Labour’s first budget punishes the “working people” they claim to support.

Keir Starmer and Rachel Reeves promised to deliver real change to the electorate, after 14 years of Tory rule. Today, they have broken that promise. This budget is austerity by another name. While we welcome the government’s decision to invest in school and hospital buildings, it is extremely disappointing that these investments have been undermined by a swathe of public sector cuts, cruel attacks on the worst-off, and a dogmatic refusal to redistribute wealth and power. These are not “tough choices” for Government Ministers, but for ordinary people who are forced to choose between heating their home and putting food on the table.

Years of austerity and privatisation have decimated our public services and pushed millions into poverty, disproportionately impacting women, people of colour and disabled people. The collapse of the Tory government was an opportunity for Labour to end the grotesque levels of inequality reached under the Tories. Instead, they have chosen to inflict more hardship on the British public who expected - and deserved - something better.

Labour is raising defence expenditure to 2.5% of GDP while telling us there is no money to lift 250,000 children out of poverty; no money to help pensioners living in poverty stay warm this winter; and no money to maintain the £2 bus cap which punishes the poorest for trying to get to work and go about their lives.

Put simply, this is a lie. There is plenty of money. It’s just in the wrong hands. The richest 1% in the UK hold more wealth than 70 per cent of Britons. By refusing to impose a wealth tax, this Government has chosen to force vulnerable communities to pay the price for years of economic failure, instead of making the richest pay their fair share. Labour’s first budget shows us whose side they’re on.

Making millions of children, working, retired and disabled people poorer damages our entire economy and stretches our public services. An austerity economy is a false economy.

Shifting the fiscal rules to increase investment is welcome but this should have been used to tackle inequality and maximise the creation of good jobs. As we saw in the New Labour years, growth does not necessarily deliver for the majority - reducing poverty and inequality while tackling the climate emergency should have dictated Labour’s policy choices. Instead the Chancellor has wedded us to a failed economic ideology and undermined our ability to fix this country.

We call on the Labour Government to:

1. Abolish the 2-child benefits cap and stop attacking welfare recipients;
   More than two thirds of children in poverty live with a parent in work. We must support, not stigmatise, welfare recipients. Since the election, more than 10,000 children have been pushed into poverty by the two-child limit. Abolishing the cap would cost £1.4bn and lift 250,000 children out of poverty overnight. If this isn’t a priority, what is?
2. Reverse cuts to winter fuel;
   Four in every five pensioners living below or just above the poverty line are set to lose the winter fuel payment. We will always defend the principle of universalism to ensure everyone has the support they need.
3. Restore the £2 bus cap;
   Scrapping the £2 bus fare cap outside of London harms the poorest in communities across England and discourages the use of public transport when it is needed more than ever to tackle the climate crisis.
4. Invest in a Green New Deal;
   The climate emergency is the single greatest crisis of our time. Why, then, has the government reneged on its £28bn climate pledge, while continuing a Tory scheme to give £21.7 billion in public funds to subsidise the world’s largest fossil fuel companies for carbon capture and storage when we know this doesn’t work. We will continue to demand urgent investment in renewable energy and green jobs to safeguard our children’s future.
5. Introduce wealth taxes;
   A 2% tax on wealth above £10 million would raise £24bn every year. With that, you could abolish the 2-child benefits cap 17 times over. There is plenty of money. It’s just in the wrong hands.

We refuse to believe that child poverty, mass hunger and homelessness are inevitable in the sixth largest economy in the world. A progressive movement is growing up and down the country, demanding a real alternative to this race to the bottom between Labour and the Tories which has seen the new government perpetuate decades of austerity and rampant corporate greed.

The Tories’ collapse allowed Labour to come to power with the lowest vote share ever won by any single party majority government. Labour hemorrhaging votes to progressive independents and Greens in their heartlands should be a lesson to this Government: you are wrong to believe that progressive voters have nowhere else to go. Our movement is growing every day - and you ignore the demand for a real alternative at your peril.