In a pivotal speech, Starmer outlines Labour’s financial strategy, vowing to prevent devastating cuts while introducing a new £3 cap on bus fares

In a significant address leading up to Wednesday’s Budget announcement, Sir Keir Starmer has set the stage for what promises to be a transformative financial strategy aimed at addressing the UK’s pressing economic challenges. The Labour leader warned that the nation must confront “the harsh light of fiscal reality,” signalling a commitment to implementing tax rises while ensuring that the burden does not fall on working individuals.

Starmer emphasised that the country is facing “unprecedented circumstances,” a reference to the economic fallout from previous government policies. He stressed that the decisions his government plans to make are necessary to avert the “devastating austerity” that has plagued public services in recent years. By taking a proactive approach, Starmer aims to reshape Labour’s image as a party that prioritises the needs of the public over political expediency.

When questioned during an interview with the BBC about potential “sneaky tax rises,” Starmer reiterated his commitment not to increase taxes on working people. However, he acknowledged that the government is likely to raise taxes, particularly on National Insurance contributions paid by employers. This anticipated move aligns with Labour’s broader goal of enhancing funding for public services that have suffered from years of underinvestment.

As part of the forthcoming Budget, the Prime Minister also announced a significant adjustment to public transport fares. The existing £2 cap on bus fares will be replaced with a new £3 limit, a change that has drawn mixed reactions. Critics, including Shadow Transport Secretary Helen Whately, have labelled this increase a “tax on commuters,” asserting that it effectively imposes an additional financial burden on working families.

Starmer’s speech came against a backdrop of accusations from the Conservatives, who have accused him of presiding over a government rife with “broken promises.” In response, Starmer has sought to clarify that any tax increases are aimed at generating necessary revenue to fund vital public services, a key theme that will likely resonate during the Budget presentation.

In addition to addressing tax policies, Starmer revealed plans for a £240 million investment dedicated to public services. He emphasised the need to clamp down on waste and tax avoidance, underscoring Labour’s commitment to responsible governance. These investments are positioned as essential steps toward rebuilding the economy and ensuring that public services are adequately funded.

SKY NEWS

In a recent speech in Birmingham, Prime Minister Sir Keir Starmer revealed plans for tax rises in the upcoming budget, aiming to avert a “devastating return to austerity” while rebuilding public services. This announcement comes as the government grapples with a £40 billion black hole in the nation’s finances.

Starmer confirmed that the current £2 cap on bus fares will be raised to £3, a move that has sparked criticism and labelled a “bus tax” by opponents. Additionally, he announced a £240 million investment aimed at getting people back to work, positioning the budget as one that prioritises stability and long-term growth through borrowing.

While Starmer emphasised the need for tax rises to prevent further austerity measures, he refrained from detailing specific increases. However, expectations are mounting that the budget will include hikes in employer national insurance contributions, as well as potential increases in capital gains and inheritance taxes.

The announcement has ignited discussions regarding the government’s definition of “working people.” Labour’s election manifesto had pledged not to raise taxes on this group, explicitly ruling out increases in VAT, national insurance, and income tax. This has led to scrutiny of how the government will reconcile its commitments with the necessary fiscal adjustments.

Starmer’s address set the stage for Chancellor Rachel Reeves’s first budget, highlighting the tough choices ahead as the Labour government seeks to balance public investment with financial prudence in a challenging economic climate. As the budget approaches, the implications of these tax changes will likely dominate political discourse and influence public sentiment towards the government’s fiscal strategy.

POLITICO

As the UK approaches its first Labour budget in 15 years, Prime Minister Keir Starmer stands at a pivotal crossroads, set to unveil plans that may stretch or outright break key campaign commitments. This budget, to be delivered by Chancellor Rachel Reeves on Wednesday, represents a critical moment for the new Labour government, coming on the heels of a rocky start and slipping poll ratings.

The impending budget is framed as a response to a £22 billion fiscal “black hole” left by the previous Conservative administration. Reeves has made it clear that addressing this shortfall will involve tough spending cuts and tax increases, many of which have been publicly signalled in recent months. However, the nature of these announcements raises concerns about the government’s adherence to its electoral promises made during the July campaign.

Starmer’s strategy appears to hinge on the belief that voters will overlook the abandonment of certain manifesto pledges if the government demonstrates tangible improvements in public services. This is a risky gamble; historically, when parties diverge from their commitments, they often face significant backlash from constituents who feel betrayed.

While on a recent trip to Washington, Reeves asserted her commitment to being “a different sort of chancellor,” aiming to distinguish her approach from those of previous administrations that failed to deliver on their promises. Her claim will be put to the test with this budget, as voters will scrutinise whether the measures introduced genuinely address the urgent issues facing the UK.

Critics of the government are poised to challenge any moves perceived as contradictory to Labour’s platform, particularly those that could affect working families. As the budget approaches, the stakes are high; Starmer and Reeves must navigate these complexities with caution to maintain public trust and confidence in their leadership.

BBC

Prime Minister Sir Keir Starmer announced that the single bus fare cap in England will increase to £3 in the upcoming Budget, up from the previous £2 limit set by the former Conservative government. This change, effective immediately and lasting until the end of 2025, aims to address cost-of-living challenges, particularly in rural areas that depend heavily on public transport.

Approximately 3.4 million people in England use buses daily, and while the increase is seen as a way to avoid a sudden end to subsidised fares, many users and advocates are concerned about affordability. Joshua Anderton, a university student reliant on buses, described the fare hike as an “absolutely awful idea,” highlighting that his daily transport costs would rise significantly, especially with the removal of return tickets.

Bill Hiron, chair of Eastern Transport Holdings, warned that drastic fare increases could discourage ridership and create financial hardship. Environmental groups like Greenpeace condemned the decision, arguing that raising fares lacks justification and undermines support for low-income individuals who rely on buses as a primary means of transport.

As the Labour government approaches its first budget, this fare increase illustrates the challenges Starmer faces in balancing fiscal responsibility with the needs of everyday citizens. The upcoming budget will be pivotal in shaping the government’s economic strategy and addressing public concerns about rising living costs.