During Reeves’ Treasury Committee appearance this morning in which the Chancellor said she supports releasing strategic oil reserves, she also said there is a ‘valid’ argument to be made that she shouldn’t have raised National Insurance:
“Yeah, we did make the decision to increase national insurance in my first Budget and that’s because we needed to properly fund public services including the NHS which got a £29 billion a year uplift and so I do recognise and it’s a valid argument to say that should not have happened but if that didn’t happen we wouldn’t have been able to put the money into the NHS and reduce waiting list and reducing waiting list in the NHS is also good for business because it means that more people are available for work and the workforce is is is healthier. Um, but I do recognize there are particular issues around youth unemployment.”
UK unemployment is now higher than Italy’s…
Reeves has insisted just now in the House of Commons that the 5p fuel duty rise remains “under review” but poured cold water on calls to scrap the tax hike. She blamed the Tories and said oil prices are falling:
“Well, the price today of of petrol is 8p per litre lower than if I had have followed the plans that were left to me by the previous Conservative government. And from April, they’ll be 11p per liter lower. Of course, we keep these things under review. But if you look at petrol prices oil prices today, they’re 24% lower than they were yesterday. So things are very volatile at the moment which is why as I said yesterday the most important thing we can do to address the cost of living challenges people face is to de-escalate the conflict in the Middle East which is exactly what this government are attempting to do.”
Seeing as Starmer has made U-turning the official policy of his government, opposition campaigning against the hike could yet succeed…
UPDATE: Reeves says she is prepared to back the release of International Energy Agency oil reserves following a meeting with her G7 finance minister counterparts earlier today. She adds that the price cap for domestic bills will not change next month. But warns that the Iran conflict will have “upward pressure on inflation”, so buckle up…
Oil prices rose to $119 a barrel last night – the highest since 2022 and up from $54 this time last month. Brent crude currently hovering between $100 and $110…
Yield on 10-year UK government bonds has jumped to 4.7% from a low of 4.23% on the 27th February. 25-year bond yields are at their highest since November…
Traders are now betting on an interest rate rise. Starmer released a statement overnight: “I will always be guided by what is best for the British public. And no matter the headwinds, supporting working people and their families with the cost of living is always top of my mind.” Reeves is taking part in an emergency conference call of European finance ministers later today. The government faces a Truss-level crisis down the track…
No need to correct the record. Right the first time…
The day before the Spring Statement – for which the Treasury has undergone extreme efforts to keep as quiet as possible so far – the readout from business leaders has turned sour. Who could have predicted that…
The Institute of Directors measures business leader optimism every month. Its rating decreased to -63 in February compared to -48 in January. Confirming the death of a brief uptick in confidence over Christmas…
Predictions for increased costs rose to +84 from +81. The most important factors behind the poorer scores were ‘UK economic conditions’ (77%), ’employment taxes’ (63%), and ‘business taxes’ (54%). Worries about all of these are up…
Andrew Griffith. Shadow Business Secretary, said: “This government of leftists and lawyers has no experience of business or how to grow our economy. Falling business confidence means jobs are cut, high streets hollowed out and families have less money at the end of the month.” Oil price volatility could deal an additional blow to Reeves’ ‘fiscal rule’ management with inflationary waves…
Speaking to Sky News off the back of Rachel Reeves’ Air Passenger Duty hike, Ryanair chief executive Michael O’Leary said:
“Labour is dependent on those Red Wall seats, and yet every move she makes poisons economic growth and damages the UK’s recovery… it’s the Chancellor who stumbles from policy misstep to policy misstep… I think her policy decisions are incredibly stupid.”