Stephen Morgan MP has said that the announcements in the government’s ‘mini-budget’ revealed today ‘giant handouts for millionaires and bankers’ that ‘working people will have to cover for generations to come.’
Policies announced in the Chancellor’s package today include:
- A reversal of the increase in National Insurance Contribution (NIC). Labour voted against the government’s previous hike in NICs and has welcomed the u-turn.
- A cut in corporation tax. Labour voted for a rise in corporation tax and would reform business rates to support businesses.
- A cut to the basic rate of income tax to 19p and the 45% top rate of tax for higher earners abolished, raising big questions about how government will cover tax revenues lost by this measure.
- Lifting the cap on bankers’ bonuses, which Labour has said will do nothing to support growth and comes straight from the ‘tired Tory playbook on trickle-down economics.’
The government has also announced that the threshold before stamp duty is paid in England and Northern Ireland has been raised to £250,000, and for first time buyers to £425,000.
It comes as the government blocked the government’s economic watchdog, the Office for Budget Responsibility, from publishing its independent forecasts of the impacts the new policies will have on the economy. The Institute for Government has said the decision by Ministers’ is “irresponsible and undermines the credibility of the government’s fiscal and economic policy.”
Meanwhile, the UK is forecast to have the highest inflation in the G7 until at least 2024, with the pound tanking against the dollar in reaction to changes announced by Kwasi Kwarteng today.
Torsten Bell, Chief Executive of the Resolution Foundation, highlighted that someone earning over £1m a year would receive a £55k tax cut next under the new measures, twice what a typical earner brings home a year.
The Member of Parliament for Portsmouth South, Stephen Morgan, said:
“This is a great day for millionaires and bankers, with their giant handouts paid for by the working people of Portsmouth and the country for generations to come.
“The Tories are not just deserting those who are struggling, but actively working against them.
“Their choice to fund all of this through borrowing and not attempt to fund even a proportion of it through a windfall tax on the energy companies making the most from the current crisis increases risk and leaves British taxpayers paying more for longer.
“This is the same tired and broken ideology that has put the country in this mess over the last 12 years. Only Labour can deliver the fresh start Britain so desperately needs.”
Rachel Reeves MP, Labour’s Shadow Chancellor, reacted:
“The Conservatives chose to shield the eye-watering windfall profits of the energy giants, leaving tens of billions of pounds untouched.
“Borrowing is higher than it needs to be, just as interest rates rise.
“This is casino economics – gambling the mortgages and finances of every family in the country to keep the Tory party happy.
“12 years of Tory government have left us with lower growth, lower investment, lower productivity, and today – the lowest consumer confidence since records began. The only things that are going up are inflation, interest rates and bankers’ bonuses.
“The Chancellor has made clear today what his priorities are. Not a plan for growth, a plan to reward the already wealthy. A return to the trickle down of the past, not a brave new future.”
