The UK's new Chancellor will promote a series of fiscal measures, expected to boost the pound.

Britain's new finance minister to cut spending

Reeves plans to cut a further 8.1 billion pounds of spending in the next financial year and has promised to introduce more measures when he announces a full budget on October 30, when the newly elected Labour government will need to make “tough decisions”, including on tax.

Part of the cost comes from Reeves' decision to give public sector workers pay rises totaling £9.1bn, a decision made after recommendations from independent pay-setting bodies that she said the Conservatives had long ignored.

Reeves said the state of public finances was unsustainable and would pose a threat to the stability of the economy if left unchecked, so tough decisions had to be made now to make further savings during the year.

Reeves is taking over a mess, with Britain's economy growing sluggishly, public sector net debt at a record high since the early 1960s, and the tax burden on the verge of hitting a near 80-year high.

The previous government also faced strike action in several areas of the public sector, and Reeves said she would accept proposals to give workers such as teachers and healthcare workers pay raises at a rate above inflation.

In a statement, Reeves accused the previous Conservative government of covering up the true picture of government spending and said she needed to make tough decisions to prevent the budget deficit from ballooning by 25 percent this year. Critics see this as paving the way for future tax rises.

She axed a range of projects such as road building and rail repairs, said she would revisit a plan to rebuild hospitals, and set an ambitious target for government departments to squeeze more than £3bn out of their budgets.

She also said she would stop paying annual heating bills to high-income pensioners, saving around £1.5bn a year.

The new government will also introduce tax rises

Reeves commissioned a review of the public finances as soon as she took office and used her speech in Parliament to slam the previous government, which was led at various stages by Sunnucks, Truss, and Johnson.

According to Reeves, “They promised solutions that they knew they would never find the money to support: roads that would never be built, public transport that would never be accessible, hospitals that would never be able to see a single patient.”

The Conservatives dismissed her accusations as an excuse for Labour to raise taxes.

Hunt, who was chancellor of the exchequer in the Conservative government, said, “Today's series of maneuvers is not motivated by economic considerations, it's motivated by political considerations. She wants to blame the previous Conservative government for things like the tax rises and cancellations she had been planning.”

Paul Johnson, director of the Institute for Fiscal Studies (IFS), said some of the funding pressures did appear to be greater than expected. He said, “Some of the specifics are shocking and raised some tough questions for the previous government.”

The UK's non-partisan Office for Budget Responsibility, which scrutinizes the government's tax and spending plans, said it would examine how Hunt's March budget was prepared, calling it a serious issue.

Reeves emphasized that she intends to stick to her party's campaign promise not to raise rates of income tax, VAT, and other major taxes.

Any other tax changes will be announced in the official budget statement in October, which Reeves said will contain a new set of non-negotiable fiscal rules.

Comprehensive news can be seen, the new British government came to power after the commitment to fiscal reform, helping to improve the economic situation, and boosting market confidence, thus supporting the pound, investors need to keep an eye on this.