The UK Labour government has announced plans to stop housing asylum seekers in hotels by the end of its term in 2029, a move it claims will save £1 billion (£1.2 billion) annually. The savings are slated to bolster defence and healthcare budgets.
Chancellor of the Exchequer Rachel Reeves unveiled the strategy in her multi-year Spending Review address to the House of Commons on Wednesday (June 11). Key allocations include an additional £11 billion (£13 billion) for military spending, raising defence expenditure to 2.6% of GDP by April 2027. A further £600 million will go toward Britain’s security and intelligence agencies.
NHS and Infrastructure Investments
Reeves confirmed a “record cash investment” of £29 billion per year for the National Health Service (NHS), increasing its budget by 3% annually. She criticized the previous Conservative government’s austerity measures, outlining Labour’s pledged investments:
- £22 billion for research, including £2 billion for AI
- £39 billion for a decade-long affordable housing program
- £30 billion for energy (including nuclear)
- £15 billion for public transport upgrades
Opposition Criticizes Fiscal Plans
Shadow Chancellor Mel Stride accused the government of failing to clarify expected ministry cuts or funding sources for its commitments. He warned of an additional £200 billion in borrowing compared to the Conservatives’ last budget, calling Labour’s approach a “spend now, tax later” strategy. Stride predicted a “cruel summer of speculation” ahead of the autumn budget, where he alleged tax hikes would be announced to offset spending.
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