Reeves: inflation figures are latest ‘encouraging sign that our plan for change is working’
Speaking about the latest inflation figures, chancellor Rachel Reeves said there were “encouraging signs that our plan for change is working.”
UK inflation dropped to 2.6% in March, meaning prices are rising slightly more slowly. Reeves said:
Inflation falling for two months in a row, wages growing faster than prices, and positive growth figures are encouraging signs that our plan for change is working, but there is more to be done.
I know many families are still struggling with the cost of living and this is an anxious time because of a changing world.
That is why the government has boosted pay for three million people by increasing the minimum wage, frozen fuel duty and begun rolling out free breakfast clubs in primary schools.
Key events
On Monday the Unite union overwhelmingly rejected an offer to settle the industrial dispute with Birmingham city council. The no vote was 97% on a 60% turnout. Further talks are set to be held today.
The council’s plans to scrap the role of waste recycling collection officer (WRCO), and the union maintains that WRCOs face a pay cut of £8,00o. The city council has claimed no worker needs to lose money from their salary if they move into alternative roles of the same grade.
The union’s general secretary Sharon Graham has said: “If the council puts in writing what it says in public then we would likely be much closer to a deal.”
Speaking to the Birmingham Live website, council leader John Cotton confirmed that talks would not involve councillors, but would be led by the director of people services at the council.
PA Media reports that Tommy Robinson has lost an appeal against his 18-month sentence for the civil offence of contempt of court at the court of appeal. Robinson, whose real name is Stephen Yaxley-Lennon, was jailed in October last year after admitting multiple breaches of a high court order made in 2021.
PA Media has had a dig into those inflation figures to see where prices have been rising and falling. A significant factor is that petrol and diesel both saw price cuts picking up pace. The average cost of petrol last month was 5.0% lower than it was a year earlier.
There was worse news on some food products though, with potatoes, cheese, breakfast cereals and yoghurt all seeing an acceleration in inflation last month. Coffee, cocoa and powdered chocolate all continued to rise faster than the headline rate.
Our senior economics correspondent Richard Partington has this analysis of today’s inflation data, suggesting that the optimism of Rachel Reeves in her statement this morning may well have been misplaced. You can read it here.
Birmingham bin dispute: council and union to have discussions later today
With talks planned for later today, Birmingham city council’s leader has said it is “open to negotiations” with Unite on resolving the dispute which has disrupted refuse collection in the city, but said he was disappointed union members had not accepted the offer currently on the table.
PA Media reports John Cotton said “It’s really disappointing that Unite have rejected a second reasonable offer from the council. However, our door remains open to talk, so I’m really pleased that there will be further talks taking place later today.”
“Obviously, I’m not going to offer a running commentary on what happens in those negotiations but what I will say is what we cannot accept is anything that results in crossing our red lines around our equal pay liability, or indeed imperilling the transformation of the waste service.
“These are really important things that need to happen for the benefit of the citizens of Birmingham, but we’re absolutely open to negotiations and bringing this dispute to a close which has gone on, frankly, for far too long.”
Cotton claimed that most of the backlog of rubbish piling up on the streets of Birmingham could be cleared by the end of this week, stating that more than 18,000 tonnes of rubbish has been cleared off the streets since 4 April.
Minister Lilian Greenwood has faced questions over immigration during the media round on Wednesday morning, confirming to Sky News “there are discussions ongoing with the French government” on the issue.
The FT has reported that a “migrant return” deal might be in the frame.
Greenwood told viewers “We are absolutely focused on fixing the broken asylum system that we have inherited from the Conservative government. It is not a short-term issue. This is going to take really hard work to tackle those organised gangs that are preying on people, putting their lives in danger as they try to cross the Channel to the UK. Of course, that’s going to involve conversations with our counterparts on the European continent.”
In a separate exchange on the issue during an appearance on GB News, she castigated the previous government for wasting “hundreds of millions of pounds” on its Rwanda deportation scheme. Greenwood said:
Obviously what we are doing is ensuring that those people who do arrive here illegally and have no legitimate claim are subject to returns, and that’s what we’ve been doing since we came to office.
Undoubtedly there is an incentive for people to come if they think they’re going to be able to stay. We saw under the last government. A huge backlog in asylum claims. People were allowed to stay here, at huge cost to the taxpayer, living in hotels. That is a completely unacceptable situation.
People who arrive in the UK have to have their claims looked at and processed quickly. Of course, there will be people who have a legitimate right to be here and genuine refugees. But for those who are not, they need to be returned, and that’s the system that we are determined to ensure works effectively.
Nigel Farage has issued a local election campaign video this morning, which he recorded yesterday afternoon, in which he calls the Conservative party a “self-entitled arrogant up themselves bunch of losers.”
He claims that while he has been out campaigning in Durham and Northumberland, the Conservatives “are not on the pitch, not campaigning out around the country, not appearing for any media interviews.”
There is more economic data being released today by the ONS – this time on house prices and rent.
The ONS reported:
Average UK house prices increased by 5.4%, to £268,000 in the year to February 2025, up from 4.8% in the 12 months to January 2025.
Average UK private rents increased by 7.7% in the year to March 2025, this is down from 8.1% in February 2025.
As ever there are variations between nations and regions. The ONS said the north west was the English region with the highest house price inflation, at 8%, and London the lowest with 1.7%.
The average house price for Wales was £207,000 in February 2025, up 4.1%, the average house price for Scotland was £186,000 in February 2025, up 5.7% and in Northern Ireland the figure was £183,000, which was up 9%.
Minister reiterates call for bin collection dispute in Birmingham to end
A government minister has reiterated the call for the Unite union to accept a deal and end the bin strike in Birmingham.
Speaking on GB News this morning, Lillian Greenwood, parliamentary under-secretary of state for the future of roads, said residents were facing “a completely unacceptable situation”
She said “We’ve all seen the pictures of rubbish piling up on the streets, and it’s time for this dispute to come to an end as quickly as possible. There’s a deal on the table. I think unite members should accept that deal.”
She claimed the deal “ensures that no one loses pay. This strike needs to come to an end. People in Birmingham deserve to have their streets back clean and tidy and not be facing the appalling situation that we’ve seen over the last six weeks.”
Birmingham city council leader John Cotton also spoke to the media this morning, saying the waste collection service in the city “fundamentally needs reform.”
Speaking on BBC Radio 4’s Today programme, he said of the ongoing bin collection strike: “We want to find a negotiated solution to this but what we cannot do is take steps that result in us creating further equal pay problems for the council, or indeed prejudice in our budget position, and also the service fundamentally needs reform.
“We know that the way services haven’t been delivering for parts of the city well enough for long enough, and that’s something that we need to change.”
Cotton added that the council is “absolutely focused” on ensuring the accumulation of waste is cleared and it will be “addressing any incidents” that have arisen about pest infestation.
My colleague Amy Sedghi has a separate live blog with its focus on the imminent UK supreme court ruling on whether the definition of woman in the Equality Act 2010 includes transgender women with gender recognition certificates. You can follow that here.
Davey: government should exclude Chinese firms from owning British Steel
Liberal Democrat leader Ed Davey has said he hopes the government won’t consider another Chinese firm for the future ownership of British Steel and the blast furnaces in Scunthorpe.
Appearing on Sky News, Davey said “I would caution them against” another Chinese partner, telling viewers “One of the worries that I think we’ve all had is the Chinese firm might have been under orders being influenced by the Chinese government.
“It’s in China’s interest that we don’t have our own ability to make virgin steel … so I think we should push back against that, and I really hope the government won’t go down that route. There are other options.”
Davey also spoke about the refusal of authorities in Hong Kong to allow Liberal Democrat MP Wera Hobhouse to enter there. He said:
I think this is quite worrying, really. We’ve already said that the UK government should call in the Chinese ambassador for a proper explanation of what happened.
We’ve had some reports from the Chinese authorities trying to blame Wera, which, of course, is completely outrageous.
And we’ve called on the Chinese to publish any transcripts or any recordings they have. I think that will find that Wera’s account is right.
Let us remember Wera wasn’t even going on a political visit. She was visiting her new yearly born grandson. She was going on a family visit. And it was quite wrong of the Hong Kong and Chinese authorities to do what they did.
And I think it’s right that we, as not just the Liberal Democrats, but as MPs, as a country, demand a full explanation.
Liberal Democrat leader Ed Davey has been doing the media round this morning, as campaigning continues ahead of local elections in some regions of England in May. He has been calling for a reform of rural policing.
Appearing on Sky News he told viewers “Rural crime is really serious, affecting many communities: livestock theft, equipment theft from farms, hare coursing which is seeing organised crime gangs damaging crops and threatening farmers and their families, and there’s not the police there to deal with it, with the technology to deal with it.
“And we’ve done an analysis asking the police services in England and Wales, how many officers they have dedicated to these types of rural crimes. And it’s really shocking. It’s less than 0.5% of police resources are dedicated to these crimes.
“So we’re saying that’s wrong, and in areas where there’s particularly few resources, places like Devon and Cornwall, they’ve only got four police officers. That needs to be changed. And they need to have new technology, things like drones to help them do their work.”
It was suggested to Davey that a falling number of police officers in England and Wales was something that started under the coalition government of the early 2010s, of which he was a part.
He said “Well I think most of the problems have started in recent years, and frankly, you are talking about a long time ago. The Conservatives, since 2015, they were in power for nine years, failed to invest in our police.”
You can find our guide to the local elections here.
Daisy Cooper’s Liberal Democrat leader Ed Davey has also been talking about the prospects of a UK-US trade deal, after US vice-president JD Vance floated a positive message about the idea in an interview yesterday.
Appearing on Sky News, and asked for his thoughts on a potential deal, Davey told viewers:
If we can get a good trade deal that’s in our country’s interests with the US, we will support it. What we’ve said is any deal should come before parliament, so MPs can scrutinise the details.
He made the point that in opposition Labour had called for trade deals to be viewed by parliament, and said he hoped they would stay good to their word.
He said parliamentary scrutiny was essential “particularly when we hear rather worrying reports that the government may be willing to do a deal with Trump on agriculture, potentially undermining standards.”
Davey also said it would be “unacceptable” to the Lib Dems if a trade deal “relaxed our rules on online safety for children.”
The Liberal Democrats have also remarked on the latest inflation figures, with Treasury spokesperson Daisy Cooper warning Rachel Reeves about complacency and calling for enhanced economic cooperation with the EU. She said:
The chancellor will be making a grave error if she lets her guard down over today’s figures. Those already struggling with the sky-high cost of living simply won’t be able to withstand another hammer blow to their pockets, such as from resident Trump’s global trade war.
Instead of looking to appease Trump and Vance in a trade deal that waters down our high British standards, the government must stand up for people and small businesses against their economic bullying, by forging new trade deals with our closest European and Commonwealth allies.
Stride accuses chancellor of ‘driving up the cost of living’
The Conservative shadow chancellor Mel Stride has claimed government choices are “driving up the cost of living.”
Reacting to news that inflation had slowed, Stride said: “Inflation remains above target and we know from official forecasts that price rises are set to increase further this year because of the chancellor’s choices.
“The Conservatives left Labour with inflation bang on target but the chancellor’s reckless union payouts, tax hikes, and borrowing binge is driving up the cost of living.
“Be in no doubt, the chancellor’s choices are keeping inflation higher for longer and working families are paying the price.”
Rishi Sunak’s government had inflation at the government’s target of 2% for one month just prior to the 2024 general election, after almost three years of much higher rates.
Phillip Inman
Phillip Inman is an economics writer for the Guardian
UK inflation dropped to 2.6% in March, increasing the pressure on Bank of England policymakers to cut interest rates next month.
Prices growth was weak ahead of an expected rise in April as households begin to pay higher council tax and utility bills, as well as an uncertain outlook posed by Donald Trump’s tariff war.
The Office for National Statistics (ONS) said falling fuel prices and flat costs for recreation and culture activities drove inflation lower, although this was offset by price rises for clothing and footwear. The price of food was also a factor in dragging down prices growth after it was flat in March compared with rising prices in the same month last year.
Welcome and opening summary …
Good morning, and welcome to our rolling UK politics coverage for Wednesday. Here are your headlines …
I am Martin Belam, and I will be with you today. You can reach me at martin.belam@theguardian.com if you have spotted typos or what you consider to be errors or omissions.
Reeves: inflation figures are latest ‘encouraging sign that our plan for change is working’
Speaking about the latest inflation figures, chancellor Rachel Reeves said there were “encouraging signs that our plan for change is working.”
UK inflation dropped to 2.6% in March, meaning prices are rising slightly more slowly. Reeves said:
Inflation falling for two months in a row, wages growing faster than prices, and positive growth figures are encouraging signs that our plan for change is working, but there is more to be done.
I know many families are still struggling with the cost of living and this is an anxious time because of a changing world.
That is why the government has boosted pay for three million people by increasing the minimum wage, frozen fuel duty and begun rolling out free breakfast clubs in primary schools.
