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Rachel Reeves has pushed back the date of the Treasury’s multi-year spending review until June, as the government struggles to get a handle on the volume of decisions it needs to make on its funding priorities.

The British chancellor had previously pledged to complete the process by “spring 2025”, but officials and ministers told the Financial Times that the timetable had been delayed.

They previously worked on a schedule where the spending review was expected “around April,” according to a person briefed on the process.

The new date of June 2025 will be almost a year after Labour’s landslide victory in the UK general election in July this year.

“It was supposed to be done in the spring, but they realized as they started talking to ministers that it could be a much longer and more complex process,” the person briefed on the process said.

British governments use spending reviews to determine how to distribute funds between departments. The last multi-year review took place in 2021, when the then chancellor, Rishi Sunak, set the allocation of funds over three years. These reviews, major events in the Treasury calendar, involve months of haggling as ministers try to protect their budgets.

The delay in Labour’s multi-year review will extend a period of uncertainty for departments, which waited almost four months after the election to Reeves’ first budget in October.

His budget set departmental spending limits for 2025-26 as part of a £40bn tax rise package which injected billions of pounds into public services over the year in course and the following year.

But Reeves has postponed tough long-term decisions on public spending, with overall spending growth expected to slow after 2025-26 to a real terms rate of 1.3% per year. The Chancellor has sworn not make another big tax increase budget.

Next year’s spending review will determine exactly which departments win and lose later in Parliament. The review will cover a minimum of three years of daily spending and will also set investment budgets for five years.

The delay in the target date likely reflects the difficult trade-offs Labor faces as it balances competing demands for public service investment in areas ranging from health and education to defense and security. asylum.

The late timing of Labour’s spending review means Reeves is likely to receive full economic and budget forecasts from the official watchdog before announcing the results.

The Office for Budget Responsibility is supposed to release two full sets of forecasts in a financial year, meaning the next one is expected by the end of March.

The forecasts could lead to difficult decisions for the Treasury if the OBR suggests Reeves is at risk of failing to meet its newly reframed budget rules.

The chancellor has pledged to hold just one major “tax event” a year, with ministers hoping this event will take place in the autumn.

Analysts warn that the government’s margin for error from its fiscal rules has already been reduced by developments such as rising borrowing costs.

“Further tax rises are not inevitable, but they are more likely than the chancellor would have us believe,” said Ruth Gregory, UK economist at Capital Economics.

The United Kingdom’s public finances are under severe strain. Borrowing in the first seven months of the current financial year totaled £96.6 billion, £1.1 billion more than the same period last year and the third highest high since the start of monthly readings.

Although people differ on the exact date of “spring”, the British government’s Met Office said that of meteorologists lasts until May 31. When Treasury holds a tax event in the spring, it’s usually in March.

“You could write an article on the historical precedence of the use of the word ‘spring’ in Whitehall,” joked one minister.

The Treasury said: “The Chancellor has confirmed that Phase 2 of the SR (Spending Review) will conclude in late spring and has also made clear that she will never mess with the public finances. »