Expect a steady the ship budget with promises of jam tomorrow from Chancellor Jeremy Hunt | Beth Rigby
After the debacle of Liz Truss’s September mini-budget, with all its mega ramifications, and an autumn statement eight weeks later that performed an about-turn so big that the country’s tax burden hit a 70-year-high, Wednesday’s budget will be all about stability and sticking to the plan.
“No big bangs in this budget,” is how one senior government insider put it to me last week. “It’s got to be a growth budget.
“We’re fighting to be competitive again with Labour. If we can get to next summer and the economy is ticking up, and we can narrow the gap to five to eight points behind in the polls, there’s a chance in an election campaign we can shift the dial.”
Tax cuts, I’m told, will have to wait.
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What the chancellor and prime minister want to project this week is the sense that they are getting the economy back on track, and working towards Rishi Sunak’s pledges to halve inflation, get debt down and get the UK economy growing again.
Do that, argue his allies, and the tax cuts will come – just in time for a general election.
But there is pressure, and lots of it, from voters and from the Tory backbenchers to do more on tax cuts and cost-of-living now, not tomorrow.
And that pressure is all the more palpable after the chancellor received a £30bn windfall in the public finances last month, after it emerged that in the year to January, the public sector had borrowed less than forecast in November by the UK’s official fiscal watchdog.
Floating voters we spoke to in a focus group in one Tory shire seat last week told us that struggling with the cost-of-living and a buckling NHS were top of their concerns, and they expressed scepticism that the government was up to the job.
One voter in the Wycombe constituency in Buckinghamshire described the government as “stale”, with another telling us: “The current crisis emphasises that our government is fairly broken.”
On the cost-of-living, our group of floating voters spoke of their anxiety around energy bills, food prices and childcare.
Charlotte, a working mum, told us she had to change her working hours because she couldn’t afford childcare costs.
“I can’t afford to work full time anymore,” she told us. “It’s not feasible for our family, so I’ve had to rope my mum in to do childcare.
“I wouldn’t say we’re a low earning family. That’s just the way it is now.”
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Voters talk about their priorities with our political editor Beth Rigby.
Food bills were also a concern, with voters saying they’d switched to cheaper supermarkets and cut back in the face of galloping food price inflation.
Ashley, who in the past has voted Conservative but is now undecided, told us he’d switched his weekly shop from Tesco and M&S to Aldi, while energy bills were a problem all round.
“I’ve voted Conservative a long time,” the father-of-two told us. “And then I got a bit tired of, you know, Boris and the promises.
“We need to have some results and I want to see some improvement, not the deflection bit around immigration, [but] some real positive on the cost of living. For me, that’s the most key…it’s what’s important to people.”
Short and long term plans
The Treasury is alive to the pressure, with insiders telling me there will be two parts to Mr Hunt’s budget on Wednesday: a short-term support plan to provide immediate relief on the cost-of-living crisis and then the long-term plan for growth.
On the first part of that, the government is expected to extend the £2,500 energy price guarantee for another three months from April (where there had been a planned rise to £3,000) to give people support on their bills.
The chancellor is also under pressure to again freeze fuel taxes in this budget, at a cost of £6bn.
When it comes to childcare, the chancellor is expected to change rules so that parents on Universal Credit are given more money for childcare and given the funding upfront.
The Treasury is also believed to be planning a cash injection of hundreds of millions into increasing the availability of the 30 hours of free childcare to three to four-year-olds.
Mr Hunt also plans to loosen staff-to-child ratios for two-year-olds, which could make the cost of childcare a little cheaper.
But anything really big bang on childcare, such as extending 30 hours of free childcare to one-and two-year-olds, is unlikely – that policy would cost around £6bn.
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These are some predictions for the budget.
And when it comes to the most obvious way of helping people manage their bills – wage packets – the government is standing firm, with Treasury insiders insisting there will be no above inflation pay sector awards.
Neither is the chancellor expected to offer voters any cuts to personal taxes.
“We haven’t got £30bn to cut taxes,” is how one government insider put it to me, in a nod to the boost from revised public finances.
“What we’ve got to do is get people back into work, be that through better childcare support or incentives to get those in their 50s back into work.
“That is where we have to focus policy, and that could amount to say £5bn and that comes out of the [£30bn] headroom.”
Because beyond the short-term support measures, the focus for this budget will be on trying to get the economy moving and getting people back to work post-pandemic, with a package of measures to try to shift parents, the sick, disabled and older workers back into jobs.
To that end, the chancellor is expected to raise the lifetime allowance for pension savings from £1m to an expected £1.8m – a record level – in order to try to incentivise doctors and other professionals out of retirement and back into work.
He could also lift the annual tax-free allowance for pensions from £40,000 to £60,000.
It’s a package that could cost £2bn a year and would be much welcomed by higher earners, but also opens the chancellor up to criticism that he is giving a tax break to the rich while offering nothing to basic rate taxpayers.
Read more:
What to look out for in Hunt’s first budget
And when it comes to the other group of voters the chancellor and PM need to placate, his backbenchers, there is disquiet over the high level of tax burden, with many Tory MPs keen for tax cuts.
One former cabinet minister told me last week that they wanted to see the £30bn windfall in the public finances used to reverse the planned increase in corporation tax from 19p to 25p in April.
It is a pretty popular refrain.
But Treasury insiders insist the tax hike will go ahead and instead the chancellor will offer business tax breaks to try to encourage growth.
When Mr Sunak was chancellor back in March 2021, he created the £25bn “super-deduction” tax allowance for capital investment – a two-year measure offering 130% tax relief on companies’ purchases of equipment – in order to try to boost investment and growth.
Mr Hunt is coming up with a new set of plans to try to support business and could give firms much more generous capital allowances to incentivise investment.
Watch too for policies and reforms targeting certain industries and sectors, from artificial intelligence to green energy and advanced manufacturing: all of it will be framed as the government’s long-term plan for growth.
Rishi Sunak and Jeremy Hunt will be hoping to reassure people they are making the right choices for the UK economy.
Wednesday will be, if you like, the third act of the prime minister’s performance over the past few weeks to try and win a jaded public back around by trying to convince them he will stick to his plan and deliver on promises.
On the international stage, he has rehabilitated the UK with allies after the bumpy years of Prime Minister Johnson and then Prime Minister Truss, symbolised most strongly in a deal with the EU over post-Brexit trading arrangements in Northern Ireland – where even his foes conceded Mr Sunak had got more than they expected.
At home, the PM has put forward his plan to “stop the boats” – a key priority of many of the voters he needs to keep onside or win back in 2024.
Whether the plan, surrounded in legal and practical controversies, will come off remains to be seen.
But Mr Sunak will at least be able, to quote one of his allies, “build a narrative” that blames the failure of the policy around France and the EU refusing to grant the UK a returns agreement and the international courts blocking his plans.
“At least he can then make the argument it wasn’t his fault,” they said.
Narrow path back
On Wednesday, the focus will be on the PM’s three economic targets – halving inflation, cutting debt and growing the economy – as the chancellor tries to lay down the best conditions he can for the Conservatives’ run into the general election in 2024.
Mr Sunak’s allies tell me they think there is a way back to victory for this government at the ballot box once again, but the “path is very narrow”.
A budget then building the foundations rather than lighting the fireworks, all of this the groundwork for the pre-election showstopper next year.
But with the cost-of-living squeeze so acute, the promise of jam tomorrow is unlikely to satisfy the public, particularly if those being given some of the spoils this time around look to be business and the wealthy.
Mr Hunt may be charged with steadying the ship, but he’ll have to be skilful on Wednesday not to lose more ground.
World
27 Palestinians killed by Israeli fire while waiting for aid distribution, says Hamas-run Gaza health ministry
Twenty-seven Palestinians have been killed by Israeli gunfire while waiting for aid to be distributed, according to Gaza’s health ministry.
They were reportedly killed in the Rafah area of southern Gaza early on Tuesday.
The Hamas-run ministry claimed that more than 90 people were injured in what it called a “massacre”, with some of the wounded in a serious condition.
The Israel Defence Forces (IDF) said it fired “near a few individual suspects” who left the designated route, approached its forces and ignored warning shots, about half a kilometre from the aid distribution site of the US-backed Gaza Humanitarian Foundation (GHF). It added that people were moving towards its forces in a way that “posed a threat to them”.
Later, IDF spokesperson Effie Defrin said accusations that the Israeli military shot at civilians were “completely unfounded and false”.
“We are debriefing this event, and we will find out the truth,” he added.
The media office of the Gaza government, which is run by Hamas, said in a statement that Israel was transforming aid distribution centres “into mass death traps and bloodbaths” with 102 people killed and 490 more injured in just eight days since the centres opened on 27 May.
The aid centres were “luring starving civilians to them as a result of the crippling famine”, said the media office, which called for humanitarian aid delivered through UN agencies and neutral international organisations rather than the GHF.
A woman reacts following the death of Palestinians near a aid distribution site in Rafah. Pic: Reuters
A child at the funeral of Palestinians killed in alleged Israeli fire. Pic: Reuters
The IDF said in a statement: “Earlier today (Tuesday), during the movement of the crowd along the designated routes toward the aid distribution site – approximately half a kilometre from the site – IDF troops identified several suspects moving toward them, deviating from the designated access routes.
“The troops carried out warning fire, and after the suspects failed to retreat, additional shots were directed near a few individual suspects who advanced toward the troops.”
Sky News pressed Israeli government spokesperson David Mencer on whether any of these individuals had weapons – but he failed to answer the question.
Mencer told Sky’s Kamali Melbourne: “The warning shots were fired away from the aid distribution point in response to the threat perceived by IDF troops.”
The GHF said in a statement on Tuesday: “While the aid distribution was conducted safely and without incident at our site today, we understand that IDF is investigating whether a number of civilians were injured after moving beyond the designated safe corridor and into a closed military zone. This was an area well beyond our secure distribution site and operations area.
“We recognise the difficult nature of the situation and advise all civilians to remain in the safe corridor when travelling to our distribution sites. Questions regarding the potential incident should be referred to the IDF Spokesperson.”
The International Committee of the Red Cross said its field hospital in Rafah received 184 casualties. A spokesperson added that 19 of those were declared dead upon arrival, and eight died of their wounds shortly after.
There were three children and two women among the dead, according to Mohammed Saqr, who is the head of nursing at Nasser Hospital in Gaza.
A spokesperson for the UN high commissioner for human rights, Jeremy Laurence, said: “For a third day running, people were killed around an aid distribution site run by the ‘Gaza Humanitarian Foundation’.”
Mr Laurence’s office said the impediment of access to food and relief for civilians in Gaza may constitute a war crime, describing attacks on civilians trying to access food aid as “unconscionable”.
An ambulance outside Nasser hospital in Gaza, where people allegedly injured by Israeli fire were taken
Palestinians arriving at Nasser hospital following alleged Israeli fire near an aid distribution site
The alleged shooting comes just two days after reports that 31 people were killed as they walked to a distribution centre run by the GHF in the Rafah area.
Witnesses said the deaths came after Israeli forces opened fire, while Palestinian and Hamas-linked media attributed the deaths they reported to an Israeli airstrike.
The IDF later said its forces “did not fire at civilians while they were near or within the humanitarian aid distribution site and that reports to this effect are false”.
Read more from Sky News:
How Israeli-backed aid plan in Gaza is unravelling
Ex-Biden official says Israel committed war crimes
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Surgeon describes working in Gaza
On Monday, three more Palestinians were reportedly killed by Israeli fire.
UN secretary general Antonio Guterres said he was “appalled” by reports of Palestinians killed and injured while seeking aid.
He called for an independent investigation and said: “It is unacceptable that Palestinians are risking their lives for food.”
Two women cry during the funeral of Palestinians killed early Tuesday. Pic: Reuters
Palestinians arrived to collect aid from a Gaza Humanitarian Foundation hub in Rafah last week. File pic: Reuters
The IDF said that three of its soldiers were killed in Gaza on Monday, in what appeared to be the deadliest attack on Israeli forces since the ceasefire with Hamas ended in March.
Officials said the soldiers, all in their early 20s, died in northern Gaza, with Israeli media reporting that they were killed in an explosion in the Jabaliya area.
Last week, Israel accepted a US-brokered ceasefire proposal, which would see the release over the course of a week of nine living hostages and half of the known hostages who have died.
But Hamas said that it was seeking amendments to the proposed 60-day truce, offering 10 living Israeli hostages and the bodies of 18 in exchange for Palestinian prisoners.
There is a distinct moment when the tranquillity of the Tacugama Chimpanzee Sanctuary envelops our car as we drive higher up the mountain.
The buzz of Freetown gives way to the hushed calm of this pocket of pristine rainforest reserved for critically endangered western chimpanzees rescued from across Sierra Leone.
The quiet is necessary. These bright primates – closest related to humans in the animal kingdom – are easily disturbed and the ones living in Tacugama are particularly sensitive.
The more than 120 chimpanzees brought here are traumatised survivors of mistreatment, hunting and violent separation from their families in the wild.
They are now facing another existential threat. Illegal encroachment is eating away at the edges of the conservation area. Despite wildlife laws, forest has been cleared to make way for houses being constructed closer and closer to chimp enclosures.
Forest has been cleared to make way for houses being constructed closer and closer to chimp enclosures
“We’ve been issuing several warnings over the last year,” says Tacugama founder Bala Amarasekaran. “Four months ago – again – we gave a warning. Then we had presidential intervention say that some of this encroachment will be stopped. It started very well for the first month then everything stopped again and we are back at square one. So, we are very tired and very stressed.”
Thirty years ago, Mr Amarasekaran appealed to the government to donate land and partner with him to create a sanctuary for the protection of the abused orphaned chimps he was finding across Freetown. Today, land in the Western Area Forest Reserve is being grabbed right under the government’s nose.
“The government has been very good in terms of helping us in every way – however we expect the leadership to be more firm,” says Mr Amarasekaran.
“When we talk to them, they are all with us. They all want to help. But when it comes to action it looks like some of the departments that have the mandate to institute certain laws and take the necessary law enforcement action are not acting.”
Tacugama founder Bala Amarasekaran
Sanctuary closes its doors to focus on conservation, rehabilitation and research
Tacugama has grown to become Sierra Leone’s most popular tourist attraction over the last three decades. But in a stand against the fast-approaching illegal encroachment, the sanctuary has closed its doors to visitors to focus on conservation, rehabilitation and research.
“It is not a tourist attraction – we made it become a tourist attraction. It is supposed to be an orphanage for rescued chimpanzees,” Mr Amarasekaran says.
“They are used to us and some visitors but they will start to see strangers come and that is where the problems start. They are not comfortable with strangers – don’t forget it is the stranger who killed their mother. It is the stranger that wiped out their group.”
‘A complex problem’
We asked Sierra Leone’s government spokesperson and minister of information and civic education, Chernor Bah, about the illegal encroachment.
“It is a complex problem. You have a city that is growing. People need places to stay and we have not done the best job in terms of enforcing all these limitations,” he replied. “Some of our agents seem to have been complicit in allocating and giving people land in places they are not supposed to stay. So, I don’t think I can sit here and say we have done enough – there is much more we can do.
“[Tacugama] is probably our most cherished and significant wildlife asset in the country.”
A national symbol for tourism
In 2019, the government designated the western chimpanzee as the national animal and national symbol for tourism. The image of a chimp is now etched in Sierra Leonean passports, a result of Tacugama’s advocacy Mr Amarasekaran and his team hope will entrench a love and respect for chimps that will curb the need for intervention.
“We wanted something more – that is how the national animal bill came through,” says Mr Amarasekaran.
“We thought if the agencies that are mandated to do all the law enforcement are not active and effective, then maybe we need to create a synergy between the people and the animals.”
Chimpanzees hunted for bushmeat
But chimpanzees are still being hunted as bushmeat for food across Sierra Leone and baby chimps are being torn from their families to be kept as illegal pets. Tacugama’s latest rescue is only eight months old.
Baby Asana is frail with thinning hair and is being nursed back to health by his chimp mum, Mama P, when we meet him. He was rescued after an informant sent a video of Asana wearing human clothes and being mistreated as an illegal pet in Bo, Sierra Leone’s second largest city.
“For me as the founder of the sanctuary, I feel defeated,” says Mr Amarasekaran with Asana being cared for behind him.
“These chimps shouldn’t be arriving here if we have done enough work outside – there shouldn’t be any killings, there shouldn’t be any rescues. That is the time when I can say that I achieved something.”
Research from the Jane Goodall Institute identified that between five and 10 chimpanzees die for every surviving rescued chimpanzee. And with the sanctuary closed, much-needed public advocacy work will take a hard hit.
‘Until I came to the sanctuary, I didn’t see a chimpanzee’
“I’m really concerned because I only even started to experience chimpanzees when I started working here. I knew that we had chimps here. But until I came to the sanctuary, I didn’t see a chimpanzee,” says 25-year-old Tacugama communications officer, Sidikie Bayoh.
“Now, we are at a situation where we are closed indefinitely but what if this becomes something wherein we can never open the sanctuary again for people to visit? Then you will have all these young Sierra Leoneans never fully understanding what their national animal is.”
Tacugama communications officer Sidikie Bayoh
The closure also means there will be no revenue from visitors at a time when USAID funding has been halted.
“In the absence of funding from – at the moment – the US government, it is going to be difficult for us to turn around quickly,” says Mr Amarasekaran.
Listen to The World with Richard Engel and Yalda Hakim every Wednesday
He then shrugs and smiles knowingly, adding: “We are very resilient – we are like chimpanzees. So, we will manage somehow.”
World
Madeleine McCann: New search under way brings fresh hope – but there are big unanswered questions
Dense shrubs, empty barns, disused wells and dirt tracks – the police here have got their work cut out if they’re to find evidence relating to Madeleine McCann’s disappearance.
At 6am, before police cordons were put up, we spoke with an officer – a balaclava covering his face – manning one of the forensic tents.
“It’s a large area,” he told me. “A different place will be searched each day.”
Follow latest: New search for Maddie could be ‘last throw of dice’
A police officer in Praia da Luz where authorities are searching for Madeleine McCann
Gusty winds blow up dust on the dirt tracks. The land is used by dog walkers and hikers, and is sparsely populated.
But as the crow flies, it’s only a mile or so from where the three-year-old was last seen while on holiday with her family in Praia da Luz in 2007.
As we stood by the police van, out for his morning run was Tony Gallagher, a Brit who has lived within this new search area for 20 years.
He remembers when it all happened.
“I know for a fact that they searched up here 20 years ago,” he said.
“I’m not sure what they’re hoping to find, because even locals were searching.”
Tony Gallagher said police and locals had searched the same area 20 years ago
It’s one of the big unanswered questions: Just what intelligence is this latest search based on? Has someone come forward?
“It feels strange, you know,” Tony adds.
“I think it will be for the people in Praia da Luz… because it had a whole negative impact there 20 years ago in terms of business and tourists coming and everything.
“And I hope for the locals that doesn’t happen again.”
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Timeline of the McCann case
At 9am, two vans and three cars arrived – all with German number plates. Inside, police – some in camouflage uniforms – were ready to begin the search.
Police in Germany had asked officials in Portugal for access back in April, so this has been in the planning for weeks.
Madeleine’s disappearance is one of the most high-profile missing-person investigations in the world.
It’s why every new search brings the world’s media.
Members of the media report on the new search
At one point, more than 20 journalists were broadcasting live alongside us, lining the road opposite the police.
While this new search brings fresh hope, journalists and, more importantly, Kate and Gerry McCann have been here before, many times.
Around two years ago, a dam about 45 minutes from here was searched, but nothing was found.
Read more:
What we know about new Madeleine McCann searches
McCanns remember daughter on anniversary of disappearance
In May, on the anniversary of these tragic events, her parents said they will leave “no stone unturned” in the search for their daughter.
Eighteen years on, it is a poignant moment – Madeleine would have turned 22 last month.
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