UK warned tax won’t return to pre-Covid levels for decades after ‘series of economic own goals’ – UK politics live

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Jeremy Hunt has said it was not “easy” for him to delay the social care cap, which he insisted he “passionately did not want to do”.

The decision to delay the cap until October 2025 has been criticised by the economist behind the plan. Sir Andrew Dilnot, who advised several conservative governments on fixing the care sector, said he was “astonished, puzzled and deeply disappointed”.

He added that the government had now broken a 2019 manifesto promise to “fix social care” and implement changes that were finalised a year ago. They included raising the amount of assets a person can have before getting state funding for social care from ?23,250 to ?100,000 as well as capping lifetime care costs at ?86,000.

This morning Hunt told BBC Breakfast: “I don’t pretend this was an easy thing for me to do given what I said in 2013 but it does mean we can give overall a bigger increase to social care than it’s ever had in its history.

“Some of those decisions are very hard for me as chancellor. I’m a Conservative chancellor that has put up taxes, I’ve had to delay those Dilnot reforms to social care which is something I passionately did not want to do.

“But I’m doing it because we face an international economic crisis and I recognise that people are worried about the future and I’m prepared to do difficult things even if they’re things I wouldn’t personally choose to do, because they’re the right thing for the country.”

The shadow chancellor was also out and about this morning to lay out Labour’s alternative to Tory budget plans.

Rachel Reeves told BBC Breakfast Labour would tax “the better off to pay more to ease that pressure on ordinary people”.

PA Media carries her quotes:

The most important thing is to grow the economy because that is the way to lift living standards for everybody.

“And what we saw in the numbers yesterday was that living standards are going to fall by the biggest amount for more than 70 years.

“The International Monetary Fund is predicting that the UK will have the slowest growth in the next few years of all of the big industrialised economy because there is no serious plan from this government for growth and that I think is the big difference between Labour and the Conservatives.”

Jeremy Hunt’s autumn statement will mean Britain’s workers will miss out on pay rises worth ?15,000 over the next five years as the chancellor’s tax-heavy budget pressures the nation’s “squeezed middle”.

Figures published alongside the Jeremy Hunt’s autumn statement on Thursday by the Office for Budget Responsibility said the UK was in a recession that would wipe out eight years of growth, with British households set to face the biggest fall in living standards since records began.

The Resolution Foundation thinktank said on Friday that the dire economic outlook means that real wages are now not expected to return to 2008 levels until 2027.

If pay had continued to grow at the pre-crisis peak, workers would be ?292 a week, or ?15,000 annually, better off over the next five years.

You can read the full story here:

Reactions to Jeremy Hunt’s autumn statement dominate the UK’s front pages on Friday – and my colleague Jonathan Yerushalmy has done a round-up.

The Guardian’s goes with “From bad to worse” and reports that the chancellor’s ?30bn of delayed spending cuts and ?25bn of backdated tax increases “laid bare the country’s dire economic predicament”.

The i splashes with “UK’s lost decade”, and what the paper calls the “biggest drop in living standards on record … sending British earnings back to 2013”.

Its report says the country is paying the price for “Putin’s war in Ukraine, the pandemic, Brexit policies and Liz Truss’s damage to market confidence”.

Usually reliably sympathetic to the Tory party, the Daily Mail turns its ire on Hunt’s budget with the headline “Tories soak the strivers”.

The paper’s political editor reports that the overall tax burden will be pushed to its “highest level since the second world war”, “with highest earners hardest hit”.

The verdict of the paper’s star columnist, Sarah Vine, is carried on the front page: “And there was me thinking we’d voted in the Conservatives!”

The Telegraph, too, is blunt in its assessment, quoting an economist in its headline: “‘The rhetoric of Osborne … with the policies of Brown'”.

The paper’s main story says that Britain’s welfare bill is to rise by almost “?90bn after Jeremy Hunt shielded benefit claimants and pensioners from soaring inflation with a raid on workers”.

The Tory peer and former Brexit negotiator David Frost writes in a front-page opinion piece that the “ship has been steadied – but we’re all left with less money of our own.”

The Mirror’s headline simply reads “Carnage”. The paper quotes shadow chancellor Rachel Reeves as saying that “all the country got today was an invoice for the economic carnage that the government has created”.

The Times writes that as the chancellor seeks to balance the books, there will be “years of tax pain ahead”.

The Financial Times carries a similar headline with “Hunt paves way for years of pain,” quoting the chancellor as saying: “We need to give the world confidence in our ability to pay our debts.”

Scotland’s Daily Record harks back to another era of Tory rule with the headline “You’ve never had it so bad”, as does Metro.

The Record says that after 12 years of Conservative rule the UK faces its “biggest-ever clump in living standards” as well as a “surge in unemployment and a year-long recession”.

The Express is able to find some good new in it all, however. Splashed on to a full-page image of Hunt, the paper claims “Victory” in its campaign to secure a 10.1% increase in the state pension, saying it will “help millions cope with the cost-of-living crisis”.

Welcome to the politics blog. Jeremy Hunt has been doing the morning media round to defend his autumn statement and has warned that the next two years will be challenging.

The UK chancellor appeared on Sky News the day after announcing that millions more people will pay more in tax and spending cuts of ?30bn.

The chancellor said his plans would help get the economy “on an even keel”, but added: “Over the next two years it is going to be challenging. But I think people want a government that is taking difficult decisions, has a plan that will bring down inflation, stop those big rises in the cost of energy bills and the weekly shop, and at the same time is taking measures to get through this difficult period.”

We’ll bring you the latest news and reactions on the autumn statement. Here’s what’s coming up today:

9am: The Resolution Foundation will publish its take on Hunt’s measures.

10.30am: The Institute for Fiscal Studies will present its findings.

1pm: The Institute for Government has an autumn statement event, which will be attended by the OBR’s Richard Hughes.