Reeves' enormous budget should perhaps have been bigger still

ITV News' Political Editor Robert Peston spoke to the Chancellor about her Budget, questioning her on the OBR's prediction that GDP will be no higher at the end of this parliament, despite the new measures

The sums of money raised by Rachel Reeves in tax and borrowed, and then spent and invested, are breathtakingly large.Public expenditure is set to rise by £70bn a year, with two thirds going on day-to-day spending and one third on investment.Higher taxes will raise £36bn a year, increasing the share of the economy taken in taxes to a record 38% by the end of the parliament.Borrowing is set to rise by £32bn a year, and - as the OBR says - the national debt in underlying terms is set to rise every year for five years.So surely - you might argue - with such ambition shown by Rachel Reeves the UK will see public services fixed and investment rise to the extent that productivity and economic growth must surely recover at last.

Maybe. But there is a case to be made that Reeves could and should have been more ambitious, or at least more creative, notably on taxing and spending.First of all, lots of important public services will still feel desperately squeezed, because the lion's share of a rise in resources is going to health, education and defence.Second, the choice of employers' national insurance as the main tax raising measure - extracting £25bn from companies - combined with the fiscal loosening, the increased government borrowing, actually lead to lower private-sector investment, according to the Office for Budget Responsibility.

This is particularly embarrassing for a prime minister who repeatedly said during the general election that he wanted businesses to invest much more, to revive the country's prosperity.

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Third, in the round the budget is a sugar rush: growth up in the short term, national output unchanged in five years - says the OBR.Fourth, what the OBR says is one of the most significant fiscal loosening's of modern times will almost certainly mean interest rates will be higher for longer - which is a pain for private-sector borrowers and for the highly indebted government itself.So although I know it sounds mad, on the logic of what Reeves says she wants to do - namely revive the public sector and increase investment - she should actually have raised taxes by more.Her failure to put up fuel duties - which haven't been increased since 2010 - looks particularly eccentric, and indeed self-damaging, at this critical juncture.

The point is that increasing employers’ national insurance will never raise the headline £25bn a year, according to the OBR, because businesses will respond to it by cutting staff wages and reducing employment. So the net yield in five years will be nearer £15bn.

It would have been more rational to directly reverse former chancellor Jeremy Hunt’s £20bn reduction in employees’ national insurance, but that was ruled out in Labour’s manifesto.

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