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Tory 'pickpockets' get blasted after Hunt's Autumn budget statement

US Rep. Ilhan Omar (D-MN) (L) talks with Speaker of the House Nancy Pelosi (D-CA) during a rally with fellow Democrats before voting on H.R. 1, or the People Act, on the East Steps of the US Capitol on March 08, 2019 in Washington, DC. (AFP photo)
Shadow Chancellor Rachel Reeves speaks during Britain's Labour Party annual conference, in Brighton, Britain, September 27, 2021. (Photo by Reuters)

The UK’s opposition Labour Party has accused the ruling Conservatives of “pickpocketing” the entire nation after the government unveiled its painful spending cuts and tax hikes.

The accusation by Labour’s shadow chancellor Rachel Reeves comes after the Chancellor of the Exchequer, Jeremy Hunt, on Thursday announced tens of billions of pounds of tax increases and spending cuts that officials promised would plug a gaping hole in the nation’s public finances.

In a 50-minute long statement in the Commons, Hunt said that high earners would have to pay more taxes to plug a £55 billion hole in the government’s finances.

The tax increases coupled with spending cuts amounted to one of the most austere budgets ever imposed on Britain, a country that is already in a recession.

Reeves said Hunt had handed the nation an “invoice for the economic carnage” caused to the nation by the ruling Conservative Party, the governing party in Britain since 2010.

“In the last hour, the Conservatives have picked the pockets of purses and wallets of the entire country as the chancellor has deployed a raft of stealth taxes taking billions of pounds from ordinary working people.

“A Conservative double whammy that sees frozen tax thresholds and double-digit inflation erode the real value of people’s wages.

“Just one of those freezes, in the personal allowance, will cost an average earner more than £600.”

She said that while the government was attempting to displace blame for the economic turmoil on “global” factors such as the war in Ukraine, “this was a crisis made in Downing Street”.

“What does the chancellor have to offer today? More of the same, with working people paying the price for his failure,” the Labour MP said.

“The chancellor should have come here today to ask for forgiveness, at the very least he could have offered an apology, but no.

“Instead he says that his predecessor was correct in his analysis at the mini-budget, the mini-budget that put our economy into freefall.

“All the country got today was an invoice for the economic carnage that this government has created.”

She added, “The mess we are in is the result of 12 weeks of Conservative chaos, but also 12 years of Conservative economic failure.”

The Chancellor’s Autumn Statement in the UK House of Commons has been branded “utterly depressing” as economists predict a drastic decline in household disposable income. The devastating impact on families across the UK has been spelled out in a daunting graphic which highlights the prospect of fiscal drag.

Hunt, who was appointed as the Chancellor of the Exchequer after Kwasi Kwarteng's mini-budget plunged the UK economy into free-fall, scrapped almost all of the previous government's unfunded tax cuts and scaled back the vast energy support scheme it proposed.

He detailed a raft of higher taxes, worth £25 billion, or about $29.7 billion, and cuts to government programs of about £30 billion ($35 billion), though the cost reductions will not take effect for two years.

The long-term impact of the Chancellor’s budget evoked negative comments by British economic analysts.

Sky News data and economics Editor Ed Conway reported, “No longer is this the worst year for household disposable income in modern history, it is the worst two years for seeing our household income basically contracting.

“That is frankly utterly depressing – that is one of the most depressing charts I have seen."

“Today’s Autumn Statement has painted a bleak picture for the UK... Markets originally reacted well to the steady hand of Jeremy Hunt. They will continue to give him the benefit of the doubt and see the impact of this plan, however, there is also a chance that they see this as an overcorrection and that the measures could stifle what economic growth was present. The government will be hoping that these measures are merely temporary in order to stabilize the ship ahead of an election in just two years’ time,” said Marcus Brookes, the chief investment officer at a London investment firm.

Stuart Cole, the head macro economist at Equiti Capital in London said, "For investors, the UK remains somewhat of a difficult place to judge right now. We are not necessarily at the end of the train of bad news and with a prolonged recession priced in we may need to wait for a more sustained downward path of inflation.”

Labour would grow our economy for a brighter future for Britain.

After 12 years of Tory mismanagement it’s time for a Labour Government. pic.twitter.com/ggvAZ37IkT

— Rachel Reeves (@RachelReevesMP) November 17, 2022

“The pound is suffering as more of the budget black hole is coming from tax hikes rather than spending cuts. It will be just under half from tax hikes now whereas I think the expectation previously was more would come from spending cuts. That will hit consumer spending.

A lot of tax rises are coming from windfall taxes, allowance changes etc. It is very political, as it avoids the headlines that the government has put up headline tax rates,” said Michael Hewson, Chief Markets Strategist at CMC Markets in London.


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