Through Halting a Harsh Tory Welfare Policy, This Financial Plan Clearly Outlines How the Labour Party Will Fight the Struggle to Revitalize Britain

Just recently, the finance minister, Rachel Reeves, presented a Labour Party budget. The public have been asking for Labour’s purpose and values to be more clearly expressed. By way of the decisions made – a transition to a fairer tax system, targeting wealth to fund tackling child poverty, quality public services and the living expenses – we have clearly demonstrated what we stand for.

This is why Labour MPs cheered in the Commons, and it’s why we are ready for the battles to come. And it’s why the cries from the conservative side began right away.

The Main Dividing Line in UK Politics

The central dividing line in British politics is once again on the economy. On the one hand Labour, who aim to change it so it benefits ordinary working people, and on the other, our opponents, who favor the status quo and the unsuccessful ideology of the past. We must now take on, and prevail in, the argument.

The Tories were given 14 years to resolve things and instead, by any measure, they got far more dire. Their doctrinaire austerity and trickle-down economics – tax cuts for the wealthy, cutting off investment (leaving us with low productivity and wages), and failing to support young people after the pandemic – proved ineffective.

Record of Failure Under the Former Government

Quality of life dropped by the biggest amount since records began, child poverty reached record levels, NHS waiting lists in England were the highest on record, wages were stagnant, a housing crisis became entrenched, young people scarred by Covid were left on the scrapheap. The record of failure goes on.

A single budget alone can’t put all this right, so Labour has a comprehensive plan for rebuilding and for restructuring the country. And we have to go out and continue making the case for why our approach will yield benefits.

Social Security and Child Poverty

During the Tories, welfare spending significantly increased. As did child poverty, because they didn’t address the root causes: low pay, high housing costs, deep inequalities in education, health and regions. The state ends up paying more to manage the symptoms instead of the solution.

It’s why we are building more social housing than for a generation, raising wages and enhanced protections for workers, greatly increasing investment in infrastructure and new industries, reducing waiting lists down and bringing down the costs of childcare and energy as we pursue clean power.

Removing the Two-Child Limit

It’s also why we are absolutely right to use this budget to lift the two-child benefit cap.

For eight long years, since it was enacted, low-income families with children have endured from a cruel social experiment that was marketed as fair for working people when it was the opposite. Most of the families impacted by it have a parent in work.

It has only served to push 300,000 more children into poverty – which, ultimately, costs us more, as well as being heartless and unethical.

Real Impact in Local Areas

From experience from my own constituency – where over 5,000 children will be raised out of poverty as a result of ending the cap – the real impact it’s had. Children wearing £1 wellies as school shoes, children going to bed without food and cold, living in cramped, mouldy homes, parents this Christmas depending on food banks for a simple meal or small gift for their kids.

I also see the impact on schools, teachers, social workers, doctors and charities who are already stretched but have to redirect time and resources to supporting children who are living with the results of deep poverty.

Lasting Consequences of Child Poverty

Just a quarter of pupils from the poorest families achieve five good GCSEs, compared with almost 75% among wealthier families. This predisposes them for the disadvantages they face throughout their lives: missed potential, financial struggles and ill health. Children who were raised in poverty are more likely to be unemployed or poor as adults.

Confronting child poverty isn’t just a moral imperative, it is a long-term investment. Poverty costs the economy far, far more than the £3bn cost of lifting the two-child cap, or expanding free school meals.

That’s why we acted promptly in the budget, despite the very difficult economic context. Every day with this cap in place sees over a hundred additional children pushed into poverty. The benefits of lifting it will not occur overnight either, so taking early action in the parliament was vital.

The cap was a totem to 14 years of unsuccessful conservative ideology. Now it is gone.

Fair Financing for Policies

We, as Labour, can also be explicit that these measures are being funded in a just way – from a new gaming tax, eliminating tax loopholes and a new “mansion tax”.

Conclusion

Fairness and purpose – that’s how we will succeed in the contest of ideas. This budget is a clear statement that we won the election as Labour, and will lead as Labour. As I repeatedly said during my campaign to become deputy leader, we must reclaim the political megaphone and define the narrative more strongly about what’s truly flawed with the country and how we are repairing it. We’ve certainly done that this week.

So let’s keep hold of it and prevail in this struggle about how we will rebuild Britain and address the deep inequalities impeding progress.