Reeves's 'reckless spending' slammed as UK borrowing costs reach 28-year high

 Robert Jenrick has taken aim at Rachel Reeves's "reckless spending" after long-term UK borrowing costs reached their highest level since 1998. This has been caused by rising inflation and political uncertainty ahead of Thursday's local elections. The yield on 30-year UK government bonds - also known as gilts - reached a 28-year high on Tuesday afternoon, up 0.14 percentage points to 5.798%.

Reform UK's Treasury spokesman Robert Jenrick, said: "Rachel Reeves is spending eye-watering amounts of taxpayers' money just servicing the country's debt. This year alone, she is forecast to spend a whopping £110 billion on debt interest - and it's climbing even higher each day.

"As the Labour Party is thrown into disarray, hardworking Brits are being made to pay the price. Instead of Rachel Reeves spending their money on their priorities, it's being diverted to cover the costs of her reckless spending. The British public are being made to pay the price for Labour's reckless spending and borrowing decisions."

Gilt yields move in the opposite direction to bond prices, meaning their prices fall when yields rise. Rising yields on these bonds mean it costs governments more to borrow from financial markets.

The yield on 10-year gilts also rose, lifting by 0.15 percentage points to 5.122%, but remains below recent highs reported last month. The yield on US 10-year Treasury notes was flat on Tuesday but has steadily risen in recent weeks.

Gilt yields have grown amid growing predictions that the conflict in Iran will drive higher inflation due to spiking energy costs, which is then likely to cause the Bank of England to increase interest rates.

UK government borrowing fell to a three-year low for the year to March, dropping to £132 billion but analysts expect borrowing to worsen through the year if inflation rises.

The Iran war has led to the effective closure of the Strait of Hormuz, impacting the world's supplies of oil and liquid natural gas, and causing energy prices to skyrocket.

Mr Jenrick added: "Instead of focusing on cutting people's bills and getting rid of wasteful spending, Labour MPs are now squabbling about who should replace Keir Starmer and what jobs they should all get. They've stopped serving the country and are more interested in serving themselves.

"The country deserves so much better. The billions of pounds we're wasting on debt interest is money that could be spent on badly-needed new hospitals, ships or prisons. On Thursday, I urge Express readers to vote for Reform UK and send Keir Starmer a message that we won't put up with this disaster any longer."

City traders currently expect the central bank to vote for at least two interest rate hikes in the coming months, despite the Bank maintaining the current rate of 3.75% last week.

The rise in gilt yields means the Government will face higher debt interest costs, providing more strain on the Chancellor's spending powers.

It comes amid a backdrop of significant pressure on Prime Minister Sir Keir Starmer in the run-up to the UK local elections.

The pound was broadly flat at 1.353 versus the dollar on Tuesday.