Rachel Reeves today echoes Margaret Thatcher with a pledge to help stimulate a ‘big bang’ in growth by boosting the nation’s pension pots.

Labour’s Chancellor tells Mail on Sunday readers that Sir Keir Starmer‘s Government will introduce reforms ‘to unlock growth, boost investment and deliver for pensioners’ in order to tackle ‘the worst set of economic circumstances since the Second World War‘.

Ms Reeves writes in today’s newspaper: ‘Previous governments have talked about a big bang on tax or regulation. I want to lead a big bang on growth because that is the only way we can fix the foundations.’

The reference is a conscious allusion to Nigel Lawson, Lady Thatcher’s totemic chancellor, whose radical economic policies led to the Big Bang in British financial markets.

But while Mr Lawson made dramatic cuts to personal taxation levels, Ms Reeves is facing growing claims that Labour will be forced to raise taxes to fund the Government’s spending commitments.

Labour’s Chancellor tells Mail on Sunday readers that Sir Keir Starmer ‘s Government will introduce reforms ‘to unlock growth, boost investment and deliver for pensioners’ in order to tackle ‘the worst set of economic circumstances since the Second World War’

She echoes Margaret Thatcher (pictured in 1989) with a pledge to help stimulate a ‘big bang’ in growth by boosting the nation’s pension pots

Chancellor of the Exchequer Nigel Lawson with Prime Minister Margaret Thatcher at the Conservative Party Conference in Blackpool in October 1989

However, the Chancellor insists the key to balancing the Treasury’s books lies in boosting growth, writing: ‘We cannot tax and spend our way to prosperity, nor will we play fast and loose with the public finances. Instead, we need to back the wealth creators and deliver for the British people.’

She says she has ordered an urgent Treasury review of the pensions market, focused on directing more pension schemes to invest British firms; laws to boost defined contribution pension pots by more than £11,000 by improving their management; and the consolidation of savers’ multiple pension pots into one super-pot to maximise returns.

Officials say action will also be taken to ‘unleash the full investment might of the £360billion Local Government Pension Scheme to make it an engine for UK growth’.

On Tuesday, Ms Reeves will chair the first Growth Mission Board, with the remit of ‘driving the Government’s work to achieve the highest sustained growth in the G7’.

A table showing the economic picture at the end of the last Goverment in 2010 compared to the start of Keir Starmer’s Government in 2024

Deputy Prime Minister Angela Rayner (pictured on July 9) said: ‘After putting in years of hard graft serving their communities, the very least our frontline workers deserve – millions of whom are low paid, millions of whom are women – is dignity and security in retirement’

The Institute for Fiscal Studies has urged the Chancellor to apply inheritance tax to pension pots to raise £2billion a year, saying the current exemption was ‘clearly unfair’. But experts have warned this would ‘destroy pensions’.

The Chancellor, who will deliver her first Budget in the autumn, will reportedly have to find an extra £10billion to cover a 5.5 per cent rise for millions of public sector workers that has been recommended by independent pay review bodies.

Ms Reeves ruled out a string of tax rises during the election campaign, and has promised to control borrowing.

Deputy Prime Minister Angela Rayner said: ‘After putting in years of hard graft serving their communities, the very least our frontline workers deserve – millions of whom are low paid, millions of whom are women – is dignity and security in retirement.

‘We want to make sure their hard-earned money works harder for them so we ensure they receive the pensions they have earned, whilst unlocking growth across our economy.’