Budget 2024: Unfunded tax cuts ‘deeply unconservative’, says Jeremy Hunt
The chancellor has played down expectations of tax cuts in Wednesday’s budget, telling Sky News his spending plans will be “prudent and responsible”.
Speaking to Sunday Morning With Trevor Phillips, the cabinet minister it would be “deeply unconservative” to take decisions that were unfunded and increased borrowing.
Jeremy Hunt is under pressure to deliver tax cuts in what could be the last economic set piece from the Conservatives before the next general election, which is widely expected in the autumn.
Politics live: Chancellor tempers tax cut expectations as he says budget ‘will be affordable’
The tax burden is reaching record levels, with it expected to rise to its highest point since the Second World War before the end of this decade as the country looks to pay back heavy borrowing used to support people through the COVID-19 pandemic and the energy price spike in the aftermath of Russia’s invasion of Ukraine.
Mr Hunt said: “It’s going to be a prudent and responsible budget for long-term growth.
“And when it comes to tax cuts, I do believe that if you look around the world, countries with lower tax tend to grow faster like North America, Asia.
“And so I do think in the long run, we want to move back to being a lower taxed, more lightly regulated economy.
“But it would be deeply unconservative to cut taxes in a way that increased borrowing…
“If I think of the great tax cutting budgets of the past – Nigel Lawson’s budget in 1988 – the reason that was so significant is because those cuts were permanent and people need to know that these are tax cuts you can really afford.
“So it will be responsible and everything I do will be affordable.”
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Mr Hunt described the 2p cut to national insurance at the autumn statement as a “turning point”.
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He said: “All conservatives believe that the state has a moral duty to leave as much money in people’s pockets as possible because it belongs to the people who earn that money.
“But we all know that it is not conservative to cut taxes, for example, by increasing borrowing because then you are just passing on the bill to future generations.
“So what you saw in the autumn statement was a turning point, when we cut 2p off the national insurance rate.
“We will hope to make some progress on that journey but we are going to do so in a responsible way.”
Mr Hunt’s comments come after he announced an £800m package of technology reforms designed to free up time for frontline public service workers.
Under the move, police will use drones to assess incidents such as traffic collisions and artificial intelligence will be deployed to cut MRI scan times by a third.
The Treasury said the changes have the potential to deliver £1.8bn worth of benefits to public sector productivity by 2029.
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There is “no doubt” the UK “will spend 3% of our GDP on defence” in the next parliament, the defence secretary has said.
John Healey’s comments come ahead of the publication of the government’s Strategic Defence Review (SDR) on Monday.
This is an assessment of the state of the armed forces, the threats facing the UK, and the military transformation required to meet them.
Prime Minister Sir Keir Starmer has previously set out a “clear ambition” to raise defence spending to 3% in the next parliament “subject to economic and fiscal conditions”.
Mr Healey has now told The Times newspaper there is a “certain decade of rising defence spending” to come, adding that this commitment “allows us to plan for the long term. It allows us to deal with the pressures.”
A government source insisted the defence secretary was “expressing an opinion, which is that he has full confidence that the government will be able to deliver on its ambition”, rather than making a new commitment.
The UK currently spends 2.3% of GDP on defence, with Sir Keir announcing plans to increase that to 2.5% by 2027 in February.
This followed mounting pressure from the White House for European nations to do more to take on responsibility for their own security and the defence of Ukraine.
The 2.3% to 2.5% increase is being paid for by controversial cuts to the international aid budget, but there are big questions over where the funding for a 3% rise would be found, given the tight state of government finances.
While a commitment will help underpin the planning assumptions made in the SDR, there is of course no guarantee a Labour government would still be in power during the next parliament to have to fulfil that pledge.
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From March: How will the UK scale up defence?
A statement from the Ministry of Defence makes it clear that the official government position has not changed in line with the defence secretary’s comments.
The statement reads: “This government has announced the largest sustained increase to defence spending since the end of the Cold War – 2.5% by 2027 and 3% in the next parliament when fiscal and economic conditions allow, including an extra £5bn this financial year.
“The SDR will rightly set the vision for how that uplift will be spent, including new capabilities to put us at the leading edge of innovation in NATO, investment in our people and making defence an engine for growth across the UK – making Britain more secure at home and strong abroad.”
Sir Keir commissioned the review shortly after taking office in July 2024. It is being led by Lord Robertson, a former Labour defence secretary and NATO secretary general.
The Ministry of Defence has already trailed a number of announcements as part of the review, including plans for a new Cyber and Electromagnetic Command and a £1bn battlefield system known as the Digital Targeting Web, which we’re told will “better connect armed forces weapons systems and allow battlefield decisions for targeting enemy threats to be made and executed faster”.
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PM Sir Keir Starmer and Defence Secretary John Healey on a nuclear submarine earlier this year. Pic: Crown Copyright 2025
On Saturday, the defence secretary announced a £1.5bn investment to tackle damp, mould and make other improvements to poor quality military housing in a bid to improve recruitment and retention.
Mr Healey pledged to “turn round what has been a national scandal for decades”, with 8,000 military family homes currently unfit for habitation.
He said: “The Strategic Defence Review, in the broad, will recognise that the fact that the world is changing, threats are increasing.
“In this new era of threat, we need a new era for defence and so the Strategic Defence Review will be the vision and direction for the way that we’ve got to strengthen our armed forces to make us more secure at home, stronger abroad, but also learn the lessons from Ukraine as well.
“So an armed forces that can be more capable of innovation more quickly, stronger to deter the threats that we face and always with people at the heart of our forces… which is why the housing commitments that we make through this strategic defence review are so important for the future.”
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