Rising costs and global uncertainty may force chancellor to turn to pensioners and wealthier taxpayers
Ministers may have to target pensioners and wealthier taxpayers at the autumn budget, as senior government figures voiced fears brutal welfare reforms would still not go far enough to tackle rising costs.
The Institute for Fiscal Studies warned the chancellor may be forced to consider a freeze on tax thresholds, hikes to capital gains and potentially pension taxes.
Continue reading...Department for Work and Pensions says thousands, including children, will be hit by chancellor’s announcement, as OBR forecasts UK growth to halve in 2025
Rachel Reeves will not be raising taxes in the spring statement today, even though there are many people on the left who would prefer taxes to rise as an alternative to public spending being cut. Reeves came into office promising only one budget-type event a year, and that is one reason why she is not hiking taxes today. But mainly it’s because she thinks Britons are relatively highly taxed already, because Labour was elected on a manifesto ruling out most of the obvious possible tax rises and because she’s not convinced a sweeping wealth tax would work.
But that has not stopped campaigners calling for a wealth tax, and yesterday about 300 people attended a ‘Tax the Super-Rich’ rally outside the Treasury. It was organised by charities and social justice campaign groups, but one of the speakers was Carla Denyer, co-leader of the Green party, which is in favour of a wealth tax.
Across the country, inequality is soaring and people are being left behind, struggling to make ends meet and dealing with broken public services, all while the very richest get richer. Choosing to make cut after cut to the poorest and most marginalised, while leaving the vast resource of the extreme wealth of the super rich untouched, is immoral, harmful, and will not deliver for our communities or the economy.
Continue reading...PM also claims government is spending record amount on pothole repairs amid criticism of spring statement plans
Well, that did not really get us very far. Apologies to anyone who feels misled by “grilling” in the headline. We learned very little. After the interview was over, Rachel Burden, the Radio 5 Live presenter, read out some listener reaction, including a message from someone who said: “The country is literally falling apart and Sir Keir is fixated on potholes. I give up.”
But in the interview Keir Starmer did not challenge the claim that some government departments will have to reduce spending. This is what he said when it was put to him that unprotected deparments would face cuts.
We’re looking across the board. We made a budget last year, we made some record investments, and we’re not going to undo that.
So, for example, we’ve got a record amount into the NHS. That’s just delivered five months’ worth of waiting lists coming down – five months in a row during the winter, that’s really good. So we’re not going to alter the basics.
I do think this is something that we have to take seriously. We have to address. We can’t shrug our shoulders at it.
Continue reading...Labour MP and Lib Dem leader express concern social media companies could be let off hook just as benefits are cut
Keir Starmer has been warned against “appeasing” Donald Trump as he considers reducing a major tax for US tech companies while cutting disability benefits and public sector jobs.
His chancellor, Rachel Reeves, confirmed on Sunday that there were “ongoing” discussions about the UK’s £1bn-a-year digital services tax that affects companies including Meta and Amazon.
Continue reading...Keir Starmer has been dealt a fresh blow to his living standards pledge in advance of the spring statement
Living standards for all UK families are set to fall by 2030, with those on the lowest incomes declining twice as fast as middle and high earners, according to new data that raises serious questions about Keir Starmer’s pledge to make working people better off.
The grim economic analysis, produced by the respected Joseph Rowntree Foundation (JRF), comes before the chancellor, Rachel Reeves, makes her spring statement on Wednesday in which she will announce new cuts to public spending rather than increase borrowing or raise taxes, so as to keep within the government’s “iron clad” fiscal rules.
Continue reading...Campaigners in gallery shout ‘Lords out, people in’ and drop leaflets into the chamber
Nigel Farage, the Reform UK leader, has defended politicians who get involved in entertainment TV.
In an article for the Daily Telegraph, he hit back at Kemi Badenoch, who used an interview with the paper earlier this week to dismiss Farage as just a reality TV phenomenon.
Having appeal doesn’t mean that people want you running their lives. That’s one of the things that we need to make sure that we remind people.
This isn’t I’m A Celebrity or Strictly Come Dancing. You don’t vote for the person that you’re enjoying watching and then switch off when the show’s over.
Anyway, it’s not as though I’m the first politician to have been prominent in the media. Ronald Reagan combined his early political activities with a film and TV career for 20 years, until the 1960s. When he announced in the 1970s that he wanted to become the US President, everybody said he was a B-Movie actor who stood no chance. These days, American conservatives look back on this two-term leader with a slight sense of awe in terms of his achievements.
And what about Donald Trump? He was a well-known New York property developer from the 1970s onwards but it was his massive success with the reality to show The Apprentice from 2004 that put him in a position where he could win the nomination for the Republican Party.
Kemi Badenoch has a problem. Most members of the public have no opinion of her. Even fewer know what she stands for. I have an idea for her. She could appear on a reality TV show herself. A spell in the I’m a Celebrity… jungle would be perfect. I’ll gladly give her some tips if she wants to sign up for the next series.
Continue reading...Despite the decision to hold at 4.5%, businesses and households can take a confident view of the UK’s prospects
Bank of England policymakers might be on a “go-slow” as they look forward to interest rate cuts this year, but the direction of travel is almost certain.
After a meeting on Thursday when interest rates were kept on hold at 4.5%, City investors bet there would be more reductions in the cost of borrowing this year, most likely two cuts reducing the rate to 4%.
Continue reading...Stephen Timms, social security and disability minister, says government is ‘fully supporting’ people who would always be unable to work
The Reform UK press conference is about to start. There is a live feed here.
Nigel Farage is going to announce that 29 councillors have defected to his party, according to the Guido Fawkes website.
Continue reading...Charlie Bean says OBR forecasts are ‘flaky’ and cautions against trying to hit targets five years away
The former Bank of England deputy governor Charlie Bean has warned the chancellor against making kneejerk cuts in next week’s spring statement to try to hit fiscal targets that are five years away.
Rachel Reeves is preparing to slash spending, including on disability benefits, in response to weaker forecasts from the independent Office for Budget Responsibility (OBR) – prompting a backlash from within her own party.
Continue reading...Minicab drivers say Uber’s bid to apply tax to all rides would put many out of business and leave people stranded
Two British taxi companies have launched a crowdfunding drive for the last leg of a lengthy legal battle with Uber that could result in higher cab fares.
Uber will seek, at a supreme court hearing in July, a ruling on contractual models that affect whether VAT applies to private-hire companies outside London, which it has argued would level the playing field across the UK.
Continue reading...Districts in Birmingham now ranked below poorest areas of France, Malta and Slovenia as institute urges rethink on planned welfare cuts
The UK has tumbled down the league of affluent nations after almost a decade of welfare cuts and stagnant incomes, according to a report that found the poorest districts in Britain now rank below the lowest-income areas of Malta and Slovenia.
In a warning for ministers to protect welfare spending before Rachel Reeves’s spring statement later this month, the National Institute of Economic and Social Research (NIESR) said the UK’s reputation for high living standards was under threat.
Continue reading...Even Berlin and Brussels are bending fiscal rules in the face of Russia’s threat. Will the chancellor still stick to hers?
As the Nobel laureate Robert Lucas quipped during the 2008 financial crisis: “I guess everyone is a Keynesian in a foxhole.” Donald Trump’s upending of the postwar security consensus has underlined the enduring wisdom of Lucas’s observation. But now, instead of bank bailouts and emergency bond buying, European firepower is being directed at bombs, tanks and drones in the desperate fight to secure the continent’s border with Russia.
Berlin and Brussels – typically capitals of financial orthodoxy – have been convinced that this approach is required once again. Under the plan put forward by Germany’s chancellor-in-waiting, Friedrich Merz, Berlin is on the brink of relaxing its “debt brake” rule to pave the way for spending on defence and infrastructure worth an additional €1tn (£840bn) over the coming decade.
Continue reading...Interventions follow US vice president’s comments about ‘20,000 troops from some random country that has not fought a war in 40 years’. This live blog is closed
In response to a question about intelligence cooperation with the US, Sir David Manning, a former ambassador to Washington, said he thought this would become “more difficult” because there was a problem of trust. He explained:
If you have some of Trump’s appointees in these key jobs who have very strange track records, and have said very strange things about Nato allies, the Nato alliance and so on, and you have people in the administration who seem to be, let’s say, looking for ways of appeasing Russia, then you have a problem on the intelligence front, because these are not the values that we have.
Continue reading...Chancellor says increased military spending should support ‘British jobs and British industries’
Rachel Reeves has said UK companies and jobs will be prioritised under the government’s plans for a significant increase in defence spending, with an aim to support “left behind” industrial towns and the economy at large.
Announced by Keir Starmer last week amid growing fears over Donald Trump’s commitment to European security, the government will increase defence spending to 2.5% of GDP by 2027 – worth an additional £6bn a year.
Continue reading...Program is apparently being closed according to email from former Tesla engineer installed in GSA
An Elon Musk ally installed in the US government said in a late night email going into Saturday that the office behind a popular free online tax filing option would be shuttered – and its employees would be let go.
The 18F office within the General Services Administration (GSA) created the IRS Direct File program that allows for free online tax filings. It has been a frequent target of Musk, and one of the billionaire businessman’s close associates who holds a key position in the GSA informed staffers that the agency would close 18F in an email to staffers that arrived around 1am on Saturday morning.
Continue reading...Exclusive: Hundreds of thousands of world’s poorest children could die if aid programme slashed, experts warn
Hundreds of thousands of children in the world’s poorest countries will die if the UK cuts back funding for a hugely effective vaccination programme as part of its significant reduction in overseas aid, the Guardian has been told.
According to data collated by the Global Alliance for Vaccines and Immunisation (Gavi), to which the UK has previously been one of the main contributors, even a small cut in UK funding would be expected to result in millions fewer vaccinations, leading to huge numbers of preventable deaths.
Continue reading...Resolution Foundation report says failure to reform has ‘slowly recreated the issues that undid the poll tax’
Britain’s poorest households are paying an increasing share of their income on council tax, according to new analysis that likened it to the poll tax that contributed to the downfall of Margaret Thatcher.
The poorest fifth of households paid 4.8% of their income on council tax in England, Wales and Scotland and on domestic rates in Northern Ireland in the 2020-21 financial year, up from 2.9% in 2002-3, according to research by the Resolution Foundation.
Continue reading...Businesses pay hundreds of millions of pounds more and losing trust in HMRC, reports National Audit Office
An increasingly complex tax system is burdening the government and businesses with hundreds of millions of pounds more in administration costs, Whitehall’s spending watchdog has warned.
The report by the National Audit Office (NAO) also said “poor levels of service” meant some taxpayers and their representatives were “finding it more difficult to deal with their tax matters and are losing trust in HM Revenue & Customs [HMRC]”.
Continue reading...Increase to £17.8bn is well above City forecasts and is highest December figure for four years
UK government borrowing jumped unexpectedly to £17.8bn last month, piling pressure on Rachel Reeves to plan budget cuts before a spending review in the summer.
The figure was about a quarter higher than the City had forecast and was up by £10.1bn more than in the same month a year earlier, making it the highest December borrowing for four years.
Continue reading...Home secretary also says inquiry into the attack will cover wider threat posed by youth violence
Starmer says nothing will be off the table in the inquiry.
There are also questions about the accountability of the Whitehall and Westminster system – a system that is far too often driven by circling the institutional wagons, that does not react until justice is either hard won by campaigners, or until appalling tragedies like this [take place].
Time and again we see this pattern, and people are right to be angry about it. I’m angry about it.
There are also bigger questions, questions such as how we protect our children from the tidal wave of violence freely available online.
Because you can’t tell me that the material this individual viewed before committing these murders should be accessible on mainstream social media platforms, but with just a few clicks, people can watch video after horrific video – videos that, in some cases, are never taken down,
Continue reading...