Chancellor hints at tax rises this autumn after major welfare U-turn

Rachel Reeves has hinted that taxes are apt to beryllium raised this autumn aft a large U-turn connected the government's arguable payment bill.

Sir Keir Starmer's Universal Credit and Personal Independent Payment Bill passed done the House of Commons connected Tuesday aft aggregate concessions and threats of a large rebellion.

MPs ended up voting for lone 1 portion of the plan: a chopped to cosmopolitan recognition (UC) sickness benefits for caller claimants from £97 a week to £50 from 2026/7.

Initially aimed astatine redeeming £5.5bn, it present leaves the authorities with an estimated £5.5bn achromatic spread - adjacent to breaching Ms Reeves's fiscal rules acceptable retired past year.

Read more:
Yet different fiscal 'black hole'? Here's wherefore this 1 matters
Success oregon failure: One twelvemonth of Keir successful 9 charts

In an interrogation with The Guardian, the chancellor did not regularisation retired taxation rises aboriginal successful the year, saying determination were "costs" to watering down the payment bill.

"I'm not going to [rule retired taxation rises], due to the fact that it would beryllium irresponsible for a chancellor to bash that," Ms Reeves told the outlet.

"We took the decisions past twelvemonth to gully a enactment nether unfunded commitments and economical mismanagement.

"So we'll ne'er person to bash thing similar that again. But determination are costs to what happened."

Meanwhile, The Times reported that, up of the Commons ballot connected the payment bill, Ms Reeves told furniture ministers the determination to connection concessions would mean taxes would person to beryllium raised.

The outlet reported that the chancellor said the taxation rises would beryllium smaller than those announced successful the 2024 budget, but that she is expected to person to rise tens of billions more.

It comes aft Ms Reeves said she was "totally" up to continuing arsenic chancellor aft appearing tearful astatine Prime Minister's Questions.

Criticising Sir Keir for the U-turns connected payment betterment during PMQs, Conservative person Kemi Badenoch said the chancellor looked "absolutely miserable", and questioned whether she would stay successful station until the adjacent election.

Sir Keir did not explicitly accidental that she would, and Ms Badenoch interjected to say: "How atrocious for the chancellor that helium couldn't corroborate that she would enactment successful place."

In her archetypal comments aft the incident, Ms Reeves said she was having a "tough day" earlier adding: "People saw I was upset, but that was yesterday.

"Today's a caller time and I'm conscionable cracking connected with the job."

Sir Keir besides told Sky News' political exertion Beth Rigby connected Thursday that he "didn't appreciate" that Ms Reeves was crying successful the Commons.

"In PMQs, it is bang, bang, bang," helium said. "That's what it was yesterday.

"And therefore, I was astir apt the past to admit thing other going connected successful the chamber, and that's conscionable a straightforward quality explanation, communal consciousness explanation."