CHANCELLOR Rachel Reeves launched a vicious war on benefit claimants in her Budget yesterday, warning that she intends to take over the Tory ‘work capability assessment’ and use it to ‘crackdown on fraud in our benefit system’
She admitted ‘this budget raises taxes by £40 billion’, and announced ‘funding for compensation schemes for victims of ‘two terrible injustices’, £11.8 billion for the infected blood scandal, and £1.8 billion for the Post Office Scandal.
She announced that the National Minimum Wage for 21 year olds and upwards would increase by 6.7% to 12.21 an hour and for 18-20 year olds by 16.3% to £10 an hour.
She announced the introduction of VAT on private school fees and that the level of debt repayment that can be taken from a household’s Universal Credit Payment each month would be cut from 25% to 15%. She said: ‘This means that 1.2 million of the poorest households will keep more of their awards each month.’
She announced that there will be a £2.9% increase in the defence budget next year, that 2.5% of GDP will be spent on defence and that there will be £3 billion for Ukraine for ‘as long as it takes’.
She said: ‘We will increase the rate of employers national insurance by 1.2 percentage points to 15% from April 2025, and we will reduce the secondary threshold, the level at which employers start paying National Insurance on each employee’s salary from £9,100 per year to £5000. This will raise £25 million per year by the end of the forecast period.’
Declaring war on public services, she warned: ‘Today we are setting a 2% productivity, efficiency and savings target for all departments to meet next year by using technology more effectively and joining up services across government.’
She continued: ‘As set out in our manifesto, I will shortly be appointing our Covid Corruption Commissioners. They will lead our work to uncover those companies that used a national emergency to line their own pockets, because that money belongs in our public services and taxpayers want that money back.
‘And I can confirm today that David Goldstone has been appointed as the chair of the new Office of Value for Money to help us realise the benefits from every pound of public spending.’
Targeting, the sick, the disabled, the mentally ill and the unemployed, Reeves announced that she will shortly come forward with a ‘Get Britain Working White Paper’, which will ‘tackle the root causes of inactivity’.
She announced a pot of ‘£240 million for 16 trailblazer projects targeted at those who are economically inactive’.
‘Today I am taking three steps to ensure that welfare spending is more sustainable:
‘First, we inherited the last government’s plans to reform the work capability assessment. We will deliver those savings as part of our fundamental reforms to the health and disability benefit system.
‘Second, I can today announce a crackdown on fraud in our welfare system, often the work of criminal gangs. We will expand DWP counter-fraud teams using innovative new methods to prevent illegal activity and provide new legal powers to crack down on fraudsters, including direct access to bank accounts to recover debt. This package saves £4.3 billion a year by the end of the forecast.
‘Third, the government will shortly be publishing the Get Britain Working White Paper, tackling the root causes of inactivity with an integrated approach across health, education and welfare.
‘And we will provide £240 million for 16 trailblazer projects targeted at those who are economically inactive and most at risk of being out of education, employment or training, to get people into work and to reduce the benefits bill.’
Towards the end of her one-hour and twenty minute speech she warned that she was going to scrap what she claimed had been ‘the previous government’s immunity to lower value shoplifting,’ she announced a 40% cut in business rate relief for for pubs and leisure and a 50% hike in the maximum bus fare cap, up from £2 to £3.
