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Keir Starmer has delivered a stark speech warning of “unprecedented” economic challenges during a visit to the West Midlands today.
His speech comes ahead of Labour’s first Budget since coming into power on 30 October, where chancellor Rachel Reeves will lead one of the most anticipated fiscal events in over two decades.
Speaking in Birmingham, Sir Keir said: “Politics is always a choice. It’s time to choose a clear path, and embrace the harsh light of fiscal reality so we can come together behind a credible, long-term plan.”
The prime minister also defended tax rises which are set to come on Wednesday, saying “I will defend our tough decisions all day long,” adding: “it’s the only way to get the investment we need”
He spoke as Labour faces a row over reported plans to raise employer national insurance contributions and capital gains, with critics arguing these measures would breach the party’s manifesto commitment to not raise taxes on “working people.”
Addressing the row, Sir Keir said the UK’s working people “know exactly who they are,” repeating the term 24 times throughout the speech.
We’ll be bringing you all the latest updates ahead of the big event here, on The Independent’s liveblog.
Environmental campaigners criticise Labour’s bus cap increase
Greenpeace condemned Sir Keir’s decision to hike the bus fare cap, saying it “makes no political, economical or environmental sense whatsoever”.
“This is a ‘tough decision’ the government did not need to make,” senior transport campaigner Paul Morozzo said.
He added: “Not only are buses a critical lifeline to millions of people – particularly those on lower incomes – and the use of them a driver of economic growth, but it’s absolutely critical that we get more people out of polluting cars and onto cleaner public transport if we have any chance of tackling the climate crisis. Raising the fares by 50% will obviously won’t help achieve that.
“A government that was truly prioritising the needs of the poorest in society would rethink this decision at the first opportunity, and provide young people especially the possibility to reach education and employment they would otherwise be shut out from”.
Keir Starmer confirms £2 bus fare cap will be hiked to £3 ahead of ‘tough’ Budget
The cap on bus fares will rise from £2 to £3 until the end of next year in a bid to ease pressure on the public finances, Sir Keir Starmer has confirmed.
Laying the groundwork for Wednesday’s Budget, the prime minister said the existing cap will be replaced by the higher fare limit.
Comment | It is time to cut interest rates – and give homeowners a break
With inflation falling rapidly, the Bank of England is looking to cut interest rates, writes James Moore.
He adds: “There are still reasons to be cautious but mortgage payers can look forward to light at the end of the tunnel.”
Changes to debt rule will not affect interest rates, says Starmer
Asked about planned changes to the debt rule to borrow more for investment into capital expenditure, the Prime Minister said: “I’m not going to pre-empt exactly what the Chancellor will say on Wednesday, but I have been really clear that we have to move to a situation where we invest in the future of this country.
“Where we invest to ensure that we get the better jobs that we need, we have the infrastructure that we need.
“And so part of what we will say on Wednesday is, first, how we’re going to fix the foundations and deal with the problem we’ve inherited, but secondly, how then we rebuild the country.
“And investment is an important part of that story. Precisely how that will take place will be set out in detail on Wednesday. I do not accept the proposition that it will have an impact on interest rates.”
Reeves to announce £240 million for services that help people into work
The Chancellor will announce £240 million in funding for services to get people back into work in the Budget, Sir Keir Starmer has said.
The Prime Minister said in a speech: “Rebuilding Britain and delivering growth will take the skills and effort of all of us.
“That’s why this Budget will also get Britain working. It will pave the way for reforms that tackle the root causes for economic inactivity and make sure that those who can work do work.
“As a Labour Government, we will always help those who cannot support themselves, but the UK is the only G7 country for whom inactivity is still higher than it was before Covid.
“And that’s not just bad for our economy, it’s also bad for all those who are locked out of opportunity.
“So the Chancellor will announce £240 million in funding to provide local services that can help people back into work.”
Sir Keir Starmer confirms that the £2 cap on bus fares will rise
Speaking today, Sir Keir Starmer confirmed the £2 cap on bus fares would end, but promised a new £3 limit instead.
The Prime Minister said: “On the £2 bus fare, first thing to say is the Tories only funded that until the end of 2024 and therefore that is the end of the funding in relation to a £2 capped fare.
“I do know how much this matters, particularly in rural communities where there’s heavy reliance on buses.
“And that’s why I’m able to say to you this morning that in the Budget we will announce there will be a £3 cap on bus fares to the end of 2025 because I know how important it is.”
We will do the “hard work” in this Budget says Starmer
Asked if this will be the end of major tax rises under the current Labour government, the prime minister says he can’t give a “cast iron guarantee” as “we don’t know what will be around the corner.”
“The tough stuff is coming from this Budget,” he says, “but we’re going to resist the temptation to say at no point ever will there be an adjustment to anything else in the future.”
“Every pensioner will be better off” says Starmer
Asked if pensioners who are struggling with fuel costs should regret voting Labour, Sir Keir says he understand the concerns, but adds that Labour is “protecting the most vulnerable with pension credit,” and making sure all entitled pensioners are taking it up.
But, he adds, Labour is also “fixing the foundations and stabilising the economy,” enabling a commitment to the triple lock to remain in place.
Mike Amesbury footage was ‘shocking’, Keir Starmer says
Sir Keir Starmer has said the video of suspended Labour MP Mike Amesbury punching a constituent was “shocking”.
The prime minister said: “Look, I’ve seen the video footage. It’s shocking. We moved very swiftly to suspend him as a member and as a member of parliament.
“There is now a police investigation. In the circumstances, you’ll appreciate there’s not much more I can say.”
Analysis: Daring his detractors even before the Budget is a bad sign
The fact that Keir Starmer is already daring his government’s detractors to say what they would do instead is a bad sign about what is coming.
The language of tough decisions, and unprecedented challenges certainly laid the ground for a Budget to deal with a crisis.
Normally politicians dare their critics to say what they would do after a Budget has been delivered. Starmer along with Rachel Reeves are the only ones who know what is coming. He is already predicting an assault on his government in the media and political sphere.
We will get the details on Wednesday from the chancellor but the mood music is already distinctly gloomy.
