RACHEL Reeves is staring at a £40 billion funding gap ahead of the Budget – but insists on still prioritising the NHS.
Rachel Reeves needs the cash to halt cuts, cover an annual £22billion overspend and for a financial buffer.
Treasury officials are now looking at ways to close the mammoth shortfall with tax rises being a central part.
One close ally of the Chancellor said: “If we are having to raise taxes, we want to put the money into the people’s priorities.
“The NHS is the number one priority.”
The £40 billion figure could come down if the independent Office of Budget Responsibility forecasts greater economic growth.
The Chancellor will submit her final Budget plans to the body today.
She also wants to build up a buffer to help keep the country better protected against economic shocks.
She has previously revealed that she has welfare cuts in her sights to make up any shortfall.
She is understood to have told the Cabinet yesterday: “The Budget will be about protecting working people, starting to fix the NHS and rebuilding Britain.
“We cannot turn around 14 years of damage in one Budget, but we can start to deliver on our promise of change.”