How the labour movement reacted to the government’s autumn statement

Katie Neame
© Claudio Divizia/Shutterstock.com

Jeremy Hunt delivered his long-awaited autumn statement this morning. The Chancellor set out a large number of measures including reducing the 45% income tax threshold from £150,000 to £125,140 and announcing a cut to dividend allowance to £1,000 next year to be reduced further to £500 the following year.

Hunt unveiled threshold freezes, including for income tax and inheritance tax for a further two years, on top of an existing four-year freeze. He revealed that the government’s levy on the profits of oil and gas companies will be raised from 25% to 35% and confirmed a new temporary 45% levy on electricity producers.

The Chancellor announced new one-off payments of £900 to households on means-tested benefits, £300 to pensioner households and £150 for individuals on disability benefit and committed an additional £1bn of funding to enable a further extension of the household support fund.

He said social rents will be capped at 7% next year, announced a rise in the national living wage to £10.42 next year. He also confirmed that benefits will rise in line with inflation by 10.1%, the triple lock on pensions will remain in place and the benefit cap will be increased with inflation next year.

Responding to the statement, Rachel Reeves warned that the UK has “fantastic strengths” but is being “held back” by “mistakes” made by the Conservative government and argued that we need a “serious long-term plan to get our economy growing again”.

Here’s what the rest of the labour movement had to say…

Trade unions

TUC general secretary Frances O’Grady said: “Millions of key workers across the public sector – who got us through the pandemic – face years of pay misery as departmental budgets are brutally squeezed. The Chancellor talked about everyone making sacrifices, but the super-rich have once again been let off the hook – token tweaks to tax will do little to dent their bank balances.

“This is a government more interested in rewarding wealth than work. This is a government choosing to hold down the wages of nurses and teachers while it allows bankers unlimited bonuses. This winter, workers will be taking action to defend their jobs and pay. They need a government that is on their side – not one determined to hold down their pay at any cost.”

Unite general secretary Sharon Graham declared: “This autumn statement is not for working people. The Chancellor has taxed income over wealth, backed City bankers instead of nurses and chosen profiteers over public services. He has made political choices based on rules that he himself has the power to change.

“As for the Labour Party, they appear to have accepted the economic premise of the black hole rather than challenge it. That is a mistake. We are stuck in an economic straight-jacket. Our political class repackage the same failed approach crisis after crisis, choosing to put a sticking plaster on a wound that needs surgery.”

UNISON general secretary Christina McAnea said: “The government acts like there’s no public sector pay or workforce crisis. Nothing was said today to change the minds of NHS staff currently voting on strike action. Health worker wages must be boosted now to prevent a damaging dispute this winter. Otherwise, the NHS can’t hang on to experienced staff, halt the damaging exodus of key workers or improve wait times for patients.”

GMB general secretary Gary Smith commented: “The Chancellor has decided to double down on the Conservatives’ recipe for recession, ushering in a new era of austerity in public services. NHS workers from nurses and porters to paramedics, who put their lives on the line during the pandemic, are being thanked with yet another big real-terms pay cut.

“Meanwhile, he’s ducked the big decisions on defence and hydrogen spending and long-term investment is being slashed – stagnation is here to stay with this government. Even the minimum wage is being cut in real terms – it’s clear the government no longer believes in clapping key workers and prefers to stick two-fingers up instead.”

TSSA interim general secretary Frank Ward said: “Today’s budget is a squeeze on people who are already struggling. This Conservative government is clobbering working people with extra taxes while failing to address the cries of millions for a pay rise. The cost-of-living crisis was made by the Conservative Party, yet they take no responsibility nor offer any hope.”

Usdaw general secretary Paddy Lillis said: “Usdaw’s survey of over 7,500 members, mainly key workers, found that over three-quarters have struggled to pay an energy bill over the past 12 months, 45% no longer use the heating and over four in ten have cut down on other essentials such as food.

“They need help right now, not in April. Despite this evidence, the Chancellor has not listened and the Conservatives continue to punish the lowest paid workers for Conservative economic failures.”

Community head of research, policy and external relations Kate Dearden argued: “What working people needed today was for the government to step up and propose concrete solutions to the difficulties they face. But at this crucial time, they failed to deliver anything substantial to help people through the crisis.”

Commenting on the Chancellor’s announcement about Sizewell C nuclear power station, Prospect senior deputy general secretary Sue Ferns said: “The government’s reiteration of its commitment to Sizewell C is welcome, but merely restating previous announcements is not enough. When are we going to get confirmation of the government investment decision? This is not something that can wait.”

Labour Party

Deputy Labour leader Angela Rayner said: “A lost decade. That’s the price of years of Tory failure. But instead of learning from their mistakes, they’re repeating them. It’s time to break free from their vicious cycle – with Labour’s plan for growth.”

Scottish Labour leader Anas Sarwar tweeted: “Jeremy Hunt’s cuts budget will leave us lurching from crisis to crisis with falling living standards and low growth. They are making you – the working people of this country – pay for the chaos made in Downing [Street]. The country needs change – the country needs Labour.”

Shadow Foreign Secretary David Lammy said in a tweet: “The [Conservatives] blaming global issues for the economic crisis they have unleashed in Britain will fool no one. We are the only G7 country that is still poorer than before the pandemic.

Shadow Business Secretary Jonathan Reynolds said: “Every promise today I first heard 12 years ago when they came to power. ‘Growth, high wages, stability’ – they’ve delivered none of it. 12 years of failure and wasted opportunities.”

Shadow Transport Secretary Louise Haigh tweeted: “Rishi Sunak told voters he would deliver Northern Powerhouse Rail IN FULL – now he’s abandoned it. A lost decade of broken promises has left us with second-rate infrastructure and held our economy back. They crashed the economy and want Northern communities to pay the price.”

Shadow Welsh Secretary Jo Stevens said: “The Welsh government’s budget next year is worth £1.5bn less than it was when the Tories set it in November last year, so the Barnett consequential of £1.2bn promised today still leaves Wales much worse off.”

Kate Osborne said in a tweet: “This Budget for the richest is a political choice… Poverty is a political choice – one the Tories make over and over again. People in our communities need investment not more cuts and we need a [General Election now] so we can start to fix this mess.

John McDonnell tweeted: “Classic Chancellor’s statement – announce big numbers, smoke-screening reality of ongoing austerity. Cash allocations to departments are real-term cuts. No allowance for inflation proofing wages in NHS [and] schools wipes out any increases. Pressure on NHS, schools [and] councils unrelenting.”

Fellow backbencher Ian Byrne said: “A disaster for my constituents and indeed the nation. A disaster created by a toxic Tory Party. The failed neoliberal experiment we have lived through is utterly broken. We need systemic change and a Labour government that leads for the many and not the few.”

Nadia Whittome tweeted: “There’s no cost-of-living crisis for Britain’s billionaires who increased their fortunes by £55bn in one year. And that’s before we even get to the multimillionaires. The government should tax their incomes and wealth – not punish the working class.”

Apsana Begum said: “Slashing funds for vital public services to protect the wealth of the super-rich is an act of national vandalism. If there are large-scale public sector strikes in the months ahead, the Government will have only themselves to blame.”

Mick Whitley tweeted: “The Chancellor looked remarkably pleased with himself as he sat down after the [Autumn Statement]. It’s not applause he should be looking for. It’s forgiveness. Recession, collapsing standards of living, cuts to public services – all the legacy of twelve years of Tory government.”

Charities, think tanks, campaign groups

Founder of The Big Issue and crossbench peer Lord Bird said he was “deeply concerned” by the Chancellor’s statement, arguing that the policies announced “will only serve to push even more people into poverty and worse, onto the streets”.

“Austerity is too expensive for this country, not just in terms of the human cost, but financially. The last austerity destroyed generational opportunity. Balancing the books in the short-term means passing the debt on to future generations and destroying the hope of current generations,” he added.

Fabian Society general secretary Andrew Harrop said: “2023 and 2024 will be truly grim years for Britain. Today, we learnt that real family incomes are set to plummet, so hundreds of thousands more will turn to food banks. Public services did not get the money they needed for decent pay rises that track the private sector.

“As the next election nears, the public sector staffing crisis will only grow, backlogs will continue and local councils will face bankruptcy. Then worse still is supposed to follow. The Chancellor announced even more austerity from 2025 if the Conservatives are re-elected.”

Joseph Rowntree Foundation chief economist Rebecca McDonald declared that families are facing the “worst winter many will remember”, noting that, despite the uprating to benefits announced, “rates are at historic lows and households facing difficult times are increasingly not able to cover the essentials”.

Institute for Fiscal Studies director Paul Johnson said: “The next two years look grim in terms of living standards. The biggest reduction in household incomes possibly on record, certainly within recent generations, a 7% cut over two years, according to the Office of Budget Responsibility.”

New Economics Foundation director of research and chief economist Alfie Stirling commented: “The Chancellor is talking down the public finances to distract from the actual crisis: the longest recession on modern records coinciding with skyrocketing costs of living.”

End Fuel Poverty Coalition co-ordinator Simon Francis said: “The Chancellor has now condemned 7 million households to suffer in fuel poverty this winter. The rise in the energy price cap from April next year could see this figure increase to 8.6 million households.

“We are already seeing the horrific impact of living in cold damp homes on children, the elderly, disabled and those with illnesses ranging from cancer to asthma. Even with the additional funding pledged to the NHS and social care system today, we are deeply concerned that it will be overwhelmed by the energy bills crisis and millions will suffer.”

Institute for Public Policy Research North director Zoë Billingham declared: “Despite the government now going into hard reverse on most of its plans, they’re still not clear on whether they can stick to the basics. Promises like the delivery of Northern Powerhouse Rail in full and investment in our vital public services must not be rolled back. This would be devastating to communities across the North and totally undermine the UK economy.”

Common Wealth senior analyst Chris Hayes argued “these choices are not necessary – they are political” and warned that “despite the Chancellor’s rhetoric about letting the broadest shoulders carry the greatest weight, the policies on offer are weak”.

Local Government Information Unit chief executive Jonathan Carr-West commented: “Today’s budget offered limited respite for hard-pressed councils. In a week when two of England’s largest local authorities have said they are facing a financial cliff edge – the message from the sector is clear. Well run councils will fail unless something changes.”

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