Rachel Reeves denies lying to public in run-up to budget

A picture


Rachel Reeves has denied lying to the public in the buildup to last week’s budget, insisting that she needed to raise taxes to a record level to ensure economic stability.The chancellor said on Sunday she had announced £26bn-worth of tax rises on Wednesday in part to build a buffer against her fiscal rules and reduce the risk of further tax increases in the future, and in part to protect public spending.Her messaging contrasted, however, with what she said before the budget, when she said tax rises would be necessary because of an expected decision by economic forecasters to reduce their growth expectations.In the end, the Office for Budget Responsibility (OBR) did downgrade its expectations for economic productivity, but said unexpectedly strong wage growth and tax receipts would more than make up for that.The OBR’s comments have kickstarted a political firestorm, which has led opposition politicians to demand Reeves’s resignation.

Keir Starmer is expected to defend the chancellor in a speech on Monday, during which he will also announce new measures to boost economic growth.On Sunday, Reeves told the BBC’s Laura Kuenssberg: “I wanted to build up the fiscal, economic resilience.The headroom that I had in the spring statement of £9.9bn, I’ve taken that up to £21.7bn.

”She added: “I know that some people are suggesting that there was a small surplus that the OBR published on Friday.But if I was on this programme today and I was saying £4bn surplus is fine, there was no economic repair job to be done, I think you would rightly be saying that’s not good enough.“That would have been the lowest surplus that any chancellor ever delivered against the fiscal rules.I was clear I wanted to build up that resilience, and that is why I took those decisions.”She added that she was confident in her position as chancellor despite calls from the Conservatives and Reform UK for her to resign.

“I was an MP in opposition for 14 and a half years,I have been underestimated all the way through my life,As a young girl from an ordinary background, people make assumptions about me,I’ve defied them before, and I will defy my critics again,”Starmer and Reeves have spent the past few days defending the decisions they made in the budget, which included freezing income tax thresholds to help pay for more headroom and about £8bn more welfare spending than previously planned.

Much of the criticism directed at Reeves has centred on comments she and her aides made in the buildup to the budget as she contemplated breaking a manifesto commitment and raising income tax rates.In a speech earlier this month, she said: “It is already clear that the productivity performance that we inherited from the last government is weaker than previously thought.“A less productive economy is one that produces less output per hour worked.That has consequences for working people – for their jobs and for their wages, and it has consequences for the public finances too, in lower tax receipts.”Kemi Badenoch, the Conservative leader, said on Sunday she thought the chancellor should resign.

“The chancellor called an emergency press conference, telling everyone about how terrible the state of the finances were, and now we have seen that the OBR had told her the complete opposite,” Badenoch told the BBC.“Because of that, I believe she should resign.”Badenoch defended the tone of some of her criticisms, including her personal mockery of the chancellor in the House of Commons.She accused Reeves in her official budget response of “wallowing in self-pity and whining about misogyny and mansplaining” – comments that Reeves said on Sunday made her “uncomfortable” because of their personal nature.Badenoch insisted, however, she was right to criticise the chancellor in the tone she did, saying: “My job is to hold the government to account, not to provide emotional support for the chancellor.

”Downing Street defended Reeves over the weekend,A No 10 source told reporters: “The idea that there was any misleading going on about the need to raise significant revenue as a result of the OBR figures, including the productivity downgrade they contained, is categorically untrue,”Starmer will repeat those sentiments on Monday morning in a speech from Downing Street in which he is expected to praise the budget for reducing the cost of living and inflation,He will also announce a fresh push to cut business regulation in a renewed effort to boost economic growth, including reforming the rules on building nuclear power plants,The prime minister is also expected to announce that the business secretary, Peter Kyle, has been asked to look again at the processes surrounding large infrastructure projects in general.

politicsSee all
A picture

Let’s not repeat the folly of PFIs for NHS buildings | Letter

In response to Lord Hutton’s letter (23 November) on NHS hospitals built under the private finance initiative (PFI), independent research into the design quality of PFI public buildings, by all of the auditing authorities in the UK, showed serious flaws and a significant “quality gap” when compared to traditional design-led procurement.In my 2007 book The Design Quality Manual: Improving Building Performance, I included results from all these reviews, starting with the Audit Commission’s 2003 report PFI in Schools. The design flaws were serious, including poor functionality, short-life materials, and non-compliance with building and safety regulations.PFI contracts tend to be led by building contractors rather than architects. So was the refurbishment of Grenfell Tower

A picture

Fears for UK security as Foreign Office moves to scrap unit on conflict and refugee crises

The Foreign Office has been warned that a plan to axe its dedicated unit on emerging conflicts and refugee crises is a “real error” that “undermines UK security” as the department grapples with swingeing cuts.The Foreign, Commonwealth and Development Office’s (FCDO) migration and conflict directorate, which employs about 100 civil servants, is being abolished at the end of this year and its work subsumed by the rest of the department.The directorate provides advice and technical support to governments and civil society groups in trouble spots, including Syria, South Sudan, Ethiopia, Yemen and the Philippines.It is slated to close despite Yvette Cooper, the foreign secretary, writing last week that the FCDO was “stepping up efforts” to support peace-building.The move is part of a wider restructuring that threatens 2,000 jobs – about a quarter of the workforce – and has damaged morale among diplomats

A picture

Your Party to have ‘collective leadership’ in win for Zarah Sultana

The new leftwing party headed by Jeremy Corbyn and others has voted narrowly for it to have a ‘“collective leadership” in a win for Zarah Sultana, who has been at loggerheads with the former Labour leader.The results were announced on Sunday after a chaotic start to its founding conference in Liverpool. Sultana, a former Labour MP who now sits as an independent, had boycotted the first day of the conference amid disagreements over how Your Party – its provisional name – should be run.In advance of the results of voting on the party’s constitutional arrangements, Corbyn had said: “It’s quite hard for the public to grasp things that there are sort of 10 people who run things.”However, members voted by 51

A picture

Rachel Reeves denies lying to public in run-up to budget

Rachel Reeves has denied lying to the public in the buildup to last week’s budget, insisting that she needed to raise taxes to a record level to ensure economic stability.The chancellor said on Sunday she had announced £26bn-worth of tax rises on Wednesday in part to build a buffer against her fiscal rules and reduce the risk of further tax increases in the future, and in part to protect public spending.Her messaging contrasted, however, with what she said before the budget, when she said tax rises would be necessary because of an expected decision by economic forecasters to reduce their growth expectations.In the end, the Office for Budget Responsibility (OBR) did downgrade its expectations for economic productivity, but said unexpectedly strong wage growth and tax receipts would more than make up for that.The OBR’s comments have kickstarted a political firestorm, which has led opposition politicians to demand Reeves’s resignation

A picture

Your Party’s first conference shows little sign of achieving fresh start

When the idea of a new leftwing party spearheaded by Jeremy Corbyn and Zarah Sultana was first mooted in the summer, it was so popular that hundreds of thousands of people expressed an interest in joining.Although it was quickly beset by arguments – its co-founders rowed bitterly over its initial leadership and funding model – many hoped this weekend’s inaugural conference would signal a fresh start.A sizeable chunk of the 2,500 delegates are former Labour members, disappointed by the policies of the current government and looking for a political home as they worry about the rise of Reform UK.As plans for the party’s first official gathering were finalised, Sultana and Corbyn looked to have buried the hatchet. Appearing at a leftwing festival in Manchester last month, Sultana jokingly compared the duo to the Gallagher brothers, saying: “I’m here to tell you the show is back on the road

A picture

Your Party conference thrown into chaos as Zarah Sultana boycotts first day

Zarah Sultana has boycotted the first day of Your Party’s inaugural conference, throwing the party’s first official gathering into chaos amid disagreements with co-founder Jeremy Corbyn over how the party should be run.Corbyn confirmed to journalists on Saturday that he preferred a single leader and is likely to stand for the role but Sultana said she would vote for collective leadership and that she did not believe parties should be run by “sole personalities”.In a sign of further division within the fledgling movement, a spokesperson for Sultana said she would not be entering the conference hall on Saturday in solidarity with delegates who were expelled over links to other leftwing parties, describing the process as a “witch-hunt”.The Guardian understands Sultana will run against Corbyn if members decide to elect one leader. Delegates in Liverpool will choose between electing a sole leader or a collective of lay members – those not already serving as MPs or councillors