Budget 2024 latest: Angela Rayner ‘handed £1bn budget boost for housing revolution’
Speculation is mounting ahead of 30 October
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Housing secretary Angela Rayner is planning to double the number of council homes after receiving a boost in the budget, according to reports.
The deputy prime minister is set to announce nearly £1billion to begin a “council housing revolution” and build tens of thousands of extra homes, The Times reported.
Ms Rayner believes council housing is crucial for the government’s target of 1.5 million new homes in the next five years.
As part of the plan, the deputy PM is also set to crack down on the Right to Buy scheme, which allows council house residents to buy their homes below market value, according to The Times.
A senior government source told The Times: “Angela’s ambitions on social and council housing have the full backing of the prime minister and chancellor, and that will become even clearer in the weeks ahead.
"They are joined at the hip when it comes to getting Britain building.”
We’ll be bringing you all the latest updates ahead of the big event on 30 October here, on The Independent’s liveblog.
Comment: Labour were right to break their promise on taxes – we should all be paying more
Labour were right to break their promise on taxes – we should all be paying more
... and the Conservatives are the last people who can complain, writes John Rentoul
UK faces ‘make or break moment’ in Budget as Swinney calls for spending
Scotland’s First Minister will use a speech on Monday to urge the Chancellor to increase spending, as he said the Budget presents a “mark or break moment” for the UK.
On Monday, First Minister John Swinney is expected to make his most outspoken intervention on the budget and push the Chancellor to invest in public services.
Speaking at an event in Edinburgh on Monday in front of academics, think tanks and representatives of the private, public and voluntary sector, the First Minister is expected to describe the past seven years – which has seen Brexit, the pandemic, the war in Ukraine and the subsequent energy price and inflation hikes – as a “long, dark economic winter”.
He will add: “What is needed now is a collective commitment to public investment for economic renewal, investment that will allow us to move into an economic spring, with new growth, new opportunities and new hope.
“In this century, defined by global crises, we must invest boldly to improve living standards, increase equality, and protect the planet.
“We cannot simply sit back and wait for economic conditions to improve after nearly two decades of volatility.”
Wider economic gains being ignored in two-child limit debate, says think tank
The wider benefits of scrapping the two-child limit such as the future earnings potential of young people who avoid poverty as a result are being ignored, a think tank has said.
Prime minister Sir Keir Starmer has faced pressure, including from some of his own Labour MPs, since being elected in July to scrap the controversial Conservative policy but has insisted he cannot do so in the current economic climate.
The New Economics Foundation (NEF) said its UK-wide analysis suggests that retaining both the two-child limit and the benefit cap – which a number of campaigners have said should also be axed – could see almost half (49.4%) of families with three or more children living in relative poverty after housing costs by the end of this Parliament five years from now.
Scrapping both from April 2025 could cost the Government £2.5 billion a year, rising to £3.5 billion by 2029/30, the organisation said.
Much of these costs are taken up by the two-child limit at £1.9 billion and £2.6 billion respectively, the NEF said, but it argued this would be “significantly offset by short, medium and longer-term economic gains”.
What other steps could be taken to tackle the UK’s economic challenges?
There have been rumours Labour could tweak the fiscal rules the Government uses to constrain its own spending and tax decisions.
Chief among those under consideration for change is the period over which the Government aims to see national debt falling as a percentage of the UK’s overall economic output.
Relaxing this rule to a longer period than the current five-year target, or removing spending by certain public organisations from the total, could allow the Chancellor to borrow more cash to invest in major infrastructure projects such as railways, roads, hospitals and new prisons.
What has the Government already said about how it plans to manage the public finances?
Labour has vowed there will be no return to austerity while it is in government.
The party also made a manifesto promise not to raise the major taxes on “working people”: national insurance, income tax and VAT.
Instead, it has committed to specific tax rises, such as the decision to start charging VAT on private schools, in order to fund their agenda.
However, there are hints further tax rises could come, and also that the Chancellor may make changes to the way the Government calculates its debt reduction targets.
What are the problems Labour faces as it sets out its spending plans?
Public services including the NHS and local councils are struggling across the UK, as they grapple with an ageing population, backlogs caused by the pandemic, and the aftermath of the coalition-era austerity programme.
Labour has brokered a pay deal for a swathe of public servants after several years of industrial action, a spending commitment worth £9 billion by some estimates.
Ms Reeves has also claimed the previous Conservative government did not account for the costs of some of its promises, which now need to be met or scaled back.
These commitments, alongside keeping the Government’s ongoing costs “standing still”, made up the so-called £22 billion “black hole” in the public finances which Labour said it needs to fill.
However, Ms Reeves is said to have since identified a far larger £40 billion funding gap which she will seek to plug to protect key departments from real-terms cuts and put the economy on a firmer footing.
Ending private school tax breaks quickly is ‘right’ decision, says minister
An education minister has said it is “right” to end tax breaks for private schools as soon as possible in order to raise funding for the state sector.
Baroness Smith of Malvern defended the speed at which the policy was being introduced, arguing it had been Labour’s plan in opposition and was included in the party’s election manifesto.
From January, the Government plans to remove the VAT exemption and business rates relief for private schools to enable funding for 6,500 new teachers in state schools.
Currently, independent schools do not have to charge 20% VAT on their fees because there is an exemption for the supply of education.
One of the criticisms levelled by opponents is the short timescale involved.
Tory peer Lord Lexden, who is president of the Independent Schools Association, criticised the “great haste” at which the Government was introducing the measure during a debate in Parliament.
‘Listen to voters’ and block Chancellor’s Budget cuts, Flynn tells Starmer
Sir Keir Starmer has been told to “listen to voters” and block his Chancellor’s plans to impose deep cuts in this year’s Budget.
Rachel Reeves is looking to raise up to £40 billion through tax hikes and spending in her 2024 autumn Budget at the end of the month.
But she has faced backlash from within her own party with some ministers unhappy at being asked to reduce spending by as much as 20%.
Stephen Flynn, the SNP’s leader at Westminster, has written to the Prime Minister urging him to intervene and stop the cuts.
He said that Sir Keir must “listen to voters and your own cabinet colleagues: intervene now, overrule the Chancellor and stop the cuts, or people in Scotland will never forgive the Labour Party”.
Claiming the Chancellor’s Budget was “descending into total chaos” he urged the Prime Minister to “immediately intervene and block the Chancellor’s plans for devastating austerity cuts”.
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