Streeting hints at Budget of major tax rises after bagging billions for NHS from Reeves

Health secretary confirms his departmental budget has been agreed and hints at major tax rises on the way

Wes Streeting has appeared to confirm that Rachel Reeves will carry out a tax raid on national insurance contributions to help fill the £40 billion gap in Labour’s spending plans.

Meanwhile, his refusal to rule out extending the freezing of income tax thresholds beyond 2028 also appeared to confirm speculation that the chancellor is getting creative on raising taxes.

The health secretary was speaking in a series of Sunday morning interviews, where he also revealed that his department’s spending settlement has already been agreed with a belief that he has managed to get billions extra for the NHS on the promise that he delivers long term cost cutting reforms.

The interventions followed new reports that Ms Reeves also intends to raise an extra £1 billion by lowering the thresholds on inheritance tax in what will be seen as a tax raid on the middle classes.

Wes Streeting said the Government’s 10-year plan would turn the NHS ‘on its head’ (Ben Whitley/PA) (PA Wire)

She is also expected to end the exemption farmland has on inheritance tax in what some people are describing as “the Jeremy Clarkson tax”, after the TV presenter bought the farm featured in his Amazon show.

Pressed on GB News about whether there are plans to raise the employer contribution to national insurance while only freezing the employee rate, Mr Streeting appeared to confirm the plan emphasising that Labour had only promised not to “raise taxes on working people”.

Despite previously voting against Rishi Sunak’s decision to freeze income tax thresholds to help pay for lockdown during the Covid pandemic, Mr Streeting made it clear he would not do that if Ms Reeves brought in an extension to that plan beyond 2028.

Speaking on Sunday Morning With Trevor Phillips on Sky News, he said: "I'm not going to speculate on what the Chancellor might do in the Budget.

"If you're asking me whether I would vote against anything in the chancellor's Budget? The answer is no, of course I'm not going to do that."

The Chancellor will present her budget on October 30 (Jonathan Brady/PA) (PA Wire)

He went on to say: "This country is paying a heavy price for Conservative failure, and we're going to have to make some big and difficult choices in this Budget to make sure we fix the foundations of the economy and we don't end up back here."

He later added: "What we're not going to do is duck the difficult decisions, have Government by gimmick, short-term sticking plasters, because that is exactly how we ended up in this situation."

Mr Streeting is launching a consultation in to the future of the NHS which will culminate in a 10-year plan. The health secretary wants to bring down long term costs by moving to digital from analogue and community based health from hospital based health.

He has suggested a rollout of smartwatches to monitor people’s health at home and prevent diabetes and heart disease.

He insisted though that hospitals will have to make improvements to productivity to benefit from additional funding.

The health secretary said: "Certainly the approach that the Chancellor and I are taking is to link investment to reform."

Asked whether hospital trusts would be penalised if they did not "play ball", he added: "We definitely need to manage performance.

People queuing outside at the opening of Jeremy Clarkson’s new pub, The Farmer’s Dog, in Asthall, near Burford in Oxfordshire in August. His farm could be subject to inheritance tax (Ben Birchall/PA) (PA Wire)

"I think it's a quid pro quo. It's my responsibility to give system leaders the tools to do the job, and that's my responsibility as secretary of state, but it's their responsibility to deliver.

"We're a team, we've got to work in partnership, and the way I'm thinking about the reform agenda and how we go about it and how we involve the NHS staff in it, is a team effort."

But even as he was laying out his plans, the health secretary was being warned that pharmacies are in "crisis" and there will not be enough nurses to fulfil Labour's plans to turn the NHS into a "neighbourhood health service".

The Royal College of Nursing (RCN) general secretary Professor Nicola Ranger has warned the NHS "simply does not have the nursing numbers to deliver it".

She said: "Without new investment, the number of community nurses will stay on track to be half what it was two decades ago.

"Nursing staff are ready to help deliver the modernisation our health service needs, but staff are overworked and chronically undervalued."

According to the RCN, the number of community nurses is projected to fall to 8,995 by 2029, from 18,070 in 2009, without government intervention.

The National Pharmacy Association (NPA) has also warned that pharmacies are in "financial crisis" and that any plans for the NHS must include urgent action to address this.

The Royal College of GPs has said that any changes to the way general practice works must be developed "in partnership with GPs and their patients" while recognising the "intense workload and workforce pressures" GPs currently face.

Professor Kamila Hawthorne, chairwoman of the Royal College of GPs, continued: "We've heard lots of encouraging words from the new Government about shifting resources into general practice, ensuring we have the GP workforce numbers we need, and better integration between primary and secondary care to ensure a more joined-up patient experience of the NHS.

"We must now start seeing action, and we hope the production of the 10-year plan will be the first stage of this - so the RCGP looks forward to feeding into this consultation."