Category Archives: Budget

Jeremy Hunt faces red wall revolt if he delivers ‘a budget for the rich’

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The chancellor’s potential inheritance tax cut in Wednesday’s budget would aid millionaires amid a cost of living crisis

Jeremy Hunt faces a backlash from “red wall” Tory MPs if he uses a fiscal windfall of up to £20bn to deliver tax cuts for the rich rather than to help ordinary families with the cost of living, the Observer has been told.

The chancellor and Rishi Sunak are this weekend finalising an autumn statement on Wednesday that could include a major reduction in inheritance tax – four-fifths of which would benefit those with more than £1m at their death, according to a new report from the Institute for Fiscal Studies (IFS). Each person with more than £1m would receive an average tax cut of £180,000, the IFS states.

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Hunt urged to invest £30bn a year in infrastructure or risk ‘decade in doldrums’

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Thinktank says stronger than expected tax revenues have given chancellor scope for bold package in autumn statement

Jeremy Hunt risks condemning Britain to a decade in the doldrums unless he uses this month’s autumn statement to announce a £30bn-a-year investment plan to upgrade public infrastructure, a leading thinktank has warned.

The National Institute for Economic and Social Research (NIESR) said the chancellor should ignore calls by Tory MPs for pre-election tax cuts and instead focus on measures to boost growth through improvements to transport, digital networks, skills and housing.

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Liz Truss to claim her economic plan would have saved government £35bn

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Former PM set to give speech defending her time in charge and explaining spending decisions

Liz Truss will claim that Rishi Sunak’s government has spent £35bn more than she would have as prime minister, in a speech on Monday.

The short-lived prime minister will use a speech at the Institute for Government to defend and explain her time in charge, nearly a year on from the ill-fated mini-budget that helped end her premiership.

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Liz Truss to ‘share lessons’ of her time in government in new book

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The former PM blames lack of support for Conservative ideas as part of her downfall during her 49-day premiership

Liz Truss is writing a book about her 49 days as prime minister, which will argue the main cause of her downfall was a lack of “support for Conservative ideas” – and too much support for the “global Left”.

The former prime minister wants to see a “Conservative movement revival” and has decided to “share the lessons” from her time in government, where she was “often the only conservative in the room”.

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Military sites to house asylum seekers to meet ‘essential living needs and nothing more’, says minister – as it happened

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Eagle how the pay settlement for health workers will be funded.

Hunt says, as with all pay settlements, departments fund them from the money they get in the spending review. But in exceptional circumstances they can speak to the Treasury about extra help.

But we make a commitment that there will not be a degredation of frontline services for the public.

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Lack of data makes government claims about English childcare ‘meaningless’

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Only 15% of local councils collect data on proportion of parents who are able to access sufficient childcare

The government’s claims that there are enough childcare places in England are “meaningless” as councils collect little to no information on whether provision meets local demand, experts have said.

Local authorities are responsible for ensuring that the provision of childcare is sufficient to meet the requirements of parents in their area under section 6 of the Childcare Act 2006.

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Doubts grow over number of NHS doctors helped by pension giveaway

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New figures reveal only 100 hospital doctors left NHS in 2022 due to voluntary early retirement, despite claims by Jeremy Hunt

The number of hospital doctors that could be helped by Jeremy Hunt’s pensions giveaway has been cast into doubt, after new figures revealed that only 100 of them left the NHS last year due to voluntary early retirement.

Criticism has mounted about the measure announced in the budget, which would scrap the up to 55% tax levied on lifetime pension pots worth just over £1m and raise the annual allowance threshold from £40,000 to £60,000.

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NHS workers expected to be offered one-off payments worth up to 6% as part of revised pay offer – UK politics live

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Health secretary expected to announce a formal pay offer to key unions later today

Sinn Féin’s US fundraising arm has caused a row by calling for a referendum on Irish unity in adverts in the New York Times, Washington Post and other US publications.

The half-page ads were paid for by Friends of Sinn Féin and ran on Wednesday urging support for unity referendums in Northern Ireland and the Republic of Ireland. “It is time to agree on a date,” it said. “Let the people have their say.”

They’re ads from Irish American organisations whose view on reunification is well known and held for a very long time and they take out ads every year. So, the focus now needs to be on getting back to work [at Stormont].

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Budget: UK on track for ‘disastrous decade’ of income stagnation

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Thinktank says taxes as share of GDP are on course to reach 70-year high but public services are being cut

The UK remains on track for a “disastrous decade” of stagnant incomes and high taxes, despite cuts to public services, the Resolution Foundation has said in its analysis of the budget on Wednesday.

The thinktank, whose stated aim is to improve the standard of living for low- and middle-income families, said typical household disposable incomes were on course to be lower by the end of the forecast period in 2027-28 than they were before pandemic, when inflation was taken into account.

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Jeremy Hunt defends pensions giveaway as Labour vows to scrap it

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Shadow chancellor says decision to axe lifetime allowance is ‘wrong priority at the wrong time for the wrong people’

The Labour party has vowed to reverse the chancellor’s £1bn budget pensions tax “gilded giveaway” for the wealthiest 1% if it wins the next general election, as Jeremy Hunt defended his decision to scrap the lifetime pensions allowance.

The shadow chancellor, Rachel Reeves, said Labour would seek to force a Commons vote next week on the decision, which critics argue will allow the wealthiest people to put a limitless amount into their pension pots, which can then be passed on to their heirs without paying inheritance tax.

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Jeremy Hunt is helping rich instead of helping people into work, says thinktank

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IFS says budget pensions giveaway could open up loophole for avoidance of inheritance tax

Jeremy Hunt’s huge pensions giveaway for the wealthiest 1% may have no impact on increasing the number of people in work, while opening a loophole for avoidance of inheritance tax, a leading economic thinktank has warned.

The Institute for Fiscal Studies said the surprise measure in the chancellor’s budget “probably won’t play a big part, if any” in increasing the number of people in work.

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Jeremy Hunt aims to spur business investment with ‘full expensing’ tax break

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Measure over next three years will allow firms to write off costs of IT equipment and machinery against tax on profits

Jeremy Hunt has launched a flurry of tax breaks to encourage investment by businesses after the double blow of microchip designer Arm opting for a New York stock market listing and AstraZeneca deciding to build a new factory in Dublin.

Businesses that invest in IT equipment and machinery will be able to claim back the cost by writing it off against tax on their profits, the chancellor announced in his budget on Wednesday.

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Jeremy Hunt makes U-turn on planned cut to energy support

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Campaigners unite with suppliers to call on ministers to give long-term help to struggling households

Ministers are under pressure to announce plans for a social tariff to help Britons struggling with their energy bills over the long term, after the government performed a U-turn on a planned cut to support for households.

On the morning of the chancellor Jeremy Hunt’s budget speech, the government confirmed the energy price guarantee would continue at its current rate, which limits a typical annual household bill to £2,500. It is being extended from April, when it was due to expire, for a further three months until the end of June.

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Budget pension shake-up is £4bn tax giveaway for wealthy, critics say

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Jeremy Hunt criticised for scrapping lifetime allowance and increasing annual contribution cap

The chancellor has been accused of unveiling a £4bn tax giveaway that will benefit the wealthiest people in the UK by dramatically increasing how much they can stash away in pensions while enjoying the full tax benefits.

Jeremy Hunt announced a major shake-up of the rules governing how much people can pay into their retirement pots, which will have no impact on the vast majority of the population but could lead to huge gains for the top few per cent of wealthy, older pension savers. Labour claimed it was a handout for “the richest 1%” and that someone with a £2m pension pot would pay up to £275,000 less in tax as a result.

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Hunt’s disability plans put 1m at risk of losing £350 a month, IFS says

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Charities and disability campaigners say chancellor’s proposals set out in his budget more ‘stick than carrot’

Up to 1 million people currently claiming incapacity benefits could lose hundreds of pounds a month as a result of plans outlined in the budget to push ahead with the “biggest reforms to the welfare system in a decade,” experts have said.

The warning came as ministers unveiled a range of measures to try to drive more people back into the workplace, including scrapping controversial “fit for work” tests for disabled claimants and stepping up the threat of benefit sanctions against part-time workers.

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Tories urge Jeremy Hunt to reverse army cuts in forthcoming budget

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Planned 4% reduction in troop numbers should be abandoned in light of Ukraine war, say MPs and officials

Senior Tories are calling on Jeremy Hunt to abandon further cuts to the army by raising defence funding at next month’s budget, amid growing unease at the state of Britain’s military capabilities.

The chancellor has been urged by MPs to ensure the number of troops is held at the current level of about 76,000, instead of reducing it to 73,000 by 2025.

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Raising council tax to fund social care will deepen inequality in UK, experts warn

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Jeremy Hunt’s plans criticised for delay to reform, shifting burden to local authorities and ‘skewing the system’

Jeremy Hunt’s decision to fund more social care through increases in council tax will deepen inequality and undermine the cause of “levelling up”, the architect of the government’s planned reforms said last night.

The criticism from Andrew Dilnot, the economist whose blueprint for reform was delayed by another two years in Hunt’s first budget on Thursday, was echoed by senior figures in local government who said it would leave poorer areas at a disadvantage and was not the answer to the social care crisis.

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

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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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Voters choose Sunak’s Tories over Labour to repair economy, new poll reveals

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Rishi Sunak’s arrival in Downing Street is already helping to repair the party’s reputation for financial management

Rishi Sunak and the Conservatives have overturned Labour’s lead in terms of who voters trust most to manage the economy, a new poll for the Observer has revealed.

The new prime minister is currently drawing up tax rises and spending cuts designed to fill a £40bn fiscal hole left by Liz Truss’s disastrous time in Downing Street, with warnings that any significant attempt to cut Whitehall budgets will lead to huge pressure on public services. It comes with new analysis revealing that freezing public service spending would save £20bn but would also lead to a return to the austerity of the 2010s.

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

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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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