Chancellor Rachel Reeves says she has now reached spending settlements with all government departments ahead of her much-anticipated Budget on 30 October.

It comes after reports of Treasury rows with multiple departments over the expected scale of spending cuts.

Reeves told BBC Radio 5’s Matt Chorley she had struck deals with all her cabinet colleagues – and in line with tradition, popped all balloons put up in the Treasury to represent each department’s funding agreement.

While sympathising with “the mess” her colleagues had inherited, Reeves insisted departments needed to find savings to balance the budget.

In recent Budgets, chancellors have adopted the tradition of hanging balloons in the office of the Chief Secretary to the Treasury to represent spending deals that must be negotiated with government departments.

As settlements are reached, the balloons are popped.

In the exclusive interview, Reeves said: “There are no balloons left in the Chief Secretary’s office – the balloons have been burst.”

In the run-up to the Budget there have been growing reports of unease in the Cabinet over the spending cuts needed to meet the Treasury’s target of finding £40bn of savings.

Sky News reported that the Treasury missed its initial 16 October deadline to finalise all major Budget measures for submission to spending watchdog the Office of Budget Responsibility ahead of the Budget.

Deputy Prime Minister Angela Rayner who runs the Ministry of Housing, Communities and Local Government, as well as Justice Secretary Shabana Mahmood and Transport Secretary Louise Haigh have all been reported as writing to Sir Keir Starmer to complain about the scale of cuts their departments were facing.

Haigh has since told the BBC she did not write a letter, but had been having Budget negotiations with the Treasury “in the normal way”.

Addressing reports colleagues had gone over her head to take their concerns about budget cuts directly to the prime minister, Reeves said, “I wouldn’t believe everything you read” in the media.

But she went on to say it was “perfectly reasonable that Cabinet colleagues set out their case – both to me as chancellor and to the prime minister, about the scale of the challenges that they find in their departments”.

“I’m very sympathetic towards the mess that my colleagues have inherited”, Reeves said.

“But any additional money, in the end, it has to be paid for either by taking money from other departments or raising taxes.”

The Labour manifesto promised not to raise income tax rates, national insurance or VAT to protect “working people”.

Labour also campaigned on a pledge not to “return to austerity” – the programme of deep spending cuts and tax hikes aimed at reducing the UK’s budget deficit pursued by the 2010 Conservative-Liberal Democrat coalition.

“All of those things mean that we do need to find additional money,” Reeves said.

Reeves admitted this meant she was considering tweaks to “other taxes to ensure the sums add up”.

“We were clear during the election campaign, you can’t undo 14 years of damage in one Budget or in just a few months,” she said.

“It is going to take time to rebuild our public services to ensure that working people are better off and to fix the foundations of our economy and our society as well.”

As she looks to balance the first Labour Budget in 14 years, Reeves admitted she speaks to several major political figures.

“I speak to Gordon regularly – I also speak to Tony Blair regularly,” she said.

She also maintains a “good relationship” with her predecessor Jeremy Hunt, regularly messaging the Conservative shadow chancellor.

“I may not be particularly impressed with the state of the public finances that he left me, but I do recognise that after Kwasi Kwarteng, he had a tough job to do as well,” she said.

The one person she wishes she could “pick up the phone to now” is Alistair Darling, the last Labour chancellor to deliver a Budget – who died last year aged 70.

Lord Darling served in cabinet for 13 years under both Blair and Brown, and was best known as the chancellor who steered the UK through the 2008 financial crisis.

“I hope that he would be proud of what I’m doing as the next Labour chancellor after him,” she said.

Reeves spoke about her pride at being the first female chancellor in the role’s 800-year history.

Becoming chancellor was “beyond what a girl like me, from the ordinary background that I came from, could have ever dreamed of,” Reeves said.

Now in her “dream job”, Reeves said, “one of the wonderful things in the first few months of doing this job is to meet female finance ministers from around the world” – such as US Secretary of the Treasury Janet Yellen and Chrystia Freeland, the Canadian finance minister.

“I take a lot of inspiration from those amazing women and so many others,” Reeves said.

Kemi Badenoch has hit back at her Tory leadership rival Robert Jenrick’s claim that her decision not to set out detailed policies was “disrespectful” to the party’s membership.

Speaking to Political Thinking with Nick Robinson, Badenoch said she would not use that word about another candidate and that everyone had “their own campaign approach”.

“If this was a general election, yes, it would be wrong to be standing with no policies. This is not a general election,” she told Nick Robinson.

She added: “He [Jenrick] doesn’t know what he’s going to be standing on in four years’ time.”

Jenrick stood by his criticism in an interview with BBC Radio 5’s Matt Chorley.

“Kemi and I disagree on this point. I believe you have to start with principles and values, but I think that is not enough. You also have to have policies.”

He argued that the public were “deeply sceptical” of politicians and the best way to win them back was to set out policies and “lay out the trade-offs”.

“The age of policy-free politics is over,” he said, adding that it was “wrong” to ask party members to support you “on the basis of a plan for tomorrow”.

During the leadership campaign, Jenrick has said he wants to leave the European Convention on Human Rights, encourage housebuilding and oppose Labour’s plans on reaching net-zero carbon emissions.

Defending her approach, Badenoch said the party members know what her principles are. She said she would take time to design policies adding: “We have time, we don’t need to rush.”

She said she did not want to make promises “unless I know how I am going to deliver it”.

Earlier in the week, Jenrick told BBC Radio 4’s Westminster Hour: “I think it’s disrespectful to the members and the public to ask for their votes without saying where you stand on the big issues facing our country today.”

Conservative Party members are currently voting between the two candidates and a result is due on 2 November.

Unlike her rival, Badenoch has not done many media appearances, however in a wide-ranging interview she spoke to Nick Robinson about her thoughts on net-zero, immigration and Covid lockdowns.

On the environment, she said she was a “net-zero sceptic” but not “a climate change sceptic”.

She said she did not want to do something “because it looks good” and “before we figured out how to do it”.

She pointed to speeches she had made in Parliament on subject asking: “Lot’s of schoolchildren will be very happy, but where is the plan?”

She added: “Is net-zero a solution or is it a slogan… I am not sure we have properly thought that through.”

On immigration, she said “numbers matter but culture matters more”.

For several years, Conservative politicians have promised to get down the numbers coming into the country, but immigration has continued to rise, hitting record levels in 2022.

Badenoch said there should be a cap on numbers but it was also important to ensure those arriving “love British culture”.

Asked how the government should decide this, Badenoch said it was important to establish from which countries “successful migrants” were coming from.

“We should be getting to a point where we can say we’re happy to take more from countries A, B and C and for countries X, Y and Z, we’re going to have stricter rules.”

During the coronavirus pandemic, Badenoch was a Treasury minister. She said she would not apologise for spending “a lot” during Covid but added: “I think we just overran it to the point where it made inflation worse than it needed to be.”

She also said she thought the government “overdid it in terms of the length of lockdown”.

“There was a King Canute sort of situation. I thought that we were trying to do too much, that this was where government was overstretching itself and we weren’t trusting people enough.

“The biggest thing I hated was the fixed penalty notices.”

The notices were issued by the police to people who breached Covid rules, resulting in fines of between £200 and £10,000.

Both Boris Johnson and Rishi Sunak, the prime minister and chancellor during the pandemic, were issued with fines for breaching the regulations.

Badenoch said: “If Boris did not bring in those fixed penalty notices, he would not have had the Partygate scandal, certainly not to the extent that it was… he got caught in a trap that he had set for himself.”

She said Conservatives had “strayed away” from their principles of freedom.

Asked about her own leadership style, Badenoch said she aspired to be a “fun” leader and would try to bring some “humour” and “light-heartedness” to her approach.

“I think that we’ve been very gloomy. We’re not the gloomy party. We are actually quite an optimistic and fun party and I want to bring that out.”

Reflecting on her own background, she compared finding out that she was a British citizen to “finding out that you’d won the lottery”.

Badenoch explained that because she was born in Nigeria, a Commonwealth country, before a 1983 rule change, she qualified to be British – something she only found out when she was 14 years old.

She said there was a “very unpleasant sort of ethno-nationalist anti-Kemi wing” who called her an “anchor baby” – a term used in the United States to refer to people who ensure their children are born in the country in order to gain residency.

Badenoch was born in the UK because her mother had come to get medical care at a private hospital, but she said that is not why she qualifies as a British citizen.

Michelle O’Neill has corrected the record at Stormont regarding the age of the teenage boy who received inappropriate texts from the former Irish Senator Niall Ó Donnghaile.

On Monday, the first minister and Sinn Féin deputy leader told the Northern Ireland Assembly that party membership files said the boy was 17 at the time.

But the young person had said he was 16 years old.

Sinn Féin leader Mary Lou McDonald has also corrected the record officially in the Dáil (lower house of Irish parliament).

On Tuesday, O’Neill told the assembly she “fully accepted” the age and wanted to correct the information on the record.

She said it was her understanding that the young person was 17 based on the information he had provided in his application to join Sinn Féin.

She also repeated her apology to him saying she was “absolutely so sorry for the hurt caused” by the party’s statement issued following Mr Ó Donnghaile’s resignation in December 2023.

O’Neill had been facing calls to return to the assembly after the Democratic Unionist Party (DUP) submitted an urgent question.

She is also being asked to return to Stormont’s executive office committee on Wednesday for further questioning, but this has not yet been confirmed.

McDonald came to the Dáil on Tuesday to correct the record in which she previously stated the young person was 16 and apologised for her words.

“I have now written to the young person and his mother offering a full, unequivocal and sincere apology,” she said.

“What happened to this young person was wrong, Niall Ó Donnghaile’s behaviour was unacceptable, utterly inappropriate, and no young person should have experienced that.”

The Sinn Féin leader also said she was “very sorry” for the hurt the words in her statement following Mr Ó Donnghaile’s resignation.

“That was never, ever my intention, and I apologize to that young person,” she added.

McDonald said it was her understanding the teenager was 17 years old at the time of the incident “because of the information provided on his application, formally applied to join Ográ Sinn Fein, that information was wrong,” Ms McDonald said.

“The young person themselves have made clear that he was in fact 16 at the time, so I want to correct the Dáil record to reflect that he was in fact 16 years of age when the text was sent.”

Sinn Féin has faced criticism over the last week for its handling of the suspension and resignation of Mr Ó Donnghaile.

Mr Ó Donnghaile, a former Belfast lord mayor, was suspended by Sinn Féin over the issue but the party allowed him to resign on health grounds in 2023 without revealing the complaint against him.

Calls for clarity on the teenager’s age came following a Sunday Independent article where the boy said he was 16 at the time the texts were sent and not 17 as McDonald and O’Neill had previously said.

The message is believed to have been personal in nature but not sexually explicit.

The party has also been questioned over its safeguarding policies after two former press officers gave references to former colleague and convicted child sex offender Michael McMonagle.

On Monday, it emerged that a Sinn Féin employee had resigned after admitting involvement in an incident where a portrait of former DUP lord mayor Lord Browne was damaged.

Speaking at Stormont on Tuesday, the first minister said the employee was “immediately suspended” and the police have been notified.

On Monday evening, McDonald said Sinn Féin accepted the boy’s own account that he was 16 at the time.

“The person knows their age so obviously Michelle [O’Neill] is right, the party records did indicate that he was 17, it was on his application form for membership,” McDonald said.

“But that doesn’t matter now. What matters is that we respond fully to the young person in question and what matters is that the Dáil record is accurate and I will attend to both of those matters tomorrow.”

A Sinn Féin spokesperson said the party record of the boy’s age was “based on the date of birth that [he] provided on his membership documents at the time”.

The spokesperson said it had “since emerged” that the boy was 16 years old.