Compensating Waspi women would ‘burden’ the taxpayer, Sir Keir Starmer says

Published

4 months ago

December 17, 2024

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Sir Keir Starmer has defended a decision not to compensate women affected by changes to their retirement age – saying doing so would “burden” the taxpayer.

The prime minister said he understood the concerns of the Women Against State Pension Inequality – often known as Waspi women – but their demands were not affordable.

He was speaking after Work and Pensions Secretary Liz Kendall issued an apology for a 28-month delay in sending out letters to those born in the 1950s impacted by state pension changes.

However, she said she doesn’t accept that compensation should be paid.

Follow politics latest: Reaction to Waspi decision

Ms Kendall said the “great majority of women knew the state pension age was increasing” and that a state-funded pay-out wouldn’t be “fair or value for taxpayers’ money'”.

The announcement was branded a “day of shame” by the Liberal Democrats, who accused the Labour government of “turning its back on millions of pension-age women who were wronged”.

In the mid-1990s, the government passed a law to raise the retirement age for women over a 10-year period to make it equal with men.

The coalition government then sped up the timetable as part of its cost-cutting measures.

The Waspi group say millions suffered financially as they were not given sufficient warning to prepare for the later retirement age.

Earlier this year, an investigation by the Parliamentary and Health Service Ombudsman (PHSO) found that thousands of women may have been adversely impacted by failures to adequately inform people of the change.

The watchdog suggested that women should receive compensation of between £1,000 and £2,950 – but the findings were not legally binding.

Ms Kendall said paying that would have cost up to £10.5 billion, which is not “fair or proportionate”.

She also said she did not agree that sending letters earlier would have made a difference, saying research given to the Ombudsman showed “only around a quarter of people who are sent unsolicited letters actually remember receiving them or reading them“.

However she did accept there was maladministration in communicating the changes and vowed to “learn all the lessons” so it did not happen again.

Speaking later to journalists, Ms Kendall said “real and concrete actions” were coming out of the report, including a “detailed action plan to make sure those sorts of delays never happen again”.

Speaking to reporters after the announcement, Sir Keir said: “I do understand, of course, the concern of the Waspi women. But also I have to take into account whether it’s right at the moment to impose a further burden on the taxpayer, which is what it would be.”

The Waspi campaign group hit out at the decision on X, reminding Ms Kendall that she had previously called for a “fair solution for all affected”.

Angela Madden, chairwoman of Waspi, said refusing to compensate them was a “bizarre and totally unjustified move”.

She added: “An overwhelming majority of MPs back Waspi’s calls for fair compensation and all options remain on the table. Parliament must now seek an alternative mechanism to force this issue on to the order paper so justice can be done.”

This may be as big a political blunder as chancellor’s winter fuel cut

Jon Craig

Chief political correspondent

@joncraig

When Liz Kendall declared in the Commons there’ll be no compensation for the so-called WASPI women, there were shouts of “shame!” from MPs.

And no wonder. Could this be as big a political blunder as Rachel Reeves axing winter fuel payments for pensioners? Potentially, yes, given the furious backlash already.

Yes, compensation was promised by former Labour leader Jeremy Corbyn and his shadow chancellor John McDonnell in the run-up to the December 2019 general election.

Mr McDonnell promised a £58 billion compensation scheme designed to end a “historic injustice” and said a “debt of honour” was owed to women born in the 1950s.

And yes, Sir Keir Starmer fought this year’s election as a changed Labour Party. And no, there was no repeat of the Corbyn-McDonnell pledge in this year’s election manifesto.

But as recently as 2022 the prime minister told a caller in a radio phone-in: “This is a real injustice. We need to something about it.”

In 2019, when she was in Mr Corbyn’s shadow cabinet, Angela Rayner said the Tory government “stole this money” from women born in the 1950s and Labour would “right that injustice”.

But not only that, Liz Kendall herself attended a WASPI campaign event in 2019 and said: “This injustice can’t go on. I have been a longstanding supporter of the WASPI campaign…”

No surprise then, that many of Labour’s newly-elected MPs now feel betrayed. “It feels a bit like we assembled this enormous coalition at the election and now we’re just intent to taking an axe to it piece by piece,” one new Labour MP told Sky News.

If it was an injustice in 2019 and in 2022, surely it’s still an injustice? Should other groups battling against injustice – like sub-postmasters and infected blood victims – be worried now?

Labour MPs were among those who criticised the decision in the House of Commons.

Gareth Snell, for Stoke-on-Trent Central, said today was a “sad moment” and asked the government to re-think its position if the economy improves.

Brian Leishman, for Alloa and Grangemouth, said he was “appalled” at the refusal to compensate the women, calling it “an incredible let down”.

Business

Trump trade war escalation sparks global market sell-off

Published

12 hours ago

April 3, 2025

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Trump trade war escalation sparks global market sell-off

Donald Trump’s trade war escalation has sparked a global sell-off, with US stock markets seeing the biggest declines in a hit to values estimated above $2trn.

Tech and retail shares were among those worst hit when Wall Street opened for business, following on from a flight from risk across both Asia and Europe earlier in the day.

Analysis by the investment platform AJ Bell put the value of the peak losses among major indices at $2.2trn (£1.7trn).

The tech-focused Nasdaq Composite was down 5.8%, the S&P 500 by 4.3% and the Dow Jones Industrial Average by just under 4% at the height of the declines. It left all three on course for their worst one-day losses since at least September 2022 though the sell-off later eased back slightly.

Trump latest: UK considers tariff retaliation

Analysts said the focus in the US was largely on the impact that the expanded tariff regime will have on the domestic economy but also effects on global sales given widespread anger abroad among the more than 180 nations and territories hit by reciprocal tariffs on Mr Trump‘s self-styled “liberation day”.

They are set to take effect next week, with tariffs on all car, steel and aluminium imports already in effect.

Price rises are a certainty in the world’s largest economy as the president’s additional tariffs kick in, with those charges expected to be passed on down supply chains to the end user.

The White House believes its tariffs regime will force employers to build factories and hire workers in the US to escape the charges.

Economists warn the additional costs will add upward pressure to US inflation and potentially choke demand and hiring, ricking a slide towards recession.

Apple was among the biggest losers in cash terms in Thursday’s trading as its shares fell by almost 9%, leaving it on track for its worst daily performance since the start of the COVID pandemic.

Concerns among shareholders were said to include the prospects for US price hikes when its products are shipped to the US from Asia.

Other losers included Tesla, down by almost 6% and Nvidia down by more than 6%.

Many retail stocks including those for Target and Footlocker lost more than 10% of their respective market values.

The European Union is expected to retaliate in a bid to put pressure on the US to back down.

The prospect of a tit-for-tat trade war saw the CAC 40 in France and German DAX fall by more than 3.4% and 3% respectively.

The FTSE 100, which is internationally focused, was 1.6% lower by the close – a three-month low.

Financial stocks were worst hit with Asia-focused Standard Chartered bank enduring the worst fall in percentage terms of 13%, followed closely by its larger rival HSBC.

Among the stocks seeing big declines were those for big energy as oil Brent crude costs fell back by 6% to $70 due to expectations a trade war will hurt demand.

The more domestically relevant FTSE 250 was 2.2% lower.

A weakening dollar saw the pound briefly hit a six-month high against the US currency at $1.32.

There was a rush for safe haven gold earlier in the day as a new record high was struck though it was later trading down.

Sean Sun, portfolio manager at Thornburg Investment Management, said of the state of play: “Markets may actually be underreacting, especially if these rates turn out to be final, given the potential knock-on effects to global consumption and trade.”

He warned there was a big risk of escalation ahead through countermeasures against the US.

Sandra Ebner, senior economist at Union Investment, said: “We assume that the tariffs will not remain in place in the
announced range, but will instead be a starting point for further negotiations.

“Trump has set a maximum demand from which the level of tariffs should decrease”.

She added: “Since the measures would not affect all regions and sectors equally, there will be winners and losers as in 2018 – although the losers are more likely to be in the EU than in North America.

“To protect companies in Europe from the effects of tariffs, the EU should not respond with high counter-tariffs. In any case, their impact in the US is not likely to be significant. It would be more efficient to provide targeted support to EU companies in the form of investment and stimulus.”

Business

British businesses issue warning over ‘deeply troubling’ Trump tariffs

Published

12 hours ago

April 3, 2025

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British businesses issue warning over 'deeply troubling' Trump tariffs

British companies and business groups have expressed alarm over President Donald Trump’s 10% tariff on UK goods entering the US – but cautioned against retaliatory measures.

It comes as Business Secretary Jonathan Reynolds launched a consultation with firms on taxes the UK could implement in response to the new levies.

Money blog: Pension top-up deadline days away

A 400-page list of 8,000 US goods that could be targeted by UK tariffs has been published, including items like whiskey and jeans.

On so-called “Liberation Day”, Mr Trump announced UK goods entering the US will be subject to a 10% tax while cars will be slapped with a 25% levy.

The government’s handling of tariff negotiations with the US to date has been praised by representative and industry bodies as being “cool” and “calm” – and they urged ministers to continue that approach by not retaliating.

Business lobby group the CBI (Confederation of British Industry) said: “Retaliation will only add to supply chain disruption, slow down investment, and stoke volatility in prices”.

Industry body the British Retail Consortium (BRC) also cautioned: “Retaliatory tariffs should only be a last resort”.

‘Deeply troubling’

While a major category of exports, in the form of services – like finance and information technology (IT) – has been exempted from the tariffs, the impact on UK business is expected to be significant.

Mr Trump’s announcement was described as “deeply troubling for businesses” by the CBI’s chief executive Rain Newton-Smith.

The Federation of Small Businesses (FSB) also said the tariffs were “a major blow” to small and medium companies (SMEs), as 59% of small UK exporters sell to the US. It called for emergency government aid to help those affected.

“Tariffs will cause untold damage to small businesses trying to trade their way into profit while the domestic economy remains flat,” the FSB’s policy chair Tina McKenzie said. “The fallout will stifle growth” and “hurt opportunities”, she added.

Companies will need to adapt and overcome, the British Export Association said, but added: “Unfortunately adaptation will come at a cost that not all businesses will be able to bear.”

Watch dealer and component seller Darren Townend told Sky News the 10% hit would be “painful” as “people will buy less”.

“I am a fan of Trump, but this is nuts,” he said. “I expect some bad months ahead.”

Industry body Make UK said the 25% tariffs on cars, steel and aluminium would in particular be devastating for UK manufacturing.

Cars hard hit

Carmakers are among the biggest losers from the world trade order reshuffle.

Auto industry body the Society of Motor Manufacturers and Traders (SMMT) said the taxes were “deeply disappointing and potentially damaging measure”.

“These tariff costs cannot be absorbed by manufacturers”, SMMT chief executive Mike Hawes said. “UK producers may have to review output in the face of constrained demand”.

The new taxes on cars took effect on Thursday morning, while the measures impacting car parts are due to come in on 3 May.

Business

Trump trade war: The blunt calculation that should have spared UK from reciprocal tariffs

Published

12 hours ago

April 3, 2025

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Trump trade war: The blunt calculation that should have spared UK from reciprocal tariffs

Economists immediately started scratching their heads when Donald Trump raised his tariffs placard in the Rose Garden on Wednesday.

On that list he detailed the rate the US believes it is being charged by each country, along with its response: A reciprocal tariff at half that rate.

So, take China for example. Donald Trump said his team had run the numbers and the world’s second-largest economy was implementing an effective tariff of 67% on US imports. The US is responding with 34%.

Trump latest: UK considers tariff retaliation

How did he come up with that 67%? This is where things get a bit murky. The US claims it studied its trading relationship with individual countries, examining non-tariff barriers as well as tariff barriers. That includes, for example, regulations that make it difficult for US exporters.

However, the actual methodology appears to be far cruder. Instead of responding to individual countries’ trade barriers, Trump is attacking those enjoying large trade surpluses with the US.

A formula released by the US trade representative laid this bare. It took the US’s trade deficit in goods with each country and divided that by imports from that country. That figure was then divided by two.

So, in the case of China, which has a trade surplus of $295bn on total US exports of $438bn, that gives a ratio of 68%. The US divided that by two, giving a reciprocal tariff of 34%.

This is a blunt measure which targets big importers to the US, irrespective of the trade barriers they have erected. This is all part of Donald Trump’s efforts to shrink the country’s deficit – although it’s US consumers who will end up paying the price.

But what about the small number of countries where the US has a trade surplus? Shouldn’t they actually be benefiting from all of this?

That includes the UK, with whom the US has a surplus (by its own calculations) of $12bn. By its own reciprocal tariff formula, the UK should be benefitting from a “negative tariff” of 9%.

Instead, it has been hit by a 10% baseline tariff. Number 10 may be breathing a sigh of relief – the US could, after all, have gone after us for our 20% VAT rate on imports, which it takes issue with – but, by Trump’s own measure, we haven’t got off as lightly as we should have.