‘I’m not going to write a budget here’: Rachel Reeves refuses to rule out further tax rises if Labour finds black hole in public finances post-election
Rachel Reeves has refused to rule out tax rises beyond income tax, national insurance and corporation tax if Labour finds a black hole in the public finances once it enters government.
In an interview with Sky News, the shadow chancellor swerved questions on whether the government books might be worse than anticipated if Labour wins the election, and how the party would raise the money to deal with pressing issues.
The shadow chancellor said her plans were fully funded, but existing tax rises were there only to fund commitments already made, and insisted: “We have no plans for increased taxes.”
But pressed on whether she would raise other taxes if there was a black hole on entering government, she said: “I’m not going to write a budget here.”
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The shadow chancellor draws a distinction between income tax, national insurance and corporation tax , saying her party had “already ruled out” rises for the parliament.
But Ms Reeves declined to engage with the question of what would happen if she finds a black hole on entering government – with some Labour figures expecting immediate cost pressures from the creaking prison service, bust local councils and the need to fund vast compensation schemes including infected blood at the next budget.
“There are no further increases in tax that we are planning or that we need to fill any black holes,” she said.
Analysts point out that Labour has not made any commitment not to raise VAT, and is already extending that tax to private schools.
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“We don’t need to increase VAT because we don’t need to increase any taxes because all of our plans, unlike the Conservatives’, are fully costed and fully funded and people can have confidence in that – there will be nothing that we put forward that we can’t explain where the money’s going to come from.”
Ms Reeves spoke to Sky News on the same day that she delivered a campaign speech from Derby, in which she declared Labour to be the “natural party of British business” – and that included paying bosses large salaries.
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‘Labour is party of British business’
In her first major speech of the election campaign, the shadow chancellor sought to persuade voters Labour is now pro-business and pro-workers.
She also said the party would bring the UK closer to the European Union, something Labour has previously announced, and “bring investment back to Britain”.
Ms Reeves also criticised the Conservatives for promising to cut taxes for pensioners by creating a new “age-related” tax-free allowance – dubbed the “triple lock plus”.
Currently, people can receive £12,570 a year of their pensions before they start paying income tax on them – the same figure as the personal allowance for those who work.
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But if the party wins the next election, a pensioner’s allowance would rise in line with either average earnings, inflation or by 2.5% – whichever is higher – from next April, echoing the rules on annual state pension increases.
The shadow chancellor accused Rishi Sunak of “desperately adding more baubles to a Christmas tree”.
“The truth is, unless you can be really clear about where the money’s going to come from, then these sums just don’t add up and therefore they’re not deliverable.
“And that’s the question people have to ask at this election. Do they want another five years of chaos and decline under the Conservatives, or a changed Labour Party offering stability? And frankly, after what we’ve had these last few years, stability is change.”
Conservative Party leader Kemi Badenoch has called on Sir Keir Starmer to sack Treasury minister Tulip Siddiq over allegations she lived in properties linked to allies of her aunt, Sheikh Hasina, the deposed prime minister of Bangladesh.
It comes after the current Bangladeshi leader, Muhammad Yunus, said London properties used by Ms Siddiq should be investigated.
He told the Sunday Times the properties should be handed back to his government if they were acquired through “plain robbery”.
Tory leader Ms Badenoch said: “It’s time for Keir Starmer to sack Tulip Siddiq.
“He appointed his personal friend as anti-corruption minister and she is accused herself of corruption.
“Now the government of Bangladesh is raising serious concerns about her links to the regime of Sheikh Hasina.”
Ms Siddiq insists she has “done nothing wrong”.
Her aunt was ousted from office in August following an uprising against her 20-year leadership and fled to India.
Ms Siddiq is also named with her aunt in Bangladesh court documents about meetings with the Russian government.
Tory leader Kemi Badenoch has called on Sir Keir to sack the minister
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As economic secretary to the Treasury, Ms Siddiq is responsible for policy on both the City and tackling corruption.
She referred herself to the prime minister’s ethics watchdog on Monday following the reports about the properties.
On the same day, the prime minister said: “Tulip Siddiq has acted entirely properly by referring herself to the independent adviser, as she’s now done, and that’s why we brought into being the new code.
“It’s to allow ministers to ask the adviser to establish the facts, and yes, I’ve got confidence in her, and that’s the process that will now be happening.”
Police in Aberdeen have widened the search area for two sisters who disappeared four days ago in the city.
Eliza and Henrietta Huszti, both 32, were last seen on CCTV on Market Street after leaving their home on Tuesday at around 2.12am.
The sisters – who are part of a set of triplets and originally from Hungary – crossed the Victoria Bridge to the Torry area and turned right on to a footpath next to the River Dee.
Eliza and Henrietta Huszti were last seen on CCTV in Market Street. Pic: Police Scotland/PA
They headed in the direction of Aberdeen Boat Club but officers said there is no evidence to suggest the missing women left the immediate area.
Specialist search teams, police dogs and a marine unit have been trying to trace the pair.
The sisters crossed Victoria Bridge before walking along a footpath next to the River Dee
The pair were heading in the direction of Aberdeen Boat Club on the south side of the River Dee
Further searches are being carried out towards the Port of Aberdeen’s South Harbour and Duthie Park.
Police Scotland said it is liaising with authorities in Hungary to support the relatives of the two sisters.
Chief Inspector Darren Bruce said: “Eliza and Henrietta’s family are understandably extremely worried about them and we are working tirelessly to find them.
“We are seriously concerned about them and have significant resources dedicated to the inquiry.”
The sisters, from Aberdeen city centre, are described as slim with long brown hair.
Henrietta Huszti. Pic: Police Scotland
Eliza Huszti. Pic: Police Scotland
Officers have requested businesses in and around the South Esplanade and Menzies Road area to review their CCTV footage for the early morning of Tuesday 7 January.
Police added they are keen to hear from anyone with dashcam footage from that time.
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