New UK budget to face 'harsh light of fiscal reality,' says premier

By Burak Bir

LONDON (AA) – The new Labour government's first budget will be "another step" on a "long, difficult" path towards change, said the British prime minister on Monday.

In an address ahead of the arrival of the government's budget on Wednesday, Keir Starmer stressed that "fixing the foundations" of the country is the priority.

On tax hikes, the prime minister said nobody wants to pay more taxes, but he cannot give a "cast-iron guarantee" that in the future there will not be more hikes.

"Another step taken on the long, difficult but resolute path towards a Britain returned to the service of working people," he said of the upcoming budget.

“Change must be felt," he said, but added: “Every decision that we have made, every decision that we will make in the future, will be made with working people in our mind's eye.”

Difficult choices will benefit the public down the line, he said.

"We have to be realistic about where we are as a country. This is not 1997, when the economy was decent but public services were on their knees. And it’s not 2010, where public services were strong, but the public finances were weak,” he stressed.

“Politics is always a choice," he said, adding: "It’s time to choose a clear path, and embrace the harsh light of fiscal reality so we can come together behind a credible, long-term plan. It’s time we ignored the populist chorus of easy answers because we saw what happens if you reject the constraints of economic stability and we’re never going back to that.”

Starmer said that it is not possible to lower tax and spend more on public services, and that it is about time the country faces up to this.

"Almost everybody knows the NHS (National Health Service) is broken. We're going to fix it, but put it back on its feet and make it something we can be proud of again," he added.

He also announced that a £2 ($2.60) cap on bus fares will be scrapped and a new £3 limit introduced.

After his speech, Starmer said the budget "will help to get Britain working."

"It will pave the way for reforms that tackle the root causes of economic inactivity, so those who can work, will work," he wrote on X.