‘FAMILIES hit by the cost of living crisis, business hit by a supply chain crisis, those who rely on our schools and our hospitals, and our police. They won’t recognise the world that the chancellor is describing,’ Rachel Reeves, Labour shadow chancellor, said yesterday in response to Tory Chancellor Sunak’s budget.
It amounted to huge tax cuts for bosses and bankers and a stepping up of the war on working families, the unemployed and youth.
‘They will think that he is living in a parallel universe,’ Reeves continued.
She added: ‘The Chancellor in his budget has decided to cut taxes for banks.’
She stressed: ‘And the sheer arrogance. After taking £6bn out of the pockets of some of the poorest people in this country, expecting them to cheer today when he gives £2bn back to compensate.
‘In the long story of this Parliament, never has a Chancellor asked the British people to pay so much for so little.
‘Time and again today, the Chancellor compared the investments that he is making to the last decade.
‘But who was in charge in the last decade? They were.
‘The highest sustained tax burden in peace time. And who is going to pay for it?
‘It is not international giants like Amazon. No the Chancellor has found a tax deduction for them.
‘It is not property speculators, they have already profited a stamp duty cut and and it is clearly not the banks, even though bankers’ bonuses are set to reach a record high this year.
‘Instead, the Chancellor is loading the burden on working people. A National Insurance tax rise, on working people. A council tax hike on working people.
‘No support today for working people who have to pay VAT on their gas and electricity bills.
‘And what are working people getting in return? A record NHS waiting list, with no plan to clear it, no way to see a GP and still having to sell their home to pay for social care.’
‘… And why are we in this position?
‘Why are working class people being asked to pay more tax while putting up with worse services.
‘Why is billions of pounds in taxpayers’ money being funnelled to the friends and donors of the Conservative Party while millions of families on Universal Credit are having £20-a-week taken away from them.
‘Now the government will always blame others – it’s businesses fault, its the EU’s fault, it is the public’s fault. Global problems, the same old excesses.
‘But the blunt reality is this: Working people are being asked to pay more for less for three simple reasons; economic mismanagement, an unfair tax system and wasteful spending.
‘… The Chancellor says that we have bounced back greater but that is because we fell further.
‘If this was a plan, it would be economic sabotage.’
Tory Chancellor Rishi Sunak, in opening his budget, admitted that inflation has hit 3.1% and ‘is likely to rise further.’
He announced that VAT on household energy bills is not going to be cut, despite calls to help families struggling with soaring prices.
Sunak put the sharp rise in inflation down to ‘global factors of the world opening up after the pandemic’ and ‘demands for goods increasing’.
He admitted that higher prices will last past Christmas. He said that the fiscal situation in the UK is between four to six times more ‘sensitive’ than it was before the pandemic, so forecasts have been adjusted.
Nurses, NHS workers, teachers and all workers will be furious that, on the burning issue of a pay rise, he refused to put a figure to a rise – and as inflation rips, any ‘rise’ may well be a real terms pay cut.
Sunak said: ‘Public sector workers will see fair and affordable pay rises across the whole spending review period.
‘And we return to the normal independent pay setting process.
‘And I can take action to help the lowest paid as well.
‘ … The Independent Low Pay Commission brings together economists, business groups and trade unions.
‘The government is accepting their recommendation to increase the National Minimum Wage next year by 6.6% to £9.50 an hour.’
Sunak declined to take responsibility for the crisis saying: ‘Do we want to live in a country where the response to every question is “what is the government going to do about it?. . .”
‘Or do we choose to recognise that government has limits. If it is a controversial statement to make then that means it needed to be said.
‘There is a reason we talk about the importance of family, community and personal responsibility.’
The Office for Budget Responsibility pointed out that ‘Sunak has raised taxes by more this year than in any single year since 1993’, after the Black Wednesday currency crash.
Borrowing costs could start to go up as soon as next week when the Bank of England is due to announce its November policy decision over raising the Bank Rate.