UK Politics

Businesses have warned Rachel Reeves that she risks forcing more job losses if she presses ahead with plans to raise the minimum wage.The chancellor is believed to be looking at increasing the amount to national living wage of about 4 per cent, from £12.21 to at least £12.70 and extending it to 18 to 21-year-olds.The move would help appease demands from Labour backbench MPs who want to see the least well-off get a boost while the rich and big corporations are hit by wealth taxes.But the leader of the UK’s hospitality sector has warned that the move would be disastrous for the industry.Businesses have already been hit in last year’s budget with a double blow of the living wage being hiked at the same time as a rise in national insurance contributions (NICs) for employers.Rachel Reeves has said she wants the ‘broadest shoulders’ to bear the heaviest tax burden in new Budget More

Rachel Reeves is under pressure to break Labour’s manifesto pledge with a tax raid on the highest earners amid growing calls from within Labour to hit the wealthy.Ministerial sources have told The Independent that changes to the top rate of income tax have been discussed within government as the chancellor looks to find ways to fill a Budget black hole estimated to be between £30bn and £40bn.The changes would exceed the 1p increase to income tax that Ms Reeves is also understood to be considering.One source said: “The 45p rate is definitely in play. It would be a popular move within the party.”Chancellor Rachel Reeves will need to find a way to meet her goal of balancing day-to-day spending with tax revenues while maintaining £10bn ‘headroom’ (Peter Byrne/PA) More

Lucy Powell has defeated Cabinet minister Bridget Phillipson in the race to succeed Angela Rayner as Labour’s deputy leader. The former leader of the Commons has long been seen as more of a challenger to the current status quo in Labour than her rival. While both candidates promised to spend more time listening to the party’s membership, Ms Powell – who was sacked as a minister in the reshuffle that followed Ms Rayner’s resignation just months ago – was seen as more of a “change” candidate than her rival Ms Phillipson. Her victory is likely to be seen as a call from the Labour membership for a change of direction amid growing unhappiness with Sir Keir Starmer’s government.Ms Powell, who says her politics were shaped by growing up in the North under Margaret Thatcher, is seen to sit on the party’s “soft left” and, launching her leadership bid, promised to urge the prime minister to pursue “bold policies, rooted in progressive Labour values”.Lucy Powell says her politics were shaped by growing up under Margaret Thatcher in the North More

Counting was underway Saturday for votes in Ireland’s presidential election, with early tallies suggesting a significant lead for left-wing independent Catherine Connolly.Voters were choosing between Connolly and center-right Heather Humphreys as their new president, a largely ceremonial role in the European Union member country.The two women were the only contenders after Jim Gavin, the candidate for Prime Minister Micheál Martin’sFianna Fail party, quit the race three weeks before the election over a long-ago financial dispute. Martin, who heads Ireland’s government, had personally backed Gavin as a presidential candidate. Though Gavin had stopped campaigning, his name remains on the ballot paper because of his late withdrawal from the race.While Irish presidents represent the country on the world stage, host visiting heads of state and play an important constitutional role, they do not have the power to shape laws or policies. Connolly, the frontrunner, has garnered the backing of a range of left-leaning parties, including Sinn Féin, the Labour Party and the Social Democrats.The 68-year-old former barrister, an independent lawmaker since 2016, has been outspoken in criticizing Israel over the war in Gaza. Polls have suggested strong voter support for her over rival Humphreys, 64, from the center-right party Fine Gael.The former cabinet minister has stressed that she is a center-ground, pro-business, pro-EU candidate who will strive for unity.Others — including musician Bob Geldof and the former mixed martial arts champion Conor McGregor — had indicated they wished to run for president but failed to receive enough backing for a nomination.The winner will succeed Michael D. Higgins, who has been president since 2011, having served the maximum two seven-year terms. Connolly or Humphreys will be Ireland’s 10th president and the third woman to hold the post.Voting slips were being counted by hand. The final result will be declared later Saturday once all 43 electoral constituencies across the country have completed counting. More

Keir Starmer’s leadership of Labour has been dealt a blow after former cabinet minister Lucy Powell, who has criticised his leadership and policies, was elected as deputy leader.Ms Powell beat Sir Keir’s preferred candidate Bridget Phillipson by 87,407 votes to 73,576 in a clear message from Labour members that they want a change of direction. Although the turnout was only 16.6 per cent.The result is a huge comeback for Ms Powell, who was sacked as Commons leader by Starmer in last month’s reshuffle caused by the departure of Angela Rayner, whom she has now been elected to replace.Additionally, Ms Powell, the MP for Manchester Central, is close to Manchester mayor Andy Burnham who many would like to see replace Sir Keir as leader.Lucy Powell gives her deputy leader victory speech More

Rapid rent rises combined with frozen housing benefits are set to push more people into crisis if Labour does not act, a damning new report has warned.The affordability gap between rental prices and support for low-income tenants is set to reach a record 17 per cent next year, findings from the influential Resolution Foundation show. This represents an average shortfall of £104 a month – or just over £1,200 a year – as households are forced to face rising debt or homelessness.Without action the figure will reach 25 per cent by 2029-2030, the think tank adds, meaning an average shortfall of £180 a month.Local housing allowance, which sets housing benefit rates, has been frozen by the Labour government until at least 2026, following a brief unfreeze in April 2024. This is the formula that sets how much funding the Department for Work and Pensions (DWP) will give each council to administer housing benefit, uprating it to cover at least the cheapest 30 per cent of rents in the area that year.The funding gap for housing benefit is most stark in London, a new report shows More

A group of senior MPs has warned the government not to cut the cash Isa allowance at the Budget as chancellor Rachel Reeves is understood to be considering the measure.In a candid intervention, the cross-party Treasury Committee has unequivocally told the government that it should not introduce a cut to the £20,000 tax-free allowance granted to every saver.The chancellor is reportedly considering dropping the figure significantly to £10,000 in a bid to boost investment in stocks and shares of British companies.But this “simply will not deliver the change she seeks”, warns Treasury Committee chair Dame Meg Hillier, sharing a new report from the group of MPs that finds savers are unlikely to be incentivised to switch to investing.Chancellor Rachel Reeves will need to find a way to meet her goal of balancing day-to-day spending with tax revenues while maintaining £10 billion ‘headroom’ More

Allied nations have pledged to act to take Russian oil and gas off the global market, Sir Keir Starmer said, after leaders gathered with Volodymyr Zelensky in London. The prime minister urged other nations to follow the US and impose sanctions, and said allies had agreed on a “clear plan for the rest of the year” in supporting Kyiv. Among the further pledges were plans to “push on with the progress” on Russian assets and “keep up the military pressure on Putin” as the conflict heads towards its fourth winter. The UK also said it would “accelerate” its missile production programme to get more weapons to Ukraine.It comes days after the White House imposed new sanctions on Russian oil in an attempt to squeeze Moscow.Keir Starmer and Volodymyr Zelensky speaking to the media following a meeting with the coalition of the willing allies More