People terrified by benefit reforms, says Labour politician
"What we need to do as a Labour Party is to address the fundamentals in the economy," he told BBC Radio Wales' Sunday Supplement."We're seeing at the moment taxation increasing because the economy is failing."People want to work and people want to live decent lives and it's the role of government, surely, to help people do that," said Davies whose Blaenau Gwent constituency has the highest proportion of disabled people in Wales, according to census data. In her address to MPs on Wednesday, Reeves said "it can't be right" to "write off" an entire generation who are out of work and improperly using Pips.There are two elements to Pips – a daily living and a mobility component – and under the government's proposals, assessments for the daily living part will be tightened, a move the official forecaster – the Office for Budget Responsibility (OBR) – says will affect around 800,000 people.The chancellor also confirmed health-related universal credit for new claimants - which was already due to be halved from April 2026 under a package announced last week - would be frozen at its new lower level of £50 per week until 2030.A Department for Work and Pensions assessment found 3.2 million families across England and Wales would be worse off as a result of the changes, with 250,000 more people pushed into relative poverty.The UK government has said the reforms are aimed at modernising the welfare system, and getting many of those reliant on assistance back into work.On Friday, Wales' First Minister Eluned Morgan refused to back the chancellor's welfare cuts, telling the Senedd she wanted to "reserve my position" until she knew what the impact would be on Wales.Morgan also confirmed she was waiting for a response from Work and Pensions Secretary Liz Kendall to her request for a Wales-specific impact assessment and said she was now seeking a meeting with her.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Wales Online
43 minutes ago
- Wales Online
Hefin David was a tireless campaigner, advocate for Caerphilly and a friend to those across politics
Hefin David was a tireless campaigner, advocate for Caerphilly and a friend to those across politics Politicians from across the Senedd have remembered Hefin David as an all round "good person" Hefin David's political career began as a local councillor in Caerphilly (Image: PA) Senedd Member Hefin David has died suddenly. The politician, ardent campaigner and father-of-two was 47 and died just the day before his 48th birthday. Mr David had served in his role as the Senedd Member for Caerphilly since 2016 when he took over from Jeff Cuthbert who became the Gwent Police and Crime Commissioner. His political career began much more locally when he was elected as a local councillor for the ward of St Cattwg in Caerphilly County Borough Council at the age of 29 through a by-election in March 2007. It was role he held up until 2017 and saw him secure a substantial £400,000 grant to rebuild a local village hall. Following his work as a local councillor and university lecturer, he was elected as an MS in 2016 and during his nine years in Cardiff Bay he sat on the Senedd's economy committee and the culture committee. Politicians from across the Senedd have remembered him as being an all round "good person". Tom Giffard, the Senedd Member for South Wales West and a member of the Welsh Conservatives said it was rare that you call someone from another party a friend but that Mr David was "certainly that". Article continues below Mr David had also recently been selected as number one on Labour's list of candidates for the new Blaenau Gwent Caerffili Rhymni constituency in next year's Senedd election. He has been described by his colleagues in Cardiff Bay as a "dedicated public servant to Caerphilly" and a "strong campaigner", with Keir Starmer calling him a "powerful voice for the people of Wales". Stay informed on Caerphilly news by signing up to our newsletter here . During his nine years in the Senedd Mr David frequently made contributions about one of his two daughters, who has autism and learning difficulties, routinely speaking up on the experiences of him and his family. Through his work he campaigned for improved services for and supporting families with relatives with additional learning needs, the development of Valleys communities and small firm development and growth. His tireless campaigning also saw him speak out about freeholders, who have estate management charges imposed on their properties, and called on the Welsh Government to cap estate management charges in Wales. Alongside his political work, the MS was heavily involved in his local community serving as a governor at his old school, Heolddu Comprehensive School, and being a keen supporter of the Caerphilly Miners Centre. Mr David was also a Fellow of the Higher Education Academy (FHEA) and an Academic Associate of the Chartered Institute of Personnel and Development (CIPD). Mr David was born in Caerphilly Miners Hospital in August 1977 and grew up in the village of Penpedairheol near Bargoed and in the Caerphilly constituency where he lived up until his death. He was educated at Heolddu Comprehensive School before studying Politics and Economics at Cardiff University. He later went on to gain a PhD in small business employment issues before working as a senior lecturer in business management at the University of Wales in Newport and then as a HR Development and Practice lecturer at Cardiff Metropolitan University. Article continues below Mr David's work spanned further than Wales, having also worked and taught in Germany, Greece, India and China. He is survived by his partner Vicki Howells, who is a fellow Labour MS for Cynon Valley and the deputy minister for education, as well as his two daughters.
The Independent
43 minutes ago
- The Independent
Labour can't hit ‘working people', so now they're after people who used to work
Labour has got itself into a cleft stick. Having come to power on a pledge of not raising taxes on 'working people,' in response to the opposition charge that it cares more about those who don't work, that raising money from the employed goes to help those who choose to be unemployed, Sir Keir Starmer and Rachel Reeves are stuck. They are faced with a deficit of £50bn, give or take, for which they can no longer blame the Tories – that legacy was half. It's down to their failure to drive the economy, to achieve as they insist, 'faster and further' growth. It's just not happening, and, meanwhile, they have that hole to fill. They can't borrow extra because another reason that the chasm is so large is due to higher-than-expected borrowing costs. They dare not cut services because that would alienate their bedrock, and 'austerity' is what Tories do, not them. So, they cast around for tax targets. However, they can't alight on those who are putting in the hours and earning by aiming for income tax, employee national insurance, or VAT, because that would betray the election promise. So, they pick those who once worked. Inheritance tax, or IHT, or as it's popularly known, 'death duty,' is in their crosshairs. At present, inheritance tax is 40 per cent on estates above £325,000. But there is no limit on how much can be gifted to relatives tax-free if the giving is made seven years before someone dies. If it's within seven years, then a sliding scale or 'taper relief' applies. The rate drops each year, from 32 per cent to 8 per cent. Those who think they, or rather their inheritors, may be clobbered duly give it away in good time. The result is that inheritance tax is paid by only around four per cent of estates. In the eyes of Reeves and her advisors, that is too little. They know that people are sitting in homes that have soared in value and possess gold-plated pension pots, and they want some of it. They are looking at imposing a lifetime cap on how much can be gifted and/or changing the rules on taper relief. To ensure, in other words, that IHT is not so easily avoided and that the four per cent figure increases enormously. What's not to like? Politically, those affected are the better off, who are not natural Labour voters. It is not earned money, in the sense that property prices and pensions have risen since they ceased to work. It's fair game to grab it. Indeed, that is precisely what a source with knowledge of the work told the Guardian: 'It's hard to make sure these taxes don't end up with loopholes that undermine their purpose. But we are trying to work out what revenue might be raised and how to ensure it's a fair approach.' Labour has form for this. It's exactly what this government did to the farmers, except there it was farmers with land worth more than £3m. Reeves said this week she believed they 'should make a contribution.' These are weasel words. Reeves is ignoring the fact that they have already contributed, as presumably, she and her colleagues are doing so again, by claiming they are looking to be 'fair'. Apparently, one of the motivators is that they are not keen on a wealth tax as many of their supporters would like because that will serve to encourage the wealthy who can do so to leave the country, and there is evidence to suggest that is already happening, and would damage attempts to encourage greater investment to galvanise the economy. But how is this any different? It still sends the same signal that Labour sees the rich and not even that rich, as ripe for plundering. However it is dressed up and spun, the message is clear: you don't want to work and make some money under Labour, because they will get you. Ignoring the working and selecting those who worked may cleverly satisfy their political and fiscal ambitions, but it fools no one. Under Labour, it really does pay not to work.
The Guardian
an hour ago
- The Guardian
The UK's bank ringfencing doesn't need large-scale reform
One reason to worry about the chancellor's plan for deregulation in the financial services sector is the dramatic language in which she pitched it. Rachel Reeves's metaphor in her Mansion House speech last month about regulation in too many areas acting as 'a boot on the neck of business' felt wildly over the top when you remember why tougher financial rules were needed in the banking sector in the first place. It was because the light-touch regulatory era caused the whole economy to be clobbered in the collapses of 2008-09. In the event, it took until 2019 to fully implement the centrepiece of the clean-up operation – bank ringfencing, which requires UK banks of a certain size to separate their retail and investment banking activities. Now, six years later – no time at all in the grand scheme – the Treasury, lobbied by most of the big banks, is contemplating 'meaningful' changes to ringfencing in the interests of economic growth. It feels far too soon to try anything radical. The definition of 'meaningful' is vague, it should be said. Outright abolition of ringfencing is off the table, thankfully, and some of the possibilities floated by the Treasury could be viewed as innocuous. Letting banks share back-office resources across the ringfence? Yes, that could be regarded as mere housekeeping. Allowing ringfenced banks to provide more products to UK businesses? Possibly, if we're talking about low-octane services. But the details do matter. The danger is that, if you create too many holes in the fence, you end up defeating the purpose of the construct. There are at least three reasons why Reeves should drop the inflammatory language and err on the side of caution. First, remember the primary goal: to ensure the state never has to bail out banks again – at least not the riskier trading activities. The plea from reformists is that other measures, such as stiffer capital requirements and 'living wills' to organise an orderly wind-down, do the same job. Yet ringfencing is surely genuinely different because it is a structural measure – the core UK deposit-taking operations have to sit inside their own legal entity. Maximum protection for the deposit-taking core still feels a sound principle given what happened in 2008-09, and how the whole of the wretched Royal Bank of Scotland was dragged down. Second, ringfencing may lower funding costs for banks. The perception of greater resilience should, in theory, attract a funding bonus. Put another way, regulators – with their eye on the overall stability of the system – might demand even higher capital buffers if ringfencing were to be meaningfully weakened. Would-be abolitionists grumble about the costs of trapped capital. Fair enough, but they probably wouldn't like bigger capital buffers either. Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion Third, if the chancellor's aim is more growth, why make it easier for UK banks to chase higher returns outside the UK? She should listen to the commonsense point made by Andrew Bailey, the governor of the Bank of England: 'Removing the ringfence would most likely have a negative effect on UK lending, both in terms of cost and quantities.' If ringfencing has meant cheaper mortgages, it would be a political risk for a chancellor to mess with the formula. None of which is to pretend that ringfencing has been a free lunch. Friction and expense clearly exist – the big banks spent a small fortune setting up the structures and have to carry extra overheads. Competition may also have suffered as big ringfenced banks have concentrated on UK mortgage lending and smaller banks have been forced towards riskier lending. Visions of a post-crisis world full of dynamic 'challenger' banks never materialised. But that is just to say that trade-offs exist. For the UK – a country that simply cannot afford another crisis like 2008's – financial stability should still be the priority. A few minor fiddles might be an improvement because no design is perfect. But major reform is not needed.
