Rachel Reeves issues tax warning over Chancellor’s autumn statement

Jeremy Hunt countered by claiming Labour has ‘nothing credible to say on the economy’.

Richard Wheeler
Wednesday 22 November 2023 14:45 GMT

Taxes will be higher at the next election than they were at the last one, Rachel Reeves has warned in her autumn statement response.

The shadow chancellor said Jeremy Hunt had “lifted the lid on 13 years of economic failure” in his statement, telling MPs: “The Chancellor claims that the economy has turned a corner, yet the truth is under the Conservatives growth has hit a dead end.

“What has been laid bare today is the full scale of the damage that this Government has done to our economy over 13 years.”

The fact is that taxes will be higher at the next election than they were at the last

Rachel Reeves

Ms Reeves said working people are “still worse off” despite promises from the Government, before saying: “From their failure to uprate income tax or national insurance bands, to forcing councils to raise council tax, the Conservatives have pushed the costs of their failure onto others.

“But the British people won’t be taken for fools. They know that what has been announced today owes more to the cynicism of a party desperate to cling on to power than the real priorities of this high-tax, low-growth Conservative Government.

“So I think we can forgive taxpayers for not celebrating when they see the truth behind today’s announcements. Going into this statement the Government had already put in place tax increases worth the equivalent of a 10p increase in national insurance.

“So today’s 2p cut will not remotely compensate for the tax (increases) already put in place by this Conservative Government. The fact is that taxes will be higher at the next election than they were at the last.”

Ms Reeves questioned if cutting inheritance tax was a “decision delayed or a decision abandoned”.

She also told the Commons: “This autumn statement for growth is now the 11th Conservative economic growth plan from the fifth prime minister, the seventh chancellor and the ninth business secretary.

“And what do those numbers add up to? According to the most recent GDP data, a big fat zero. That’s zero growth in the most recent data in the third quarter of this year.”

Ms Reeves said the UK is “more world-following than world-beating” on economic growth under the Conservatives.

She went on: “The Chancellor and the Prime Minister say that the cost-of-living crisis is dealt with, now everything might look a little bit better 10,000 feet up in your helicopter, but down here on planet Earth people are approaching Christmas and the year ahead with worry and trepidation.

“The cost-of-living crisis has hit us harder because Tory mismanagement has left us so exposed, 11 million UK households don’t have enough savings to cover three weeks of living expenses if they needed it.

“Working families have been skating on thin ice for too long and as their resilience has been eroded, so has our national economy’s.”

Mr Hunt replied by claiming Labour has “nothing credible to say on the economy”.

He said of Ms Reeves: “She tells the papers this morning that she will accept these measures, as you would expect from a copy-and-paste shadow chancellor.”

Mr Hunt added: “Her main policies are not supply-side, it is a demand-side boost to growth by increasing borrowing by £28 billion-a-year with absolutely no plans to repay it.”

And Mr Hunt said Labour should “drop their damaging inflationary plan to ramp borrowing up”.

On the NHS, he said: “Despite the fact that we’ve had more doctors, more nurses, we’ve had more patients treated in good or outstanding hospitals, again what she didn’t mention is the only place in Britain that NHS funding has been cut is Wales.”

For the SNP, economy spokesman Drew Hendry said: “The Chancellor wants you to think he’s pulled a rabbit out of the hat today but actually all he’s done is pulled the wool over many people’s eyes.

“Things are still getting worse for people. Inflation is still more than double the target that it should be and that means prices and costs for people in their homes are still going up day by day.”

Mr Hendry said welfare changes proposed by the Government show the “nasty party is back in business”, adding: “This Government is on the record as working to the principle of let people die.”

Mr Hunt replied: “I think he prepared his comments for the autumn statement he wanted me to deliver, not the one I actually delivered.”

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