Rachel Reeves' Spring Statement revealed the Office for Budget Responsibility (OBR) has halved the UK's 2025 growth forecast from 2% to 1%. In response, Reeves announced deeper welfare cuts, including freezing the health element of Universal Credit for new claimants until 2030 after a 50% reduction. Cuts to Personal Independence Payments (PIP) eligibility will affect 800,000 people, with an average annual loss of £4,500. These measures are projected to save £4.8 billion by 2030, though 250,000 more people, including 50,000 children, may fall into relative poverty. Defence spending will rise to 2.5% of GDP by 2027 and 3% in the next parliament, funded by a reduction in overseas aid. Departmental budgets will grow by 1.2% above inflation, slightly less than the 1.3% previously forecast, posing significant pressures. Despite criticism from shadow chancellor Mel Stride, Reeves denied this was ‘austerity 2.0’, insisting it would lift families out of poverty.