Following her criticism of chancellor Kwasi Kwarteng in the House of Commons on Friday, Labour shadow chancellor Rachel Reeves has once again hit out at his policies set out in the mini-Budget.
Speaking at the party’s autumn conference, Reeves (pictured) accused Kwarteng of “gambling all our money”.
She also said the chancellor was “fanning the flames” of a pound sterling that was cascading in value, after it hit a record low against the US dollar in early morning trading.
The pound fell four per cent in value to $1.03 against the dollar from Sunday to the early hours of Monday, before standing at around $1.06 on Monday morning.
Reeves said: “It is incredibly concerning. I think many people had hoped over the weekend things would calm down, but I do think the chancellor fanned the flames on Sunday in suggesting there may be more stimulus, more unfunded tax cuts, which has resulted overnight in the pound falling to an all-time low against the dollar.”
Reeves had already been scathing in her criticism of the mini-Budget after it had been announced in Parliament on Friday, saying that it was a move to increase borrowing mainly to help the wealthy.
However, Kwarteng defended his policies over the weekend, saying that they favour individuals “right across the income scale”, pointing out the one per cent cut to the standard rate of income tax set to come in from April 2023.
The chancellor also hinted that further tax cuts could be forthcoming, an idea which concerned Labour politicians.
Speaking also during the party conference, Labour leader Sir Keir Starmer chose to attack Kwarteng’s decision to abolish the top 45 per cent tax bracket for incomes over £150,000, vowing to reverse that decision if Labour were to be elected to power.
Sir Keir did, however, say that he would choose to keep the new 19 per cent rate of basic income tax that will be introduced from April.
The Labour chief said that he would “reduce the tax burden on working people” and criticised Kwarteng for making “the wrong choice” in his tax cutting policies by easing the burden on higher earners.
In her keynote speech at the party conference, Reeves is expected to outline Labour’s plans for a National Wealth Fund, that will be used to channel an initial £8.3 billion into green and sustainable initiatives and channel wealth into local communities.
This would form part of Labour’s wider plans to make the UK the first of the world’s major economies to produce all its electricity fossil fuel free. It hopes that the UK can achieve this by 2030, five years ahead of the government’s current target.
The shadow chancellor further suggested that the taxpayer would “own a share” of any project that benefited from public investment.
Elsewhere at the conference, shadow rail minister Tanmanjeet Dhesi has confirmed that Labour’s policy around the rail industry would be to bring the railways back into public ownership.
