Budget dresses up stagnation as stability

Sir Keir Starmer has accused the chancellor of “dressing up stagnation as stability” in his Budget.

The Labour leader also criticised plans to abolish the pensions allowance limit as “a huge giveaway” for the wealthy.

But Jeremy Hunt said the UK would avoid entering a recession and the economy was “proving the doubters wrong”.

The government’s independent forecaster said the economy was still likely to shrink this year, but by less than it previously thought.

The Office for Budget Responsibility (OBR) is also warning of a big drop in living standards, which it says will not recover to pre-pandemic levels until at least 2027.

Sir Keir told the Commons that after 13 years of the Conservatives “our economy needed major surgery” but the government was providing “only a sticking plaster”.

“A country set on a path of managed decline, falling behind our competitors, the sick man of Europe once again,” he said.

He added that the country was “stuck in a doom loop of lower growth, higher taxes and broken public services”.

The Labour leader also attacked the decision to abolish the cap on how much workers can accumulate in their pensions savings over their lifetime before having to pay extra tax.

Mr Hunt said the move would incentivise doctors and other experienced professionals to stay in work for longer.

But Sir Keir said it would “benefit those with the broadest shoulders when many people are struggling to save into their pension”.

“We needed a fix for doctors, but the announcement today is a huge giveaway to some of the very wealthiest,” he said.

“The only permanent tax cut in the budget is for the richest 1%. How can that possibly be a priority for this government?”

On the government’s plans to expand free childcare for working parents in England, Sir Keir said “more money in the system is obviously a good thing”.

“But we have seen the Tories expand so-called free hours before and as parents up and down the country know, it’s no use having more free hours if you can’t access them,” he said. “And it pushes up the costs for parents outside the offer.”

Reports /TrainViral/