Chancellor Rachel Reeves should focus on affluent pensioners to alleviate strain on the public purse and safeguard infrastructure investment commitments, leading economists and former ministers have argued.

Former Cabinet secretary Gus O'Donnell, ex-Tory minister and Goldman Sachs executive Jim O'Neill, and prominent economists including Mariana Mazzucato have called on the government to "rebalance" the tax system to finance spending promises.

It is broadly anticipated that Reeves will need to generate at least £25bn - and possibly as much as £50bn - to restore her limited fiscal breathing room remaining from this year's Spring Statement.

The OBR has allegedly cautioned Reeves that it is likely to reduce productivity forecasts before the Budget, which would generate a deficit worth tens of billions of pounds depending on the scale of its revision.

The letter, published in The Times, stated that Reeves needed to "provide the foundations" for growth by reforming the broader tax system, as reported by City AM.

"Above all, the tax and pension system needs to be rebalanced so that better-off older people, especially those with substantial property and pension wealth, make a much larger contribution to addressing the fiscal pressures that result from increasing spend on the NHS, social care and pensions," signatories including former Cabinet Office economists Jonthan Portes and Allianz adviser Mohamed El-Erian said.

"These and other pressures on public spending must also be managed in a more sustainable way."

Economic experts are also pushing for modifications to her fiscal framework that would result in the OBR producing a single annual fiscal projection, a proposal already backed by the International Monetary Fund (IMF) and various economists. .

They further suggest Rachel Reeves could "make more use of the opportunities" offered by her rules' emphasis on public sector net financial liabilities (PSNFL) as a debt measurement tool instead of total debt as a proportion of GDP. .

The Chancellor's "investment rule", which ensures PSNFL decreases as a percentage of GDP across a three-year rolling forecast timeframe, permits the government greater borrowing flexibility since financial assets in loans and pension obligations are factored into debt calculations. .

"Pro-investment reforms to the fiscal framework could also boost fiscal credibility, for example by requiring governments to address long-term risks, like climate change, at fiscal events," economists added.

Widespread speculation suggests Rachel Reeves will implement comprehensive alterations to pension pot taxation whilst potentially increasing gambling duties to restore her financial wiggle room.

Modifications to the property taxation structure are also under consideration, with City AM revealing this week that talks had occurred regarding transforming stamp duty into a staged payment system as part of housing market enhancement reforms.

Economists at JP Morgan speculate that Rachel Reeves may construct a smaller buffer than £9.9bn, which already ranks as the third smallest fiscal cushion of the last 15 years, while analysts at Goldman Sachs have proposed that the Chancellor may struggle to alleviate pressures on public finances by increasing taxes further.

Rachel Reeves told to 'target wealthy pensioners' before it's too late - Daily Star