Labour 'lose control' as gilt yields rise above worst of Liz Truss era
The real yield on 30-year inflation-linked debt – the return investors get from 30-year government bonds that protect against inflation – rose to its highest since at least 2010 at 2.571%, according to data from LSEG.
This meant the rate had pushed past a previous high of 2.547% set on September 28, 2022 during turmoil after former prime minister Truss's disastrous 'mini-budget'.
READ MORE: Seamus Logan: Scotland is wealthy but GERS makes it look poor. Time for a rethink
Official figures on Wednesday then showed that UK inflation rose to 3.8% in the 12 months to July, almost double the Bank of England's 2% target and 0.1% above the widely expected 3.7%.
The bank has forecast inflation will peak at 4% in September and remain above its target until mid-2027.
Reuters reported that investors are starting to think ahead to Reeves's Budget in the autumn, when many economists think she will have to raise taxes by tens of billions of pounds to stay on track to meet her self-imposed fiscal rules.
Responding to the figures, SNP economy spokesperson Dave Doogan MP said: 'Prices are up again because the Labour Party has lost control over the economy – they promised stability and promised 'change' but the truth is that things have only got worse under their watch.'
Doogan said the spike in the cost of food and drink – inflation in that area rose to 4.9% in July, from 4.5% in June – was 'particularly painful for households'
Chancellor Rachel Reeves is under fire after a week of poor economic data'After a year in government the only thing that has risen faster than prices under the Labour Party is their list of broken promises,' he went on.
'Economic stat after economic stat, figure after figure, month after month confirms what people already know – Brexit Britain is broken – and Scots now know that the cost-of-living crisis will never end under Westminster control.
'As the Chancellor prepares another brutal Budget this autumn that will directly hit people in the pocket, Rachel Reeves should be laying the ground to help households with their family finances instead of blatantly laying the ground to fill the financial black hole in the UK Treasury.'
LibDem MP Susan Murray also said that while the Tories had left a 'toxic economic legacy', Reeves has 'made things worse for herself'.
"The markets clearly don't have a lot of faith in Labour's economic plans,' Murray went on. 'That's no wonder because her National Insurance hike is already hurting businesses and making them less willing to take on new staff.
READ MORE: Just 7 per cent of Edinburgh TV Festival panellists based in Scotland
"The UK needs to invest in getting people who are inactive back to work by getting them the mental health care and support they need.
'It also needs a serious programme of investment in the key industries of the future to ensure that we are at the forefront of fields like renewable technology and biosciences."
The Treasury declined to comment on market movements in gilt yields.
However, addressing the inflation figures on Wednesday, Reeves said: 'We have taken the decisions needed to stabilise the public finances, and we're a long way from the double-digit inflation we saw under the previous government, but there's more to do to ease the cost of living.
'That's why we've raised the minimum wage, extended the £3 bus fare cap, expanded free school meals to over half a million more children and are rolling out free breakfast clubs for every child in the country.'
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The Independent
21 minutes ago
- The Independent
Is Labour really failing on immigration and asylum hotels?
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Last year (2024/5), the cost for hotel bills was at £2.1bn, down by a third from £3.1bn in the previous year. The smaller bill is a result of multiple factors, most notably the reduction in the asylum backlog. The average daily cost for housing each asylum seeker in a hotel has gone down from £176 to £170 per person. This still remains higher than previous years. The government has also made efforts to reduce the proportion of asylum seekers housed in hotels, moving them towards other types of accommodation. Figures from March show 32,345 asylum seekers out of over 100,000 were being accommodated in hotels, with the remainder housed in temporary accommodation including council-owned homes and a former airfield. Just 30 per cent are staying in hotels, which is meant as a contingency - or temporary - measure. Government accounts show that costs are likely to remain similar this year, with £2.2bn requested by the Home Office to asylum housing costs; suggesting that the number of asylum seekers is unlikely to fall significantly. In February, Home Office permanent secretary Sir Matthew Rycroft said the department was aiming to 'get to zero' asylum hotels by the end of this parliament in 2029. In 2022, the government began plans to use 'large sites' like cruise ships and ex-military bases to accommodate asylum seekers. Among these are the Bibby Stockholm barge, which was shut down last year, and former RAF airfield Wethersfield which now houses 588 people as of early 2025. But a review last year found that these sites cost more than hotels as a way to house asylum seekers. Nonetheless, hotels cost around six times more on average than other types of accommodation, according to analysis by the Migration Observatory; at £170 a day compared to £27 a day. Yet most of the time, the government is forced to place people in hotels due to a lack of capacity, with a shortage of accommodation and a substantial –albeit decreasing – asylum backlog. The asylum backlog stood at 78,745 cases at the end of March – a 13 per cent drop from December, and down 41 per cent from the mid-2023 peak. Yet the sizeable backlog, which is still higher than pre-2022 levels, represents a host of ongoing costs for the government as people wait for a decision on their asylum claims. Most asylum seekers are still waiting over six months for an initial decision on their claim, although waiting times have improved compared to the same time last year. The majority of people in the backlog are Afghan, Pakistani and Iranian nationals, according to the Migration Observatory. The UK's asylum backlog is the fifth largest in Europe. Where are asylum seekers staying in the UK? Now, over 8 in 10 local authorities host some asylum seekers, Home Office figures show. This is a significant rise over the last decade. Accommodation for asylum seekers varies by region. In the North East of England, just 5 per cent are housed in hotels, while in London hotels make up the majority of accommodation (65 per cent). Epping Forest council is within the East of England region, which has 41 per cent of migrants housed in hotels. However, being in Essex, the council is on the edge of London which has a higher concentration of asylum seekers than the rest of the UK. Around 140 migrants were being housed in The Bell Hotel in Epping, according to BBC reports, all of whom must now leave by September. Though the hotel has provided accommodation for the Home Office for several years, occupancy has fluctuated, with figures in March showing just 28 asylum seekers housed across Epping Forest hotels. 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Meanwhile arrests of people smugglers who enable the crossings were down last year, according to National Crime Agency data obtained by The Independent. The shadow home secretary called Labour's failure to 'smash the gangs' an 'abject failure'. This suggests that small boats migration could be the highest on record over 2025, bringing with it a slew of new asylum claims; since almost all irregular migrants apply for asylum.
Scottish Sun
21 minutes ago
- Scottish Sun
Huge jump in rejections for vital benefit worth £340 a year that unlocks full state pension payments – how to avoid it
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To claim you'll need to be aged 16 or over but under the state pension age, which is currently 66. You could claim the benefit if you're in one of these situations: You care for one or more people for 20 hours or more a week but miss out on Carer's Allowance because you don't care for any one of them for 35 hours or more a week Where there is more than one of you caring for someone, and someone else is getting the Carer's Allowance for that person You care for someone who can't or refuses to claim disability benefits, or if the disability benefits of the person you are caring for have stopped due to them being in hospital or residential care You are within 12 weeks of claiming Carer's Allowance and/or within 12 weeks of your claim for Carer's Allowance stopping. 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Western Telegraph
29 minutes ago
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BBC ‘not institutionally antisemitic', says Observer's editor-in-chief
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