One in five workers will be higher-rate taxpayers by 2027 – IFS

Jeremy Hunt’s freeze on allowances and thresholds will put a quarter of teachers and one-eighth of nurses in 40% income tax bracket

One in four teachers and one in eight nurses will be higher-rate taxpayers by 2027 as a result of the government’s record freeze on income tax allowances and thresholds, according to a leading thinktank.

The Institute for Fiscal Studies said better-paid public sector workers will be among the almost 8 million people – one in five of all taxpayers – who will pay income tax at 40% or above as result of the Treasury’s attempt to reduce the UK’s budget deficit.

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How the autumn statement brought back the ‘squeezed middle’

IFS and Resolution Foundation say Jeremy Hunt’s policies will shock middle England, with higher taxes here to stay


Traditionally elections in Britain are decided by swing voters in a relatively small number of seats. Parties go to considerable lengths to tailor their policies to the perceived demands of those getting by on average incomes. Pollsters have even coined names for the archetypal electors that need to be wooed: Basildon man and Worcester woman.

So it will be of some concern to government strategists that the post-autumn statement analysis by thinktanks focused heavily on how the measures announced by Jeremy Hunt had an effect on those not particularly poor but not especially rich either. Both the Resolution Foundation and the Institute for Fiscal Studies highlighted the return of the “squeezed middle”.

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Autumn statement 2022 live: OBR says living standards to fall 7% as Hunt confirms millions to pay more taxes

Fiscal watchdog’s figures show eight years of growth wiped out; chancellor announces higher taxes and some cost of living support

In the Commons Rishi Sunak is making a statement about the G20 summit. These statements are normally routine, and just summarise what was said or decided at the meeting. They don’t normally include fresh announcements.

Sunak started by talking about the missile incident in Poland. He said Russia attacked Ukraine with missiles on the day that he “confronted the Russian foreign minister across the G20 summit table”. He said the blame for the missile landing in Poland lay with Russia. Ukraine could not be blamed for defending itself, he said.

During the bombardment of Ukraine on Tuesday an explosion took place in eastern Poland. The investigation into this incident is ongoing and it has our full support.

As we’ve heard the Polish and American presidents say, it is possible the explosion was caused by Ukrainian munition which was deployed in self-defence.

In just a few moments the chancellor will build on these international foundations when he sets out the autumn statement, putting our economy back on to a positive trajectory and restoring our fiscal sustainability.

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Truss? Brexit? Covid? Who is really to blame for the Tories’ ‘fiscal hole’?

The succession of PMs have all spoken out on who or what has caused the state of UK finances. They’re all partly right, but conveniently miss out one or two other key reasons

Covid-19 ripped a £400bn hole in the government’s finances. The money was used largely to support the economy and it succeeded in allowing industries and workers to bounce back once restrictions were lifted.

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Hunt dismisses Kwarteng’s claim that mini-budget not to blame for state of UK finances – UK politics live

Latest updates: chancellor says ‘we’ve learned that you can’t fund spending or borrowing without showing how you are going to pay for it’

Sadiq Khan, the Labour mayor of London, has released polling suggesting that half of Londoners are either “financially struggling” (18%) or “just about managing” financially (32%).

According to the polling, 49% of Londoners are also using less water, energy or fuel.

This shocking new polling highlights the realities of the worst cost of living crisis in generations.

With spiralling inflation and soaring interest rates meaning many Londoners are struggling to make ends meet – a situation made worse by the government’s failed mini-budget – the chancellor has a duty to take decisive action on Thursday to support vulnerable Londoners.

In total, the NHS paid more than £3bn to agencies who provide doctors and nurses on short notice. The figure represents a 20% rise on last year, when the health service spent £2.4bn. Trusts spent a further £6bn on bank staff, when NHS staff are paid to do temporary shifts, taking the total spent on additional staff to around £9.2bn.

One in three NHS trusts paid an agency more than £1,000 for a single shift last year, while one in every six trusts paid more than £2,000, results from freedom of information requests reveal.

Taxpayers are picking up the bill for the Conservatives’ failure to train enough doctors and nurses over the past 12 years. This is infuriating amounts of money paid to agencies, when patients are waiting longer than ever for treatment.

Labour will tackle this problem at its root. We will train the doctors and nurses the NHS needs, paid for by abolishing the non-dom tax status.

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Bank of England left in the dark ahead of new interest rate decision

With fiscal statement deferred and mixed government messaging on tax and spending the BoE has little to go on

The Bank of England will next week consider how much to raise interest rates without having received any guidance from the government about its tax and spending policies, after Jeremy Hunt pushed back the date for this year’s “autumn statement”.

Its policymakers meet on 3 November to decide the increase in the cost of borrowing required to tackle a rate of inflation that climbed above 10% in September.

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Another U-turn looms – how much will it save and what else could the chancellor ditch?

Corporation tax plans likely to be latest to be dropped – bad news for Kwarteng’s credibility, but good for his balance sheet

Liz Truss is on the verge of reversing one of the last major pillars of her chancellor’s disastrous September mini-budget.

While Kwasi Kwarteng mingles with finance ministers at the International Monetary Fund gathering in Washington DC, discussions are taking place in London that would see the promise to freeze corporation tax rates binned. There is also speculation about dropping smaller measures including a more generous tax treatment of share dividends. These U-turns would come hard on the heels of the humiliating climbdown on Kwarteng’s promise to scrap the 45p top rate of tax.

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Unfunded tax cuts mean UK ‘will need £60bn spending cuts’

IFS says Kwasi Kwarteng’s mini-budget will leave ministers making serious reductions in public services

Kwasi Kwarteng will need to find £60bn of savings by 2026 to fill the gap left by unfunded tax cuts and the costs of extra borrowing triggered by a panicked reaction on international money markets to the chancellor’s “mini-budget”, according to the Institute for Fiscal Studies.

The UK will also struggle to hit the chancellor’s 2.5% growth target, with economic forecasts by the investment bank Citigroup that the IFS uses to underpin its analysis showing the UK will struggle to grow at more than 0.8% on average over the next five years.

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Truss and Kwarteng will face fury of Tory MPs in week of crisis meetings

The PM and chancellor will try to stop panic spreading through the party after their high-risk economic plan threatens a ‘death spiral’

The prime minister, Liz Truss, and the chancellor, Kwasi Kwarteng, will face the wrath of Tory MPs at a succession of crisis meetings in parliament this week as their high-risk economic policies hit their poll ratings and spread panic in all wings of the party.

After a turbulent first five weeks at No 10 and an ill-disciplined, chaotic annual conference in Birmingham last week, Truss is expected to address the 1922 Committee of Tory backbenchers on Wednesday evening after taking on Keir Starmer at prime minister’s questions.

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Why OBR forecast is being held back until Kwarteng’s next fiscal plan

Huge policy changes are needed to get UK back on track – so early publication would give an incomplete picture

The message the government wanted to get out was clear. After less than a month as prime minister, Liz Truss had converted from vocal scourge of Treasury orthodoxy to an active supporter.

Given the fallout in financial markets after the not-so-mini-budget, Truss and her chancellor, Kwasi Kwarteng, laid on a heavily stage-managed meeting on Friday with officials from the Office for Budget Responsibility, the Treasury’s independent economic forecaster, to try to smooth over the mess.

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Truss and Kwarteng to hold back OBR forecasts for six weeks

PM and chancellor say they will not publish projections until late November despite them being ready next week

Liz Truss and Kwasi Kwarteng will refuse to release forecasts from the Office for Budget Responsibility (OBR) until more than six weeks after receiving them, despite calls for them to be published as soon as possible.

The prime minister and chancellor said they would only publish the independent forecasts on 23 November alongside a fiscal statement, despite them being ready on 7 October.

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Homeowners warned of ‘significant’ rise in UK interest rates

Bank of England’s chief economist speaks out after mini-budget, with financial markets expecting rates to reach up to 6%

Britain’s homeowners have been warned to brace themselves for a “significant” increase in interest rates from the Bank of England in response to Kwasi Kwarteng’s tax-cutting mini-budget last week.

Huw Pill, Threadneedle Street’s chief economist, added to the concerns of millions of mortgage payers who have already seen hundreds of home loan products pulled by lenders in anticipation of a big increase in the cost of borrowing.

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‘Fiscal sustainability’ plus rising borrowing costs could add up to cuts

To make the sums work, some suggest Kwasi Kwarteng may include deep spending reductions in his medium-term fiscal plan

When Kwasi Kwarteng met City figures on Tuesday, the Treasury said he had “reiterated the government’s commitment to fiscal sustainability”: though the grim faces of attendees in the official photos suggested they may not have been terribly reassured.

Some analysts are now warning that with borrowing costs rising sharply, and the chancellor determined not to water down his radical tax plans, “fiscal sustainability” points to one thing: spending cuts.

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Mini-budget 2022: pound crashes as chancellor cuts stamp duty and top rate of income tax – live

Tax cuts to cost Treasury around £37bn in 2023-24, official figures reveal

There are no urgent questions in the morning, and so Kwasi Kwarteng, the chancellor, will be delivering his statement soon after 9.30am.

The Commons starts sitting at 9.30am, but they always begin with prayers in private, and so Kwarteng will be up a few minutes later.

The last time they did it one third of the beneficiaries were people buying second homes or buy to let, so we are sceptical that this is the magic bullet to increase homeownership. What we really need to do is to build more houses and to help get people onto the property ladder by increasing the supply of housing.

When this has been done before, it has often fuelled an already hot market and many of the beneficiaries have been people buying a second or third home, rather than the first time buyers that we really want to help who are often trapped in private rented accommodation where they’re paying as much in rent every month as they would in a mortgage.

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Kwarteng accused of reckless mini-budget for the rich as pound plummets

Strategy of sweeping tax cuts gets hostile reception from markets and economic thinktanks, leaving some Tory MPs aghast

Kwasi Kwarteng has been accused of delivering a reckless mini-budget for the rich after his £45bn tax-cutting package sent the pound crashing to its lowest level against the dollar in 37 years.

In a high-risk strategy designed to revive Britain’s stagnant economy, the new chancellor announced more than £400bn of extra borrowing over the coming years to fund the biggest giveaway since Tony Barber’s ill-fated 1972 budget.

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UK in recession and further interest rate hikes probable, Bank warns Kwarteng

Threadneedle Street makes clear on eve of tax-cutting mini-budget that plans risk triggering more rate rises

The Bank of England has warned Kwasi Kwarteng the economy is in recession and it will most probably need to push interest rates higher after Friday’s tax-cutting mini-budget.

On the eve of a major package of support from the chancellor designed to break what he called the economy’s “cycle of stagnation”, Threadneedle Street said the UK economy was heading for a second consecutive quarter of falling output, with gross domestic product set to shrink 0.1% in the three months to September.

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Kwasi Kwarteng urged to allow release of OBR forecasts with mini-budget

Tory chair of Treasury committee says independent forecasts vital to provide reassurance to markets

The Tory chair of the Treasury select committee has urged Kwasi Kwarteng to allow independent forecasts for the public finances to be published alongside his mini-budget on Friday.

Mel Stride released a strongly worded statement urging more clarity around the effects of the new chancellor’s fiscal interventions.

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Economic watchdog confirms it could scrutinise Truss’s cost of living plans

MPs say it is vital tax and spending measures proposed by potential new prime minister are examined by OBR

Liz Truss has been challenged to open up her prospective emergency tax cuts and spending plans to scrutiny if she becomes prime minister and makes immediate moves to tackle the cost of living crisis.

The Office for Budget Responsibility (OBR), which produces independent forecasts based on major fiscal announcements by the government, revealed preparatory work had been under way for about a month to publish fresh economic forecasts in September.

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Soaring inflation pushes UK borrowing to £14bn in May

Interest on debt payment leaps 70% on a year ago to £7.6bn, a monthly record

Government borrowing was higher than expected in May at £14bn as soaring inflation sent interest payments on the UK’s debt to a monthly record.

The Office for National Statistics (ONS) said debt interest payments leapt 70% on a year ago to £7.6bn, the third highest debt interest payment made by central government in any single month and the highest payment in May on record.

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Labour urges spending watchdog to assess impact of chancellor’s £21bn package

Shadow Treasury secretary asks Office for Budget Responsibility to examine Rishi Sunak’s emergency cost of living measures

Labour has called for an independent assessment of whether Rishi Sunak’s £21bn cost of living emergency package could cause inflation to rise even higher and a verdict on the fiscal impact of substantial borrowing.

Pat McFadden, shadow chief secretary to the Treasury, wrote to the Office for Budget Responsibility (OBR) to ask it to analyse the impact of the measures.

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