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Treasury head Rachel Reeves has announced she is planning "focused measures to address cost of living challenges" in next month's Budget.

In comments to media outlets, she stated that reducing inflation is a shared responsibility of both the government and the central bank.

The United Kingdom's price growth is expected to be the highest among the Group of Seven industrialized countries this year and the following year.

Potential Utility Bill Measures

Reports indicate the administration could take action to bring down energy bills, for example by cutting the present 5% rate of VAT applied on energy.

Another option is to lower some of the regulatory levies presently included in bills.

Budgetary Limitations and Analyst Predictions

The government will obtain the next draft from the official forecaster, the OBR, on Monday, which will show how much scope there is for these measures.

The view from the majority of economists is that Reeves will have to introduce tax increases or budget cuts in order to meet her voluntary borrowing rules.

Previously on Thursday, estimates showed there was a £22 billion shortfall for the chancellor to fill, which is at the more modest range of expectations.

"There's a shared task between the Bank of England and the government to further reduce some of the causes of inflation," Reeves informed the BBC in Washington, at the yearly gatherings of the IMF and World Bank.

Revenue Pledges and International Issues

While a great deal of the focus has been on probable tax rises, the Treasury chief said the most recent data from the OBR had not changed her pledge to campaign commitments not to raise tax levels on income tax, VAT or social security contributions.

She blamed an "unpredictable global environment" with increasing geopolitical and commercial issues for the Budget tax moves, likely to be directed on those "with the broadest shoulders."

International Trade Tensions

Commenting on concerns about the UK's commercial links with China she said: "The UK's national security always come first."

Recent announcement by China to increase export controls on critical minerals and other resources that are essential for high-technology manufacturing led US President Donald Trump to propose an additional 100% import tax on imports from the Asian country, raising the risk of an all-out trade war between the two global powers.

The American finance chief labeled China's move "economic coercion" and "a global supply chain power grab."

Inquired about accepting the American proposal to participate in its conflict with China, Reeves said she was "extremely troubled" by China's measures and urged the Chinese government "to avoid restrictions and limit trade."

She said the decision was "bad for the international commerce and creates additional obstacles."

"I believe there are fields where we should confront Chinese policies, but there are also important prospects to trade with Chinese markets, including banking sector and other areas of the economy. We've got to maintain that equilibrium correct."

The Treasury chief also confirmed she was collaborating with other major economies "regarding our own critical minerals approach, so that we are more independent."

NHS Drug Costs and Funding

Reeves also admitted that the price the NHS pays for pharmaceuticals could go up as a result of ongoing negotiations with the US government and its drugs companies, in exchange for reduced taxes and investment.

A number of the world's largest drug companies have said lately that they are either halting or scrapping investments in the United Kingdom, with some blaming the low prices they are receiving.

Recently, the Science Minister said the price the NHS spends on medicines would need to increase to halt companies and pharmaceutical investment leaving the United Kingdom.

The Chancellor informed the BBC: "We have seen because of the payment system, that clinical trials, new drugs have not been available in the United Kingdom in the manner that they are in other continental states."

"Our aim is to guarantee that people receiving care from the National Health Service are able to receive the best life-saving medicines in the globe. And so we are looking at this situation, and... aiming to obtain increased funding into Britain."