Latest news with #fantasyEconomics
Bloomberg
29-05-2025
- Business
- Bloomberg
Starmer to Accuse Farage of Truss-Style ‘Fantasy' Economic Plans
Keir Starmer is expected to hit back at what he described as Nigel Farage's 'fantasy economics,' in the latest sign that the Labour prime minister believes he must act to arrest Reform UK's surge in opinion polls. Starmer will argue on Thursday that tax-and-spend policies like those laid out by Farage earlier this week would risk a market meltdown similar to the 'mini-budget' crisis that prompted then-Conservative Prime Minister Liz Truss to step down after weeks in office in 2022, according to a statement from the Labour Party. The Reform leader promised, among other things, to lift the point at which workers start paying income tax to £20,000 ($27,000) from £12,570, which the Institute for Fiscal Studies said could cost in excess of £50 billion annually.
Telegraph
29-05-2025
- Business
- Telegraph
Starmer attacks Farage's ‘fantasy economics'
Sir Keir Starmer will accuse Nigel Farage of 'fantasy' economics on Thursday, in an attack reflecting the scale of Labour's concern about the Reform UK surge. The Prime Minister will claim the Reform leader is proposing to use family bills and mortgages as a 'gambling chip' in a 'mad experiment' with the public finances. There will also be an attempt to link Mr Farage's approach with that of Liz Truss, whose misfiring mini-Budget led to a market backlash and her swift ousting as prime minister. Sir Keir's speech will be delivered to workers at a manufacturing business in the North West, where Reform has soared in popularity, and is a rebuttal of Mr Farage's pledge of a benefits giveaway. On Tuesday, the Reform leader promised to reinstate the winter fuel payment for all pensioners and scrap the two-child benefit cap in his latest targeting of Labour voters. The move triggered renewed focus on whether Reform's economic agenda adds up. A think tank said one flagship income tax cut could cost up to £80 billion a year, more than the defence budget. But the decision to deploy the Prime Minister to make the political assault on Reform demonstrates how seriously its rising popularity is being treated in No 10. Reform is now far ahead of other parties in average opinion polls, 30 per cent versus Labour's 22 per cent, the Tories' 17 per cent and the Liberal Democrats' 15 per cent. Sir Keir is expected to say: 'In opposition, we said Liz Truss would crash the economy and leave you to pick up 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.' Reform, which has traditionally positioned itself to the Right of the Conservatives, is increasingly trying to appeal to Labour voters with a more Left-wing economic agenda. Mr Farage embraced the nationalisation of British Steel in the run-up to the May 1 local elections, which saw the party take control of 10 councils, gain another MP in a by-election and secure two regional mayors. On Tuesday, he announced three new policy positions – reinstating the winter fuel payment, scrapping the two-child benefit cap and a more generous transferable marriage tax allowance. The first two piled pressure on the Prime Minister, who has so far failed to promise that all pensioners will get the annual winter fuel payment of up to £300 again, or that the two-child benefit cap will be fully lifted. Both policies are under review. Mr Farage argued the move would be funded by scrapping the target of making the UK net zero by 2050, though gave few specifics, as well as halting spending on housing asylum seekers and diversity projects. It triggered renewed focus on Reform's wider tax and spending policy, which critics have argued would need vast extra borrowing to fund. The Institute for Fiscal Studies, a leading economic think tank, said that just one tax cut promise in Reform's 2024 election manifesto, raising the personal income tax allowance from £12,570 to £20,000, would cost between £50 billion and £80 billion a year. The No 10 decision to zoom in on Reform's economic platform, and question whether it amounts to a series of vote-maximising announcements rather than a coherent strategy, echoes the approach being taken by the Conservatives. Mel Stride, the shadow chancellor, said this week: 'Farage has announced billions in unfunded commitments with fantasy ways to pay for them. It's Corbynism in a different colour.' Downing Street insiders hope that Reform's recent local elections successes will bring more scrutiny on their policy proposals and whether they are credible.
BBC News
29-05-2025
- Business
- BBC News
Farage's Reform policies 'fantasy' economics, says Starmer
Prime Minister Sir Keir Starmer has accused Nigel Farage of "fantasy" economics after the Reform UK leader set out a number of policies earlier this a speech later this morning, Sir Keir is expected to liken Farage to former PM Liz Truss and say that Reform's policies would lead to an increase in mortgage made big gains in the English local elections earlier this month, cementing it as a prime challenger to Britain's traditional main parties.A spokesperson for Reform dismissed the prime minister's comments as a "desperate attack" from a party "behind in the polls". Speaking at a business in the north-west of England later, Sir Keir, 62, will accuse the Reform leader of pledging unfunded tax cuts which, he will warn, could spark an economic meltdown."In opposition we said Liz Truss would crash the economy and leave you to pick up the bill," he is expected to say. "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."Thursday's speech is further evidence that right now the prime minister sees Farage as his principal political Tuesday, Farage pledged more generous benefits for pensioners and parents – but it was a commitment to raising the threshold at which someone starts to pay income tax from £12,570 to £20,000 that had some economists questioning whether his sums added Institute for Fiscal Studies said the policy could cost between £50bn and £80bn a year – and that Reform had not spelled out how they would raise the cash."Of course they don't have to do that yet – we're not at a general election," said IFS economist Stuart Adam. "But at some point, if they're going to be a party of government, they would have to make those numbers add up." In Farage's speech, the former Ukip leader, 61, said the Conservatives had become an "irrelevance", adding: "They've had a good 200 years."The local elections saw Reform make big gains at the expense of both Labour and the Conservatives – winning one by-election and two mayoral races, as well as gaining 677 new party won most votes, most seats and overall control of most councils. But, as politics professor Sir John Curtice highlighted, the party's share of the votes across all councils where elections took place was no more than 31% – so despite doing well, it secured far from a majority of those voting. A Reform spokesman said: "We will take no economic lectures from Keir Starmer."Labour's manifesto promised £10bn per year of increased spending."Their first budget raised spending by £70bn and they have added another £30bn since then for Chagos."The prime minister faces pressure from his own MPs on government spending decisions, including cuts to disability also said he would scrap the two-child benefit limit, which some Labour MPs also want to see abolished. The cap prevents most families from claiming means-tested benefits for any third or additional children born after April 2017.
