Britain’s new left-wing Labour government has announced plans to cut winter energy benefits for around 10 million pensioners while preparing huge tax increases to pay for a spending surge caused by mass immigration.
The head of the Treasury, Chancellor of the Exchequer Rachel Reeves, confirmed the new Labour government’s high tax, high spending policies in her first major speech to Parliament on Monday.
Mr Reeves insisted he “never wanted to do this” but claimed the previous Conservative government of Rishi Sunak had left a £22bn “black hole” in the UK finances. Daily Mail Reports.
The deficit is made worse by illegal immigration and asylum schemes, which have been overspended by £6.4 billion this year alone. The chancellor also pointed to increased spending on the National Health Service, funding the war in Ukraine and maintaining highways and roads.
To help cover the costs, Reeves said the government would remove energy bill support for up to 10 million pensioners this winter.
Mr Reeves said support would be cut for everyone not on pension credit despite the country’s ongoing energy crisis, which he claimed would save the government around £1.4bn this year and a further £1.5bn next year.
“This is not a decision I wanted to make, nor is it a decision I expected to make, but it is a necessary and urgent decision I must make,” Reeves told the House of Representatives.
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Despite the Government’s decision to cut home heating costs for the elderly and fears of accelerating inflation, Mr Reeves has promised a 22% pay rise for junior doctors in an attempt to end a long-running labour dispute.
Despite the country struggling with its highest tax burden since the second world war, Mr Reeves has hinted billions more in tax increases will be needed when he presents his budget at the end of October, saying inheritance tax and capital gains tax are likely to be targeted to plug a £16.4 billion hole after budget cuts announced on Monday.
Value added tax (VAT) will also be levied on private school tuition fees from the start of next year, with everyone who pays tuition fees in advance being included in the scheme from this week.
Mr Reeves said: “On my first day at the Treasury I was warned by staff that this was not what the previous administration had expected to spend this year, not even close.”
“This level of overspending is not sustainable and, if left unchecked, it risks jeopardizing our economic stability. Unlike the opposition, I would never do anything to threaten the economic stability of our country.”
“So it’s on us to make the hard decisions now to realise further savings over the year. Given the scale of the situation we face, we have to make very tough choices.”
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