Al Mayadeen English

  • Ar
  • Es
  • x
Al Mayadeen English

Slogan

  • News
    • Politics
    • Economy
    • Sports
    • Arts&Culture
    • Health
    • Miscellaneous
    • Technology
    • Environment
  • Articles
    • Opinion
    • Analysis
    • Blog
    • Features
  • Videos
    • NewsFeed
    • Video Features
    • Explainers
    • TV
    • Digital Series
  • Infographs
  • In Pictures
  • • LIVE
News
  • Politics
  • Economy
  • Sports
  • Arts&Culture
  • Health
  • Miscellaneous
  • Technology
  • Environment
Articles
  • Opinion
  • Analysis
  • Blog
  • Features
Videos
  • NewsFeed
  • Video Features
  • Explainers
  • TV
  • Digital Series
Infographs
In Pictures
  • Africa
  • Asia
  • Asia-Pacific
  • Europe
  • Latin America
  • MENA
  • Palestine
  • US & Canada
BREAKING
Palestinian media: Three Palestinians were killed after being targeted by Israeli drone fire in the al-Shujaiya neighborhood east of Gaza City
Nicolas Maduro: The Palestinian cause is the most sacred cause for humanity, and we propose sending teams of builders, farmers, and doctors to Gaza to help the people
Al Mayadeen's correspondent in Lebanon: IOF infiltrate Khallet Wardeh towards the municipality in the town of Aita al-Shaab, south of Lebanon.
Leaders of the United States, Egypt, Qatar, and Turkey sign a ceasefire agreement in Gaza.
Trump arrives in Sharm el-Sheikh
Israeli PM's office: PM informed Trump he would not attend Sharm el-Sheikh Summit on account of Jewish holidays.
Israeli media: Netanyahu makes last-minute decision to cancel trip to Sharm el-Sheikh.
Al Mayadeen's correspondent: Large crowds gather in Khan Younis to welcome the liberated Palestinian detainees, waving flags of Hamas and Islamic Jihad in celebration
Buses of released prisoners arrive in Ramallah
Israeli media: Netanyahu gifts Trump a "Golden Dove".

UK scraps social care cap and fuel payments to fix £22bn fiscal hole

  • By Al Mayadeen English
  • Source: News websites
  • 30 Jul 2024 08:50
4 Min Read

The UK's chancellor of the exchequer says that the previous Conservative government had concealed the extent of the fiscal deficit.

Listen
  • x
  • Rachel Reeves speaks during a press conference at the Treasury ON July 29,2024. (AFP/Getty Images)
    Rachel Reeves speaks during a press conference at the Treasury, on July 29, 2024. (AFP/Getty Images)

UK's Chancellor of the Exchequer Rachel Reeves has eliminated the social care cap and reduced winter fuel payments, alongside announcing significant cuts to hospital and road projects. She aims to address a £22 billion deficit in public spending, which she claims was "covered up" by the Conservative government.

In a Commons statement combining detailed economic explanations with partisan criticism, the chancellor defended the cuts with a repeated refrain, saying, “If we cannot afford it, we cannot do it.”

Reeves announced that the autumn budget will be presented on October 30 and cautioned that it will “involve taking difficult decisions to meet our fiscal rules across spending, welfare and tax”, hinting at potential tax increases.

To save £1 billion annually, she announced the plan to cap care charges for older people would be abandoned, which led to outcries from the Tory benches.

“I can understand why members are angry,” Reeves replied. “I am angry, too. The previous government let people down.”

She stated that the previously universal winter fuel payments for pensioners would now be limited to those with lower incomes who receive pension credits.
 
 “Let me be clear, this is not a decision I wanted to make, nor is it the one that I expected to make, but these are the necessary and urgent decisions that I must make,” Reeves added.

She said there would also be a review of the previous government’s plan for 40 new hospitals, which would be replaced with a "thorough, realistic and costed timetable for delivery."

Reeves told MPs that while she knew in advance that Labour, if elected, would inherit a difficult fiscal position, there were a number of areas where nasty surprises had emerged.

Emergency fund already spent

Several specific budgets were "not even close" to what was needed, resulting in a "£22bn hole in the public finances now – not in the future, now – £22bn of spending this year that was covered up by the party opposite."

Related News

Labour Party members vote for recognizing genocide in Gaza

Britain poised to formally recognize Palestine on Sunday

This included "very clear instances of specific budgets’ overspend that the Office for Budget Responsibility (OBR) was not aware of," and a £9 billion contingency fund that had already been spent three times over.

In a letter released after the statement, the head of the OBR announced a review to "assess the adequacy of the information and assurances provided to the OBR" by the then-Conservative-run Treasury before the last budget in March.

Reeves revealed that the overspend on asylum this financial year was £6.4 billion, with a £1.6 billion overspend on rail. Additionally, spending plans did not account for higher-than-target inflation or public sector pay awards above 2%.

She stated that the government would adhere to the recommendations of public sector pay review bodies, including a 22.3% pay increase over two years for junior doctors, which will add £9 billion to this year's costs.

In response, Jeremy Hunt, the shadow chancellor, argued that Reeves had complete access to government accounts and was misleading the public into believing that a fiscal black hole "has magically emerged."

“She wants to blame the last Conservative government for tax rises and project cancellations she’s been planning all along,” he said.

While Hunt cited Paul Johnson, director of the Institute for Fiscal Studies (IFS), claiming the situation was obvious to everyone, Johnson himself replied to Reeves’ statement by agreeing with her to some extent.

Johnson posted on X: “1 Last govt left public finances in bad state; 2 it does appear that funding for eg asylum was not provided but 3 c. half of spending ‘hole’ is public pay over which govt made a choice and where pressures were known; and 4 overall challenge for spending was known and remains.” 

1 Last govt left public finances in bad state; 2 it does appear that funding for eg asylum was not provided

but 3 c. half of spending "hole" is public pay over which govt made a choice and where pressures were known; and 4 overall challenge for spending was known and remains

— Paul Johnson (@PJTheEconomist) July 29, 2024

To address the gap, Reeves said government departments would need to find £3 billion in savings, including cuts to consultants, communications, and back-office staff.

She mentioned £1 billion worth of unfunded transport projects would be "thoroughly reviewed," with the A303 tunnel under Stonehenge and an A27 project being canceled.

Additional savings would be achieved by abandoning the planned Advanced British Standard qualification, speeding up asylum claim processing, and avoiding the sale of government shares in Natwest at a discount to the public.

Read more: Report finds UK population has worst health in Europe

  • Labour Party
  • Chancellor of the Exchequer
  • Conservative Party
  • Tories
  • Rachel Reeves
  • United Kingdom
  • social care

Most Read

Palestinian journalist Saleh al-Jaafarawi in an undated image in Gaza, occupied Palestine (Social media)

Gaza Palestinian journalist Saleh al-Jafarawi killed by collaborators

  • Politics
  • 12 Oct 2025
Taylor Swift: The Life of a Showgirl

The Life of a No-Girl: The one verse Taylor Swift refuses to sing

  • Arts and Culture
  • 8 Oct 2025
Ceasefire in Gaza takes effect amid conflicting signals and bombings

Gaza ceasefire takes effect; 'Israel' resumes bombing, timing disputed

  • Politics
  • 9 Oct 2025
drop site

New report details extensive Israeli arson in Gaza after ceasefire

  • Politics
  • 13 Oct 2025

Coverage

All
War on Gaza

Read Next

All
Freed Palestinian prisoners carry rifles as they arrive in the Gaza Strip following their release from Israeli jails, outside Nasser Hospital in Khan Younis, southern Gaza Strip, Monday, October 13, 2025 (AP)
Politics

Palestinian Resistance remains steadfast, victorious Larijani says

Lebanese Army Commander General Rodolphe Laffan inspecting the command structure of the 10th Infantry Brigade in Kfarskhna-Zgharta on October 13, 2025. (Lebanonese Army)
Politics

Lebanese Army chief: Israeli aggression threatens Lebanon's security

Hamas fighters escort buses carrying freed Palestinian prisoners arriving in the Gaza Strip after their release from Israeli jails, in Khan Younis, southern Gaza Strip, Monday, October 13, 2025 (AP)
Politics

154 Palestinian prisoners exiled to Egypt under exchange deal

Israeli Prime Minister Benjamin Netanyahu arrives before US President Donald Trump addresses the Knesset, Israel's parliament, Monday, October 13, 2025 in Occupied Al-Quds. (Kenny Holston/The New York Times via AP, Pool)
Politics

Netanyahu withdraws from Sharm El-Sheikh summit amid regional pushback

Al Mayadeen English

Al Mayadeen is an Arab Independent Media Satellite Channel.

All Rights Reserved

  • x
  • Privacy Policy
  • About Us
  • Contact Us
  • Authors
Android
iOS