Rachel Reeves has declared that there is “no doubt” the Labour Party is “winning the battle of ideas” after Rishi Sunak announced a U-turn and committed the government to introducing a windfall tax on the profits of oil and gas companies.
Addressing the Commons this afternoon, the Shadow Chancellor welcomed the fact that the government was “finally acting on our call to introduce a windfall tax“, adding that it was a “painful journey to get the government to this point”.
Reeves noted that Labour had also highlighted the “unfairness” of the government’s ‘buy-now-pay-later’ compulsory loan scheme. Sunak announced today that repayment of the loan would be scrapped.
The Shadow Chancellor said it had been clear “for months” that “more was necessary to help people bring their bills down”, highlighting: “Every day for five months, the Prime Minister sent Conservative MPs out to attack the windfall tax and yet defend an increase in taxes on working people.”
She pointed out that the Prime Minister had ordered Tory MPs to vote against a windfall tax on three occasions, and “sent his MPs to defend the litany of rule breaking in No 10” revealed in the publication of the Sue Gray report into ‘partygate’.
“There is a lesson here for Conservative MPs, you can’t believe a word that this Prime Minister says. And as long as he is in office, he’s going to continue making fools out of each and every one of you,” Reeves said.
“You can’t fake fairness. You either believe in it or you don’t. Labour called for a windfall tax because it is the right thing to do. The Conservatives are doing it because they needed a new headline.”
She called for an emergency Budget to “spike the hike in national insurance, to cut business rates for high street and small businesses, to provide help for energy-intensive firms and ensure that every pound of taxpayer money is spent wisely”.
Reeves added: “We will look closely at the detail of today’s announcements. Of course, most of them seem to have been written by us. But so far, we have seen nothing to suggest that this Conservative government has the ideas or the energy to tackle the challenges that we face as a country.”
In his statement, Sunak announced a “temporary, targeted energy profits levy”, which he said would raise £5bn. He claimed that the government have built into the levy a “new investment allowance”, similar to the super deduction, to incentivise energy companies to reinvest their profits in the UK.
He said the £200 loan households announced in February intended to help with energy bills would no longer need to be repaid and said that the grant would be doubled to £400 per household.
The Chancellor also announced that more than eight million of the lowest income households would receive a one-off payment of £650, while eight million pensioners will be sent £300 and six million disabled people will receive £150.
Sunak said the measures were worth a total of £15bn and represented a “significant set of interventions to support the most vulnerable in our country”. He told MPs: “This government will never stop trying to help people to fix problems where we can, to do what is right as we did throughout the pandemic.”