UK

Rachel Reeves makes first public appearance after breaking down in tears in the CommonsRachel Reeves has appeared in public with Sir Keir Starmer a day after breaking down in tears alongside the prime minister in the Commons.The pair were both at the launch of the government’s 10-year plan for the NHS in London.Speaking to broadcasters following following the launch, Ms Reeves declined to give the reason behind her tears.“Clearly I was upset yesterday and everyone could see that. It was a personal issue and I’m not going to go into the details of that,” the chancellor said.“My job as chancellor at 12 o’clock on a Wednesday is to be at PMQs next to the prime minister, supporting the government and that’s what I tried to do.“I guess the thing that maybe is a bit different between my job and many of your viewers’ is that when I’m having a tough day it’s on the telly and most people don’t have to deal with that.” She appeared to reject suggestions that her tears at PMQs were related to a conversation with Commons Speaker Sir Lindsay Hoyle or another member of government.Can Labour survive its identity crisis? Ask chief political commentator John Rentoul anythingLabour’s internal rift has burst into full view. Sir Keir Starmer’s push on welfare reform has sparked open rebellion—from both loyalists and Corbynites – exposing the party’s deepest tensions.The flashpoint? Disability benefits. The fallout? Starmer’s authority dented, his party divided. Only Angela Rayner seems to have gained ground, fuelling fresh leadership speculation.So, can Labour survive this identity crisis—or is the party tearing itself apart?Join The Independent’s chief political commentator John Rentoul live at 2pm BST, Friday 4 July for a no-holds-barred Q&A on Labour’s future, Starmer’s struggles, and what’s next for the opposition.Ask your question or follow along here.3 July 2025 15:29Watch | Reeves says she was ‘clearly upset’ at PMQs and reasserts it was ‘a personal issue’Reeves says she was ‘clearly upset’ at PMQs and reasserts it was ‘a personal issue’Jabed Ahmed3 July 2025 14:59Which tax rises could Rachel Reeves introduce to pay for the £5bn welfare U-turn? Our Political Correspondent Millie Cooke takes a look below: Jabed Ahmed3 July 2025 14:38Hunt welcomes NHS planFormer Tory health secretary Sir Jeremy Hunt has welcomed the Labour government’s NHS 10-year plan.Sir Jeremy said: “There is much to welcome in today’s plan, particularly bringing back family doctors, which is something that I tried – and frankly did not succeed – in doing when I was doing his role, so we all wish him well.”He emphasised that the Care Quality Commission (CQC) must maintain its overall rating system to avoid another Mid Staffs scandal, in which hundreds of patients died as a result of poor care at Stafford Hospital between 2005 and 2009.Former health secretary Jeremy Hunt (Peter Byrne/PA) More

This week’s embarrassing climbdown on welfare saw the government’s benefits reforms gutted almost entirely, while savings from the bill were slashed from £5bn to nothing. In the wake of the U-turn, there are now growing questions over how the government will raise the money to fill the black hole in the public finances.Ministers have already squeezed significant savings out of their departments in cuts that were unveiled at last month’s spending review, meaning there is now a mounting expectation that the chancellor will be forced to raise taxes instead. But Labour’s manifesto pledge not to raise taxes on “working people” leaves the chancellor with a limited number of workable options. A few possibilities were floated by deputy prime minister Angela Rayner in a leaked memo to Rachel Reeves ahead of the spring statement, which saw her urge the chancellor to raise taxes – suggestions which were ignored. But perhaps this week’s welfare climbdown will leave the chancellor with no option but to look again at Rayner’s suggestions. Here, The Independent takes a look at a number of tax rises that the government could rely on to raise funds and balance the books. Tax threshold freezes The Treasury’s most likely move would be to extend the freeze on income tax thresholds. This means that as wages rise with inflation, over the years workers are dragged into higher tax bands and end up paying more. A freeze on the threshold at which the higher 45 per cent tax rate is paid was one of the options suggested by Ms Rayner in her leaked memo. But there is growing speculation the government could extend the freeze across all tax brackets. It’s a stealth tax, the impacts of which are not felt immediately, meaning it is normally better received among the general public compared with a direct hit to businesses or pay slips. But, if the freeze were extended to the end of the parliament, it could also bring in billions for the Treasury as earnings rise. The freeze, which is already planned to last until 2028, is expected to drag around two million workers into higher tax bands.Wealth tax There have been calls from Labour MPs on the left of the party to introduce a wealth tax, calls which have only grown in the wake of Tuesday’s welfare climbdown. Rachael Maskell, the architect of the rebellion which forced the government into shelving key pillars of the bill, demanded the government increase taxes on the very richest to pay for the £5bn climbdown. Polling conducted by YouGov on behalf of Oxfam on the eve of the spring statement found more than three-quarters of people (77 per cent) would rather the government increase taxes on the very richest to improve public finances than see cuts to public spending. However, such a tax – which could look like a 2 per cent tax on net assets worth more than £10m – is thought to be very hard to implement, and could also lead to some of Britain’s highest earners leaving the country. Ms Rayner also called for the lifetime pensions allowance to be reinstated. The allowance, which puts a cap on how much savers can put into their pension pot before a higher rate of tax is applied, was axed by the Tories. Labour had initially planned to reinstate the cap, but the plans were abandoned ahead of the election. However, amid the controversy over cutting winter fuel payments – and then later reversing the decision – the government may be hesitant to introduce any other policies which would upset pensioners. Corporation tax The chancellor could also look at increasing corporation tax for banks – one of the suggestions included in the deputy prime minister’s memo. Politically, its fairly easy to tax banks as there is limited direct impact on voters. But it’s important to note that banks in the UK are already highly taxed. They pay normal corporation tax of 25 per cent, plus a bank surcharge of 3 per cent. On top of this, they pay a bank levy of 0.1 per cent of their balance sheets. The deputy prime minister also proposed raising tax rates on dividends – a portion of a company’s earnings received by a shareholder – for higher earners. Currently, tax is not paid on dividend income that falls within your income tax Personal Allowance. There is also a £500 dividend allowance each year, meaning individuals only pay tax on any dividend income above this. Removing it altogether would be worth £325 million a year, HMRC data indicates. However, there are concerns that raising dividend tax rates could discourage people from investing in companies – which is likely to have a net negative impact on the economy. Ms Rayner also suggested ending inheritance tax relief on shares listed on the smaller Aim stock market. The Aim stock market is a sub-market of the London Stock Exchange. From April 2026, qualifying Aim shares held at the time of death will be eligible for 50 per cent relief from inheritance tax – but Ms Rayner has suggested ending this entirely. While these changes might make businesses uncomfortable, they’re actually unlikely to raise much money for the Treasury – meaning it’s a less likely option for the chancellor. More

There are moments in politics where the situation has spun so badly out of control that somebody has to step in quickly to end the chaos.Most famously in recent history it was former 1922 committee chairman Sir Graham Brady’s visit to Liz Truss in Downing Street to force her to resign after the mini-budget fallout. But last night Keir Starmer had reached such a moment. His government was in meltdown.A brutal 48 hours had seen him apparently lose control of his government’s policy agenda after the welfare reform rebellion by Labour backbenchers. Chancellor of the Exchequer Rachel Reeves (right) crying as Prime Minister Sir Keir Starmer speaks during Prime Minister’s Questions (UK Parliament/PA) More

Welcome to an exclusive Ask Me Anything session with me, John Rentoul, The Independent’s chief political commentator.Keep scrolling for more. If you want to jump straight to the Q&A, click here.Recent attempts by Sir Keir Starmer’s leadership to tackle welfare reform have exposed deep tensions within Labour, shaking its identity to the core.The standoff over disability benefits, with dramatic rebellions from both loyalist and Corbynite MPs alike, laid bare the struggles Labour faces in balancing fiscal responsibility with social justice. Starmer’s handling of the crisis has damaged his standing – and it seems that only deputy leader Angela Rayner emerged stronger, prompting whispers about the future leadership of the party.But the question remains: can Labour survive this identity crisis? Can the party reconcile its historic commitment to working people with the tough policy decisions required in today’s political climate – and craft a credible alternative to austerity without alienating its own members?What about Rachel Reeves, Liz Kendall, and Angela Rayner? Will these recent developments change the balance of power within the party – or push one of them out entirely?Join me live at 2pm BST on Friday, 4 July to discuss Labour’s internal battles, the challenges facing Starmer’s government, and what the future holds for the party.Submit your questions in the comments below. If you’re not already a member, click “sign up” in the comments section to participate. For a full guide on how to comment, click here.Don’t worry if you can’t see your question right away – some may be hidden until the Q&A starts. See you at 2pm! More

A distressed Rachel Reeves shed tears in the House of Commons on Wednesday as Sir Keir Starmer dodged a question over her future on a day when the government appeared to be spiralling out of control.Following a damaging rebellion over welfare cuts by 49 Labour MPs, the prime minister floundered at Prime Minister’s Questions and refused to rule out new taxes to pay for the £5bn funding gap created by his welfare U-turns.A senior Labour figure said the backbench revolt – and the last-minute concessions that hollowed out the welfare bill – were “terminal” for the prime minister’s political prospects.The PM is facing pressure to sack Ms Reeves and his controversial chief of staff Morgan McSweeney, both of whom have been held partly responsible for the welfare fiasco, and there have been renewed calls for a wealth tax to balance the books.And after the Institute for Fiscal Studies revealed that the watered-down welfare reforms would end up costing money rather than saving billions as originally planned, the bond markets also became uneasy.Chancellor of the Exchequer Rachel Reeves (right) cries as Keir Starmer speaks at PMQs yesterday More

MPs have backed the government’s move to ban the direct action group Palestine Action as a terrorist organisation, despite warnings that this would have a “chilling effect” on protest.Legislation passed in the Commons yesterday, as MPs voted 385 to 26, a majority of 359 in favour of proscribing the group under the Terrorism Act 2000.While security minister Dan Jarvis told MPs that Palestine Action as not a “legitimate protest group”, others criticised the move and described it as “draconian overreach” and likened the group to the Suffragettes. Zarah Sultana, the independent MP for Coventry South, told the Commons: “To equate a spray can of paint with a suicide bomb isn’t just absurd, it is grotesque. It is a deliberate distortion of the law to chill dissent, criminalise solidarity and suppress the truth.”The motion is expected to be debated and voted on by the House of Lords today before it becomes law.Meanwhile, pro-Palestine demonstrators have hit out at the government, accusing it of “hypocrisy” as it prepares to ban an activist group under anti-terror law.The decision to proscribe the group comes after two planes were vandalised at RAF Brize Norton on June 20. Pro-Palestine protesters demonstrating outside parliament More

British Prime Minister Keir Starmer’s office said Wednesday that Treasury chief Rachel Reeves is secure in her job after a series of government U-turns dented her revenue-raising plans.Speculation about Reeves’ future mounted after she appeared to be in tears Wednesday in the House of Commons, the day after an embarrassing reversal for the government over its plans to cut welfare spending. Many viewers observed that Reeves looked exhausted and upset as she sat behind Starmer during the weekly Prime Minister’s Questions session.The Treasury said Reeves was dealing with a “personal matter.” It would not elaborate.Starmer initially declined to say, when asked by opposition leader Kemi Badenoch, that Reeves would still have her job when the next election is called, likely in 2029.But Starmer’s press secretary later said Reeves “is going nowhere. She has the prime minister’s full backing.”On Tuesday, Starmer’s government was forced to water down plans to curb welfare spending in order to quell a rebellion by lawmakers from his own party.In something of a hollow victory, the bill passed its first big House of Commons hurdle after the government appeased Labour Party rebels by softening and delaying cuts to welfare benefits for disabled people. Even so, 49 Labour lawmakers voted against the bill.The result is a major blow to Starmer’s authority as he approaches the one-year anniversary of his election on Friday, reckoning with a sluggish economy and rock-bottom approval ratings.It also leaves the Treasury short of money it had counted on to invest in public services, making tax increases more likely. The government has promised not to raise key levies including income tax and sales tax.The government estimated that its welfare reforms would save 5 billion pounds ($7 billion) a year, but after the changes it’s unclear whether they will save any money at all.The reversal follows a decision in May to drop a plan to end winter home heating subsidies for millions of retirees, which Reeves had also counted on to raise money. More

At 5.25pm yesterday disabilities minister Sir Stephen Timms got to his feet in the Commons chamber to intervene on a speech by Labour backbencher Andrew Pakes.His purpose was in effect pull up the white flag on the government’s flagship welfare legislation, in the view that a vote in favour of the government on a completely hollowed out bill was better than defeat. They removed personal independence payments (PIPs) from a bill with the PIPs in the title.Timms is a veteran politician of 31 years in parliament, stoic and understated in nature, thoughtful and careful in speech. He was in many ways the least likely character on the stage to deliver a moment of such theatre.But the hours before that revealed that the real drama was playing out spectacularly in the corridors and corners of the Palace of Westminster, where a defeat for a government with a majority of 156 less than a year into office was becoming a shockingly strong possibility.Starmer defended his position at PMQs More