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Labour has pledged to reverse plans to abolish the lifetime pensions allowance if it wins power, calling it “a Tory tax cut for the rich”.

The party released analysis saying the policy proposed in Jeremy Hunt’s budget will save the wealthiest 1% of pensioners £45,000 when they retire.

Speaking to Sky News, the chancellor accused Labour of shifting its position “overnight”, pointing to remarks by shadow health secretary Wes Streeting in September calling for the limit to be scrapped.

But responding on Twitter, Mr Streeting said he had called for a change specifically for doctors and the Tories opposed it at the time.

Politics live: Chancellor speaks to Sky News after delivering budget

Shadow chancellor Rachel Reeves said the new policy was “the wrong priority, at the wrong time, for the wrong people”, adding: “The budget was a chance for the government to unlock Britain’s promise and potential.

“But the only surprise was a £1bn pensions bung for the 1%, a move that will widen the cost of living chasm.”

Mr Hunt used his budget on Wednesday to announce the abolition of the lifetime pensions allowance.

It means people will be allowed to put aside as much as they can in their private scheme without being taxed – removing the £1.07m limit.

The chancellor also said he would increase the pensions annual tax-free allowance, from £40,000 to £60,000, under measures designed to increase the workforce by removing disincentives to being employed for longer.

The policies will cost the Treasury more than £1.1bn a year by 2027-28, with the aim of stopping an estimated 15,000 high earners – including senior NHS doctors – leaving the workforce.

But Ms Reeves called it a “gilded giveaway” coming at a time when many people across the country face “rising bills, higher costs and frozen wages”.

She added: “That’s why a Labour government will reverse this move. We urge the chancellor and the Conservative government to think again too.”

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Jeremy Hunt says the pensions lifetime allowance will be abolished

Asked by Sky News if the NHS needed more nurses rather than encouraging back consultants, the chancellor said the government was recruiting more staff but pensions rules deterring doctors were “a big problem”.

He added: “Wes Streeting said we should get rid of the cap on pensions, the lifetime allowance. He seems to have changed his mind overnight on that one. He said it was crazy and it would save lives to get rid of that cap.

“Well, he was right in September when he said that.”

In response on Twitter, Mr Streeting posted: “Labour called for action on DOCTORS’ pensions to help retention.

“The Tories attacked our suggestion of a tax unregistered scheme on cost grounds. Now you’ve come up with a massive bung to the richest costing £835m a year.”

Labour said they would encourage doctors to stay in work by creating a targeted scheme as the government has done for judges, “rather than create a free-for-all for the wealthy few”.

And experts said that millions of savers will feel no impact from the changes, with Institute for Fiscal Studies (IFS) Director Paul Johnson saying they would “encourage a relatively small number of better-off workers to stay in the workforce a bit longer”.

Meanwhile, the Resolution Foundation warned the policies may actually cause some workers to retire early or use “their now uncapped pensions saving to avoid inheritance tax”.

Chief executive Torsten Bell said the measures are “hugely regressive and wasteful”, adding: “It’s a big victory for NHS consultants but poor value for money for Britain.”

Sir Keir Starmer, the Labour leader, also hit out at the plan, saying: “The only permanent tax cut in the budget is for the richest 1%. How can that happen?”

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Mhari Aurora explains all you need to know about the budget

Budget at a glance

The pensions tax break was one of the headline announcements from Mr Hunt’s budget, alongside a pledge to introduce free childcare for children under three.

Some key policies were revealed ahead of the chancellor’s speech, including keeping the cap on energy prices at £2,500 for a further three months, despite a planned rise to £3,000 in April, and 12 new investment zones.

A number of other plans were unveiled by Mr Hunt, including:

• Bringing charges for prepayment meters in line with direct debit charges, impacting over four million households and saving them an average of £45 per year

• Making duty on draught products in pubs up to 11p lower than supermarkets

• Maintaining the freeze in fuel duty

Read more on the budget:
Tax calculator – see if you’re better off
Ed Conway: There’s a feel-bad factor coming, and this budget won’t help

Unions reacted angrily to a lack of measures on public sector pay, saying Mr Hunt “stuck up two fingers to workers with the budget”.

The announcement took place against the backdrop of an estimated half a million workers, including junior doctors, teachers and civil servants, walking out in disputes over pay, jobs and conditions.

Despite the promises of help with the cost of living, families still face a painful financial squeeze.

Living standards, based on real household disposable income per person, are expected to fall by a cumulative 5.7% over the two financial years 2022-23 and 2023-24 – less than forecast in November but still the largest drop since records began in 1956-57.

Mr Starmer said: “After 13 years of his [the chancellor’s] government, our economy needed major surgery, but like millions across our country, this budget leaves us stuck in the waiting room with only a sticking plaster to hand.

“A country set on a path of managed decline, falling behind our competitors, the sick man of Europe once again.”

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Brianna Ghey’s mother calls for school smartphone ban

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Brianna Ghey's mother calls for school smartphone ban

The mother of murdered teenager Brianna Ghey is calling on the government to introduce a ban on mobile phones in schools – a move she says will not only safeguard children, but also improve their behaviour and engagement in class.

In February 2023, Brianna, 16, was stabbed to death by two 15-year-olds after being lured to a park in Warrington.

In the lead-up to the attack, her killers had spent time on the dark web. At the same time, Brianna was also trapped online, struggling with a phone addiction.

Her mother Esther Ghey’s Phone Free Education campaign is driven by her personal experiences as a parent and the impact Brianna’s phone use had on her education.

Brianna Ghey struggled with a mobile phone addiction, according to her mother
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Brianna Ghey struggled with a mobile phone addiction, according to her mother

“All the arguments that me and Brianna had were down to her phone use,” Esther said.

“But even in school, she had issues and I used to have phone calls from the school saying that Brianna wouldn’t put her phone away.”

Brianna, who was transgender, struggled with an eating disorder and also self-harmed.

Her mother says the constant time she spent online exacerbated those issues, while impacting her behaviour at school, where she had 120 safeguarding logs and 116 behaviour incidents recorded by her teachers.

Esther Ghey said she had calls from her daughter's school saying that 'Brianna wouldn't put her phone away'
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Esther Ghey said she had calls from her daughter’s school saying that ‘Brianna wouldn’t put her phone away’

“It was so difficult as a parent, because I felt in one way that I was failing and then in another way, and this is really difficult for me to speak about, I was so annoyed with Brianna,” she recalled.

“I thought, why can’t you just go to school, get your head down and just focus on your education, because this is important.

“Only now, after two years of being immersed in this world, do I realise that actually, it’s so much harder than that.”

Research by the Children’s Commission has shown that 79% of secondary schools are still allowing pupils to bring their mobile phones into school, and even into classrooms.

Brianna's school introduced a ban on mobile phones in September last year
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Brianna’s school introduced a ban on mobile phones in September last year

How phone ban is working at Brianna’s old school

Esther is campaigning for government guidance on phones to become statutory, with funding also set aside for the equipment to help schools implement the ban, arguing the lack of legislation is “setting children up to fail”.

At Birchwood Community High School in Warrington, where Brianna was a pupil, they introduced a ban on phones last September.

At the beginning of the day, pupils turn off their phones and place them in pouches, which are locked. At the end of the school day, the pouches are then unlocked.

Pupils at Birchwood Community High School in Warrington place their phones in pouches, which are then locked
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Pupils at Birchwood Community High School in Warrington place their phones in pouches, which are then locked

The headteacher, Emma Mills, said introducing these measures has come with several benefits.

“It’s had an impact in all areas of school, and it’s actually had a really positive impact in ways that I didn’t foresee,” said Ms Mills.

“Attendance has improved this year. In terms of behaviour, behaviour has improved. We’ve had no permanent exclusions this year in school, which is actually the first time since I’ve been headteacher in six years, there’s been no permanent exclusion.”

This summer, the school also saw its best-ever GCSE results in the core subjects of Science, maths, and English.

Emma Mills, headteacher at Birchwood Community High School in Warrington
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Emma Mills, headteacher at Birchwood Community High School in Warrington

‘They can live without their phones’

For Ms Mills, another significant change has been the atmosphere in the school.

“They’re not as worried, they’re not as distracted,” Ms Mills said.

“They’ve realised that they can live without their phones. Something else we’ve really noticed is that it’s a bit louder in school at breaks and lunch times. It’s because they’re talking more, they’re interacting more, and they’re communicating more.”

The positive impact of a ban at Brianna’s old school has served as encouragement to Esther, who has written an open letter addressed to Sir Keir Starmer and Education Secretary Bridget Phillipson, asking for government support.

Read more:
Screen time limit for children being considered

‘Whole society’ approach needed to stop doomscrolling

Brianna Ghey
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Brianna Ghey

High-profile signatories include the actress Kate Winslet, as well as actor and film producer Stephen Graham.

For Esther, who will deliver the letter to 10 Downing Street next month, the campaign is not just Brianna’s legacy, but also creating societal change.

“I think it’s important that we teach young people to live in the real world,” she said.

“It’s going to impact society at one point and I think this small amount of investment in students now will have a massive impact in the future.”

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Revealed: Huge rise in protests being dealt with by police

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Revealed: Huge rise in protests being dealt with by police

Police across the UK dealt with more than 3,000 protests over three months this summer – more than three times as many as just two years ago.

There were 3,081 protests this June, July, and August across England, Wales, Scotland and Northern Ireland, figures from the National Police Chiefs’ Council have revealed.

Last summer, when riots were raging across the country following the Southport murders, police dealt with 2,942 protests. In 2023, it was 928.

The summer months this year have been dominated by widespread demonstrations, some against the ban on Palestine Action and others against housing asylum seekers in hotels.

Counter-protesters with police as people take part in a Stand Up To Racism rally in Orpington in August. Pic: PA
Image:
Counter-protesters with police as people take part in a Stand Up To Racism rally in Orpington in August. Pic: PA

‘Increasing tension’

Gavin Stephens, chairman of the NPCC, said it was clear that there has been “more community tension and more division”, adding that “we all have a responsibility, policing included, to set the tone”.

“Anybody in a leadership position should think about how we can reduce and defuse tensions and not sow division,” Mr Stephens said.

The senior official said protests this year were a “chronic pressure” for police compared to last year’s disorder, which was acute.

“This is not talking about the volume of protest, and this is not a commentary from policing on people’s right to protest peacefully,” he said.

“We absolutely support that in a democracy, but we do know that there is a climate of increasing tension and polarity in what we’re seeing.”

He is convinced communities will be able to reunite and “reset”, and said claims that the UK is on the verge of civil disobedience are “exaggerated”.

Read more from Sky News:
Protester arrested after climbing clock tower
Rival groups face off outside migrant hotel

It comes as policing leaders are pushing for a major restructuring of forces in England and Wales, hoping to bring more powers to a national level.

They also want to overhaul how funding is calculated for each force.

A government white paper on potential changes to the service is expected to be published in the coming months.

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Thames Water rescue plan promises £20.5bn investment

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Thames Water rescue plan promises £20.5bn investment

The group of Thames Water lenders aiming to rescue the company have set out plans for £20.5bn of investment to bolster performance.

The proposals, submitted to the regulator for consideration, include commitments to spending £9.4bn on sewage and water assets over the next five years, up 45% on current levels, to prevent spills and leaks respectively.

Of this, £3.9bn would go towards the worst performing sewage treatment sites following a series of fines against Thames Water, and other major operators, over substandard storm overflow systems.

It said this would be achieved at the 2025-30 bill levels already in place, so no further increases would be needed, but it continued to argue that leniency over poor performance will be needed to effect the turnaround.

The creditors have named their consortium London & Valley Water.

It effectively already owns Thames Water under the terms of a financial restructuring agreed early in the summer but Ofwat is yet to give its verdict on whether the consortium can run the company, averting the prospect of it being placed in a special administration regime.

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Is Thames Water a step closer to nationalisation?

Thames is on the brink of nationalisation because of the scale of its financial troubles, with debts above £17bn.

Without a deal the consortium, which includes investment heavyweights Elliott Management and BlackRock, would be wiped out.

Ofwat, which is to be scrapped under a shake-up of oversight, is looking at the operational plan separately to its proposed capital structure.

The latter is expected to be revealed later this month.

Sky News revealed on Monday that the consortium was to offer an additional £1bn-plus sweetener in a bid to persuade Ofwat and the government to back the rescue.

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Thames Water handed record fine

Mike McTighe, the chairman designate of London & Valley Water, said: “Over the next 10 years the investment we will channel into Thames Water’s network will make it one of the biggest infrastructure projects in the country.

“Our core focus will be on improving performance for customers, maintaining the highest standards of drinking water, reducing pollution and overcoming the many other challenges Thames Water faces.

“This turnaround has the opportunity to transform essential services for 16 million customers, clean up our waterways and rebuild public trust.”

Read more from Sky News:
Value of pound sinks
UK hit by toxic cocktail of market shifts

The government has clearly signalled its preference that a market-based solution is secured for Thames Water, though it has lined up a restructuring firm to advise on planning in the event the proposed rescue deal fails.

A major challenge for the consortium is convincing officials that it has the experience and people behind it to meet the demands of running a water company of Thames Water’s size, serving about a quarter of the country’s population.

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