UK Government Freezes Credit Cards to Tackle Public Spending

The UK Labor government plans to freeze nearly 20,000 government-issued credit cards, valued at hundreds of millions of pounds, to mitigate the country's strained public finances. The move, part of a broader cost-cutting effort, aims to reduce wasteful spending and enforce higher scrutiny of expenditures.

The UK government is set to freeze thousands of government-issued credit cards, a move expected to impact spending worth hundreds of millions of pounds. This decision by Britain's Labor government aims to address the nation's strained public finances amidst slowing growth forecasts and fiscal constraints limiting borrowing capacity.

According to a statement from the cabinet office, around 20,000 'Government Procurement Cards' will be affected. The intent is to curb what has been identified as wasteful spending, with figures indicating that spending through these cards has surged over 400% since the 2020-21 financial year, reaching over 675 million pounds.

The freeze will mainly spare only those for whom it is essential, like diplomats in crisis regions. Any cards not justified will be revoked by month's end as the government seeks to halve the number of such cards in use, aligning similar cost-saving strategies seen in the U.S. under President Trump's administration.

(With inputs from agencies.)