Rachel Reeves became Britain’s first female Chancellor of the Exchequer on Friday. She holds one of the country’s four most important government positions and is responsible for managing the UK budget.
After a decade and a half of economic stagnation, Ms Reeves, a Labour lawmaker with a reputation as a serious and steady manager, faces a tough task of boosting Britain’s productivity growth, a key measure of prosperity, and reviving struggling public services.
“I know the magnitude of the challenge I am likely to inherit,” said Ms Reeves told the BBC early on Friday. “There is not such a large amount of money there,” she said, adding that the party needed to free up private investment.
Ms Reeves is expected to approach her new role with consideration.
“Labour has come a long way in rebuilding public confidence in its economic performance and it does not want to take that risk,” said Carys Roberts, director of the Institute for Public Policy Research.
In recent years, Labour has moved towards a more centrist policy, following former leader Jeremy Corbyn’s left-wing programme of higher spending and widespread nationalization of industries.
Ms Reeves, 45, was elected to Parliament in the northern city of Leeds in 2010. To establish her credibility, she has often pointed to her traditional training as an economist during her six years working at the Bank of England after graduating.
She stressed her aim to create stability after a period of international and domestic economic shocks, including a rise in energy prices and the premiership of Liz Truss, who served just 49 days in office after her tax cut proposals roiled financial markets.
Ms. Reeves calls her economic agenda “securonomics,” a dull-sounding portmanteau that reflects her already serious reputation. She once said told The Guardian that if you want someone else to do a somersault, you have to turn it toward someone else.
She has described “securonomics” as ensuring Britain’s economic security in a fragmenting world, while also ensuring the security of working people’s finances. It is inspired by the policies of US Treasury Secretary Janet Yellen.
But the call for stability is also a sign that Britons should not expect rapid or drastic changes to the economy.
Amid high debt levels and relatively high taxes, Ms Reeves has vowed not to raise corporate, personal income or VAT taxes and to stick to strict debt rules. Given these constraints, she hopes stability will unleash much-needed economic growth.
In practice, this means giving institutions such as the tax watchdog Office for Budget Responsibility more power and working more closely with companies to encourage them to make more private investments.
“Labour is placing a lot of hope in economic growth, and it is also counting on growth allowing them to spend more on services,” Ms Roberts said.
