Tories accuse Labour of waging war on pensioners after Starmer says budget will be ‘painful’ – as it happened | Politics

• In his first major speech as prime minister, Keir Starmer gave his strongest hint yet of tax rises to come in October’s budget, warning he will have to make “painful” decisions after finding what Labour says is a £22bn black hole in the public finances left by the Tories.

• Starmer warned that the government’s forthcoming Budget will be “painful” as he asked the country to “accept short-term pain for long-term good”.

• Starmer said those with the “broadest shoulders” will carry the heaviest burden. He stressed that taxes on “working people” – namely national insurance, VAT and income tax – will not be increased in the 30 October budget, but stressed that “things will get worse before they get better”.

• Starmer said removing winter fuel payments for millions of pensioners in England and Wales was difficult. There will be more “difficult” decisions to come, he said.

• Starmer refused to comment on why he had chosen to overturn the appointment of Gwyn Jenkins, formerly the number two in the armed forces, as the new national security adviser, a decision that has caused unrest in Whitehall.

• Former prime minister and current leader of the opposition, Rishi Sunak, said Starmer’s speech was “the clearest indication of what Labour has been planning to do all along – raise your taxes”. The shadow home secretary, James Cleverly, accused Starmer of having “waged war on pensioners”.

• Sharon Graham, the general secretary of the Unite union, criticised the “bleak vision” Keir Starmer delivered in his first major speech as prime minister, saying it’s “time to see the change that Labour promised”. If we taxed 1% on the wealthiest 1%, the so-called black hole would be gone,” she wrote on X.

• The Green party said “enduring more economic pain and hardship isn’t what people voted for”, with its co-leader, Carla Denyer, criticising Labour’s “refusal to tax the super-rich”.

• The Scottish government is largely responsible for its current financial crisis, the country’s independence fiscal watchdog said, because it is spending so much on wages without a clear strategy on pay. SNP ministers are considering cutting or limiting universal benefits on which its electoral successes were built, including free prescriptions, free bus travel and free school meals, in a concerted drive to cut public spending.

• Former British prime minister Liz Truss considered scrapping all cancer treatment on the NHS in an attempt to repair the damage caused by her economic policies, according to claims contained within Sir Anthony Seldon’s book, Truss at 10: How Not to Be a Prime Minister.

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The shadow home secretary, James Cleverly, has accused Keir Starmer of “rolling out dishonest policies”, following his Downing Street speech earlier this morning.

Cleverly, who is running to replace Rishi Sunak as the leader of the Conservative party, said:

More meaningless drivel from Keir Starmer today as he tries to distract from his latest cronyism row. He says he wants to serve people; all he is serving them are tax rises.

The Conservatives left Labour with low inflation, falling migration, and the highest growth in the G7. Yet the Labour government have waged war on pensioners, caved to their union paymasters and splurged millions of pounds of taxpayers’ money on unaffordable pay rises for strikers.

Keir Starmer was elected on a manifesto that he won’t stick to, and he is now rolling out a series of dishonest policies for which he has no democratic mandate.

Since Labour’s landslide general election victory on 4 July, Labour have been at pains to blame the previous Conservative government(s) for leaving them with a terrible inheritance and no room for financial manoeuvre.

Labour has come under fierce criticism – including from its own MPs – about the decision to scrap winter fuel payments for 10 million pensioners in England and Wales.

Severin Carrell

Shona Robison, the Scottish finance secretary, said she welcomed the Scottish Fiscal Commission report into the devolved government’s spending crisis, but insisted it was largely due to cuts being imposed by the UK government.

She said:

I welcome this report, which provides useful independent analysis. As it says, there is ‘significant uncertainty’ on the level of funding we will receive from the UK government ahead of the UK Budget on 30 October.

The first minister and I have both made clear that, following the UK chancellor’s July statement, the Scottish government continues to face the most challenging financial situation since devolution.

I will be providing an update to (the Scottish) parliament after recess on the urgent action being taken to address these profound financial pressures.

Scottish finance watchdog says SNP ministers to blame for spending crisis

Severin Carrell

Severin Carrell is the Guardian’s Scotland editor

The Scottish government is largely responsible for its current financial crisis, the country’s independence fiscal watchdog has said, because it is spending so much on wages without a clear strategy on pay.

The Scottish Fiscal Commission said the emergency spending controls on all non-essential spending recently imposed by Shona Robison, the finance secretary, “are the result” of the pay policies pursued by Robison and other ministers.

The commission’s blunt assessment came as details emerged about the areas being considered for cuts, which already include reintroducing peak rail fares; cutting free iPads and laptops for school pupils; cutting back council spending on flood defences and nature restoration and cutting eligibility for free school meals.

Government departments have been told to freeze recruitment, ban all non-urgent staff travel, sacking outside consultants and public relations firms. The health and social care directorate, for instance, has been told to cut £750m from its spending immediately.

The commission said the devolved government estimates that last year public sector pay accounted for £25bn worth of its spending, equal to more than 50% of all the money it has for day to day spending.

Despite that, it had no policy on pay but had agreed this year to a host of pay awards (including to nurses, refuse workers and college staff) with an average increase of 6.5%, three percentage points higher than ministers estimated in May 2023.

“If a budget is set based on pay assumptions which are lower than those that materialise, this creates challenges with in-year management of the budget, requiring the government to reduce its planned spending on services.

“The recent emergency spending controls the Scottish government has put in place for 2024-25 are the result of those challenges,” it said.

Meanwhile Anas Sarwar, the Scottish Labour leader, said this situation was the result of 17 years of Scottish National party incompetence in government. “Every single institution is weaker, not stronger,” he said.

Michael Marra, Labour’s finance spokesman, said Robison and her colleagues were “in a blind panic” about their cost challenges. They had “no planning, no strategy for change,” he said.

Former British prime minister Liz Truss considered scrapping all cancer treatment on the NHS in an attempt to repair the damage caused by her economic policies, according to claims contained within Sir Anthony Seldon’s book, Truss at 10: How Not to Be a Prime Minister. Seldon is arguably Britain’s leading contemporary political historian. The Independent has this report on the extraordinary claim (we have not been able to independently verify it yet).

Sir Anthony’s book, Truss at 10: How Not to Be a Prime Minister, is deeply critical of Ms Truss, who was forced to resign in 2022 after she triggered an economic crisis by proposing the introduction of £45bn of unfunded tax cuts. She spent only 49 days in office.

The author claims that, in the immediate aftermath of the mini-Budget, Ms Truss and her chancellor, Kwasi Kwarteng, launched a desperate attempt to find spending cuts in an effort to restore stock market confidence in their strategy.

Sir Anthony says a group of Ms Truss’s Tory aides met to discuss the issue. One of her senior advisers, Alex Boyd “was told that Truss and Kwarteng were thinking they could still sort out the black hole with severe cuts”: “We’ve been told that they’re looking at stopping cancer treatment on the NHS.”

Mr Boyd’s response was to ask “Is she being serious?” writes Sir Anthony, while other aides said she had “lost the plot”.

“She’s shouting at everyone that ‘We’ve got to find the money.’ When we tell her it can’t be done, she shouts back: ‘It’s not true. The money is there. You go and find it,’” they told the author.

Speaking to The Independent, Mr Kwarteng said: “I wasn’t involved in any conversations about restricting healthcare, but that doesn’t mean the prime minister and her team didn’t discuss this.”

As we reported in an earlier post, Rachel Reeves, the chancellor, is set to extend the household support fund, which is due to end next month and helps tens of thousands of households at risk of destitution with cash, food parcels, fuel vouchers and clothing.

The End Fuel Poverty Coalition, a group of anti-poverty campaigners, charities, local authorities and unions, said this is the “least” Labour needs to announce. The campaign group says the Treasury also needs to expand the warm home discounts, restore winter fuel payments and “evolve” standing charges, the daily fees that are applied whether you use any electricity or not.

Reacting to Starmer’s speech, Simon Francis, coordinator of the End Fuel Poverty Coalition, said:

The winter fuel payment axe is not about rot in the system, it is about basic fairness for older people facing soaring energy bills.

In real terms, the changes this winter mean that some older people will face the highest energy bills on record.

This has the potential to create a public health emergency which will actually create more pressure on the under-pressure NHS which the prime minister says he wants to fix.

The impact of living in cold damp homes is particularly harsh on those older people with a disability, a long term health condition or with poor mental health. It results in people turning to an NHS and, in some cases, can result in additional winter deaths.

Ending energy debt, extending the Household Support Fund, expanding Warm Home Discounts and evolving standing charges are all now needed urgently to help mitigate the impact of high bills and the axe to the Winter Fuel Payment.

But as well as support this winter, the public need to see a clear timetable for when the very real benefits of cheaper renewable energy and the Warm Homes Plan will kick in.

If the prime minister needs to find some ‘broad shoulders’ to pay for this support, let’s not forget that every month we hear about more massive profits for firms in the wider energy industry.

Rishi Sunak, the leader of the opposition, has responded to Keir Starmer’s speech this morning from Downing Street’s rose garden.

In a post on X, the former prime minister wrote:

Keir Starmer’s speech today was the clearest indication of what Labour has been planning to do all along – raise your taxes.

During the general election, Sunak repeatedly said during ITV’s head-to-head debate with Starmer that “independent Treasury officials” had costed Labour’s policies “and they amount to a £2,000 tax rise for everyone”. Starmer said this claim was a lie.

Amid dire polling numbers, the Conservatives said they would rule out changes to council tax bands and cutting discounts, would maintain protections on homes from capital gains tax, and would not increase stamp duty. Labour said it would match all those pledges. Starmer insisted today that he would not raise tax on “working people” (while not clarifying what this actually means), namely national insurance, VAT and income tax.

During his speech this morning, Starmer, who won July’s general election in a landslide, warned “things are worse than we ever imagined” because of a £22 billion “black hole” in the public finances, claiming to have found out last week that the Tories had borrowed almost £5 billion more than the Office for Budget Responsibility expected.

SNP will lose Scottish election without complete rethink, say senior party figures

Libby Brooks

Libby Brooks is the Guardian’s Scotland correspondent, based in Glasgow

The Scottish National party will lose the next Holyrood election without a fundamental rethink of purpose and policy while carrying out long-delayed internal reforms, senior figures have warned.

However, some have expressed doubt that the party’s leader, John Swinney, is strong enough to direct the scale of change required.

Before the SNP’s annual conference at the end of August, the Guardian spoke to more than 20 influential voices within the party, including current and former Scottish government ministers, senior activists and those ousted in July’s catastrophic general election defeat – in which the SNP was reduced from 46 to nine MPs as Labour swept the board across the country.

Many predict the SNP, which has enjoyed stratospheric electoral success over the past decade, faces “a doing” at the Scottish parliament elections in 2026 as Scottish Labour capitalises on the UK party’s Westminster win.

“The way things are now, we run the real risk of not winning in 2026,” said one senior MSP. “We have to change course and John needs to be decisive.”

Stewart McDonald, a former MP for Glasgow South, who had cleared his Westminster desk before 4 July because he was so certain of defeat, said: “What does an SNP that has learned its lesson look and sound like? I don’t think it’s possible to overstate the scale of the challenge we are facing as a party.”

Almost all argued that countering the Labour message of change to voters who were desperate to get the Tories out of Downing Street was “incredibly difficult if not impossible”, as one former MP described it.

Shadow housing secretary, Kemi Badenoch, who is the current frontrunner to be the next leader of the Tory party, said Starmer’s speech shows he is “taking the British public for fools”.

In one of the first reactions from a senior Conservative MP, Badenoch was quoted by the BBC as saying: “Keir Starmer is taking the British public for fools, but his dishonest analysis won’t wash.”

“He campaigned on promises he couldn’t deliver and now he is being found out,” she adds.

Badenoch has long been considered the frontrunner in the Tory leadership contest (as per this recent YouGov poll). She has said the Conservatives “will speak the truth again” and return to its roots if she wins it. The MP for north west Essex has argued for leaving the European convention on human rights, a major dividing line within her party.

The former business secretary previously ran for the Tory leadership after the resignation of Boris Johnson and came fourth.

Rishi Sunak, the former prime minister and current leader of the opposition, will hand over to his successor on 2 November after an extended Conservative leadership contest.

The Green party co-leader, Carla Denyer, has reacted to Starmer’s speech. She said that people didn’t vote for Labour for more “economic pain” and said that the party could improve people’s lives if their economic agenda was bolder. She singled out Labour’s “refusal to tax the super-rich” as an example of a business as usual approach to politics.

Denyer, the newly elected MP for Bristol Central, has said she believes the four Green MPs elected to the Commons can put pressure on Starmer from the left. She wants Labour to be more radical on the climate, the housing crisis and the funding of public services.

In reaction to Starmer’s Downing Street speech, she said:

Enduring more economic pain and hardship isn’t what people voted for. They were told they were voting for change. Not voting for things to get worse before they get better. Labour needs to be honest about the fact that they could choose to make things better for everyone if they were bolder and braver.

What is being framed as tough choices is actually about political choices. People don’t need a constant reminder that the Tories broke Britain. They need a new approach, not misguided fiscal rules that are set to make things worse.

We must generate the funds needed for investment by shifting the burden away from the poorest onto the wealthiest. Labour’s refusal to tax the super-rich shows that business as usual is very much still in business.

Keir Starmer says the violent riots earlier this month exposed a deeply unhealthy society. But the health of a society can’t be improved if it is forced to swallow the same failed medicine. The government can choose to provide the investment our communities are crying out for. This would help create hope and unleash the goodness of people to improve their communities.

The Green Party manifesto proposed to raise up to £151bn a year in new taxes by 2029, including a new tax on the wealthy, which they claimed would raise about £15bn. Some analysts said many people this would affect would have likely left the UK to avoid paying the extra cash. The party also said there would be a tax rise for earners on more than £50,270.

Here are some of the key takeaways from Keir Starmer’s first major speech as prime minister:

• Starmer warned that the government’s forthcoming Budget will be “painful” as he asked the country to “accept short-term pain for long-term good”.

• Starmer said those with the “broadest shoulders” will carry the heaviest burden. He stressed that taxes on “working people” – namely national insurance, VAT and income tax – will not be increased in the 30 October budget, but stressed that “things will get worse before they get better”.

• Starmer said removing winter fuel payments for millions of pensioners in England and Wales was difficult. There will be more “difficult” decisions to come, he said, pointing to the government inheriting a £22bn black hole in the public finances from the Conservatives.

• Starmer claimed to have found out last week that the Tories had borrowed almost £5 billion more than the Office for Budget Responsibility expected.

• Starmer said his government inherited a “societal black hole” made worse by recent rioting, which he said exposed the state of a “deeply unhealthy society”.

• The prime minister said his government has done more in seven weeks than the Conservative government did in seven years.