Next two years will be ‘challenging’, says Chancellor Jeremy Hunt – as disposable incomes are set to fall to record lowest level
The UK’s economic outlook will be “challenging” for the next two years, Jeremy Hunt says.
The chancellor presented his autumn statement to parliament on Thursday, littered with stealth taxes and curbs on government spending amounting to £55bn in an attempt to plug the black hole in the public finances.
But the independent Office for Budget Responsibility (OBR) warned the disposable incomes of UK households would fall by 7.1% over the next two years – the lowest level since records began in 1956/7, and taking incomes down to 2013 levels.
Politics live: Tax burden reaches highest level since WWII
Speaking to Sky News, Mr Hunt said it was “a difficult time for everyone” but tax hikes and spending cuts are needed to get the economy “on an even keel”.
“Over the next two years it is going to be challenging,” he said.
“But I think people want a government that is taking difficult decisions, has a plan that will bring down inflation, stop those big rises in the cost of energy bills and the weekly shop, and at the same time is taking measures to get through this difficult period.”
The chancellor insisted that his autumn statement is a “very Conservative package” following criticism from some Tory MPs.
“The Office for Budgetary Responsibility said yesterday that what we’re doing is actually recession shallow, it’s saving jobs,” he said.
“But what I would say to my Conservative colleagues is there is nothing Conservative about spending money that you haven’t got, there is nothing Conservative about not tackling inflation, there is nothing Conservative about ducking difficult decisions that put the economy on track.
“And we’ve done all of those things and that is why this is a very Conservative package to make sure we sort out the economy.
“None of this is easy, but it’s the right thing to do.”
Former business secretary Jacob Rees-Mogg accused the chancellor of taking the “easy option” in Thursday’s autumn statement rather than bearing down harder on public spending.
He said the country needed lower taxes to drive up growth.
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Hunt questioned over autumn statement
Probed on how it can be fair that pensions will go up by inflation when public sector workers will not see pay increase alongside prices, Mr Hunt said the elderly do not have the ability to work more to improve their take home pay.
“Well, I think the truth is, first of all, pensioners have retired. They don’t have the ability to work more or work longer hours in the way that people of working age do,” the chancellor said.
“But I think it is wrong to say that only the poorest pensioners are feeling the squeeze at the moment.
“I think this is something that’s affecting everyone and I think it’s right.
“Having made that promise to pensioners in our manifesto that we would have this triple lock, I think this is exactly the kind of tough time that people want it to kick in.
“And so that’s why I think it’s the right thing to do.”
The chancellor added: “We’re not pretending that this isn’t going to be a difficult time for everyone. But what we have is a plan.”
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’12 weeks of Conservative chaos’ – Rachel Reeves
In yesterday’s autumn statement, Mr Hunt announced economic policies which the government hopes will help to rebalance the nation’s finances after the economic turmoil which followed former chancellor Kwasi Kwarteng’s mini-budget.
These included:
• Income tax thresholds being frozen for two more years until April 2028
• Top level of income tax now being paid on earnings over £125,140 instead of £150,000
• Pensions triple lock will remain – with pensioners to see a 10.1% increase in weekly payments in line with inflation
• Benefits to also rise in line with inflation – by 10.1%
• Energy cap to rise from £3,000 a year to £2,500 a year beyond April
• UK minimum wage to rise from £9.50 to £10.42 an hour for those aged over 23
• Windfall tax on oil giants’ profits to rise from 25% to 35% and be extended by two years until March 2028
• Additional cost of living payments of £900 for those on benefits and £300 for pensioners
• Spending on public services in England to rise slower than planned
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As a result of Mr Hunt’s announcements, the tax burden in the UK will also now be at its highest since the Second World War, and there are stark warnings about increased bills and higher unemployment as the recession takes hold – as well as predictions the economy will still shrink 1.4% in 2023.
But most of the difficult decisions on spending have been postponed until after the next general election, due in 2024.
Treasury analysis suggests around 55% of households will be worse off as a result of the measures.
Read more: Jeremy Hunt’s autumn statement had all the hallmarks of a Labour budget
Labour has blamed “12 weeks of Conservative chaos” and “12 years of Conservative economic failure” for the bleak outlook.
Shadow chancellor Rachel Reeves accused the government of forcing the UK economy into a “doom loop where low growth leads to higher taxes, lower investments and squeezed wages, with the running down of public services”.
Ms Reeves told Sky News she is “really worried about what’s going to happen to people’s living standards next year from April” and said a Labour government would have done more “to alleviate some of that pressure on the ordinary working person”.
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What does the autumn statement mean?
As Mr Hunt took part in the broadcast round Friday morning, economic think-tank the Resolution Foundation published analysis suggesting his autumn statement’s tax rises would deliver a 3.7% income hit to typical households.
The foundation said the statement had piled further pressure on the “squeezed middle” and that the focus on “stealthy” tax threshold freezes to raise revenue would extend far beyond high earners.
The think tank also found that the budget would reverse much of the government’s levelling up agenda.
“The £15 billion of cuts to capital investment announced yesterday will undo 80% of the remaining increases in public investment announced by previous chancellor Rishi Sunak, which underpinned the levelling-up agenda,” it said.
A man has been jailed for life for murdering his son’s girlfriend after she returned home from the school run.
Officers from Dyfed-Powys Police were called to an address on Bigyn Road in Llanelli, Carmarthenshire, on 5 July last year.
Sophie Evans, 30, had sustained 72 separate injuries on the outside of the body, “all but three of them new injuries”.
Richard Jones, who is now 50, believed he was “being taken advantage of financially” by Ms Evans and his son, with whom she was in a relationship.
While the purpose of Jones’s visit was “purely normal”, he confronted her on that morning about his suspicions and Ms Evans’s reaction was such that Jones “lost [his] temper”.
He subjected Ms Evans to “gross violence” before ultimately strangling her and leaving the property to run errands, including ordering a new bank card and buying pastries from a bakery.
Richard Jones. Pic: Dyfed-Powys Police
‘Last time on their school run’
During sentencing on Monday, the defendant kept his head bowed for most of the hearing.
He will have to serve at least 20 years behind bars before he can be considered for release by the parole board.
Swansea Crown Court heard Ms Evans was the mother of two young children.
Passing his sentence, Judge Geraint Walters said Ms Evans “had just taken her two children for the last time on their school run” prior to the attack.
“She wasn’t to know that when she parted company with them that morning,” he added.
The court heard the Jones believed he was being defrauded by Ms Evans and his son.
“There is clear evidence, that in the days leading up to this, that you had begun harbouring thoughts that Sophie Evans and your own son were in fact financially scamming you,” he said.
“What precisely brought about that view is difficult to determine.”
Judge Walters said Jones “lost [his] temper when [he] didn’t get the answer that [he] thought [he] deserved”.
He added that, having lost his temper, the defendant “subjected [Ms Evans] to gross violence over a period of time, before you ultimately extinguished her life by strangulation”.
The court was told in evidence that at the time of the attack, Ms Evans was wearing only a bath towel.
‘The rock of our family’
In a victim personal statement, Ms Evans’s sister Kerry Quinlan told the court she was “the rock of our family”.
She said Ms Evans was taken from them in a “senseless and cruel act”.
“Words cannot express fully how much of a loss this has been to her children,” she added.
“When they cry themselves to sleep wanting their mum, she isn’t there and never will be.”
Ms Quinlan added that Jones had “taken everything from us, all in the most despicable way possible”.
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Ms Evans’s partner at the time, and the defendant’s son, Jamie Davies, said in a victim personal statement, read on his behalf, that they had both “trusted” Jones, and that Ms Evans had even been planning the defendant’s 50th birthday.
“The thought of having to live my life without Sophie causes me extreme pain and heartache,” he added.
Prosecuting, Michael Jones KC said the offence was aggravated by the defendant’s previous convictions and the fact Ms Evans was murdered in her home.
In mitigation, David Elias KC said there was a “lack of premeditation”.
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Third man charged with murder over house fire in Bradford that killed mother and her three children
The family of pop star Liam Payne has criticised the media for causing “indescribable, lasting damage” in the wake of his death.
The singer, 31, died in October last year, after falling from a hotel balcony in Argentina.
He was honoured with a video montage, played at Saturday night’s BRIT awards, celebrating his legacy – with clips including his time on X-Factor and during his time with One Direction. The band won seven BRIT awards before they split in 2016.
In a statement, released to the media after the tribute was played, his family called the death an “unspeakable tragedy”.
The family also criticised the “attention and speculation” in the press that caused “indescribable, lasting damage on the family, particularly on Liam’s son, who is trying to process emotions which no seven-year-old should have to experience”.
It said the family accepted the Court of Appeal’s decision to drop all charges in relation to Payne’s death.
One Direction pictured at the 2014 Brit Awards – the band won seven gongs during their time together. Pic: PA
One Direction, pictured in 2011. Pic: AP
Charges were dropped against three defendants: Payne’s friend Roger Nores, who had accompanied him during his trip to Buenos Aires; Gilda Martin, the manager of the Casa Sur Palermo Hotel where Payne died; and Esteban Grassi, the hotel’s main receptionist.
Two others are still facing prosecution for allegedly supplying Payne with drugs. Supplying drugs in Argentina carries a sentence of up to 15 years in prison.
Toxicology tests revealed that before his death, he had traces of alcohol, cocaine, and a prescription antidepressant in his body. A postmortem ruled his cause of death as “polytrauma” from multiple injuries and internal and external bleeding.
‘Beautiful’ Brits tribute
After the video aired, Payne’s former band member Louis Tomlinson thanked the BRIT Awards and said: “Beautiful tribute. Miss you always, brother x.”
Awards host Jack Whitehall introduced the tribute to the singer and said: “He achieved so much in the short time that he was on this earth, and was not only a supremely gifted musician but an incredibly kind soul who touched the lives of everyone he came into contact with.
Themed tributes for singer Liam Payne were seen outside St. Mary’s Church on the day of his funeral.
Pic: Reuters
Fans sing One Direction around a candle-lit tribute for Liam Payne
“We have so many amazing memories with Liam here at The BRITs. So, tonight we celebrate his legacy and look back and remember, the remarkable Liam Payne.”
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