Economy? [ [link removed] ]’, an interactive choose-your-own adventure which puts you in the hot-seat as Chancellor. Joe also writes about the Treasury and British politics for Bloomberg News.

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