Starmer: Farage's ‘fantasy' economics will lead to Liz Truss-style meltdown
The Prime Minister is expected to urge the public to reject Reform UK's calls to use 'family finances' as a gambling chip on 'unfunded' tax cuts.
This comes after the Institute for Fiscal Studies (IFS) said the party's pledge to increase the income tax personal allowance to £20,000 a year could cost between £50 to £80 billion a year.
Reform UK leader Nigel Farage (Ben Whitley/PA)
Speaking at a press conference in central London on Tuesday, Mr Farage said his measures were 'aimed at British families' as he announced plans to scrap the two-child benefit cap and fully reverse the winter fuel payment cuts.
Responding to Mr Farage's speech, IFS deputy director Helen Miller said the announcements on winter fuel payments and the two-child benefit cap were 'dwarfed' by the change to income tax personal allowance.
On a visit to meet workers at a manufacturing business in the North West, Sir Keir is expected to brand Mr Farage's policies a 'mad experiment'.
He will say: 'In opposition we said Liz Truss would crash the economy and leave you to pick the bill. We were right.
'And we were elected to fix that mess.
'Now in Government, we are once again fighting the same fantasy – this time from Nigel Farage.
'Farage is making the exact same bet Liz Truss did.
'That you can spend tens of billions on tax cuts without a proper way of paying for it.
'And just like Truss, he is using your family finances, your mortgage, your bills as a gambling chip on his mad experiment.
'The result will be the same.
'Liz Truss bet the house and lost.
'£45 billion in unfunded tax cuts, with no means to pay for them.
'Markets reacted, the economy tanked and we're all still paying the price for mortgages, rents and bills that spiralled out of control.
'I won't let that happen.
'Labour's Plan for Change has stabilised the economy, with growth at the fastest rate in the G7 this year, four cuts to interest rates, and a pay boost for 3.5 million low paid workers.'
Short-lived Conservative prime minister Ms Truss' mini-budget spooked the financial markets in 2022 and led to a spike in mortgage rates.
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The Herald Scotland
an hour ago
- The Herald Scotland
60% of voters back two-child cap - so why is Labour set to scrap it?
Her comments came after Nigel Farage said he would scrap the limit, but there were already signs Labour was preparing to move on it, having delayed the publication of their much-anticipated child poverty strategy until the autumn. Farage's move, targeting Labour supporters, just adds to the pressure ministers were already under. What Labour did about this Conservative policy was always going to be the key left-wing virility test of Keir Starmer's government. It speaks to Labour's values like no other policy, at a time when there's growing confusion and disquiet about what the party stands for. If Labour jettisoned the two-child limit – at an estimated annual cost of £3.5bn – it would help placate backbench critics dismayed by disability benefit cuts and the scrapping of the winter fuel payment. More importantly, it would give voters a clearer picture of what this government is really about. Read more But the politics of it is not straightforward. Labour would be abolishing a policy that around 60 per cent of voters support. Some Labour strategists are thought to be opposed on the grounds it would be a big spend for little political gain. If Labour didn't abolish the limit, however, the fall-out could eventually be much worse for the party, as child poverty rose and hardship increased. The Scottish election, up against an SNP First Minister who is committed to mitigating the two-child limit, could be a toe-curling affair. The threat of humiliation is a powerful political spur. Introduced in 2017, the two-child limit prevents families from claiming means-tested benefits for third or subsequent children. The universities of Oxford, York and LSE published a study in 2023 describing it as a 'poverty-producing' measure. The Resolution Foundation estimates that lifting it now would take 470,000 children out of hardship. Labour in opposition were widely understood to oppose the limit, though insisted abolition had to be affordable. They announced they would set up a taskforce to produce a child poverty strategy once in power, which they duly did, the first serious focus on child poverty since the last Labour government. As one children's campaigner told me two years ago, there is 'no way' Labour could have a credible child poverty strategy if the two-child limit remained in place. This activist was confident the policy would go because how could Labour possibly allow it to remain? The last 11 months may have sorely tested old assumptions like that, but it has always been hard to imagine a Labour government standing by a policy that ministers themselves have variously described as 'obscene and inhumane' (Angela Rayner, 2020), worthy of being 'binned' (Jonathan Reynolds, business secretary, 2021) and something that must go to help tackle 'vast social injustice' (Starmer himself, 2020). Nigel Farage called for the benefit cap to be lifted (Image: free) And so it looks as though its days are numbered. The Prime Minister has apparently asked the Treasury to find the cash to scrap it. It would raise eyebrows now if an announcement on the policy didn't feature in autumn's budget. But what of voter opposition? Labour voters are less likely than Tory, Reform and Lib Dem voters to support the limit, but 50 per cent still do. Voters have tended to see the issue as one of fairness. The Tories sold it on the basis that people supporting themselves solely through work have to make decisions about how many children they can afford and people drawing benefits should have to as well. It was portrayed as a policy that would incentivise work and make people think harder before having big families. But the 2023 study found the two-child limit had only a 'very small effect' on family size. There was no evidence at all of increased employment among families subject to the limit. Many people didn't even know the two-child limit existed until after their child was born; in some cases, conception was the result of failed contraception or an abusive relationship. There is an exemption for children born as the result of rape or domestic abuse (the hated 'rape clause'), but most people eligible for this were not getting it. Sixty per cent of affected children are in households where a parent works, with illness, redundancy and lack of childcare typical drivers of poverty. The research found the two-child limit and the attendant benefit cap were causing 'extreme hardship'. Child poverty is at a high of 4.5m already and will rise to 4.8 million by 2029 if nothing is done. A mountain of research reveals that millions of children are affected and how: having no beds to sleep on, in homes where their parents can't afford to fix broken appliances or even provide enough food. Understandably, three quarters of Britons believe this to be 'morally wrong'. Read more The Government can argue robustly that the policy has failed in its aims and only succeeded in creating hardship. They can make the economic argument for abolition, since child poverty costs billions in lost potential, poor health and earning capacity in adulthood. If the government does away with it, ministers will hope to stem the flow of support from their left flank to parties like the SNP and Greens. Paying to abolish it now, within tight spending limits, is a strong statement of values and leaves time for poverty reduction to be seen before the next election. Nigel Farage is making the political calculation easier by supporting the idea. He can try and portray Labour as apeing his policies but it will be Labour that get to claim credit for actually funding and delivering it. Labour's first year has left many voters wondering what their new UK government really cares about. Abolishing the two-child limit would be a powerful answer. Rebecca McQuillan is a journalist specialising in politics and Scottish affairs. She can be found on Bluesky at @ and on X at @BecMcQ
Wales Online
an hour ago
- Wales Online
Minister says one group won't get Winter Fuel Payments despite U-turn
Minister says one group won't get Winter Fuel Payments despite U-turn Treasury minister Darren Jones said winter fuel payments will 'still be targeted' Darren Jones, Chief Secretary to the Treasury Millionaires should not get 'subsidy for their energy bills from the Government', a Treasury minister has said. Darren Jones has said that winter fuel payments will 'still be targeted to those that need it the most'. Sir Keir said at Prime Minister's questions last week that he wants to restore the payments to more pensioners, following pressure from campaigners, signalling a partial U-turn on one of Labour's first announcements in Government. He claimed that the UK's improving economic prospects could allow for the move at the next fiscal event. The partial U-turn came as ministers are continuing to face calls to scrap the two-child benefit cap. Speaking to Sky News on Thursday evening, Chief Secretary to the Treasury Mr Jones was asked about Reform UK's commitments on both the winter fuel and benefit cap policies. 'All of those things cost money,' Mr Jones said. 'It's right that we set out the detail and how we're going to pay for those in a proper and orderly way.' He added: 'We're sticking to the principle that millionaires shouldn't be getting subsidy for their energy bills from the government, so winter fuel payments will still be targeted to those that need it the most.' Mr Jones also touched on the Government's approach to child poverty, telling the same programme that 'we're a Labour government we want child poverty to be falling in this country, not rising'. 'Of course, we want to help families lift themselves out of poverty.' Last summer, Rachel Reeves announced that the previously universal winter fuel payment would be means-tested. The policy was blamed for the party's collapse in support since last year's general election, and campaigners were challenged about it on the doorsteps during May's local elections. Reform UK leader Nigel Farage confirmed earlier this week that his party would support scrapping the two-child benefit cap and also reverse the winter fuel payment cuts. Sir Keir said he is looking at 'all options' to drive down child poverty when asked if he would like to get rid of the two-child benefit cap on Thursday. Speaking on a visit to the North West, the Prime Minister said: 'There isn't a single bullet, but I'm absolutely determined that we will drive this down, and that's why we'll look at all options, always, of driving down child poverty.' Article continues below Conservative leader Kemi Badenoch has accused the Labour and Reform leaders of asking people to fund 'unlimited child support for others' by scrapping the two-child cap. Writing in the Daily Mail, she said that the Conservatives are the 'only serious party of sound money'. 'Britain deserves party leaders who don't treat economics like a branch of showbiz, an announcement for a nice headline and forget about the deficit,' she said.
New Statesman
an hour ago
- New Statesman
Kemi Badenoch is in a hole – and she keeps digging
Photo byLabour MPs have a lot to be depressed about. The euphoria as more than 400 of them swept into parliament in July dissipated at a speed as historic as their election win. Not only has the party dropped into the polls to levels of public support not seen since before the 2019 election, but MPs who entered parliament full of ideals and optimism have had to stomach an endless string of policy announcements – from scrapping the winter fuel allowance to disability benefit cuts to the tightening of migration rules – that feel fundamentally at odds with what they went into politics to achieve. (These two things, one Labour MP wryly suggested, might in fact be connected.) But there is one thing that keeping Labour spirits from collapsing entirely. And that is the Leader of the Opposition. 'She cheers us up every week,' one Labour MP said of Kemi Badenoch's sparring matches against Keir Starmer at PMQs. Another pointed out how visibly more relaxed the Prime Minister seems in his weekly Commons performances, loosening up enough to tell jokes that actually land and at times looking like he even enjoys the experience. The list of frustrations Conservative MPs have with their leader is growing – but right at the top are her efforts at PMQs. Badenoch frequently chooses to ignore the headline issue of the day to focus either on pet projects inspired by the right-wing Twittersphere (the details of which sometimes come back to haunt her), or on areas where justifiable criticism of Labour opens her up to counter-attacks about the Tories' own record. She seems incapable of taking advantage of moments where Starmer is obviously under pressure from his own MPs, and – as last week's reaction (or lack thereof) to the announcement of a U-turn on winter fuel cuts showed – has an uncanny ability to miss open goals. Tories – even those critical to Badenoch – are quick to point out the impossibility of her situation, attempting to rebuild a party from the ashes when there is an insurgent challenger on the right consuming all the airtime. There is general consensus that no one in that position would be doing well at this stage in a parliament, and that the party needs time to recover. But at the same time, Badenoch is making a bad situation worse – from interviews where the main takeaway is that she hates sandwiches to the recent row over use of a private car and driver as when she was trade secretary. (The fact Badenoch is reported to once again be unhappy about the car arrangements provided to her as opposition leader is, one Tory source despaired, an unforced error of 'galactic proportions'.) Overall, the mood is one of dismay that, the 'box office' firebrand who was meant to terrify Starmer has proved such a disappointment. Labour figures, however, had a very different perception of Badenoch before she became leader. Contrary to what was breathlessly written in Telegraph columns, the candidate they really feared was James Cleverly, who was considered 'the most dangerous opponent' for a variety of reasons: his likeability within the party and ability to unite the Tories and boost morale after a defeat; his skill at media; and his pitch to bring the Conservatives towards the centre ground, rather than chasing Reform. Subscribe to The New Statesman today from only £8.99 per month Subscribe One Labour MP recalls a 'palpable sense of elation' in the Commons tearoom when the shock announcement came that Cleverly had been knocked out of the contest (thanks to a vote-swapping debacle), leaving Badenoch to face Robert Jenrick in a head-to-head of Conservative members. The relief was felt among both Labour and Liberal Democrat MPs that the biggest threat to them had been eliminated. Jenrick is viewed as the de facto successor if Badenoch is ousted – a point Starmer made at PMQs recently by congratulating those who had run the London marathon and joking that the shadow justice secretary was 'still running'. Labour MPs have mixed views of Jenrick's chances of reviving the official opposition. One suggested he might be a bit 'slicker' on TV, and Jenrick's work ethic was mentioned (he's been all over the country since the election, doing hundreds of events with Conservative groups while Badenoch's reputation for being 'lazy' is only growing). But no one thought this would be enough to solve the Tories' problems. That's in part because the biggest problem for the Conservatives is Reform – and another leader attempting to be 'Farage-lite' will do nothing to neutralise that threat. And it's a threat, of course, that applies to Labour too. Labour MPs began noticing the shift in Starmer's attitude even before the Prime Minister said he considered Reform to be the government's main opposition. Planted questions at PMQs have enabled Starmer to take aim at Farage, on issues ranging from workers' rights to green jobs, and he rarely misses an opportunity to connect Reform to the economic calamity of Liz Truss. The Prime Minister gave an entire speech on that subject on Thursday, accusing Farage of 'the same fantasy' as Truss after the Reform leader announced a slate of policies earlier in the week that would add tens of billions to government spending. Farage, Starmer argued, was 'Truss 2.0'. The Lib Dems have gone for the even catchier line 'Trussonomics on steroids'. Where does all this leave Badenoch? As effectively irrelevant, I was told by a Labour source – which could be both a blessing and a curse. 'We're torn between wanting her to stay because of how bad she is, and hoping the Conservatives improve because that might put some pressure on Reform.' It's unclear what form such improvement could take. It's hard to see who on the opposition benches could be a leader who takes the Tories back into government (the names being floated – by both Labour and Tory figures – have only been in parliament a matter of months). There was doubt among Labour MPs that Cleverly would ever make it in a vote among the Tory membership (speculation that might not be accurate, I was told by a Reform source, who wondered whether the exodus of Conservative members to Nigel Farage's party might have changed the membership so radically Cleverly would have a much better chance now than in October). The suggestion of a Boris Johnson comeback was greeted with laughter ('Good luck to him'). But even with the lack of options, Labour figures said they expected the Tories to get frustrated and find a way to oust Badenoch, if not by the end of the year then around the time of next May's local elections. However bad the polls are for Labour, they are worse for the Conservatives, one MP pointed out, flagging the 'extinction-level' poll that put the Tories in fourth place. 'Kemi is getting nowhere.' [See also: Inside the Conservative Party's existential spiral] Related
