Chancellor says she ‘can’t leave welfare untouched’ this parliament as budget looms
Rachel Reeves has said she “can’t leave welfare untouched” this parliament, with the Treasury understood to be considering axing up to £1bn in tax breaks for a scheme providing cars for disabled people,The chancellor set out her thinking on welfare before next month’s budget in an interview, having previously said she would need to make cuts and raise taxes,“We can’t leave welfare untouched,” she told Channel 4 News when asked about changes to the benefit system,“We can’t get to the end of this parliamentary session and I’ve basically done nothing … We have to do reform in the right way and take people with us,”The government had to abandon billions of pounds in cuts to disability benefits earlier this year after a revolt by Labour backbenchers, but it is still pressing ahead with cuts for future claimants of the health element of universal credit from April 2026.
It is now understood to be considering removing tax breaks for the Motability scheme, under which disabled people are exempt from VAT and insurance premium tax on cars subsidised by the government,Whitehall sources said the ending of tax exemptions was under consideration but that no decision had been taken,They downplayed the idea of reducing the eligibility criteria for Motability cars, but said the option of scrapping the VAT and insurance premium tax exemptions was “more likely”,Another change under consideration is the idea of removing luxury brands such as BMW and Mercedes from the scheme, under which a minority of claimants top up with an advance to get a more premium car,These premium brands only make up 40,000, or about 5%, of the 800,000 Motability cars.
Adding VAT and insurance premium tax to the Motability car’s price tag would mean more claimants would need to make an advance payment for their cars,Estimates suggest it could bring in about £1,2bn, although Whitehall sources suggested it would not be likely to raise as much as that,Although not a direct cut to the benefits bill, further attempts to reduce tax exemptions for the Motability scheme would still be controversial, with critics warning the Treasury to listen to the concerns of disabled people,James Taylor, the director of strategy at the charity Scope, said it could “heap extra costs on to disabled people all over Britain”.
“Motability is a cost-effective way for disabled people to be able to use adapted cars.Often these cars need to be able to accommodate equipment, carers, and disability related aids,” he said.“Life costs more if you are disabled.Energy and day-to-day living costs remain stubbornly high across the board.The government shouldn’t be looking to ramp up costs on disabled people.
They could leave more disabled people isolated, and less able to get into work,”Emma Vogelmann, the co-chief executive of the disability group Transport for All, said: “As disabled people we often find public transport is unusable – broken pavements, nonexistent bus routes, and packed stations we can’t navigate,A Motability car changes that – it allows us to work, shop, and do the school run,Scaling back the scheme would lock disabled people away from daily life,Does the chancellor want to take away our freedom?”Cuts to the Motability scheme have previously been backed by the Conservatives.
Helen Whately, the shadow work and pensions secretary, said on Friday that the chancellor was “following our lead”.“I’m glad she’s been keeping an eye on our welfare announcements, but the government should be doing much more to fix welfare and reform the Motability scheme,” she said.“Motability should be there for people with serious disabilities.That’s why the Conservatives would stop people with low-level mental health problems and neurodiversity – like mild depression and ADHD – getting free cars.We would also put an end to taxpayers funding luxury cars on Motability, instead ensuring every penny goes towards supporting genuinely disabled people.
”Sign up to First EditionOur morning email breaks down the key stories of the day, telling you what’s happening and why it mattersafter newsletter promotionRather than giving people “free cars”, the Motability scheme allows disabled people to use their personal independence payment (Pip) to lease new cars for three years,The scheme is run by a private company, overseen by a charitable foundation, that buys new cars then leases them to claimants for three years before selling them on,Rachael Maskell, a Labour MP who was one of the strongest critics of the government’s abandoned disability cuts, said the “government must adopt a process of co-production [involving disabled people] and then follow the evidence … Random top-slicing or cuts often cost more in the long run”,A Treasury spokesperson said: “We do not comment on speculation around changes to tax outside of fiscal events,”While Labour’s attempts to cut disability benefits were largely abandoned earlier this year, government sources suggested the chancellor continues to believe the system is unsustainable in its current form and in some cases disincentivises people from seeking work.
Reeves is expected to introduce a significant package of tax increases and spending cuts in her 26 November budget to offset a downgrade in the Office for Budget Responsibility (OBR) forecasts for economic growth.The Institute for Fiscal Studies (IFS) said on Thursday that the chancellor could be forced to look again at welfare savings alongside tax rises.The IFS said options could include scrapping the pensions triple lock, a fresh drive to cut health-related and disability benefits, and limiting growth in spending on special educational needs.The OBR reviewed its forecasting model over the summer and is expected to say the public finances look £10-20bn weaker than it believed at the time of Reeves’s spring statement.The chancellor has expressed irritation at the timing of this review, which she believes would have been better done immediately after last year’s general election or in 2023.
As well as tackling this deterioration, the chancellor must also deal with the £7bn cost of the U-turns on winter fuel and welfare.Reeves is hoping to build up more “headroom” against her fiscal rules, to avoid being buffeted by the bond markets.Government borrowing costs fell to their lowest level since July on Friday after Reeves’s comments on tax and spend appeared to reassure investors.
French customs reject British shellfish shipments after UK ‘reset’ deal with EU
One of Britain’s largest mussel exporters has suffered a £150,000 loss, after three of its shipments to the EU were rejected in recent weeks by French customs.Family-run business Offshore Shellfish, based in Devon, has continued exporting blue mussels to its European customers since Brexit, despite the administrative burden and onerous paperwork requirements.However, the past month has seen three out of four lorries prevented from entering the EU by customs officials at the port of Boulogne-sur-Mer for various reasons, which the company’s commercial director Sarah Holmyard called “subjective and inconsistent”.“We have sent hundreds and hundreds of loads since Brexit. We’ve never had a single one rejected,” Holmyard told the Guardian
If you like a lot of chocolate on your biscuit … look away now
If you like a lot of chocolate on your biscuit you can no longer join our Club or pick up a Penguin, as the lunchbox favourites have reduced the amount of cocoa in their recipe so much they are now only “chocolate flavour”.The two snacks, both made by McVitie’s, changed their recipes earlier this year amid soaring cocoa prices – which have prompted manufacturers to try a number of different tactics to keep prices down.Club and Penguin can no longer be described as chocolate biscuits as they contain more palm oil and shea oil than cocoa, as first reported by the trade journal The Grocer.“We made some changes to McVitie’s Penguin and Club earlier this year, where we are using a chocolate flavour coating with cocoa mass, rather than a chocolate coating. Sensory testing with consumers shows the new coatings deliver the same great taste as the originals,” the McVitie’s owner, Pladis, said in a statement
The platform exposing exactly how much copyrighted art is used by AI tools
Ask Google’s AI video tool to create a film of a time-travelling doctor who flies around in a blue British phone booth and the result, unsurprisingly, resembles Doctor Who.And if you ask OpenAI’s technology to do the same, a similar thing happens. What’s wrong with that, you may think?The answer could be one of the biggest issues AI chiefs face as their era-defining technology becomes ever more ubiquitous in our lives.Google and OpenAI’s generative artificial intelligence is supposed to be just that – generative, meaning it develops novel answers to our questions. Ask it for a time-travelling doctor, you get one that their systems have created
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From brain-rotting videos to AI creep, every technological advance seems to make it harder to work, remember, think and function independently …Step into the Massachusetts Institute of Technology (MIT) Media Lab in Cambridge, US, and the future feels a little closer. Glass cabinets display prototypes of weird and wonderful creations, from tiny desktop robots to a surrealist sculpture created by an AI model prompted to design a tea set made from body parts. In the lobby, an AI waste-sorting assistant named Oscar can tell you where to put your used coffee cup. Five floors up, research scientist Nataliya Kosmyna has been working on wearable brain-computer interfaces she hopes will one day enable people who cannot speak, due to neurodegenerative diseases such as amyotrophic lateral sclerosis, to communicate using their minds.Kosmyna spends a lot of her time reading and analysing people’s brain states
‘Those final few hours were brutal’: British duo end epic journey in Australia after rowing across Pacific Ocean
One more day. One more day up and down the pitiless slide. One more day of blistered hands gripping unforgiving oars.But after more than 8,000 nautical miles (15,000km) at sea – an epic five-and-a-half-month journey across the Pacific that included close encounters with whales, failing beacons and chocolate shortages – the sea had one more challenge.A gusting 20-knot wind off Cairns kept pushing Jess Rowe and Miriam Payne’s tiny rowboat, the Velocity, from the terra firma that was now achingly close
Champions Day horse racing at Ascot: shock winners at 200-1 and 100-1 – as it happened
Greg Wood’s report from AscotChampions Day pain for puntersAll eyes were on the Champions Stakes ahead of Champions Day at Ascot and while Calandagan was a worthy winner and may have put up the Flat racing performance of the season it was the big-priced winners on the day who made the headlines with Powerful Glory, at 200-1, and Cicero’s Gift, at 100-1, pulling off almighty shocks on a day when the racegoers flocked to the track to supposedly crown “champions”.With the ground riding fast after a prolonged dry spell this was not what was supposed to be expected. However, those sorts of results can come at the end of a long season and is partly the reason why Champions Day doesn’t always prove to be the day when the best come to the fore. Good night for now – we’ll be back with a live blog on Boxing Day as the focus now turns to jump racing.1 Crown Of Oaks 5/1 2 Ebt’s Guard 10/1 3 Holloway Boy 16/1 4 Shout 6/14
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