Resolution Foundation Chief Urges Chancellor Reeves to Rethink Budget Before November

Published: 18 September ‘2025. The English Chronicle Desk

Ruth Curtice, chief executive of the Resolution Foundation, has issued a stark message to Chancellor Rachel Reeves ahead of the critical November budget, urging decisive action to address the UK’s persistent living standards crisis. Speaking from her bright Westminster office, Curtice called on Reeves to consider bold moves, including lifting the two-child benefit cap, revising pension policies, and being open to broad-based tax reforms, while dismissing the immediate need for a new wealth tax.

Curtice, 41, has extensive experience in government finance, having served nine chancellors during her nine-year tenure at the Treasury, rising to the post of director of fiscal policy. Earlier this year, she crossed St James’s Park to head arguably the UK’s most influential thinktank on low- and middle-income living standards. While emphasizing the Foundation’s non-partisan nature, Curtice acknowledged the organization’s intimate connections to the current Labour government, noting that several key advisors, including Torsten Bell and Dan Tomlinson, previously worked at the thinktank.

Despite these links, Curtice stressed that the Foundation operates independently, drawing on decades of research rather than political loyalty. She credited her upbringing by her father, renowned pollster Sir John Curtice, with instilling an understanding of politics free from partisanship, and said it shaped her approach to evidence-based economic analysis.

Curtice warned that the ongoing debate around taxes and social spending ahead of the budget risked being “unrealistic.” She highlighted that recent tax increases, including the £40bn package announced by Reeves in last year’s budget, were necessary to fund the NHS. Yet, with a narrow margin left against fiscal rules, further adjustments would likely be required, potentially forcing the Chancellor to make difficult choices regarding manifesto pledges.

“If [Reeves] could increase her margin for error against fiscal rules, that would be a good thing. It’s difficult to achieve, but she probably wouldn’t regret it in a year’s time,” Curtice said. She urged the government to focus on broad-based tax reforms rather than relying on targeted levies that might be economically damaging. “The taxes covered by the manifesto are about 75% of the tax base. It would be better to think about those than to do things that are economically damaging, and in the end, that might be the way to go.”

Curtice also dismissed calls for a new wealth tax as impractical in the short term. Instead, she advocated reforming existing capital gains and inheritance tax systems to ensure unearned income is taxed more consistently with wages, a measure she described as both realistic and effective.

On pensions, Curtice argued for scrapping the triple lock, which guarantees annual increases based on the highest of earnings, inflation, or 2.5%. She noted that over the past two decades, pensioners’ incomes grew by 21%, while non-pensioners saw growth of just 7%, creating a disparity that demands policy reform. “Resolution has long said it would be better to peg pensions to average earnings rather than having this ratchet,” she said.

Child poverty emerged as another urgent concern. Curtice called on the government to lift the two-child limit on benefits, a measure currently excluding families from child tax credit or universal credit for third and subsequent children. According to her projections, removing the cap, at an estimated cost of £3.5bn a year, would be a targeted intervention to prevent record-high child poverty by the end of this parliamentary term. “Children in large families—half of them—will be in poverty. Our job is to produce remarkable statistics, but that one still slightly takes my breath away,” she said.

Curtice’s warnings underscore the persistent economic pressures facing low- and middle-income households in the UK. Her research shows that if living standards had continued to grow over the past 20 years at the same rate as the previous decade, typical family incomes would be approximately £20,000 higher. She stressed that the stagnation has been broad-based, affecting households across the income spectrum, and not merely a story of inequality between rich and poor.

The Resolution Foundation, celebrating its 20th anniversary this week, is funded by its founder and chair, insurance tycoon Clive Cowdery, who contributed £2.5m last year. The thinktank has been influential in shaping economic policy, advocating measures such as the national living wage under George Osborne and influencing successive fiscal strategies across administrations.

Curtice’s advice to Chancellor Reeves is clear: policymakers must confront the realities of stagnant living standards, rising child poverty, and economic uncertainty. Bold reforms on taxation, pensions, and benefits are necessary to strengthen fiscal resilience while safeguarding households most vulnerable to the cost-of-living crisis. With the November budget looming, the stakes for the Chancellor and for UK households could not be higher.