Responding to the Chancellor’s statement following a review of the public finances, CPS Director Robert Colvile, said:
‘The war of words between Rachel Reeves and Jeremy Hunt should not obscure the most important consequence of what we heard – that Labour is set to increase taxes at the October Budget.
‘The Chancellor is presenting this as an unavoidable necessity. Certainly, some of the costs she mentioned – in particular on asylum lodging – may have been unforeseen. But as her opposite number said, a substantial amount of the ‘black hole’ she identified stems from her own decisions on public sector pay, in granting significant increases to teachers and NHS workers and settling with the junior doctors on extremely generous terms.
‘In terms of the detail, the Chancellor’s focus on efficiency in spending and public sector discipline were welcome. A more frequent cycle of spending reviews is a sensible decision, and means-testing the Winter Fuel Payment is both brave and right, given the number of pensioners who simply do not need the money. However, cancelling plans to give the public the chance to buy shares in NatWest seems short-sighted, given the limited savings it will bring.
‘The real danger, however, is that the Chancellor proceeds in October to raise taxes on wealth creators and wealth creation, causing significant economic distortions and undermining the economic growth Labour claims to recognise the country needs. Contrary to the Chancellor’s rhetoric today, that will be a choice, not an inevitability – and it is a choice she should not make.’
ENDS
NOTES TO EDITORS
- Robert Colvile is Director of the Centre for Policy Studies
- For further information, please contact Emma Revell on 07931 698246 and [email protected] and Josh Coupland on 07912 485655 and [email protected]
- The Centre for Policy Studies is one of the oldest and most influential think tanks in Westminster. With a focus on taxation, economic growth, business, welfare, housing and green growth, its goal is to develop policies that widen enterprise, ownership and opportunity
Date Added: Monday 29th July 2024
