Senedd election: 2026 could be 'most difficult' Labour has faced
Labour has dominated politics in Wales for a century and has led every Welsh government since devolution began in 1999.The next election will be the first to elect 36 more politicians, with voters given greater choice over who represents them in the 96-seat parliament through a more proportional election system.Speaking to Walescast, the former counsel general for Wales said: "I think it will probably be one of the most difficult elections that we've had.''Mind you, every election is always difficult.''A poll at the end of 2024 dampened Welsh Labour's hopes for the 2026 elections with Plaid Cymru coming out on top and Reform alongside Labour.But Antoniw said: ''The last Senedd election I was involved in, it was predicted Labour would lose an enormous number of seats and there would even potentially be a Conservative rainbow government.''That didn't come about so you do have to be very careful with polls and predictions.''Antoniw said voters were attracted to Reform because they were disaffected "over the lack of change".''People want things to get better, and people want to know that there is hope on the horizon," he said.''They want to be convinced that their government will fight to make things better.''He said Reform were riding high but do not "really have any policies on which to be challenged or to be scrutinised".The former minister said the challenge for Labour was "showing that change is on the horizon, change can be made and things will improve"."That is the confidence barrier politics needs to get through by the next Senedd elections," he said.
Since the general election both governments at either end of the M4 have been run by Labour.Antoniw said there was "more engagement" now between the two.''The fact of the matter is where there was a Conservative government in Westminster you couldn't even talk about any of these things," he said.But calls for further devolution have gone unheeded, with requests for Wales to take control of the crown estate and the justice system rejected.Antoniw, who is the Welsh government's former chief legal advisor, added: ''They can't continually be saying, 'no, we're not interested in that' even if it happens to be Welsh Labour Party policy.''I think there is a need to start listening a bit more from the UK level in terms of some of these issues and why they are important to Wales.''He added teething issues were to be expected but it was important to help Welsh Labour deliver on policy.''It is always very difficult with a new government that's come in after 14 years where centralisation is quite a natural response to events, you want to get on and do things.''But it is equally important that they recognise that many of the powers and responsibilities are now devolved, and they have to help Welsh Labour to be able to deliver those as well.''
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Wales Online
19 minutes ago
- Wales Online
Government strikes returns deal with Iraq in latest bid to deter small boats
Government strikes returns deal with Iraq in latest bid to deter small boats The deal, signed by Home Office minister Dan Jarvis, will set up a formal process to return Iraqis who have arrived in the UK with no right to stay in the country A group of people thought to be migrants are brought in to the Border Force compound in Dover, Kent (Image: PA Wire/PA Images) The Government has agreed a new deal with Iraq to return illegal migrants as part of wider moves to limit small boat crossings. The deal, signed by Home Office minister Dan Jarvis, will set up a formal process to return Iraqis who have arrived in the UK with no right to stay in the country. It comes after an £800,000 deal last year with Baghdad to help the country crack down on smuggling networks and organised crime. Earlier this year Sir Keir Starmer and Iraq's prime minister Mohammed Shia Al-Sudani agreed to strengthen co-operation on migration. Mr Jarvis signed the agreement during a visit to the UK by Iraq's deputy foreign minister Faud Hussein. The Home Office said the accord would allow the "swift" return of illegal migrants. Home Office statistics said since previous deals, the number of Iraqis arriving in the UK by small boat has fallen to 1,900 in the year to March 2025, down from 2,600 in the previous year. Article continues below Mr Jarvis said: "By working together on security, development and migration challenges, we are building stronger relationships that benefit both our countries whilst tackling shared challenges like organised crime and irregular migration." The returns deal is the latest as part of the Home Office's policies to stop small boats crossing the channel. Similar agreements have already been made with Albania and Vietnam since Labour came into power. Another deal with France recently came into force, where small boat migrants who have arrived over the English Channel from the French coast can be returned to the country. The small boats migrant will then be exchanged for a legitimate asylum seeker in France who can demonstrate a genuine family link to the UK. The number has been capped, but it is hoped it will act as a deterrent to those crossing the Channel. The latest figures from the Home Office showed 116 migrants arrived aboard two small boats on August 15. Mr Jarvis said: "This visit reinforces the strength of the UK-Iraq partnership and demonstrates our government's commitment to serious diplomacy that delivers real results. "As someone who served in Iraq, I understand first-hand the importance of building enduring relationships in the region, and the new agreement we have signed is a testament to the trust and co-operation we've built with our Iraqi counterparts." However, the announcement was criticised by Conservative shadow home secretary Chris Philp. He said: "Over 50,000 illegal immigrants have crossed the Channel in Labour's short time in power, the worst illegal immigration crisis in our history. "Labour has surrendered our borders, and the consequences are being felt in our communities, from rising crime to shocking cases of rape and sexual assault by recent arrivals. "Now they boast about a measly returns deal with Iraq, but barely any small boat arrivals are Iraqi, and most would qualify for asylum anyway. It's a sham designed to look tough while crossings keep soaring. Article continues below "Labour has scrapped Conservative deterrents and created the conditions for chaos, leaving the British people to foot the bill. Only the Conservatives will stop the crossings and restore control of Britain's borders."
The Guardian
20 minutes ago
- The Guardian
Wednesday briefing: Is Rachel Reeves about to overhaul the dreaded council tax?
Good morning. Britain's fiscal outlook is bleak. The chancellor, Rachel Reeves, faces the daunting task of closing a £40bn black hole in the public finances. There is intense speculation over how she intends to, as runs that oft-used phrase, balance the books. This week, my colleagues have reported that the chancellor is considering a new 'proportional' property tax. It would mark a radical overhaul of stamp duty and council tax. While there has been a good deal of focus on stamp duty, changes to council tax in England have the potential to be the most transformative – and explosive. Almost all political parties agree that the council tax system – which replaced the deeply unpopular poll tax in 1991 and has remained unchanged since – is unfair and must be reformed. But just how to do so is notoriously complex and politically tricky – especially when so many local councils are strapped for cash. To better understand how England's council tax system exacerbates inequalities and why it has proven so difficult to change, I spoke with Richard Partington, the Guardian's senior economics correspondent. That's after the headlines. Ukraine | Donald Trump ruled out the deployment of American troops in Ukraine in his first interview after yesterday's White House meeting with the Ukrainian president, Volodymyr Zelenskyy, and European leaders. UK news | Keir Starmer's asylum plans have been plunged into turmoil after a high court ruling blocked people seeking refuge from being housed in an Essex hotel. Gaza | Israel has said it will deliver its response to international mediators by Friday over a new Gaza ceasefire plan accepted by Hamas amid mounting pressure for a truce. UK politics | A Reform UK-led county council has served its residents a 'plate of chaos' from the start of its leadership, according to its Conservative opposition. Work | Older employees who are disturbed by younger, more boisterous colleagues in the workplace are not victims of age harassment, an employment tribunal has ruled. When you move into a new home, one of the first letters that comes through your letterbox is the amount of council tax you owe to the local authority. This local form of taxation is paid by every household living in the area, whether renting or owning. The funds are used to pay for services from rubbish collection to meals on wheels. It is a tax that people can see and feel in their daily lives. Just how council tax came to be goes some way to explain why there has been such a reluctance to try to change it. Before council tax, a system called rates used to fund local councils. In the 1980s, Margret Thatcher's Conservative government tried to introduce a flat tax, payable no matter the value of the property you lived in, or the income you were on. This became widely known as the poll tax. 'It was controversial. The poll tax was first introduced in Scotland as a sort of pilot scheme and there was a big uproar. When it was coming to England in the late 1980s, there were huge riots, which coincided with the massive unpopularity of the tail end of the Thatcher administration,' Richard Partington tells me. 'It was one of the factors that brought down her premiership. And to replace it, they went back to this compromised, fudged system between the old rates system and the poll tax, and it was called council tax.' The system was devised in 1991 and came into effect in 1993. The problem, however, is that the amount someone pays in council tax is still based on what property prices were in 1991. Which would work, if only we hadn't built any homes since then and prices had never changed. 'There's something like 4.5m new homes or more that have been built since 1991, and then countless more conversions of factory buildings, of barns, and other non-residential properties, like shops, to homes. And you've got this army of experts trying to guess how much it would have been worth in 1991,' Richard says. It's not just those on the left who think the system, as it stands, is absurd. Richard points to criticism by David Willetts, the chair of the Resolution Foundation, who was advising on tax policy in Margaret Thatcher's policy unit in the 1980s. 'He actually thinks that council tax has become as regressive as the poll tax.' Fundamentally unfair system It is worth spelling out just how ridiculous the council tax system is. Several taxation bands dictate how much a household will have to pay to a local authority. But a resident in Blackpool living in a band B property, where the average house price is £130,000, will pay £1,860; while in Kensington and Chelsea, where the average house is worth £2.2m, the same band B bill would be £1,220. 'It hasn't taken account of the huge booming property valuations that have taken place over the past 30-odd years. And that means that you've got people living in hugely expensive homes that are paying relatively low rates of council tax. And that is sort of fundamentally unfair,' Richard says. Of course, the question of how to fix a situation where the numbers are so out of touch with reality brings its own problems – but we'll get to that later. A worsening funding crisis Council tax is not the only way local authorities get money. They also receive grants from central government. But due to austerity measures under Conservative governments, spending power funded by these grants fell in real terms by more than 50% between 2010 and 2021. This is coupled with local councils' ballooning budgets trying to cater to the growing needs of the population. Councils are in charge of a lot more than just littering and local libraries; for example, they front the costs for social care for vulnerable adults and children. 'A large part of what councils do, most people won't see on a day-to-day basis. But adult and children's social care service spending has increased so much because we've got an older and increasingly unwell population, and the cost of delivery has increased. To pay for that, there have been cuts to other areas of spending like road cleaning and libraries,' Richard says. Several councils have declared bankruptcy as a result in recent years and they won't be alone in feeling the pinch. Almost half of councils in England risk falling into bankruptcy without action to address a £4.6bn deficit amassed under Conservative-era policies, according to the government's spending watchdog. 'Most people who wouldn't come into contact with adult social or children's services think that they're paying more to their local authority and not getting much for it. They don't understand why and that's a huge issue.' Winners and losers The problem with the council tax system is that the longer we wait, the harder it becomes to fix, Richard says. With the local council funding crisis coming to a head, the Labour government cannot choose to look away like its predecessors. But the solutions floated come with their own headaches. The deputy prime minister, Angela Rayner, is spearheading the 'fair funding review', to figure out a new way of distributing central government grant funding to councils. That is due to come in from April next year and is under consultation. 'Among the things they're looking at is rebalancing the amount of funding for councils in more deprived areas so that they receive more money in central government funding than wealthier areas. Largely that is going to help councils in the north of England and the Midlands, where they have historically been underfunded by central government grants. And the losers will be in London and the south and the home counties,' Richard says. But a study by the Institute for Fiscal Studies shows that some of the biggest losers will be inner London boroughs where property valuations might be high but there are pockets of deep deprivation and child poverty. 'It highlights that while reforming the system that is so broken, there are going to be all kinds of issues that pop up in the process. You might think that you're addressing one problem, but another one will arise as a consequence,' Richard says. More fundamental reforms Reeves is reportedly considering overhauling stamp duty and council tax in a bid to raise desperately needed revenue. This was an idea put forward last year by Dr Tim Leunig, who was a government adviser in Rishi Sunak's Treasury, in a report for the centre-right thinktank Onwards. 'His idea was to replace council tax and stamp duty in one go with a proportional property tax that would take more accurate account of current property valuations on a national level, and a local version that would fund local services that would over time replace council tax,' Richard explains. Sign up to First Edition Our morning email breaks down the key stories of the day, telling you what's happening and why it matters after newsletter promotion The reporting suggests any changes to council tax will probably not take place until Labour wins a second term. Is this Labour kicking the can down the line? Richard doesn't think so. 'It's a slow process because there are all these issues to consider. One of the problems is that the scale of the house price changes since the 90s means that if you were to institute a council tax that was actually reflective of current property values, you'd probably crash the London property market and lots of other places where house prices have boomed since the 90s,' Richard says. He adds that there are many people across the country who might live in what are now hugely valuable properties, but it doesn't mean they bought them for those prices. And, perhaps most importantly, it doesn't mean they have high incomes to pay for a regular council tax charge that reflects the modern-day value of the home. 'People hate council tax, and the idea that your council tax would significantly rise would be politically toxic for Labour,' Richard says. 'So they've been very careful with it.' A vivid and harrowing description from an academic in Gaza of what it's like trying to write and continue doing lectures while starving – and why producing knowledge there still matters. Phoebe Notting Hill Carnival returns this weekend and police have been told not to be seen dancing with revellers. Sound ridiculous? This comment piece by the Guardian's Hugh Muir will have you chuckling. Aamna Baffled by bramble bushes bursting with fruit since mid-summer, trees dropping their lives and acorns on the ground … when it's still August? This is because the seasonal cycle is completely out of whack. Phoebe What does it take to start one's own tiny country? The Guardian's Lucy Knight meets with the 20-year-old who claims a strip of forest between Serbia and Croatia with his friends. Aamna This is quite the insight into a relationship in which one partner bringing in an exotic strain of gonorrhoea can be followed up by a session of wedding planning. Phoebe Football | Bayern Munich's move for Christopher Nkunku has stalled, delaying Chelsea's attempts to sign RB Leipzig's Xavi Simons and Manchester United's Alejandro Garnacho. Cricket | A career-best haul from veteran spinner Keshav Maharaj inspired South Africa to a crushing 98-run win over Australia in the first ODI in Cairns. US Open | Carlos Alcaraz and Emma Raducanu were bulldozed by a sharp Jessica Pegula and Jack Draper, the top seeds, who reached the quarter-finals of the revamped mixed‑doubles competition with a 4-2, 4-2 win. 'High court rules asylum seekers must be moved from protest hotel' says the Guardian while the Times has 'High court puts asylum hotel policy into turmoil'. The Daily Express proclaims 'Asylum hotel closure is 'a victory for the mums'' and the Daily Mail goes with 'Labour's migrant hotels policy in disarray'. Similar in the i paper: 'Migrant policy in disarray as court rules protest hotel must evict asylum seekers' while the Telegraph says simply 'Migrant hotels facing closure'. Top story in the Financial Times is 'Trump hints at US air role in push to seal Ukraine peace' and the Mirror runs with 'Brit troops 'to keep the peace''. The Metro splashes on 'Fury at Reeves '£500k wealth tax on homes''. What price will Ukraine have to pay for peace? After a week of historic summits on the future of Ukraine, will the president, Volodymyr Zelenskyy, have to trade land for peace? Diplomatic editor Patrick Wintour reports A bit of good news to remind you that the world's not all bad A Swedish church that was built in 1912 is going on a road trip – albeit a short one. The 672-tonne church – which is in the Arctic town of Kiruna – is being moved 5km down the road. Dozens of cameras have been set up along the route to enable people across Sweden and the world to watch as part of the latest 'slow TV' extravaganza billed as 'Den stora kyrkflytten' (the big church move). More than 10,000 people, including the Swedish king, Carl XVI Gustaf, are expected to line the streets – which have been widened especially. The endeavour took eight years of planning, and the church is not expected to reopen at its new location at the end of next year. The whole town is being moved to make way for the expansion of Europe's biggest underground mine. Sign up here for a weekly roundup of The Upside, sent to you every Sunday And finally, the Guardian's puzzles are here to keep you entertained throughout the day. Until tomorrow. Quick crossword Cryptic crossword Wordiply
Telegraph
an hour ago
- Telegraph
The tax traps Reeves must fix to grow the economy
It is no secret that Rachel Reeves is strapped for cash. Against a backdrop of rising inflation and weak growth, the Chancellor is staring down a black hole that some predict could be as high as £50bn. Worse still, some efforts to save money have already been killed off by Labour backbenchers, while bond market vigilantes have driven up Britain's borrowing costs to their highest level since the 1990s. That is without even taking into account the impact of Reeves's Budget tax raid last year, which has crushed business confidence and dampened investment. All of which means that the Chancellor is now scrambling for reforms that will boost the economy at minimal cost. Here are some of her options. Clean up the income tax trap The top rate of income tax is supposed to be 45pc, but for those earning between £100,000 and just over £125,000, it is in effect 60pc. That is because workers in this bracket lose the tax-free allowance, which applies to the first £12,570 of pay for workers on lower incomes. As a result, it can appear rather unattractive to earn more if most of this extra income will be taken by the taxman. 'Where we have these kinks in the income tax schedule, those will tend to act as a disincentive to people to work more – I might not want to take that promotion, or I might want to go four days a week,' says Isaac Delestre, at the Institute for Fiscal Studies (IFS). Scrapping this baffling tax quirk would help ease the pain. Smooth out benefits Losing child benefit can see families' effective tax rate rise to almost 60pc. This applies when one parent in a three-child household earns between £60,000 and £80,000. Believe it or not, that is an improvement on the old situation. Before Conservative reforms, a family with three children faced a tax rate of more than 70pc. Jeremy Hunt, the chancellor at the time, called the system 'confusing and unfair'. Following changes introduced by the Tories, the Office for Budget Responsibility (OBR) calculated reforms would encourage parents to work more hours, amounting to the equivalent of an extra 10,000 full-time jobs. However, perhaps the most egregious tax trap applies to adults with young children. The Government has ramped up subsidies for childcare in recent years to try to get more parents back to work. Yet for a cohort of highly productive workers, the way the system operates can be an enormous disincentive to seek out a promotion or put in extra hours. That is because the support schemes are withdrawn entirely once one parent's taxable income rises above £100,000. It means an extra penny of earnings can cost a family with two young children £14,500 in disposable income, according to the IFS. The think tank estimates that their disposable income – after tax and childcare – will not recover to its previous level until the parent earns £134,500. These parents have an enormous incentive to cut their taxable income, whether by pouring money into their pension to reduce their taxable income or by cutting the number of days they work each week. Turning the cliff edge into a smooth slope might cost the Treasury money, but would no doubt ease families' worries. Ramp up VAT Companies face similar cliff edges. Small businesses have to register for VAT when their turnover hits £90,000. That creates a huge incentive to stay below that threshold. Businesses and sole traders often stop earning once they edge closer to the limit as they seek to avoid the threat of introducing a 20pc tax on sales. Whether that means working only four days a week or closing for a month to keep takings down, it undermines growth in their business and the wider economy. The Conservatives cited this 'bunching' as a reason to raise the threshold from £85,000, but that just shifted the problem instead of abolishing it. Slashing the threshold would be a blow to small businesses and their customers, but might encourage more growth in the long term by removing it as a barrier altogether. That was the argument of the Resolution Foundation when it was run by Torsten Bell, now a Treasury minister. The think tank previously called the high threshold 'a tax on growth', claiming that: 'The best outcome would be lowering it to the point where almost no business owner would consider the option of deliberately staying below that level of turnover.' Cutting it to £30,000 could raise £1.5bn for Reeves. Cut stamp duty To say that reform of property tax is overdue is an understatement. The IFS has described council tax, which is still based on valuations from 1991, as 'out of date, regressive and distortionary'. The think tank has also branded stamp duty one of Britain's most hated taxes because it penalises people for moving. Back in 1988, a typical homeowner moved house every nine years, according to property website Zoopla. In the first six months of 2022, the gap was 21 years. The International Monetary Fund (IMF) has previously urged the UK to move away from 'transaction taxes which constrain housing and labour mobility'. Instead of a property sales tax, the Fund suggested adopting a new annual levy based on land or property values – a system some argue this would be fairer. After all, the average London house price is now more than seven times what it was in 1991, compared with a four-fold increase in the North East, according to the Office for National Statistics. At the same time, the distribution of central government funding to local authorities is still based on property values in 1991. This effectively means councils in Newcastle must now levy more tax on a property worth £250,000 than in Kensington and Chelsea to deliver essentially the same on valuations. However, as the think tank points out, any major revaluation would produce winners and losers. Back in 2020, the IFS suggested that a simple revaluation that reflected relative increases in property values would hit homeowners primarily in London and the South East. Back then, it said residents in Hackney and Wandsworth could see increases in their bills of up to 45pc, while people living in Fylde near Blackpool could see a 15pc reduction. A more radical reform that linked bills proportionally to a property's value could see bills in Stoke-on-Trent slashed in half. But it would also see bills quadruple in Kensington and almost double in parts of Surrey. There was a reason that Margaret Thatcher backed away from a poll tax. ... and planning red tape It is not just moving house that matters. Building them would boost the economy too. That is why bats and newts are high up on Reeves's hit list. The Chancellor has repeatedly grumbled about the many obstacles to getting things built in Britain, telling the House of Lords economic affairs committee last month that she cares 'more about getting a young family on the housing ladder than I do about protecting some snails'. She has a point. In a now infamous example, the chairman of the HS2 rail line admitted it was spending £100m on a shield to protect bats in ancient woodland in Buckinghamshire. Sir John Thompson said this was just one example of 8,276 'consents' required from public bodies, and expressed frustration at red tape across the UK. Reeves also knows there is a big prize on offer if she manages to reduce bureaucracy. The OBR said Labour's planning reforms were already expected to drive an increase in housebuilding of 170,000 homes until the end of the decade, which would in turn increase Britain's medium-term growth prospects by 0.2pc. Reeves has since ordered officials in the Treasury to go further. Prepare for more red tape to be slashed.
