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RACHEL Reeves sparked anger today for only vowing to end migrant hotels in the next four years.
And even by 2029, taxpayers will still be on the hook for £2.5billion a year on asylum costs.
The government is currently spending over £4 billion annually to manage and house illegal migrants, primarily those arriving by small boats.
The Sun revealed this week an extra £680million for border cops to crack down on Channel crossings.
And in her Spending Review Ms Reeves said: “Alongside that, we are tackling the asylum backlog.
“The party opposite left behind a broken system.
The Spending Review includes:
Health: The NHS is receiving an additional £29 billion each year, representing a 3 percent increase in its budget. Almost 50 percent more funding is being allocated to technology to propel the health service into the digital era. The NHS now boasts a budget comparable to Portugal’s entire GDP.
Defence: Defence expenditure is set to rise to 2.6 percent of GDP by 2027, with an additional £11 billion allocated. A substantial portion of these funds will be directed towards munitions and nuclear submarines to ensure Britain’s armed forces remain robust.
Housing: A whopping £39billion will be spent on social and affordable housing over the next decade. Another £10billion will unlock thousands more homes through Homes England.
Benefits: Pensioners earning £35,000 or less will see their Winter Fuel Payments make a comeback. The major U-turn will see nine million OAPs able to access the handout.
Borders: Border security is getting a £280million a year boost. Ministers have pledged to end hotel stays for illegal migrants by 2029. But until that point a whopping £2.5billion will be spent accommodating and supporting them.
Schools: Free school meals are being rolled out to an extra half a million kids, with anyone living in a UC household eligible. Nearly £2.3billion a year will fix crumbling classrooms, with £2.4billion to rebuild 500 schools.
Police: Funding for cops will grow by 2.3 per cent a year – around £2billion in cash. Cops have warned the meagre increase will mean forces could lose staff rather than meet the government’s target of 13,000 new bobbies on the beat.
Net Zero: Nuclear power is getting a £30billion boost, with £14.2billion for Sizewell C. Cash for making homes energy-efficient will double to £13.2billion.
Transport: £15billion is being pumped into new rail, tram, and bus networks in the West Midlands and the North. A brand-new rail line between Liverpool and Manchester has been given the green light.
Town Halls: Local councils will receive a share of £350million for parks, libraries and pools. Town hall core spending power will grow by 3.1 per cent – but councillors say this won’t be enough to meet rising demands for social care and children’s services.
“Billions of pounds of taxpayers’ money spent on housing asylum seekers in hotels, leaving people in limbo and shunting the cost of failure onto local communities.
“We won’t let that stand.
“So I can confirm today that led by the work of my RHF the Home Secretary we will be ending the costly use of hotels to house asylum seekers, in this Parliament.”
High tax, high borrowing Labour is back
By Jack Elsom, Political Editor
ONE phrase that Rachel Reeves repeated four times cuts to the nub of her economic plans: “These are Labour choices”.
But not the cuddly, business-friendly Labour that we were promised before the election – instead the old-school variety of high taxes and high borrowing.
Her £300billion spending hike means she can point to shiny news infrastructure projects and talk the language of “renewal”.
But she is now running the economy at its uppermost limits after failing to get any serious grip on welfare and debt repayments – all of which raises the risk of more tax hikes.
It is a high-stakes strategy designed to win over working class voters that Labour is bleeding to Reform, who Ms Reeves devoted time in her statement to attack.
Many of those flocking to Nigel Farage do so out of growing despair that – in his words – “Britain is broken”.
It is why she made big plays on ploughing money into defence, the NHS and ending migrant hotels.
But they won’t thank the Chancellor if she is forced to put their taxes up even more in the Autumn…
The Chancellor said that by “returning people who have no right to be here” taxpayers will be saved £1billion a year.
But Treasury documents show the Home Office will still be spending £2.5billion on asylum costs by the next election.
It has raised the prospect of small boat migrants instead going into private housing, or other accommodation such as disused student flats.
Shadow Home Secretary Chris Philp said: “Even Labour knows they aren’t going to smash the gangs.
“This year so far has been the worst ever for illegal immigrants crossing the Channel, and these figures show the government thinks that is going to continue for many years to come.
“This is a weak Government which has given up already on illegal immigration.”
Home Office sources said they hoped to be spending drastically less than £2.5billion on asylum costs.
While deportations are up under Labour, so are small boat crossings, that yesterday passed more than 15,000 for the year.
Ms Reeves today gambled on a £300billion spending spree in a do-or-die bid to drive growth – and revive her shaky Chancellorship.
In a clear tack to the Left, she used her Spending Review to defend higher taxes and borrowing to fund a cash shower.
Billions more have been poured into the defence and health budgets – with hundreds of millions also to tackle illegal migration.
Ms Reeves pledged to end the use of expensive asylum hotels – that are costing taxpayers £4million a day – before the next election.
But it risks infuriating voters who want to see action to stop using them now rather than in four years’ time.
And critics have warned Ms Reeves’ mega spending blizzard will drive Britain even further into debt and raise the prospect of more tax hikes.
The Chancellor was heckled by Tory MPs as she claimed to have turned around the economy “after 14 years of mismanagement and decline”.
All the winners and losers in today’s spending review
WINNERS
HOUSING
The Chancellor confirmed a £39billion cash injection over the next decade into social and affordable housing.
She said the plan would “match the scale of the housing crisis,” with direct funding focused on homes for social rent.
An extra £10billion will also go to Homes England to unlock private investment and deliver hundreds of thousands more homes.
SCHOOL MEALS
Half a million more kids will be entitled to free school meals under a massive expansion of the scheme.
Every child in a household on Universal Credit will now be eligible for state-sponsored lunches, in a move that should lift 100,000 children out of poverty.
Expanding free school meals will save parents on benefits £500 per child every year, according to the Department for Education.
Kids in UC households currently not eligible will be able to start claiming lunches from the start of the 2026 school year.
Meanwhile, more than 750 free breakfast clubs will be rolled out across the country.
DEFENCE
The Chancellor unveiled a major hike in defence spending today, raising it to 2.6 per cent of GDP by 2027 — up from the previous 2.5 per cent pledge.
She confirmed an £11billion boost for the Ministry of Defence and £600million for the UK’s intelligence services, calling it essential in an “age of insecurity.”
An additional £6billion will be spent to upgrade nuclear submarine production, which will support thousands of jobs across Barrow, Derby and Sheffield.
Ms Reeves said: “The investment will deliver not only security, but also renewal.”
NHS
The NHS will benefit from a whopping £30billion cash boost for day-to-day spending.
The technology budget for the health service has been raised by 50 per cent.
A mega £10billion will be invested into dragging the NHS into the digital age, including improving the app.
TRANSPORT
The Chancellor confirmed a £15billion package to “properly connect” Britain’s towns and cities.
The cash includes upgrades to buses in Rochdale, stations in Merseyside and Middlesbrough, and mass transit in West Yorkshire, Tyne and Wear, Birmingham and Stockport.
She also announced a four-year settlement for Transport for London, a fourfold increase in Local Transport Grants, and a £3.5billion boost for the Transpennine Route Upgrade.
A further £2.5billion is going into East-West Rail and new funding was confirmed for the Midlands Rail Hub and £445million for Welsh railways.
PENSIONERS
The Chancellor confirmed that over three quarters of pensioners will receive the Winter Fuel Payment this year, as part of efforts to ease the cost of living.
She also pledged to cut bills in future winters through an expanded Warm Homes Plan, including £30million for Blackpool, £11million for Rugby, and £7million for Bradford.
To help families now, the £3 bus fare cap will be extended until at least March 2027, and school uniform costs will be capped.
She said: “I know that for many people the cost of living remains a constant challenge.
“Which is why we are capping the cost of school uniforms.
“And I can tell the House today that I am extending the £3 bus fare cap until at least March 2027.
“Earlier this week, we announced that over three quarters of pensioners will receive the Winter Fuel Payment this year.
“And there is more, to get bills down not just this winter but in winters to come, we have expanded the Warm Homes Plan to support thousands more of the UK’s poorest households.”
NUCLEAR ENERGY
The Chancellor has pledged the “biggest roll-out of nuclear power for half a century” – with a £30billion commitment to clean, homegrown energy.
She confirmed £14billion for Sizewell C to power six million homes and create over 10,000 jobs, including 1,500 apprenticeships.
An extra £2.5billion will fund Small Modular Reactors with Rolls Royce as the preferred partner, and a further £2.5billion will go into nuclear fusion in Nottinghamshire.
LOSERS
POLICE
Despite a major lobbying effort by police chiefs, spending power for forces will only rise by an average 2.3 per cent per year in real terms.
The £2billion funding hike has been slammed as nowhere near enough to meet pledges from the government to halve knife crime and end violence against women and girls.
FARMING
Family farms will continue to be clobbered by a 20 per cent inheritance tax raid.
Environment Secretary Steve Reed has had to accept funding for farms will be reduced, with money restricted to just a small number.
EDUCATION
Education Secretary Bridget Phillipson has been forced to accept a major squeeze on school spending in the years ahead.
Head teachers will have to raid existing budgets to help fund a four per cent pay rise for staff next year.
Ministers have pledged £615million to help pay for the rise – but that will only cover around three quarters of the cost.
