Reeves packs up her troubles until budget day and smiles, smiles, smiles | John Crace

The chancellor beamed her way through a conference speech that offered hope at least but little of substance

Stop all the clocks, cut off the telephone. If you had thought that maybe today was the day when you made that call to Dignitas, then think again. Cancel that flight to Zurich. At least postpone it. Things might not be quite as bad as you had been led to believe. Or rather, they are that bad but there is some small flicker of hope if you can hold on long enough. There will be pain in the short and medium term. There’s no avoiding that. Try to think of it as character building. But possibly, just possibly, you might come through. We happy few. Blinking into the light of the promised land.

This was Rachel Reeves’s day. And she knew everything was going to be just fine the moment she woke up to find that Liz Truss had posted yet another cry for help on X. You can now follow the Trusster’s decline in real time on social media. It’s got so bad that she now films herself in front of a bookcase where everything is arranged by colour. The kindest explanation is that she thinks she’s filming a hostage video and the books are a coded message for “I’m being held against my will”.

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Reserve Bank expected to leave interest rate untouched for seventh meeting in a row

Economic activity was ‘a little bit softer’ than central bank had predicted, one expert notes, but a rate cut still seems unlikely

How soon the Reserve Bank might cut interest rates will be the focus for borrowers and economists alike when the central bank wraps up its latest meeting on Tuesday.

Governor Michele Bullock is expected to keep the RBA’s key rate unchanged for a seventh meeting in a row, according to a survey of 45 economists by Reuters. The bank lifted the rate 13 times between May 2022 and last November.

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Bank of England keeps interest rates unchanged at 5%

Policymakers vote 8-1 against back-to-back cuts in borrowing costs after inflation stayed above Bank target

The Bank of England has kept interest rates unchanged at 5% as it put its efforts to ease the pressure on household budgets on hold.

The Bank’s monetary policy committee (MPC) voted by a majority of eight to one against launching a back-to-back reduction in borrowing costs amid concerns over lingering inflationary pressures.

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Winter fuel allowance cut: who voted for this? – Politics Weekly UK

The government saw off a rebellion over its plans to cut winter fuel allowance this week. John Harris speaks to Caroline Abrahams from Age UK about what this winter will look like for millions of pensioners losing out. Plus, he talks to columnist Rafael Behr about whether the technocrats (Starmer and Reeves) are taking the Labour party in the wrong direction

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UK economy unexpectedly flatlines for second month in row

Pre-election slowdown continues in July despite economists predicting growth of 0.2%

The anticipated post-election bounceback in the UK economy failed to materialise as activity flatlined in July for a second month, , according to the latest official data.

The Office for National Statistics (ONS) said the pre-election stalling of activity in June was followed by another month in which gross domestic product remained unchanged.

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Up to 50 Labour MPs could rebel over cut to winter fuel allowance

Dozens said to be considering abstaining from Tuesday’s vote over pensioners’ payments, as PM says dealing with dissent is ‘matter for chief whip’

As many as 50 Labour MPs could refuse to back the government’s controversial plan to cut the winter fuel allowance, despite Keir Starmer urging back benchers to get behind a measure he has conceded is “unpopular”.

While few on the government benches are expected to vote against the policy in Tuesday’s vote, dozens are believed to be considering abstaining or being absent – though rebels say the numbers in their ranks are very hard to predict.

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More than a million British workers not having a single day of paid time off, says TUC

Employees have lost out on holiday pay worth £2bn, according to new trade union research

Workers across Britain have lost out on holiday pay worth £2bn, with more than a million people going without a single day of paid time off, according to new research.

With unions gathering in Brighton this weekend for the first TUC conference under a Labour administration for 15 years, the body revealed new research showing the extent to which workers are being denied holiday pay. Workers are entitled to 28 days paid leave for a typical five-day week.

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The final Grenfell inquiry report and what it means for families – Politics Weekly UK

The 2017 Grenfell Tower fire in London was the result of ‘decades of failure’ by central government, the public inquiry into the catastrophe has found. The Guardian’s John Harris looks at the findings of the report with the social affairs leader writer Susanna Rustin. And, as Labour continues to warn ‘things will get worse before they get better’, we are joined by the economists James Meadway and Ann Pettifor to discuss whether a painful period of austerity-lite is the only way through the storm

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Labour MP pushes for watchdog to assess PFI costs under budgets bill

Stella Creasy says she wants to put school and hospital debts and impact of trade deals ‘on nation’s books’

A senior Labour backbencher is seeking to have liabilities from schools and hospitals built under private finance initiative (PFI) deals scrutinised under a new budget responsibility bill.

Stella Creasy, who has tabled two amendments to the bill, said this would help highlight the scale of debt incurred. She also wants trade deals such as the post-Brexit arrangement with the EU to fall under its remit, arguing these can have an even greater fiscal impact.

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Voters believe Labour on UK’s woes, but not on its proposed fixes

Keir Starmer struggling to sell his remedies for the problems facing Britain after Tory mess

The prime minister is struggling to communicate how his government will address the significant problems facing the UK. While the public readily accepts that the last government left a mess, selling Labour’s remedies as necessary or fair is proving more challenging.

The incoming government’s first job was to assign blame for the country’s current woes. This proved relatively easy, given the last ­government’s unpopularity and the Conservatives’ poor campaign.

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Keir Starmer takes a political gamble with message of bad news

Past Labour PMs – Blair, Wilson, Attlee – have tended to arrive in power accentuating the positive

Sir Keir Starmer could perhaps have timed it better. On the day that Oasis, the band that symbolised the mood of sunny optimism that swept Tony Blair to power in 1997, announced their reunion, the prime minister’s message to the nation was that things would get worse before they got better.

Politically, it is quite a gamble. There haven’t been all that many Labour governments in the past 125 years, but they have tended to arrive in power accentuating the positive. That was true of Blair in 1997 and true of Harold Wilson in 1964.

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Rachel Reeves planning to raise taxes and cut spending in October budget

Chancellor insists she still has large black hole to fill despite stronger-than-expected growth in first half of 2024

Rachel Reeves is planning to raise taxes, cut spending and get tough on benefits in October’s budget amid Treasury alarm that the pickup in the economy has failed to improve the poor state of the public finances.

With the latest official set of borrowing figures out on Wednesday, the chancellor is insisting she will still have a substantial black hole to fill despite stronger than expected growth in the first half of 2024.

Raising more money from inheritance tax and capital gains tax.

Sticking to plans for a 1% increase in public spending even though it would involve cuts for some Whitehall departments.

Rejecting pressure to scrap the two-child benefit cap.

Changing the way debt is measured to exclude the Bank of England.

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UK economy continues recovery from recession with GDP growth of 0.6%

ONS data shows strong performance in second quarter with service sector helping drive growth

Britain’s economy has extended its recovery from recession after recording growth of 0.6% in the three months to June, handing a boost to the chancellor, Rachel Reeves, in the run-up to the autumn budget.

Figures from the Office for National Statistics (ONS) show gross domestic product continued to grow in the second quarter, after a rise of 0.7% in the first three months of 2024. The reading matched the forecasts of City economists.

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Liz Truss leaves stage over ‘I crashed the economy’ lettuce banner

Former PM says ‘that’s not funny’ when remote-controlled banner is unfurled behind her at event in Suffolk

Liz Truss left the stage abruptly at an event to promote her own book after campaigners unfurled a banner behind her that was emblazoned with the phrase: “I crashed the economy” below a picture of a lettuce.

The former prime minister, who lasted 45 days in office, was in Suffolk on Tuesday discussing the US presidential election when the campaign group Led By Donkeys lowered its remote-controlled banner with a huge picture of a lettuce.

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Jobs market and pay growth are cooling off, large UK employers and recruiters warn

Survey reveals net fall in permanent jobs last month amid lengthening slowdown in employment market

The UK’s largest employers have warned the jobs market is cooling amid a slowdown in wage growth in July and a fall in vacancies, extending an almost two-year downturn in hiring demand for permanent staff.

Figures from the Recruitment and Employment Confederation (REC) and the accountancy firm KPMG showed a fall in permanent staff placements in July as large employers made more redundancies and hired fewer new starters.

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Anyone hoping for lower interest rates any time soon will be dismayed by RBA chief’s media conference

Governor Michele Bullock makes clear any expectation of interest rate cuts this year ‘not aligned’ with bank’s present thinking

Those hoping for lower interest rates soon – whether stressed borrowers or those in the Albanese government itching for an early election – would have been dismayed by the Reserve Bank of Australia governor Michele Bullock’s media conference on Tuesday.

The RBA board had just wrapped up the eighth meeting under her leadership and considered just two options for its key interest rate: “hold for some time” or another rate hike. A rate cut was not up for discussion.

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Greens say Labour should focus more on building council homes and that new housing plan is flawed – UK politics live

Rayner says housing target system will raise number of homes planned to 370,000 and confirmed targets will be mandatory

Balls, who, of course, is a former Labour cabinet minister, and a former shadow chancellor, questions whether Reeves is right to suggest that Jeremy Hunt is wholly to blame for the black hole. He says that other cabinet ministers and departments drew up the spending plans that she says were unfunded.

Reeves repeats the point she has been making all morning about how the public were misled. (See 8.06am.)

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Winter fuel payments to be restricted as Reeves says there is £22bn spending shortfall – UK politics live

Chancellor suggests budget, on 30 October, will involve tax rises and cuts to spending and benefits

Downing Street has refused to comment on a report saying junior doctors are being offered a pay rise worth about 20% over two years.

In a story for the Times, Steven Swinford reports:

The British Medical Association’s (BMA) junior doctors committee has recommended an offer that includes a backdated pay rise of 4.05 per cent for 2023-24, on top of an existing increase of between 8.8 per cent and 10.3 per cent.

Junior doctors will be given a further pay rise of 6 per cent for 2024-25, which will be topped up by a consolidated £1,000 payment. This is equivalent to a pay rise of between 7 per cent and 9 per cent.

As we’ve said before, we’re committed to working to find a solution, resolving this dispute, but I can’t get into detailed running commentary on negotiations.

We’ve been honest with the public and the sector about the economic circumstances we face. But the government is determined to do the hard work necessary to finally bring these strikes to an end.

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Hospital and road projects face cuts to plug £22bn fiscal hole, Reeves says

Social care and winter fuel payments also targeted as chancellor accuses Tories of covering up scale of fiscal shortfall

Rachel Reeves has scrapped the social care cap and curbed winter fuel payments, as well as announcing big cuts to hospital and road projects, as she seeks to plug what she called a £22bn hole in public spending that was “covered up” by the Conservative government.

In a statement to the Commons that mixed detailed economics and partisan politics, the chancellor justified the cuts with the repeated mantra: “If we cannot afford it, we cannot do it.”

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How bad are Britain’s finances? Five questions on the state of the UK economy | Phillip Inman

Several factors restrict the Labour government’s room for manoeuvre in its agenda for growth

The economic outlook is improving, but a recovery from last year’s recession will be long and arduous without a boost to public investment.

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