Category Archives: Institute for Fiscal Studies

Burnham says he would put PR in Labour manifesto and scrap triple lock to fund social care – UK politics live

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PM, in first speech to party conference as leader, insists his plans are a ‘good deal’ for older people

Angela Rayner, the housing secretary, has apparently confirmed that Andy Burnham will float the prospect of getting rid of the pensions triple lock to help fund the creation of an NHS-style care service.

Asked about the prospect on Sky’s Electoral Dysfunction podcast, Rayner said that Burnham was “absolutely right to start the conversation” and that he was being “brave”.

The high principle on this is that people have paid in all their lives. They are willing, I think, to look at that.

What they don’t want is what they consider to be, quite frankly, incompetent politicians that are going to take something from us to fill a black hole.

When we met with Andy [Burnham] this week, it certainly wasn’t mentioned.

But I do think that it’s important that Labour make sure that working-class people know that they’re on their side, and this would be a direction of travel that would say the opposite to that.

What I understood the national care service to be was a universal benefit: everybody paid in and everybody gets out, and that is what actually the principle of that is.

Going to a group of people who are getting around £12,500 a year in order to pay for it to take away their security is wrong.

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Khan addresses Polanski in Urdu at London assembly, mocking Green leader’s byelection video – UK politics live

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It comes after the Green leader, who is standing as a candidate in the Holborn and St Pancras byelection, recorded a campaign video in Urdu

Andrew Griffith has delivered his speech, and he is now taking questions.

Q: You want the government to pause the making tax digital programme. Is that an admission that the last government got this wrong when it introduced it?

It is an admission that despite [good] intentions, the execution of that has left a lot to be desired.

In fact, coming to parliament from business, I can confess the law that we pass the most often is the law of unintended consequences. And I think making tax digital is a good example of that.

The truth is that Burnham and Miliband ignored the advice they were given – which was that if they were determined to sanction Israel, they should not do so before the Israeli election on 27 October.

It may not be surprising that this was the message from the Israeli foreign minister, Gideon Sa’ar, when Miliband called him on 11 August to warn sanctions were imminent. ‘He said postpone it until after the elections,’ a diplomatic source confirms. It was also the message the Israeli embassy in London – and its new chargé d’affaires Chris Cantor – was relaying to the Foreign Office. ‘Their message was clear: why do it now? Wait until after the elections, because something might change,’ a senior Labour figure says.

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Next Scottish government faces ‘really difficult’ spending choices, economists say

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Parties accused of ‘fiscal denial’ and failing to tell voters the scale of the challenge

The next Scottish government will need to make “really difficult” spending decisions soon after taking power, including tackling its large public sector pay bill, senior economists have said.

Economists with the Fraser of Allander Institute, at the University of Strathclyde, believe the manifestos published by Scotland’s political parties during the campaign failed to tell voters about the true scale of the challenge.

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Zack Polanski tells NEU teachers’ union that Greens would abolish ‘toxic’ Ofsted – UK politics live

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The Green party leader said Ofsted is a ‘failed institution’ and that teaching should move ‘toward a genuinely collaborative model’

Starmer complained about other parties whipping up division, and he specifically criticised Nick Timothy, the shadow justice secretary, for “complaining about Muslims praying in public”.

Labour, by contrast, values bringing people together, he said.

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Trump says UK’s aircraft carriers are just ‘toys’, repeating complaint about lack of support for US in Iran – UK politics live

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The comments were part of a broader address in which he condemned Nato allies

Yesterday the Conservative party said that it wanted to ban political parties from distributing campaign literature in a foreign language. Announcing a plan to propose an amendement to the representation of the people bill to make this law, the shadow communities minister Paul Holmes said:

Campaigning in a foreign language as the Greens did in Gorton and Denton only fosters greater division. A coherent national culture relies on shared values, and an inclusive electoral process relies on a common tongue.

I think it’s for political parties to choose how they campaign and communicate with British voters. If they’re using British money that is funding their campaigns and they’re speaking to people who have the right to vote, then why would you not show those voters the respect of communication?

What fuels division is Nick Timothy standing up and singling out Muslim forms of worship for a ban when he’s not applying that to forms of worship that other religions are talking about.

It just doesn’t compute, does it? I worked in Number 10. Briefly, I had a Number 10 phone. There was a paranoia about devices like that falling into other people’s hands.

And so whether it was the Met Police, whether it was Morgan McSweeney, and what sounds like pretty evasive set of reporting, even when you look at that transcript, or whether it was the Number 10 security team following up something that at the time they could not have been sure had not been taken by a state actor, a phone with all sorts of government secrets potentially in it, that’s precisely why people in government have two separate phones.

I don’t believe McSwindle had his iPhone stolen

Honest believe, Matt. It’s smacks of the liar Johnson defence of ‘lost all my WhatsApp messages’. We mustn’t take the public for fools. And I am afraid this smacks of too convenient by far. I won’t do it. I will say what I actually think. And I don’t believe it. End of!

I believe the report was made. McSwindle didn’t mention that he was the chief of staff to the PM. A significant omission of he’d wanted the police to prioritise the offence.

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Starmer says budget did not break manifesto tax pledge – as it happened

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PM says: ‘We kept to our manifesto in terms of what we’ve promised. But I accept the challenge that we’ve asked everybody to contribute’

The Conservative party is attacking the budget on the grounds that Rachel Reeves is putting up taxes supposedly to fund more spending on benefit claimants. Even though the rationale for this claim is questionable, the Tories were making it before the budget was announced, and Kemi Badenoch firmed it up last night, claiming it was a “Benefits Street budget”.

On LBC this morning, asked if the budget meant “alarm clock Britain paying for Benefits Street”, Reeves said she did not accept that. She said 60% of the families that would benefit from the removal of the two-child benefit cap (the most expensive welfare announcement in the budget) were in work.

I don’t think children should be punished by this pernicious policy any longer. And the cost to society of this is huge, the cost for councils of temporary accommodation, when people can no longer afford the rent, putting families in B&Bs, kids having to move to school all the time because parents have moved from B&B to another lot of temporary accommodation, and there’s costs for years to come, because all the evidence shows that kids that are growing up poor are less likely to get into work and more reliant on the welfare state in the future for them.

So this is a good investment in those kids, to give them the chances that I want for my kids, and everyone wants for their kids. It also saves money for taxpayers on that accommodation, on those additional health costs, and ensuring that those kids grow up to be productive adults.

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Rachel Reeves targets UK’s wealthiest in £26bn tax-raising budget

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Chancellor axes two-child benefit cap and cuts energy bills paid for by mansion tax and freezing tax thresholds

Rachel Reeves targeted Britain’s wealthiest households with a £26bn tax-raising budget to fund scrapping the two-child benefit policy and cutting energy bills.

On a chaotic day that involved key details of her budget accidentally being released early by the Office for Budget Responsibility (OBR), the chancellor defended the measures, saying she was “asking everyone to make a contribution to repair the public finances”, but that she wanted the wealthiest to pay the most.

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Starmer says welfare concessions are ‘common sense’ but dodges funding question – UK politics live

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No 10 has offered significant concessions to the rebels, estimated to cost around £3bn a year, amid fears over Tuesday’s vote

Stephen Kinnock, the care minister, was the government voice on the airwaves this morning. Here are the main points he made about the welfare bill U-turn.

Kinnock rejected claims that the U-turn was a sign of weakness. When it was put to him on the Today programme that this move, coming after the U-turns on winter fuel payments and a national inquiry into grooming gangs, showed that if Keir Starmer was pushed, he would give in, Kinnock replied:

I think if you talk to people out there in the country, they respond very positively to politicians listening, engaging, recognising that you don’t get everything right from day one every time, and making the adjustments and the changes that are needed.

And this prime minister will always put the country first. He puts country before party, and he does the right thing for the country.

He defended having a “staggered” approach to changing benefit rules. Asked about the Tory claim that the government was creating a “two-tier benefits system” (see 8.30am), he replied:

Whenever you bring forward change to a complex system, you always have to decide between do you make the change for everybody that’s in that system, in one big move, or do you do it in a more staggered way? What’s clear from the announcement today is that it’s going to be a more staggered process.

He declined to say how much the U-turn would cost. He told Times Radio:

The full details around what we are laying out, what I’ve summarised really today, is going to be laid out in parliament, and then the chancellor will set out the budget in the autumn the whole of the fiscal position and this will be an important part of that.

He said he was now confident that the UC and Pip bill will pass its second reading on Tuesday.

All of the MPs I’ve spoken to who signed the reasoned amendment – MPs from across the party, not just on the left – are sticking to their position because we understand that we are answerable to our constituents.

If the government doesn’t pull the bill, doesn’t consult properly with disabled people and come back to MPs with a serious proposal that protects the dignity of disabled people, I will vote against and I will be far from the only one.

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Starmer unlikely to fulfil pledge on hospital waiting times, says IFS

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Thinktank predicts PM will not realise ambition for 92% of patients in England to wait less than 18 weeks for planned care by 2029

Keir Starmer is unlikely to fulfil his pledge to restore the maximum 18-week wait for planned hospital care before the next election, a leading thinktank has said.

The prime minister has made bringing back the 18-week access standard in England, by ensuring that 92% of patients are seen within that time, one of the six “milestones” he has promised to achieve by 2029.

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Assisted dying bill has lost Commons majority now high court signoff abandoned, says MP – UK politics live

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Danny Kruger says those who backed the bill did so under false premise after change to safeguards announced

There will be two urgent questions after 12.30pm: on the Clonoe inquest, which found that the SAS acted unlawfully when they killed four IRA terrorists in an ambush in 1992; and then another on the US steel tariffs.

A Northern Ireland Office minister will respond to the first, and a business minister will respond to the second.

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Reeves’s long-term spending figures almost as unrealistic as Tories’ were, IFS says – UK politics live

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Institute for Fiscal Studies says budget ‘looks like the same silly games’ as seen under the Conservatives

Rachel Reeves is now being interview on ITV’s Good Morning Britain.

She is being interviewed by Ed Balls, the former Labour shadow chancellor who is now a TV presenter. He asks her to confirm that workers will end up losing out because of the employers’ national insurance contributions (NICs) increase.

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Rachel Reeves may have to find more money to fix public services, says IFS

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Institute for Fiscal Studies says budget allows for rise in public service spending this year and next, but not thereafter

Rachel Reeves could be forced to find more money to fix public services after her budget made a start at reversing the “unrealistic” and irresponsible spending plans of the Conservatives, the Institute for Fiscal Studies (IFS) has said.

Britain’s leading experts on the government’s finances said the chancellor’s tax measures on Wednesday had allowed for a substantial short-term increase in public service spending this year and next, but not thereafter.

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Jeremy Hunt claims Labour changing debt definition will ‘punish families with mortgages’ – as it happened

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Former chancellor says ‘increasing borrowing means interest rates would be higher for longer’ as Reeves says it will ‘make space for investment’

Nigel Farage, the Reform UK leader, has said that “no one knows” who Robert Jenrick, the Tory leadership contender, is.

Of the two candidates left in the contest, Jenrick is the one who is doing most to appeal to Tories who defected to Reform UK, because he is saying Britain should leave the European convention on human rights.

I know the fella. Is he the chap that one day was on the very much on the left of the Conservative party and is now on the right of the Conservative Party?... No one knows who he is.

I’m sure government can agree that support and providing opportunities for young people should be central to the policy of any government. We are glad to see the government working to build closer economic and cultural ties with Europe. We want to forge a new partnership with our European neighbours, built on cooperation, not confrontation and move to a new comprehensive agreement.

We must build rebuild confidence through seeking to agree partnerships or associations helping to restore prosperity and opportunities for British people.

We are not going to give a running commentary on the negotiations. We will obviously look at EU proposals on a range of issues, but we are clear that we will not return to freedom of movement.

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Labour needs £25bn a year in tax rises to rebuild public services, warns IFS

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Thinktank says tax increases in budget will be necessary even if Rachel Reeves changes fiscal rules

Keir Starmer’s promise to end austerity and rebuild public services will require tax increases of £25bn a year in the coming budget even if debt rules are changed to provide scope for extra investment spending, a leading thinktank has said.

In its preview of the first Labour budget in 14 years, the Institute for Fiscal Studies said Rachel Reeves would need to raise taxes to fresh record levels to meet the government’s policy goals. The chancellor was also warned of the risk of a Liz Truss-style meltdown if the City responded badly to substantially higher borrowing.

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Scottish government announces spending cuts worth £500m – as it happened

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Shona Robison, Scottish finance secretary, says current financial situation facing Scottish government is ‘not sustainable’

Tom Tugendhat, the former security minister, is launching his campaign for the Tory leadership. There is a live feed here.

Tugendhat started by saying that he did not actually want the job, because he does not want to be leader of the opposition. He wants to be prime minister, he said.

Politics is not a game, and we all know the cost when government isn’t sober and serious. We saw it in the lives lost in Afghanistan and then in that wasted chaos of that withdrawal. We saw it during Covid, not just in the lost years of education that cost so many or the opportunities missed, or even in the grief for lost loved ones or those left to cope alone, but through the disrespect.

That’s why I’m standing before you today, because this country can change. We must change, and Britain deserves better, and we need a different government.

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Former Sunak adviser urges Labour to introduce wealth tax on housing

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The economist behind the Covid furlough scheme has called for ‘unfair’ council tax and stamp duty to be axed

Council tax and stamp duty are “unfair and unpopular” taxes that should be abolished, says the economist who devised the Covid furlough scheme.

Tim Leunig, who has advised a series of cabinet ministers, including Rishi Sunak during his prime ministership, said it was time for a new and radical approach that would axe the two taxes and replace them with proportional levies.

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UK recovery ‘will accelerate and force Bank to keep interest rates higher for longer’

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Niesr forecasts raise doubts over chance of further cuts by Bank of England before end of year

The UK’s economic recovery will accelerate over the next year, forcing the Bank of England to keep interest rates higher for longer, according to the National Institute of Economic and Social Research (Niesr).

Signalling that bets on further interest rate cuts before the end of the year could be misplaced, the thinktank said a modest economic recovery and the threat from persistent inflationary trends should make the central bank more cautious about reducing the cost of borrowing.

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Labour facing moment of truth over tax pledges, economists warn

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Experts say 5.5% pay increase for public sector not ‘consistent’ with spending plans that rule out tax rises

Labour is fast approaching a moment of truth over its election pledges on tax and spending, experts have warned, after Rachel Reeves indicated the government could agree above-inflation pay rises for public sector staff.

The chancellor promised a full statement on pay board recommendations that teachers and NHS workers should receive 5.5% pay awards, ahead of an autumn budget that is set to be one of the most difficult economic balancing acts in years.

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Sunak defends decision not to take immediate action against Tories in betting scandal – as it happened

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Prime minister faces claim Tories are ‘stealing the candlesticks’ on the way out of government

After a passage in his speech attack Labour on familiar grounds, Rishi Sunak also hit out at Reform UK.

[Reform UK] are not on the side of who you think they are.

Reform are standing candidates here in Scotland that are pro independence and anti monarchy.

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Next government faces hard choices on English universities, say experts

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Ministers left with unpalatable options of raising tuition fees, making grants or capping student numbers, says IFS

The next government faces “unpalatable” choices between raising tuition fees, making direct grants or capping student numbers to rescue universities in England from their financial black hole, the Institute for Fiscal Studies has warned.

The thinktank said universities that relied on teaching UK students for the bulk of their income were most vulnerable, calculating that undergraduate tuition fees would now be £12,000 if they had kept pace with inflation, rather than the £9,250 rate frozen since 2016.

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