Suella Braverman has challenged Labour’s claims of a £22 billion fiscal crisis and warns of looming tax hikes under the new government. Here’s the full story.
Challenging Claims
Disgraced former Home Secretary Suella Braverman has attacked the government’s claims about the dire state of their economic inheritance, warning that they may be nothing more than a political manoeuvre to cover a series of incoming tax rises.
“One of the Biggest Lies”
Speaking on LBC radio ahead of Keir Starmer’s set piece speech, his first since taking office following the Labour landslide at the recent general election, Braverman called Chancellor Rachel Reeves’ summary of their dire economic inheritance “one of the biggest lies in British politics right now.”
£22 Billion “Black Hole”
Reeves has asserted that the newly elected Labour government has inherited a significant fiscal deficit from the previous Conservative government, termed the “£22 billion black hole.”
Things Will Get Worse
Starmer addressed these claims in his speech: “Things are worse than we ever imagined, and that is why we have to take action and do things differently. Part of that is being honest with people – about the choices we face. And how tough this will be. Frankly – things will get worse before we get better.”
Misrepresentation of the Economy
Braverman took issue with Reeves and Starmer’s claims, vehemently dismissing Labour’s assertion that the public finances are dire, arguing that it seriously misrepresents the economic situation left by the Conservatives.
“Fastest Growing Economy”
Speaking on LBC, Braverman stated, “We heard Rachel Reeves talk about a £22 billion black hole in the public finances a few weeks ago. I think that’s one of the biggest lies in British politics right now.”
Good Governance, Prudent Management
She added, “The Conservative government left this country with the fastest growing economy in the G7. We slashed the deficit from 2010 from 10 percent down to just over one per cent, public sector net borrowing has fallen, unemployment has fallen, the deficit and the debt have all fallen, inflation slashed, thanks to good governance and prudent financial management by the Conservative government.”
Preparing for “Draconian” Tax Rises
Braverman also claimed that the government was only predicting the worst to prepare for what she described as “draconian” tax rises in the October Budget.
Gloomy Picture
Braverman claimed, “It’s very clear in terms of what the government is seeking to do which is to set out pretty gloomy pictures about the state of the country. I think, personally, they’re paving the way for draconian action on tax rises and that we’re going to be seeing a real increase in the tax burden when it comes to the reality of this Labour government.”
Tax Hikes Anticipated
Braverman’s concerns about potential tax hikes have been fuelled by the fact that while the Labour government has ruled out increases to income tax, national insurance, or VAT, there are indications that other forms of taxation might be considered.
Possible Taxation Measures
Possible measures include increasing capital gains tax, closing inheritance tax loopholes, or reforming pension taxation.
Public Sector Wage Increases
Another significant point of contention raised by Braverman was the Labour government’s handling of public sector wage increases.
“Disproportionately Large Payouts”
Braverman stated, “So I don’t believe that lie peddled by Rachel Reeves that we’re facing this fiscal crisis. I do believe, however, what we’ve seen is huge, and I would say disproportionately large, payouts to the unions in terms of public sector wage increases. To junior doctors, for example, 23 percent wage increase given to the junior doctors costing billions of pounds.”
Criticism of Labour Initiatives
In addition to her concerns about potential tax increases and public sector wage increases, Braverman also criticised several of Labour’s flagship economic initiatives.
“Gimmicks and Vanity Projects”
She specifically targeted the £7 billion allocated to a national wealth fund and the £8 billion designated for Great British Energy, describing both these projects as “gimmicks and vanity projects.”
Braverman’s Slip-Up
However, Braverman did not escape her stint on LBC unscathed. Several callers questioned her diagnosis of the country’s dire economic outlook, with one caller in particular challenging her assertion that the Conservative government had reduced the national debt.
Misspeaking on Debt
Braverman claimed she misspoke when challenged, stating, “I was talking about the deficit. I’m very proud of our record on the deficit.”
Questioning Financial Understanding
The caller responded quickly, “I’m not blaming you personally but I think it does say something about the financial understanding of many of our Tory representatives. The debt has been going up consistently and the debt won’t fall until the deficit is negative.”
Budget Anticipation
As the Labour government prepares to outline its economic strategy in the upcoming Budget, the debate over public finances and potential tax increases will likely intensify.
Conservatives’ Persistent Attack Line
Though much reduced in Parliament, Conservatives have been constantly arguing since before the general election that a Labour government will mean tax rises and are keeping up the attack line to push back against the government’s claims of their dire economic inheritance.
Awaiting Public Response
Despite the uproar from Conservatives, it remains to be seen what taxes the Labour government will increase and what effect that will have on the public’s opinion on the newly elected government.
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Featured Image Credit: Shutterstock / I T S.
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