President Joe Biden and House Speaker Kevin McCarthy reached a provisional accord late Saturday night to reduce government spending and raise the debt ceiling, a crucial step in preventing the United States from defaulting on its debt at the start of next month.

Multiple officials confirmed to Just the News on Saturday evening that a “agreement in principle” had been reached for a two-year budget that would keep spending constant in 2024 and limit spending growth to 1% in 2025. The debt ceiling would be raised until the following presidential election.

According to the officials, the plan must still be devised and approved by the House and Senate to prevent a U.S. default.

“We still have a lot of work to do. But I believe this is an agreement in principle that’s worthy of the American people,” McCarthy said. It includes historic expenditure cuts, reforms that will elevate people out of destitution and into the workforce, and measures to rein in government overreach.

“There are no new taxes, no new government programs. There’s a lot more within the bill,” he added.

Biden said the compromise “means not everyone gets what they want.”

“It is an important step forward that reduces spending while protecting critical programs for working people and growing the economy for everyone,” the president said. “And, the agreement protects my and Congressional Democrats’ key priorities and legislative accomplishments.”

During negotiations, some Republican requests for stricter employment requirements for food stamp recipients were granted, despite strong opposition from many Democrats.

McCarthy tweeted the following on Saturday night and couldn’t help but criticize Biden: “I just got off the phone with the president a bit ago. After he wasted time and refused to negotiate for months, we’ve come to an agreement in principle that is worthy of the American people.”

“Big, thorny issues remain,”‘ one of the top negotiators, Rep. Patrick McHenry, R-N.C., told reporters in the evening. Some of those outstanding issues, McHenry said then, “the president and speaker have to resolve at that level.”

The Republican majority in the House of Representatives has pressed for drastic budget cuts and other restrictions, such as adding new work requirements to some benefit programs for low-income Americans and depriving the Internal Revenue Service, the nation’s tax collection agency, of funds.

According to Republicans, the U.S. debt, which is now nearly equivalent to the nation’s annual economic output, is developing too rapidly and must be reduced.

In exchange for a commensurate increase in the debt ceiling, the negotiators have agreed to cap discretionary spending on non-defense for two years at 2023 levels. The final agreement’s specifics were not immediately available.

Finding a compromise acceptable to the Republican-majority House (222-213) and Democratic-majority Senate (51-49) will necessitate deft needle-threading on both factions.

Treasury Secretary Janet Yellen warned Congress on Saturday that the United States could default on its financial obligations on June 5 if legislators do not act promptly to extend the federal debt ceiling. This is four days later than originally anticipated.

Economists have warned for months that a government default could trigger an economic disaster, but the White House and Republican leadership are confident that an agreement will be reached on time because they are negotiating in good faith.

The annual accounting practice of increasing the debt ceiling typically occurs unnoticed. It essentially authorizes the government to continue taking out loans to fund expenses already covered by the budget.

This year, the Republican Party has decided to use the debt ceiling as leverage in an attempt to convince Vice President Biden to scale back his preferred Democratic expenditure plans.