Latest news with #economicstrategy
The Independent
5 days ago
- Business
- The Independent
Reeves will have to ditch key party manifesto pledge, IMF warns
The International Monetary Fund (IMF) commended Rachel Reeves' overall economic strategy but issued a warning regarding the UK's limited fiscal headroom. The IMF indicated that this lack of financial flexibility might compel the Chancellor to abandon key manifesto pledges. Suggested measures from the IMF included potentially increasing taxes on working people, replacing the state pension triple lock, or introducing charges for NHS services for higher-income users. The IMF also identified the ongoing impact of Donald Trump's tariffs as a challenge for the UK economy. Rachel Reeves responded by asserting that the government's decisions are fostering economic recovery and that their plans are designed to tackle inherited economic challenges.
BBC News
16-07-2025
- Business
- BBC News
IOM government seeks more migrants to help plug critical job gaps
The Manx government's plan to increase the island's working population through inward migration has been outlined to Tynwald by the Council of Ministers. It follows a July 2024 report examining the island's migration incentives and disincentives. The study's conclusions were received by Tynwald in this month's sitting of the Manx parliament, Cabinet Office Minister David Ashford said measures were being taken to improve the immigration system, to revise visa routes, and to develop immigration incentives and said Manx workers would "come first", adding that the government would "seek to attract workers from off-island only where gaps cannot be filled locally". In a debate lasting more than two hours, Ashford updated members on the Council of Ministers' report. He said "inward migration and local workforce development" was "at the heart of the government's broader economic strategy" to create and fill 5,000 additional jobs by the island's unemployment level standing at 0.7% as of May, Ashford said "vacancies continue to exceed the number of jobseekers".He said this was especially the case in "critical sectors like health and social care". The Isle of Man is also facing "natural population decline", the minister 2024 there were 907 deaths recorded on the island, compared with only 485 births. 'Zero tolerance' The report outlined that between the 2021 census and the first quarter of 2024, the island's population increased by 1, average age of people moving to the Isle of Man during that time was laid out a "set of policy principles", which included the need to invest in "upskilling Manx workers" and maintaining island security through "the integrity" of the Common Travel Area. Changes were being phased in over the next 36 months, he said, with a number "already under way"Plans to introduce an immigration health surcharge have been approved in Minister Alex Allinson said the rules would be consistent with the UK and put Isle of Man visa applicants on a "level playing field" with said the "bulk of this money should go to the NHS" since it was "right" for it to be "invested in the healthcare of this island".Additionally, there will be an increase in the minimum salary thresholds for visa holders, and improvements to the visa processing system. Ashford also outlined plans to attract more young people to the island and to encourage the return of Manx youngsters. He said they were "taking proactive steps to attract talent" by reviewing existing incentives and considering the "potential use of student loans".They were also "developing a 'welcome home' package" to encourage Manx workers overseas to "return and contribute to the local economy", he added.A pilot of this scheme is due to begin in April 2026. 'Vulnerable' Several MHKs, including Ramsey's Lawrie Hooper, raised concerns that the island could be treated as a "side door into the UK".By having a lower salary threshold than the UK, he said it "leaves us open to be targeted by criminals" looking to access the UK via the island. While acknowledging most people were "good", Hooper warned the report did not sufficiently consider the risks posed by those who would seek to exploit the different immigration view was echoed by other MHKs, including Jason Arbory, Castletown and Malew representative described the changes as leaving the island "vulnerable". Concerns were also raised about modern slavery, where people are paid less than the minimum wage. In response, Ashford said it was "an absolute scourge on our planet".He stressed the Isle of Man had a "zero tolerance approach" to anyone seeking to move to the island and exploit people. Summarising the government's strategy, Ashford said: "Over the next three years, these changes will tighten immigration controls and strengthen the resilience of our immigration system." Read more stories from the Isle of Man on the BBC, watch BBC North West Tonight on BBC iPlayer and follow BBC Isle of Man on Facebook and X.
The Independent
06-07-2025
- Business
- The Independent
Raise taxes or this government will fail, Rachel Reeves's former top adviser warns
Rachel Reeves must U-turn on her manifesto pledge not to raise taxes for working people or Sir Keir Starmer 's government will be forced to abandon other key priorities, one of the chancellor's former top advisers has warned. Jim O'Neill, a former Goldman Sachs chief turned Treasury minister who quit the Conservatives and later advised Ms Reeves, said she faces no choice but to abandon key parts of her economic policy – including her commitment not to raise income tax, national insurance contributions for employees or VAT. Questioning whether that promise was now sustainable, he told The Independent: 'Without changing some of the big taxes, welfare and pensions, they [ Labour ] can't commit to things like Northern Powerhouse Rail, small modular nuclear reactors, and various other things that will make an investment and growth difference.' His comments come in the wake of a disastrous week for Sir Keir's government as ministers were forced to abandon key parts of welfare reforms to stop a rebellion by Labour MPs, leaving a £5bn black hole in its spending plans. In a week defined by a distressed Ms Reeves shedding tears during Prime Minister's Questions, the pressure on the government to balance the books and dramatically change strategy has increased, with the chancellor admitting that the U-turn came at a 'cost'. But with Labour dropping spectacularly in the polls – and the prime minister facing growing disquiet from the back benches – mention of the government's missions has all but disappeared, while the economy stagnates. Lord O'Neill claimed that part of the problem was that the government was caught in short-term thinking about Nigel Farage and Reform, who have taken a large poll lead. 'They need to stop worrying about Farage, they have four years before that should matter,' he said. Reflecting on the problems with the welfare reform bill, he said: 'The past few days should force government to truly prioritise, link specific priorities to their growth mission, get out of the 24/7 social media, and, crucially, recognise it can't deliver on all three of its fiscal rules, growth mission and manifesto tax commitments. Something has to give. 'I'd personally abandon triple lock on pensions, and the current welfare bill, and say they are going to pursue more serious welfare reform.' Top pollster Luke Tryl, UK director at More in Common, told The Independent the government would be better off pushing through big tax hikes now in order to fix public services before the next election. He said: 'At this stage, the government would be better to do a broad-based tax rise and ensure they can deliver on making Britain feel like it's working better, than risk a continuation of the public feeling Britain is totally broken. 'Having boxed themselves in, breaking the promise won't be without pain, but the alternative – four years of the public not seeing change – is far worse politically and for the mood of the country.' On Friday, Ms Reeves refused to rule out tax rises in the wake of what she admitted was the 'damaging' climbdown on welfare cuts. The chancellor is said to have warned that any tax hikes this autumn are likely to be more painful than those she pursued last October, with all low-hanging fruit options having been taken. Asked whether she could rule out tax hikes, she told The Guardian: 'I'm not going to, because it would be irresponsible for a chancellor to do that.' The government is, however, believed to be opposing growing calls from Labour MPs for a wealth tax to fill the hole in the public finances. The UK's leading economic think tanks have, meanwhile, warned that tax rises are inevitable with speculation that there could be a raid on pension funds and new rules to prevent people offsetting tax by putting their money into pensions. Paul Johnson, director of the Institute for Fiscal Studies, said: 'If we are looking at £30bn – which is quite plausible – you can't see a way in which you raise that kind of money without hitting people on middle incomes. 'If you are looking for big money then it has to be something in income tax, national insurance or VAT.' Ben Caswell, senior economist at the National Institute of Economic and Social Research, said: 'It seems, given the spending review and the allocation of funds, raising taxes in the autumn seems almost inevitable at this point.' Tax expert Arj Kumar, founder of tax advisers Taxd, warned: 'The next Budget will likely see Rachel Reeves dig deeper, raising taxes further to cover government spending on defence and a boost to infrastructure. If these hikes continue to cripple businesses, it's working families who will pay the ultimate price.' The warnings come as the prime minister strongly hinted that the government is going to bring in tax rises at the next Budget. In an interview with the BBC's Nick Robinson, the presenter claimed that Sir Keir had said: ''I'm not going to put your taxes up,'' adding: 'Then taxes went up.' The prime minister hit back: 'Nick, be fair, we had a manifesto commitment that we wouldn't increase income tax, national insurance and VAT for working people. That was a manifesto commitment. That is what I said to you last time, and that is what we've kept to. 'So the one thing we didn't do in the last Budget was we didn't breach that manifesto commitment. We're not going to breach that manifesto commitment.' Critics have noted that his response only closed the door to tax rises on the big three – income tax, VAT and national insurance. Already, a leaked memo from deputy prime minister Angela Rayner to Ms Reeves has revealed that the left of the party is pushing for so-called wealth taxes on the superrich and big corporations. Ms Rayner outlined eight possible new wealth taxes instead of cutting public services further.
The Independent
05-07-2025
- Business
- The Independent
Raise taxes or this government will fail, Rachel Reeves' former top adviser warns
Rachel Reeves must U-turn on her manifesto pledge not to raise taxes for working people or Sir Keir Starmer 's government will be forced to abandon other key priorities, one of the chancellor's former top advisers has warned. Jim O'Neill, a former Goldman Sachs chief turned Treasury minister who quit the Conservatives and later advised Ms Reeves, said she faces no choice but to abandon key parts of her economic policy – including her commitment not to raise income tax, National Insurance contributions for employees or VAT. Questioning whether that promise was now sustainable, he told The Independent: "Without changing some of the big taxes, welfare and pensions, they (Labour) can't commit to things like Northern Powerhouse Rail, small modular nuclear reactors (SMRs), and various other things that will make an investment and growth difference." His comments come in the wake of a disastrous week for Sir Keir's government as ministers were forced to abandon key parts of the welfare reforms to stop a rebellion by Labour MPs, leaving a £5bn black hole in its spending plans. In a week defined by Ms Reeves openly shedding tears in PMQs with questions over her future, the pressure on the government to balance the books and dramatically change strategy has increased, with the chancellor admitting that the U-turn came at a 'cost'. But with Labour dropping spectacularly in the polls – and the prime minister facing growing disquiet from the backbenches – mention of the government's missions has all but disappeared, while the economy continues to stagnate. Lord O'Neill claimed that part of the problem was that the government was caught in short-termist thinking about Nigel Farage and Reform who have taken a large poll lead. 'They need to stop worrying about Farage, they have four years before that should matter,' he said. Reflecting on the problems with the welfare reform bill, he went on: 'The past few days should force government to truly prioritise, link specific priorities to their growth mission, get out of the 24/7 social media, and, crucially, recognise it can't deliver on all three of its fiscal rules, growth mission and manifesto tax commitments. Something has to give. 'I'd personally abandon triple lock on pensions, and the current welfare bill, and say they are going to pursue more serious welfare reform.' Top pollster Luke Tryl, UK director at More in Common, told The Independent the government would be better off pushing through big tax hikes now in order to fix public services before the next election. He said: 'At this stage, the government would be better to do a broad-based tax rise and ensure they can deliver on making Britain feel like it's working better, than risk a continuation of the public feeling Britain is totally broken. 'Having boxed themselves in breaking the promise won't be without pain, but the alternative – four years of the public not seeing change – is far worse politically and for the mood of the country.' On Friday, Ms Reeves refused to rule out tax rises in the wake of what she admitted was the 'damaging' climbdown on welfare cuts. The chancellor is said to have warned that any tax hikes this autumn are likely to be more painful than those she pursued last October, with all low-hanging fruit options having been taken. Asked whether she could rule out tax hikes, she told The Guardian: 'I'm not going to, because it would be irresponsible for a chancellor to do that.' The government is, however, believed to be opposing growing calls from Labour MPs for a wealth tax to fill the hole in the public finances. The UK's leading economic thinktanks have, meanwhile, warned that tax rises are inevitable with speculation that there could be a raid on pension funds and new rules to prevent people offsetting tax by putting their money into pensions. Paul Johnson, director of the Institute for Fiscal Studies (IFS), said: 'If we are looking at £30bn – which is quite plausible – you can't see a way in which you raise that kind of money without hitting people on middle incomes. 'If you are looking for big money then it has to be something in income tax national insurance or VAT.' Ben Caswell, senior economist at the National Institute of Economic and Social Research (NIESR) said: 'It seems like, given the spending review and the allocation of funds given (and poor GDP growth and public finances), raising taxes in the Autumn seems almost inevitable at this point.' Tax expert Arj Kumar, founder of tax advisers Taxd, warned: 'The next budget will likely see Rachel Reeves dig deeper, raising taxes further to cover government spending on defence and a boost to infrastructure. If these hikes continue to cripple businesses, it's working families who will pay the ultimate price.' The warnings come as the prime minister strongly hinted that the government is going to bring in tax rises at the next Budget. In an interview with the BBC's Nick Robinson, the presenter claimed that Sir Keir had said: ''I'm not going to put your taxes up,'' adding: 'Then taxes went up.' The prime minister hit back: 'Nick, be fair, we had a manifesto commitment that we wouldn't increase income tax, National Insurance and VAT for working people. That was a manifesto commitment. That is what I said to you last time, and that is what we've kept to. 'So the one thing we didn't do in the last budget was we didn't breach that manifesto commitment. We're not going to breach that manifesto commitment.' Critics have noted that his response only closed the door to tax rises on the big three – income tax, VAT and national insurance. Already, a leaked memo from deputy prime minister Angela Rayner to Ms Reeves, has revealed that the left of the party is pushing for so-called wealth taxes on the super rich and big corporations. Ms Rayner outlined eight possible new wealth taxes instead of cutting public services further.
The Guardian
04-07-2025
- Politics
- The Guardian
This Fourth of July, the world declares its independence from America
This year, like every other year, Americans will celebrate Independence Day with flag-waving, and parades, and fireworks. The political system the flag and the parades and fireworks are supposed to represent is in tatters, but everybody likes a party. It was 249 years ago, when the United States separated from the British Empire. Over the past year it has separated from the world order it built over those 249 years, and from basic sanity and decency as well. For Americans, the madness gripping their country is a catastrophe. For non-Americans, it is an accidental revolution. This Independence Day, the world is declaring its independence from the US. As the United States retreats from the world, it is reshaping the lives of its former trading partners and allies, leaving huge holes in its wake. For Canada, where I live, the sudden absence of a responsible United States has been more shocking and more terrifying than for other countries. Americans are our friends and neighbours, often our family. We have been at peace with them for 200 years, integrating with their security apparatuses and markets. Now they are explicitly planning to weaken us economically in order to annex us. The Canadian strategy, undertaken with vigor by the newly elected government of Mark Carney, has been clear in spirit at least: a polite 'go fuck yourself.' After you've told America to fuck off, though, the real work starts. You have to figure out how to live without them. Carney has already signed major pieces of legislation to lower trade barriers inside the country, to create new trading partners, and to cement security arrangements with the European Union. But those are only the obvious beginnings. Since Donald Trump's inauguration, I have been working on Gloves Off, an audio series trying to figure out how Canada can navigate the post-American world. I've been shocked by how much needs to be done. Canada is like a beautiful mansion with huge chunks of the foundation missing. We don't even have our own secret service, just an internal security apparatus. Our military would be comically unprepared for an American annexation. Large scale-changes to national life – becoming a nuclear power, undertaking a whole society defense – may be required to survive a neighbour who is backsliding into authoritarianism every week. Under protection from America, under the assumption that its economy was globally dominant, Canada has never had to ask itself hard questions. Now we're facing a pop quiz with terrifying consequences. The decline of America leaves a psychological gap, too. America, for all its problems, was aspirational. It was easy to poke holes in its claims to exceptionalism, but it genuinely served millions of people, myself definitely included, as a beacon of freedom and openness. But I keep thinking of that line from No Country for Old Men, just before Anton Chigurh kills Carson Wells in a hotel: 'If the rule you followed brought you to this, of what use was the rule?' Its great founders knew America's vulnerabilities from inception. Washington predicted, almost exactly, the effects of partisanship the country is undergoing today: 'The alternate domination of one faction over another, sharpened by the spirit of revenge natural to party dissension, which in different ages and countries has perpetrated the most horrid enormities, is itself a frightful despotism,' he wrote in his Farewell Address. 'But this leads at length to a more formal and permanent despotism.' Abraham Lincoln saw it all coming: 'If destruction be our lot we must ourselves be its author and finisher. As a nation of freemen we must live through all time or die by suicide.' The suicide is tackier than anyone imagined, but it's been predicted since 1776. One of the great ironies of history is that the triumph of Maga has led to the piecemeal destruction of everything that once made America great, and on every level. Its power derived from a reliable trade network, with logistical chains that were the wonders of the world, combined with a huge alliance network, and the greatest scientific and technological institutes in the world. It is systematically destroying all of those strengths far more thoroughly than any enemy could. America is turning away from itself, and the rest of the world must follow. The new independence requires frankness, even brutality. There is no such thing as a deal with America any more. Canada and Mexico made one with Trump in 2018. He broke it at the first possible opportunity. Their national word is worthless. They understand only force and money, and increasingly not even those. Their military actions are more or less random, half-considered, about as deep and significant as a social media rage post. They instantly forget who helped or hurt them. All those Afghans who saved American lives a decade ago have lived to regret it, being deported, just for the spectacle of it all, back to their torturers. There is exactly no security in being their ally. If the American government declares war on something – poverty, drugs, Islamic terrorism, anti-democratic governments – you can be quite sure that whatever they're opposed to will be much stronger by the end of the fighting. US scholars of fascism are fleeing to Toronto, and the city has become a kind of lens through which to see the American collapse. Canada sees what America is becoming. Travel from Canada to the United States is down 45% year over year which is partly a political statement by way of boycott, but it's also a demonstration of common sense: America has made it perfectly clear that foreigners are unwelcome and subject to violence with total impunity. But the simplest way to explain the need to step away from the United States is the most basic: no problem the world faces has an answer that can be found in America. Not politically, not economically, not socially, not culturally. It is clear that we have to start looking for answers to the world's problems elsewhere, in ourselves and in others. There is a celebration of independence this Independence Day and it is real; it's just for countries other than America. The lesson the Americans once taught the British, they are teaching the rest of the world: there are no necessary nations. There are no exceptional countries. There are no permanent global orders. There's just more history, and trying to survive to stay yourself it. Stephen Marche lives in Toronto and is the author of The Next Civil War and On Writing and Failure
